MA. LOURDES VALENZUELA, petitioner, vs.

COURT OF APPEALS, RICHARD LI and ALEXANDER

COMMERCIAL, INC., respondents. [G.R. No. 115024. February 7, 1996]

RICHARD LI, petitioner, vs. COURT OF APPEALS and MA. LOURDES VALENZUELA, respondents. [G.R. No.
117944. February 7, 1996]

DECISION
KAPUNAN, J.:

These two petitions for review on certiorari under Rule 45 of the Revised Rules of Court stem from an action to
recover damages by petitioner Lourdes Valenzuela in the Regional Trial Court of Quezon City for injuries sustained by
her in a vehicular accident in the early morning of June 24, 1990. The facts found by the trial court are succinctly
summarized by the Court of Appeals below:

This is an action to recover damages based on quasi-delict, for serious physical injuries sustained in a vehicular
accident.

Plaintiffs version of the accident is as follows: At around 2:00 in the morning of June 24, 1990, plaintiff Ma. Lourdes
Valenzuela was driving a blue Mitsubishi lancer with Plate No. FFU 542 from her restaurant at Marcos highway to her
home at Palanza Street, Araneta Avenue. She was travelling along Aurora Blvd. with a companion, Cecilia Ramon,
heading towards the direction of Manila. Before reaching A. Lake Street, she noticed something wrong with her tires;
she stopped at a lighted place where there were people, to verify whether she had a flat tire and to solicit help if
needed. Having been told by the people present that her rear right tire was flat and that she cannot reach her home in
that cars condition, she parked along the sidewalk, about 1 feet away, put on her emergency lights, alighted from the
car, and went to the rear to open the trunk. She was standing at the left side of the rear of her car pointing to the tools
to a man who will help her fix the tire when she was suddenly bumped by a 1987 Mitsubishi Lancer driven by
defendant Richard Li and registered in the name of defendant Alexander Commercial, Inc. Because of the impact
plaintiff was thrown against the windshield of the car of the defendant, which was destroyed, and then fell to the
ground. She was pulled out from under defendants car. Plaintiffs left leg was severed up to the middle of her thigh,
with only some skin and sucle connected to the rest of the body. She was brought to
the UERM MedicalMemorial Center where she was found to have a traumatic amputation, leg, left up to distal thigh
(above knee). She was confined in the hospital for twenty (20) days and was eventually fitted with an artificial leg. The
expenses for the hospital confinement (P 120,000.00) and the cost of the artificial leg (P27,000.00) were paid by
defendants from the car insurance.

In her complaint, plaintiff prayed for moral damages in the amount of P1 million, exemplary damages in the amount of
P100,000.00 and other medical and related expenses amounting to a total of P180,000.00, including loss of expected
earnings.

Defendant Richard Li denied that he was negligent. He was on his way home, travelling at 55 kph; considering that it
was raining, visibility was affected and the road was wet. Traffic was light. He testified that he was driving along the
inner portion of the right lane of Aurora Blvd. towards the direction of Araneta Avenue, when he was suddenly
confronted, in the vicinity of A. Lake Street, San Juan, with a car coming from the opposite direction, travelling at 80
kph, with full bright lights. Temporarily blinded, he instinctively swerved to the right to avoid colliding with the oncoming
vehicle, and bumped plaintiffs car, which he did not see because it was midnight blue in color, with no parking lights or
early warning device, and the area was poorly lighted. He alleged in his defense that the left rear portion of plaintiffs
car was protruding as it was then at a standstill diagonally on the outer portion of the right lane towards Araneta
Avenue (par. 18, Answer). He confirmed the testimony of plaintiffs witness that after being bumped the car of the
plaintiff swerved to the right and hit another car parked on the sidewalk. Defendants counterclaimed for damages,
alleging that plaintiff was reckless or negligent, as she was not a licensed driver.

The police investigator, Pfc. Felic Ramos, who prepared the vehicular accident report and the sketch of the three cars
involved in the accident, testified that the plaintiffs car was near the sidewalk; this witness did not remember whether
the hazard lights of plaintiffs car were on, and did not notice if there was an early warning device; there was a street
light at the corner of Aurora Blvd. and F. Roman, about 100 meters away. It was not mostly dark, i.e. things can be
seen (p. 16, tsn, Oct. 28, 1991).

A witness for the plaintiff, Rogelio Rodriguez, testified that after plaintiff alighted from her car and opened the trunk
compartment, defendants car came approaching very fast ten meters from the scene; the car was zigzagging. The
rear left side of plaintiffs car was bumped by the front right portion of defendants car; as a consequence, the plaintiffs
car swerved to the right and hit the parked car on the sidewalk. Plaintiff was thrown to the windshield of defendants
car, which was destroyed, and landed under the car. He stated that defendant was under the influence of liquor as he
could smell it very well (pp. 43, 79, tsn., June 17, 1991).
 After trial, the lower court sustained the plaintiffs submissions and found defendant Richard Li guilty of gross
negligence and liable for damages under Article 2176 of the Civil Code. The trial court likewise held Alexander
Commercial, Inc., Lis employer, jointly and severally liable for damages pursuant to Article 2180. It ordered the
defendants to jointly and severally pay the following amounts:

1. P41,840.00, as actual damages, representing the miscellaneous expenses of the plaintiff as a result of her severed
left leg;

2. The sums of (a) P37,500.00, for the unrealized profits because of the stoppage of plaintiffs Bistro La Conga
restaurant three (3) weeks after the accident on June 24, 1990; (b) P20,000.00, a month, as unrealized profits of the
plaintiff in her Bistro La Conga restaurant, from August, 1990 until the date of this judgment; and (c) P30,000.00, a
month, for unrealized profits in plaintiffs two (2) beauty salons from July, 1990 until the date of this decision;

3. P1,000,000.00, in moral damages;

4. P50,000.00, as exemplary damages,

5. P60,000.00, as reasonable attorneys fees; and

6. Costs.

As a result of the trial courts decision, defendants filed an Omnibus Motion for New Trial and for Reconsideration,
citing testimony in Criminal Case O.C. No. 804367 (People vs. Richard Li), tending to show that the point of impact, as
depicted by the pieces of glass/debris from the parties cars, appeared to be at the center of the right lane of Aurora
Blvd. The trial court denied the motion. Defendants forthwith filed an appeal with the respondent Court of Appeals. In a
Decision rendered March 30, 1994, the Court of Appeals found that there was ample basis from the evidence of record
for the trial courts finding that the plaintiffs car was properly parked at the right, beside the sidewalk when it was bumped
by defendants car.[1] Dismissing the defendants argument that the plaintiffs car was improperly parked, almost at the
center of the road, the respondent court noted that evidence which was supposed to prove that the car was at or near
center of the right lane was never presented during the trial of the case.[2] The respondent court furthermore observed
that:

Defendant Lis testimony that he was driving at a safe speed of 55 km./hour is self serving; it was not corroborated. It
was in fact contradicted by eyewitness Rodriguez who stated that he was outside his beerhouse located at Aurora
Boulevard after A. Lake Street, at or about 2:00 a.m. of June 24, 1990 when his attention was caught by a beautiful
lady (referring to the plaintiff) alighting from her car and opening the trunk compartment; he noticed the car of Richard
Li approaching very fast ten (10) meters away from the scene; defendants car was zigzagging, although there were no
holes and hazards on the street, and bumped the leg of the plaintiff who was thrown against the windshield of
defendants car, causing its destruction. He came to the rescue of the plaintiff, who was pulled out from under
defendants car and was able to say hurting words to Richard Li because he noticed that the latter was under the
influence of liquor, because he could smell it very well (p. 36, et. seq., tsn, June 17, 1991). He knew that plaintiff
owned a beerhouse in Sta. Mesa in the 1970s, but did not know either plaintiff or defendant Li before the accident.

In agreeing with the trial court that the defendant Li was liable for the injuries sustained by the plaintiff, the Court of
Appeals, in its decision, however, absolved the Lis employer, Alexander Commercial, Inc. from any liability towards
petitioner Lourdes Valenzuela and reduced the amount of moral damages to P500,000.00. Finding justification for
exemplary damages, the respondent court allowed an award of P50,000.00 for the same, in addition to costs, attorneys
fees and the other damages. The Court of Appeals, likewise, dismissed the defendants counterclaims. [3]
Consequently, both parties assail the respondent courts decision by filing two separate petitions before this Court.
Richard Li, in G.R. No. 117944, contends that he should not be held liable for damages because the proximate cause
of the accident was Ma. Lourdes Valenzuelas own negligence. Alternatively, he argues that in the event that this Court
finds him negligent, such negligence ought to be mitigated by the contributory negligence of Valenzuela.
On the other hand, in G.R. No. 115024, Ma. Lourdes Valenzuela assails the respondent courts decision insofar as
it absolves Alexander Commercial, Inc. from liability as the owner of the car driven by Richard Li and insofar as it reduces
the amount of the actual and moral damages awarded by the trial court.[4]
As the issues are intimately related, both petitions are hereby consolidated. It is plainly evident that the petition for
review in G.R. No. 117944 raises no substantial questions of law. What it, in effect, attempts to have this Court review
are factual findings of the trial court, as sustained by the Court of Appeals finding Richard Li grossly negligent in driving
the Mitsubishi Lancer provided by his company in the early morning hours of June 24, 1990. This we will not do. As a
general rule, findings of fact of the Court of Appeals are binding and conclusive upon us, and this Court will not normally
disturb such factual findings unless the findings of fact of the said court are palpably unsupported by the evidence on
record or unless the judgment itself is based on a misapprehension of facts. [5]
 In the first place, Valenzuelas version of the incident was fully corroborated by an uninterested witness, Rogelio
Rodriguez, the owner-operator of an establishment located just across the scene of the accident. On trial, he testified
that he observed a car being driven at a very fast speed, racing towards the general direction of Araneta
Avenue.[6] Rodriguez further added that he was standing in front of his establishment, just ten to twenty feet away from
the scene of the accident, when he saw the car hit Valenzuela, hurtling her against the windshield of the defendants
Mitsubishi Lancer, from where she eventually fell under the defendants car. Spontaneously reacting to the incident, he
crossed the street, noting that a man reeking with the smell of liquor had alighted from the offending vehicle in order to
survey the incident.[7] Equally important, Rodriguez declared that he observed Valenzuelas car parked parallel and very
near the sidewalk,[8] contrary to Lis allegation that Valenzuelas car was close to the center of the right lane. We agree
that as between Lis self-serving asseverations and the observations of a witness who did not even know the accident
victim personally and who immediately gave a statement of the incident similar to his testimony to the investigator
immediately after the incident, the latters testimony deserves greater weight. As the court emphasized:

The issue is one of credibility and from Our own examination of the transcript, We are not prepared to set aside the
trial courts reliance on the testimony of Rodriguez negating defendants assertion that he was driving at a safe speed.
While Rodriguez drives only a motorcycle, his perception of speed is not necessarily impaired. He was subjected to
cross-examination and no attempt was made to question his competence or the accuracy of his statement that
defendant was driving very fast. This was the same statement he gave to the police investigator after the incident, as
told to a newspaper report (Exh. P). We see no compelling basis for disregarding his testimony.

The alleged inconsistencies in Rodriguez testimony are not borne out by an examination of the testimony. Rodriguez
testified that the scene of the accident was across the street where his beerhouse is located about ten to twenty feet
away (pp. 35-36, tsn, June 17, 1991). He did not state that the accident transpired immediately in front of his
establishment. The ownership of the Lambingan sa Kambingan is not material; the business is registered in the name
of his mother, but he explained that he owns the establishment (p. 5, tsn., June 20, 1991).

Moreover, the testimony that the streetlights on his side of Aurora Boulevard were on the night the accident transpired
(p. 8) is not necessarily contradictory to the testimony of Pfc. Ramos that there was a streetlight at the corner of Aurora
Boulevard and F. Roman Street (p. 45, tsn., Oct. 20, 1991).

With respect to the weather condition, Rodriguez testified that there was only a drizzle, not a heavy rain and the rain
has stopped and he was outside his establishment at the time the accident transpired (pp. 64-65, tsn., June 17, 1991).
This was consistent with plaintiffs testimony that it was no longer raining when she left Bistro La Conga (pp. 10-11,
tsn., April 29, 1991). It was defendant Li who stated that it was raining all the way in an attempt to explain why he was
travelling at only 50-55 kph. (p. 11, tsn., Oct. 14, 1991). As to the testimony of Pfc. Ramos that it was raining, he
arrived at the scene only in response to a telephone call after the accident had transpired (pp. 9-10, tsn, Oct. 28,
1991). We find no substantial inconsistencies in Rodriguezs testimony that would impair the essential integrity of his
testimony or reflect on his honesty. We are compelled to affirm the trial courts acceptance of the testimony of said
eyewitness.

Against the unassailable testimony of witness Rodriguez we note that Lis testimony was peppered with so many
inconsistencies leading us to conclude that his version of the accident was merely adroitly crafted to provide a version,
obviously self-serving, which would exculpate him from any and all liability in the incident. Against Valenzuelas
corroborated claims, his allegations were neither backed up by other witnesses nor by the circumstances proven in the
course of trial. He claimed that he was driving merely at a speed of 55 kph. when out of nowhere he saw a dark maroon
lancer right in front of him, which was (the) plaintiffs car. He alleged that upon seeing this sudden apparition he put on
his brakes to no avail as the road was slippery.[9]
One will have to suspend disbelief in order to give credence to Lis disingenuous and patently self-serving
asseverations. The average motorist alert to road conditions will have no difficulty applying the brakes to a car traveling
at the speed claimed by Li. Given a light rainfall, the visibility of the street, and the road conditions on a principal
metropolitan thoroughfare like Aurora Boulevard, Li would have had ample time to react to the changing conditions of
the road if he were alert - as every driver should be - to those conditions. Driving exacts a more than usual toll on the
senses. Physiological fight or flight[10] mechanisms are at work, provided such mechanisms were not dulled by drugs,
alcohol, exhaustion, drowsiness, etc.[11] Lis failure to react in a manner which would have avoided the accident could
therefore have been only due to either or both of the two factors: 1) that he was driving at a very fast speed as testified
by Rodriquez; and 2) that he was under the influence of alcohol. [12] Either factor working independently would have
diminished his responsiveness to road conditions, since normally he would have slowed down prior to reaching
Valenzuelas car, rather than be in a situation forcing him to suddenly apply his brakes. As the trial court noted (quoted
with approval by respondent court):

Secondly, as narrated by defendant Richard Li to the San Juan Police immediately after the incident, he said that
while driving along Aurora Blvd., out of nowhere he saw a dark maroon lancer right in front of him, which was plaintiffs
car, indicating, again, thereby that, indeed, he was driving very fast, oblivious of his surroundings and the road ahead
of him, because if he was not, then he could not have missed noticing at a still far distance the parked car of the
plaintiff at the right side near the sidewalk which had its emergency lights on, thereby avoiding forcefully bumping at
the plaintiff who was then standing at the left rear edge of her car.

Since, according to him, in his narration to the San Juan Police, he put on his brakes when he saw the plaintiffs car in
front of him, but that it failed as the road was wet and slippery, this goes to show again, that, contrary to his claim, he
was, indeed, running very fast. For, were it otherwise, he could have easily completely stopped his car, thereby
avoiding the bumping of the plaintiff, notwithstanding that the road was wet and slippery. Verily, since, if, indeed, he
was running slow, as he claimed, at only about 55 kilometers per hour, then, inspite of the wet and slippery road, he
could have avoided hitting the plaintiff by the mere expedient or applying his brakes at the proper time and distance.

It could not be true, therefore, as he now claims during his testimony, which is contrary to what he told the police
immediately after the accident and is, therefore, more believable, that he did not actually step on his brakes, but
simply swerved a little to the right when he saw the on-coming car with glaring headlights, from the opposite direction,
in order to avoid it.

For, had this been what he did, he would not have bumped the car of the plaintiff which was properly parked at the
right beside the sidewalk. And, it was not even necessary for him to swerve a little to the right in order to safely avoid a
collision with the on-coming car, considering that Aurora Blvd. is a double lane avenue separated at the center by a
dotted white paint, and there is plenty of space for both cars, since her car was running at the right lane going towards
Manila and the on-coming car was also on its right lane going to Cubao.[13]

Having come to the conclusion that Li was negligent in driving his company-issued Mitsubishi Lancer, the next
question for us to determine is whether or not Valenzuela was likewise guilty of contributory negligence in parking her
car alongside Aurora Boulevard, which entire area Li points out, is a no parking zone.
We agree with the respondent court that Valenzuela was not guilty of contributory negligence.
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. [14] Based on the
foregoing definition, the standard or act to which, according to petitioner Li, Valenzuela ought to have conformed for her
own protection was not to park at all at any point of Aurora Boulevard, a no parking zone. We cannot agree.
Courts have traditionally been compelled to recognize that an actor who is confronted with an emergency is not to
be held up to the standard of conduct normally applied to an individual who is in no such situation. The law takes stock
of impulses of humanity when placed in threatening or dangerous situations and does not require the same standard of
thoughtful and reflective care from persons confronted by unusual and oftentimes threatening conditions.[15] Under the
emergency rule adopted by this Court in Gan vs Court of Appeals,[16] an individual who suddenly finds himself in a
situation of danger and is required to act without much time to consider the best means that may be adopted to avoid
the impending danger, is not guilty of negligence if he fails to undertake what subsequently and upon reflection may
appear to be a better solution, unless the emergency was brought by his own negligence. [17]
Applying this principle to a case in which the victims in a vehicular accident swerved to the wrong lane to avoid
hitting two children suddenly darting into the street, we held, in Mc Kee vs. Intermediate Appellate Court,[18] that the
driver therein, Jose Koh, adopted the best means possible in the given situation to avoid hitting the children. Using the
emergency rule the court concluded that Koh, in spite of the fact that he was in the wrong lane when the collision with
an oncoming truck occurred, was not guilty of negligence.[19]
While the emergency rule applies to those cases in which reflective thought, or the opportunity to adequately weigh
a threatening situation is absent, the conduct which is required of an individual in such cases is dictated not exclusively
by the suddenness of the event which absolutely negates thoughtful care, but by the over-all nature of the
circumstances. A woman driving a vehicle suddenly crippled by a flat tire on a rainy night will not be faulted for stopping
at a point which is both convenient for her to do so and which is not a hazard to other motorists. She is not expected to
run the entire boulevard in search for a parking zone or turn on a dark Street or alley where she would likely find no one
to help her. It would be hazardous for her not to stop and assess the emergency (simply because the entire length
of Aurora Boulevard is a no-parking zone) because the hobbling vehicle would be both a threat to her safety and to
other motorists. In the instant case, Valenzuela, upon reaching that portion of Aurora Boulevard close to A. Lake St.,
noticed that she had a flat tire. To avoid putting herself and other motorists in danger, she did what was best under the
situation. As narrated by respondent court:

She stopped at a lighted place where there were people, to verify whether she had a flat tire and to solicit help if
needed. Having been told by the people present that her rear right tire was flat and that she cannot reach her home
she parked along the sidewalk, about 1 feet away, behind a Toyota Corona Car.[20] In fact, respondent court noted,
Pfc. Felix Ramos, the investigator on the scene of the accident confirmed that Valenzuelas car was parked very close
to the sidewalk.[21] The sketch which he prepared after the incident showed Valenzuelas car partly straddling the
sidewalk, clear and at a convenient distance from motorists passing the right lane of Aurora Boulevard. This fact was
itself corroborated by the testimony of witness Rodriguez.[22]
 Under the circumstances described, Valenzuela did exercise the standard reasonably dictated by the emergency
and could not be considered to have contributed to the unfortunate circumstances which eventually led to the amputation
of one of her lower extremities. The emergency which led her to park her car on a sidewalk in Aurora Boulevard was
not of her own making, and it was evident that she had taken all reasonable precautions.
Obviously in the case at bench, the only negligence ascribable was the negligence of Li on the night of the accident.
Negligence, as it is commonly understood is conduct which creates an undue risk of harm to others. [23] It is the failure
to observe that degree of care, precaution, and vigilance which the circumstances justly demand, whereby such other
person suffers injury.[24] We stressed, in Corliss vs. Manila Railroad Company,[25] that negligence is the want of care
required by the circumstances.
The circumstances established by the evidence adduced in the court below plainly demonstrate that Li was grossly
negligent in driving his Mitsubishi Lancer. It bears emphasis that he was driving at a fast speed at about 2:00 A.M. after
a heavy downpour had settled into a drizzle rendering the street slippery. There is ample testimonial evidence on record
to show that he was under the influence of liquor. Under these conditions, his chances of effectively dealing with
changing conditions on the road were significantly lessened. As Prosser and Keaton emphasize:

[U]nder present day traffic conditions, any driver of an automobile must be prepared for the sudden appearance of
obstacles and persons on the highway, and of other vehicles at intersections, such as one who sees a child on the
curb may be required to anticipate its sudden dash into the street, and his failure to act properly when they appear
may be found to amount to negligence. [26]

Lis obvious unpreparedness to cope with the situation confronting him on the night of the accident was clearly of
his own making.
We now come to the question of the liability of Alexander Commercial, Inc. Lis employer. In denying liability on the
part of Alexander Commercial, the respondent court held that:

There is no evidence, not even defendant Lis testimony, that the visit was in connection with official matters. His
functions as assistant manager sometimes required him to perform work outside the office as he has to visit buyers
and company clients, but he admitted that on the night of the accident he came from BF Homes Paraaque he did not
have business from the company (pp. 25-26, tsn, Sept. 23, 1991). The use ofthe company car was partly required by
the nature of his work, but the privilege of using it for non-official business is a benefit, apparently referring to the
fringe benefits attaching to his position.

Under the civil law, an employer is liable for the negligence of his employees in the discharge of their respective
duties, the basis of which liability is not respondeat superior, but the relationship of pater familias, which theory bases
the liability of the master ultimately on his own negligence and not on that of his servant (Cuison v. Norton and
Harrison Co., 55 Phil. 18). Before an employer may be held liable for the negligence of his employee, the act or
omission which caused damage must have occurred while an employee was in the actual performance of his
assigned tasks or duties (Francis High School vs. Court of Appeals, 194 SCRA 341). In defining an employers liability
for the acts done within the scope of the employees assigned tasks, the Supreme Court has held that this includes
any act done by an employee, in furtherance of the interests of the employer or for the account of the employer at the
time of the infliction of the injury or damage (Filamer Christian Institute vs. Intermediate Appellate Court, 212 SCRA
637). An employer is expected to impose upon its employees the necessary discipline called for in the performance of
any act indispensable to the business and beneficial to their employer (at p. 645).

In light of the foregoing, We are unable to sustain the trial courts finding that since defendant Li was authorized by the
company to use the company car either officially or socially or even bring it home, he can be considered as using the
company car in the service of his employer or on the occasion of his functions. Driving the company car was not
among his functions as assistant manager; using it for non-official purposes would appear to be a fringe benefit, one
of the perks attached to his position. But to impose liability upon the employer under Article 2180 of the Civil Code,
earlier quoted, there must be a showing that the damage was caused by their employees in the service of the
employer or on the occasion of their functions. There is no evidence that Richard Li was at the time of the accident
performing any act in furtherance of the companys business or its interests, or at least for its benefit. The imposition of
solidary liability against defendant Alexander Commercial Corporation must therefore fail.[27]

We agree with the respondent court that the relationship in question is not based on the principle of respondeat
superior, which holds the master liable for acts of the servant, but that of pater familias, in which the liability ultimately
falls upon the employer, for his failure to exercise the diligence of a good father of the family in the selection and
supervision of his employees. It is up to this point, however, that our agreement with the respondent court ends. Utilizing
the bonus pater familias standard expressed in Article 2180 of the Civil Code,[28] we are of the opinion that Lis employer,
Alexander Commercial, Inc. is jointly and solidarily liable for the damage caused by the accident of June 24, 1990.
First, the case of St. Francis High School vs. Court of Appeals[29] upon which respondent court has placed undue
reliance, dealt with the subject of a school and its teachers supervision of students during an extracurricular activity.
These cases now fall under the provision on special parental authority found in Art. 218 of the Family Code which
generally encompasses all authorized school activities, whether inside or outside school premises.
Second, the employers primary liability under the concept of pater familias embodied by Art. 2180 (in relation to
Art. 2176) of the Civil Code is quasi-delictual or tortious in character. His liability is relieved on a showing that he
exercised the diligence of a good father of the family in the selection and supervision of its employees. Once evidence
is introduced showing that the employer exercised the required amount of care in selecting its employees, half of the
employers burden is overcome. The question of diligent supervision, however, depends on the circumstances of
employment.
Ordinarily, evidence demonstrating that the employer has exercised diligent supervision of its employee during the
performance of the latters assigned tasks would be enough to relieve him of the liability imposed by Article 2180 in
relation to Article 2176 of the Civil Code. The employer is not expected to exercise supervision over either the employees
private activities or during the performance of tasks either unsanctioned by the former or unrelated to the employees
tasks. The case at bench presents a situation of a different character, involving a practice utilized by large companies
with either their employees of managerial rank or their representatives.
It is customary for large companies to provide certain classes of their employees with courtesy vehicles. These
company cars are either wholly owned and maintained by the company itself or are subject to various plans through
which employees eventually acquire their vehicles after a given period of service, or after paying a token amount. Many
companies provide liberal car plans to enable their managerial or other employees of rank to purchase cars, which,
given the cost of vehicles these days, they would not otherwise be able to purchase on their own.
Under the first example, the company actually owns and maintains the car up to the point of turnover of ownership
to the employee; in the second example, the car is really owned and maintained by the employee himself. In furnishing
vehicles to such employees, are companies totally absolved of responsibility when an accident involving a company-
issued car occurs during private use after normal office hours?
Most pharmaceutical companies, for instance, which provide cars under the first plan, require rigorous tests of road
worthiness from their agents prior to turning over the car (subject of company maintenance) to their representatives. In
other words, like a good father of a family, they entrust the company vehicle only after they are satisfied that the
employee to whom the car has been given full use of the said company car for company or private purposes will not be
a threat or menace to himself, the company or to others. When a company gives full use and enjoyment of a company
car to its employee, it in effect guarantees that it is, like every good father, satisfied that its employee will use the privilege
reasonably and responsively.
In the ordinary course of business, not all company employees are given the privilege of using a company-issued
car. For large companies other than those cited in the example of the preceding paragraph, the privilege serves
important business purposes either related to the image of success an entity intends to present to its clients and to the
public in general, or for practical and utilitarian reasons - to enable its managerial and other employees of rank or its
sales agents to reach clients conveniently. In most cases, providing a company car serves both purposes. Since
important business transactions and decisions may occur at all hours in all sorts of situations and under all kinds of
guises, the provision for the unlimited use of a company car therefore principally serves the business and goodwill of a
company and only incidentally the private purposes of the individual who actually uses the car, the managerial employee
or company sales agent. As such, in providing for a company car for business use and/or for the purpose of furthering
the companys image, a company owes a responsibility to the public to see to it that the managerial or other employees
to whom it entrusts virtually unlimited use of a company issued car are able to use the company issue capably and
responsibly.
In the instant case, Li was an Assistant Manager of Alexander Commercial, Inc. In his testimony before the trial
court, he admitted that his functions as Assistant Manager did not require him to scrupulously keep normal office hours
as he was required quite often to perform work outside the office, visiting prospective buyers and contacting and meeting
with company clients.[30] These meetings, clearly, were not strictly confined to routine hours because, as a managerial
employee tasked with the job of representing his company with its clients, meetings with clients were both social as well
as work-related functions. The service car assigned to Li by Alexander Commercial, Inc. therefore enabled both Li - as
well as the corporation - to put up the front of a highly successful entity, increasing the latters goodwill before its clientele.
It also facilitated meeting between Li and its clients by providing the former with a convenient mode of travel.
Moreover, Lis claim that he happened to be on the road on the night of the accident because he was coming from
a social visit with an officemate in Paraaque was a bare allegation which was never corroborated in the court below. It
was obviously self-serving. Assuming he really came from his officemates place, the same could give rise to speculation
that he and his officemate had just been from a work-related function, or they were together to discuss sales and other
work related strategies.
In fine, Alexander Commercial, Inc. has not demonstrated, to our satisfaction, that it exercised the care and
diligence of a good father of the family in entrusting its company car to Li. No allegations were made as to whether or
not the company took the steps necessary to determine or ascertain the driving proficiency and history of Li, to whom it
gave full and unlimited use of a company car. [31] Not having been able to overcome the burden of demonstrating that it
should be absolved of liability for entrusting its company car to Li, said company, based on the principle of bonus pater
familias, ought to be jointly and severally liable with the former for the injuries sustained by Ma. Lourdes Valenzuela
during the accident.
Finally, we find no reason to overturn the amount of damages awarded by the respondent court, except as to the
amount of moral damages. In the case of moral damages, while the said damages are not intended to enrich the plaintiff
at the expense of a defendant, the award should nonetheless be commensurate to the suffering inflicted. In the instant
case we are of the opinion that the reduction in moral damages from an amount of P 1,000,000.00 to P500,000.00 by
the Court of Appeals was not justified considering the nature of the resulting damage and the predictable sequelae of
the injury.
As a result of the accident, Ma. Lourdes Valenzuela underwent a traumatic amputation of her left lower extremity
at the distal left thigh just above the knee. Because of this, Valenzuela will forever be deprived of the full ambulatory
functions of her left extremity, even with the use of state of the art prosthetic technology. Well beyond the period of
hospitalization (which was paid for by Li), she will be required to undergo adjustments in her prosthetic devise due to
the shrinkage of the stump from the process of healing.
These adjustments entail costs, prosthetic replacements and months of physical and occupational rehabilitation
and therapy. During her lifetime, the prosthetic devise will have to be replaced and re-adjusted to changes in the size of
her lower limb effected by the biological changes of middle-age, menopause and aging. Assuming she reaches
menopause, for example, the prosthetic will have to be adjusted to respond to the changes in bone resulting from a
precipitate decrease in calcium levels observed in the bones of all post-menopausal women. In other words, the damage
done to her would not only be permanent and lasting, it would also be permanently changing and adjusting to the
physiologic changes which her body would normally undergo through the years. The replacements, changes, and
adjustments will require corresponding adjustive physical and occupational therapy. All of these adjustments, it has
been documented, are painful.
The foregoing discussion does not even scratch the surface of the nature of the resulting damage because it would
be highly speculative to estimate the amount of psychological pain, damage and injury which goes with the sudden
severing of a vital portion of the human body. A prosthetic device, however technologically advanced, will only allow a
reasonable amount of functional restoration of the motor functions of the lower limb. The sensory functions are forever
lost. The resultant anxiety, sleeplessness, psychological injury, mental and physical pain are inestimable.
As the amount of moral damages are subject to this Courts discretion, we are of the opinion that the amount of
P1,000,000.00 granted by the trial court is in greater accord with the extent and nature of the injury -. physical and
psychological - suffered by Valenzuela as a result of Lis grossly negligent driving of his Mitsubishi Lancer in the early
morning hours of the accident.
WHEREFORE, PREMISES CONSIDERED, the decision of the court of Appeals is modified with the effect of
REINSTATING the judgment of the Regional Trial Court.
SO ORDERED.
FILAMER CHRISTIAN INSTITUTE, petitioner,
vs.
HON. INTERMEDIATE APPELLATE COURT, HON. ENRIQUE P. SUPLICO, in his capacity as Judge of the
Regional Trial Court, Branch XIV, Roxas City and POTENCIANO KAPUNAN, SR., respondents.

G.R. No. 75112 August 17, 1992

GUTIERREZ, JR., J.:

The private respondents, heirs of the late Potenciano Kapunan, seek reconsideration of the decision rendered by this
Court on October 16, 1990 (Filamer Christian Institute v. Court of Appeals, 190 SCRA 477) reviewing the appellate
court's conclusion that there exists an employer-employee relationship between the petitioner and its co-defendant
Funtecha. The Court ruled that the petitioner is not liable for the injuries caused by Funtecha on the grounds that the
latter was not an authorized driver for whose acts the petitioner shall be directly and primarily answerable, and that
Funtecha was merely a working scholar who, under Section 14, Rule X, Book III of the Rules and Regulations
Implementing the Labor Code is not considered an employee of the petitioner.

The private respondents assert that the circumstances obtaining in the present case call for the application of Article
2180 of the Civil Code since Funtecha is no doubt an employee of the petitioner. The private respondents maintain
that under Article 2180 an injured party shall have recourse against the servant as well as the petitioner for whom, at
the time of the incident, the servant was performing an act in furtherance of the interest and for the benefit of the
petitioner. Funtecha allegedly did not steal the school jeep nor use it for a joy ride without the knowledge of the school
authorities.

After a re-examination of the laws relevant to the facts found by the trial court and the appellate court, the Court
reconsiders its decision. We reinstate the Court of Appeals' decision penned by the late Justice Desiderio Jurado and
concurred in by Justices Jose C. Campos, Jr. and Serafin E. Camilon. Applying Civil Code provisions, the appellate
court affirmed the trial court decision which ordered the payment of the P20,000.00 liability in the Zenith Insurance
Corporation policy, P10,000.00 moral damages, P4,000.00 litigation and actual expenses, and P3,000.00 attorney's
fees.

It is undisputed that Funtecha was a working student, being a part-time janitor and a scholar of petitioner Filamer. He
was, in relation to the school, an employee even if he was assigned to clean the school premises for only two (2)
hours in the morning of each school day.

Having a student driver's license, Funtecha requested the driver, Allan Masa, and was allowed, to take over the
vehicle while the latter was on his way home one late afternoon. It is significant to note that the place where Allan lives
is also the house of his father, the school president, Agustin Masa. Moreover, it is also the house where Funtecha was
allowed free board while he was a student of Filamer Christian Institute.

Allan Masa turned over the vehicle to Funtecha only after driving down a road, negotiating a sharp dangerous curb,
and viewing that the road was clear. (TSN, April 4, 1983, pp. 78-79) According to Allan's testimony, a fast moving
truck with glaring lights nearly hit them so that they had to swerve to the right to avoid a collision. Upon swerving, they
heard a sound as if something had bumped against the vehicle, but they did not stop to check. Actually, the Pinoy jeep
swerved towards the pedestrian, Potenciano Kapunan who was walking in his lane in the direction against vehicular
traffic, and hit him. Allan affirmed that Funtecha followed his advise to swerve to the right. (Ibid., p. 79) At the time of
the incident (6:30 P.M.) in Roxas City, the jeep had only one functioning headlight.

Allan testified that he was the driver and at the same time a security guard of the petitioner-school. He further said that
there was no specific time for him to be off-duty and that after driving the students home at 5:00 in the afternoon, he
still had to go back to school and then drive home using the same vehicle.

Driving the vehicle to and from the house of the school president where both Allan and Funtecha reside is an act in
furtherance of the interest of the petitioner-school. Allan's job demands that he drive home the school jeep so he can
use it to fetch students in the morning of the next school day.

It is indubitable under the circumstances that the school president had knowledge that the jeep was routinely driven
home for the said purpose. Moreover, it is not improbable that the school president also had knowledge of Funtecha's
possession of a student driver's license and his desire to undergo driving lessons during the time that he was not in
his classrooms.

In learning how to drive while taking the vehicle home in the direction of Allan's house, Funtecha definitely was not
having a joy ride. Funtecha was not driving for the purpose of his enjoyment or for a "frolic of his own" but ultimately,
for the service for which the jeep was intended by the petitioner school. (See L. Battistoni v. Thomas, Can SC 144, 1
D.L.R. 577, 80 ALR 722 [1932]; See also Association of Baptists for World Evangelism, Inc. v. Fieldmen's Insurance
Co., Inc. 124 SCRA 618 [1983]). Therefore, the Court is constrained to conclude that the act of Funtecha in taking
over the steering wheel was one done for and in behalf of his employer for which act the petitioner-school cannot deny
any responsibility by arguing that it was done beyond the scope of his janitorial duties. The clause "within the scope of
their assigned tasks" for purposes of raising the presumption of liability of an employer, includes any act done by an
employee, in furtherance of the interests of the employer or for the account of the employer at the time of the infliction
of the injury or damage. (Manuel Casada, 190 Va 906, 59 SE 2d 47 [1950]) Even if somehow, the employee driving
the vehicle derived some benefit from the act, the existence of a presumptive liability of the employer is determined by
answering the question of whether or not the servant was at the time of the accident performing any act in furtherance
of his master's business. (Kohlman v. Hyland, 210 NW 643, 50 ALR 1437 [1926]; Jameson v. Gavett, 71 P 2d 937
[1937])

Section 14, Rule X, Book III of the Rules implementing the Labor Code, on which the petitioner anchors its defense,
was promulgated by the Secretary of Labor and Employment only for the purpose of administering and enforcing the
provisions of the Labor Code on conditions of employment. Particularly, Rule X of Book III provides guidelines on the
manner by which the powers of the Labor Secretary shall be exercised; on what records should be kept; maintained
and preserved; on payroll; and on the exclusion of working scholars from, and inclusion of resident physicians in the
employment coverage as far as compliance with the substantive labor provisions on working conditions, rest periods,
and wages, is concerned.

In other words, Rule X is merely a guide to the enforcement of the substantive law on labor. The Court, thus, makes
the distinction and so holds that Section 14, Rule X, Book III of the Rules is not the decisive law in a civil suit for
damages instituted by an injured person during a vehicular accident against a working student of a school and against
the school itself.

The present case does not deal with a labor dispute on conditions of employment between an alleged employee and
an alleged employer. It invokes a claim brought by one for damages for injury caused by the patently negligent acts of
a person, against both doer-employee and his employer. Hence, the reliance on the implementing rule on labor to
disregard the primary liability of an employer under Article 2180 of the Civil Code is misplaced. An implementing rule
on labor cannot be used by an employer as a shield to avoid liability under the substantive provisions of the Civil
Code.

There is evidence to show that there exists in the present case an extra-contractual obligation arising from the
negligence or reckless imprudence of a person "whose acts or omissions are imputable, by a legal fiction, to other(s)
who are in a position to exercise an absolute or limited control over (him)." (Bahia v. Litonjua and Leynes, 30 Phil. 624
[1915])

Funtecha is an employee of petitioner Filamer. He need not have an official appointment for a driver's position in order
that the petitioner may be held responsible for his grossly negligent act, it being sufficient that the act of driving at the
time of the incident was for the benefit of the petitioner. Hence, the fact that Funtecha was not the school driver or was
not acting within the scope of his janitorial duties does not relieve the petitioner of the burden of rebutting the
presumption juris tantum that there was negligence on its part either in the selection of a servant or employee, or in
the supervision over him. The petitioner has failed to show proof of its having exercised the required diligence of a
good father of a family over its employees Funtecha and Allan.

The Court reiterates that supervision includes the formulation of suitable rules and regulations for the guidance of its
employees and the issuance of proper instructions intended for the protection of the public and persons with whom the
employer has relations through his employees. (Bahia v. Litonjua and Leynes, supra, at p. 628; Phoenix Construction,
v. Intermediate Appellate Court, 148 SCRA 353 [1987])

An employer is expected to impose upon its employees the necessary discipline called for in the performance of any
act indispensable to the business and beneficial to their employer.

In the present case, the petitioner has not shown that it has set forth such rules and guidelines as would prohibit any
one of its employees from taking control over its vehicles if one is not the official driver or prohibiting the driver and
son of the Filamer president from authorizing another employee to drive the school vehicle. Furthermore, the petitioner
has failed to prove that it had imposed sanctions or warned its employees against the use of its vehicles by persons
other than the driver.

The petitioner, thus, has an obligation to pay damages for injury arising from the unskilled manner by which Funtecha
drove the vehicle. (Cangco v. Manila Railroad Co., 38 Phil. 768, 772 [1918]). In the absence of evidence that the
petitioner had exercised the diligence of a good father of a family in the supervision of its employees, the law imposes
upon it the vicarious liability for acts or omissions of its employees. (Umali v. Bacani, 69 SCRA 263 [1976]; Poblete v.
Fabros, 93 SCRA 200 [1979]; Kapalaran Bus Liner v. Coronado, 176 SCRA 792 [1989]; Franco v. Intermediate
Appellate Court, 178 SCRA 331 [1989]; Pantranco North Express, Inc. v. Baesa, 179 SCRA 384 [1989]) The liability of
the employer is, under Article 2180, primary and solidary. However, the employer shall have recourse against the
negligent employee for whatever damages are paid to the heirs of the plaintiff.

It is an admitted fact that the actual driver of the school jeep, Allan Masa, was not made a party defendant in the civil
case for damages. This is quite understandable considering that as far as the injured pedestrian, plaintiff Potenciano
Kapunan, was concerned, it was Funtecha who was the one driving the vehicle and presumably was one authorized
by the school to drive. The plaintiff and his heirs should not now be left to suffer without simultaneous recourse against
the petitioner for the consequent injury caused by a janitor doing a driving chore for the petitioner even for a short
while. For the purpose of recovering damages under the prevailing circumstances, it is enough that the plaintiff and
the private respondent heirs were able to establish the existence of employer-employee relationship between
Funtecha and petitioner Filamer and the fact that Funtecha was engaged in an act not for an independent purpose of
his own but in furtherance of the business of his employer. A position of responsibility on the part of the petitioner has
thus been satisfactorily demonstrated.

WHEREFORE, the motion for reconsideration of the decision dated October 16, 1990 is hereby GRANTED. The
decision of the respondent appellate court affirming the trial court decision is REINSTATED.

SO ORDERED.
MACARIO TAMARGO, CELSO TAMARGO and AURELIA TAMARGO, petitioners,
vs.
HON. COURT OF APPEALS, THE HON. ARISTON L. RUBIO, RTC Judge, Branch 20, Vigan, Ilocos Sur; VICTOR
BUNDOC; and CLARA BUNDOC, respondents.

G.R. No. 85044 June 3, 1992

FELICIANO, J.:

On 20 October 1982, Adelberto Bundoc, then a minor of 10 years of age, shot Jennifer Tamargo with an air rifle
causing injuries which resulted in her death. Accordingly, a civil complaint for damages was filed with the Regional
Trial Court, Branch 20, Vigan, Ilocos Sur, docketed as Civil Case No. 3457-V, by petitioner Macario Tamargo,
Jennifer's adopting parent, and petitioner spouses Celso and Aurelia Tamargo, Jennifer's natural parents against
respondent spouses Victor and Clara Bundoc, Adelberto's natural parents with whom he was living at the time of the
tragic incident. In addition to this case for damages, a criminal information or Homicide through Reckless Imprudence
was filed [Criminal Case No. 1722-V] against Adelberto Bundoc. Adelberto, however, was acquitted and exempted
from criminal liability on the ground that he bad acted without discernment.

Prior to the incident, or on 10 December 1981, the spouses Sabas and Felisa Rapisura had filed a petition to adopt
the minor Adelberto Bundoc in Special Proceedings No. 0373-T before the then Court of First Instance of Ilocos Sur.
This petition for adoption was grunted on, 18 November 1982, that is, after Adelberto had shot and killed Jennifer.

In their Answer, respondent spouses Bundoc, Adelberto's natural parents, reciting the result of the foregoing petition
for adoption, claimed that not they, but rather the adopting parents, namely the spouses Sabas and Felisa Rapisura,
were indispensable parties to the action since parental authority had shifted to the adopting parents from the moment
the successful petition for adoption was filed.

Petitioners in their Reply contended that since Adelberto Bundoc was then actually living with his natural parents,
parental authority had not ceased nor been relinquished by the mere filing and granting of a petition for adoption.

The trial court on 3 December 1987 dismissed petitioners' complaint, ruling that respondent natural parents of
Adelberto indeed were not indispensable parties to the action.

Petitioners received a copy of the trial court's Decision on 7 December 1987. Within the 15-day reglementary period,
or on 14 December 1987, petitioners filed a motion for reconsideration followed by a supplemental motion for
reconsideration on 15 January 1988. It appearing, however, that the motions failed to comply with Sections 4 and 5 of
Rule 15 of the Revised Rules of Court that notice of the motion shall be given to all parties concerned at least three
(3) days before the hearing of said motion; and that said notice shall state the time and place of hearing both
motions were denied by the trial court in an Order dated 18 April 1988. On 28 April 1988, petitioners filed a notice of
appeal. In its Order dated 6 June 1988, the trial court dismissed the notice at appeal, this time ruling that the notice
had been filed beyond the 15-day reglementary period ending 22 December 1987.

Petitioners went to the Court of Appeals on a petition for mandamus and certiorari questioning the trial court's
Decision dated 3 December 1987 and the Orders dated 18 April 1988 and 6 June 1988, The Court of Appeals
dismissed the petition, ruling that petitioners had lost their right to appeal.

In the present Petition for Review, petitioners once again contend that respondent spouses Bundoc are the
indispensable parties to the action for damages caused by the acts of their minor child, Adelberto Bundoc. Resolution
of this Petition hinges on the following issues: (1) whether or not petitioners, notwithstanding loss of their right to
appeal, may still file the instant Petition; conversely, whether the Court may still take cognizance of the case even
through petitioners' appeal had been filed out of time; and (2) whether or not the effects of adoption, insofar as
parental authority is concerned may be given retroactive effect so as to make the adopting parents the indispensable
parties in a damage case filed against their adopted child, for acts committed by the latter, when actual custody was
yet lodged with the biological parents.

1. It will be recalled that, petitioners' motion (and supplemental motion) for reconsideration filed before the trial court,
not having complied with the requirements of Section 13, Rule 41, and Section 4, Rule 15, of the Revised Rules of
Court, were considered pro forma and hence did not interrupt and suspend the reglementary period to appeal: the trial
court held that the motions, not having contained a notice of time and place of hearing, had become useless pieces of
paper which did not interrupt the reglementary period. 1 As in fact repeatedly held by this Court, what is mandatory is
the service of the motion on the opposing counsel indicating the time and place of hearing. 2

In view, however, of the nature of the issue raised in the instant. Petition, and in order that substantial justice may be
served, the Court, invoking its right to suspend the application of technical rules to prevent manifest injustice, elects to
treat the notice of appeal as having been seasonably filed before the trial court, and the motion (and supplemental
motion) for reconsideration filed by petitioner in the trial court as having interrupted the reglementary period for appeal.
As the Court held in Gregorio v. Court of Appeals: 3

Dismissal of appeal; purely on technical grounds is frowned upon where the policy of the courts is to
encourage hearings of appeal on their merits. The rules of procedure ought not be applied in a very
rigid technical sense, rules of procedure are used only to help secure not override, substantial justice.
if d technical and rigid enforcement of the rules is made their aim would be defeated. 4

2. It is not disputed that Adelberto Bundoc's voluntary act of shooting Jennifer Tamargo with an air rifle gave rise to a
cause of action on quasi-delict against him. As Article 2176 of the Civil Code provides:

Whoever by act or omission causes damage to another, there being fault or negligence, is obliged to
pay for the damage done. Such fault or negligence, if there is no pre-existing contractual relation
between the parties, is called a quasi-delict . . .

Upon the other hand, the law imposes civil liability upon the father and, in case of his death or incapacity, the mother,
for any damages that may be caused by a minor child who lives with them. Article 2180 of the Civil Code reads:

The obligation imposed by article 2176 is demandable not only for one's own acts or omissions, but
also for those of persons for whom one is responsible.

The father and, in case of his death or incapacity, the mother, are responsible for the damages
caused by the minor children who live in their company.

xxx xxx xxx

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

This principle of parental liability is a species of what is frequently designated as vicarious liability, or the doctrine of
"imputed negligence" under Anglo-American tort law, where a person is not only liable for torts committed by himself,
but also for torts committed by others with whom he has a certain relationship and for whom he is responsible. Thus,
parental liability is made a natural or logical consequence of the duties and responsibilities of parents their parental
authority which includes the instructing, controlling and disciplining of the child. 5 The basis for the doctrine of
vicarious liability was explained by the Court in Cangco v. Manila Railroad Co. 6 in the following terms:

With respect to extra-contractual obligation arising from negligence, whether of act or omission, it is
competent for the legislature to elect and our Legislature has so elected to limit such liability to
cases in which the person upon whom such an obligation is imposed is morally culpable or, on the
contrary, for reasons of public policy. to extend that liability, without regard to the lack of moral
culpability, so as to include responsibility for the negligence of those persons whose acts or omissions
are imputable, by a legal fiction, to others who are in a position to exercise an absolute or limited
control over them. The legislature which adopted our Civil Code has elected to limit extra-contractual
liability with certain well-defined exceptions to cases in which moral culpability can be directly
imputed to the persons to be charged. This moral responsibility may consist in having failed to
exercise due care in one's own acts, or in having failed to exercise due care in the selection and
control of one's agent or servants, or in the control of persons who, by reasons of their status, occupy
a position of dependency with respect to the person made liable for their conduct. 7(Emphasis
Supplied)

The civil liability imposed upon parents for the torts of their minor children living with them, may be seen to be
based upon the parental authority vested by the Civil Code upon such parents. The civil law assumes that
when an unemancipated child living with its parents commits a tortious acts, the parents were negligent in the
performance of their legal and natural duty closely to supervise the child who is in their custody and control.
Parental liability is, in other words, anchored upon parental authority coupled with presumed parental
dereliction in the discharge of the duties accompanying such authority. The parental dereliction is, of course,
only presumed and the presumption can be overtuned under Article 2180 of the Civil Code by proof that the
parents had exercised all the diligence of a good father of a family to prevent the damage.

In the instant case, the shooting of Jennifer by Adelberto with an air rifle occured when parental authority was still
lodged in respondent Bundoc spouses, the natural parents of the minor Adelberto. It would thus follow that the natural
parents who had then actual custody of the minor Adelberto, are the indispensable parties to the suit for damages.
The natural parents of Adelberto, however, stoutly maintain that because a decree of adoption was issued by the
adoption court in favor of the Rapisura spouses, parental authority was vested in the latter as adopting parents as of
the time of the filing of the petition for adoption that is, before Adelberto had shot Jennifer which an air rifle. The
Bundoc spouses contend that they were therefore free of any parental responsibility for Adelberto's allegedly tortious
conduct.

Respondent Bundoc spouses rely on Article 36 of the Child and Youth Welfare Code 8 which reads as follows:

Art. 36. Decree of Adoption. If, after considering the report of the Department of Social Welfare or
duly licensed child placement agency and the evidence submitted before it, the court is satisfied that
the petitioner is qualified to maintain, care for, and educate the child, that the trial custody period has
been completed, and that the best interests of the child will be promoted by the adoption, a decree of
adoption shall be entered, which shall be effective he date the original petition was filed. The decree
shall state the name by which the child is thenceforth to be known. (Emphasis supplied)

The Bundoc spouses further argue that the above Article 36 should be read in relation to Article 39 of the
same Code:

Art. 39. Effect of Adoption. The adoption shall:

xxx xxx xxx

(2) Dissolve the authority vested in the natural parents, except where the adopter is the spouse of the
surviving natural parent;

xxx xxx xxx

(Emphasis supplied)

and urge that their Parental authority must be deemed to have been dissolved as of the time the Petition for adoption
was filed.

The Court is not persuaded. As earlier noted, under the Civil Code, the basis of parental liability for the torts of a minor
child is the relationship existing between the parents and the minor child living with them and over whom, the law
presumes, the parents exercise supervision and control. Article 58 of the Child and Youth Welfare Code, re-enacted
this rule:

Article 58 Torts Parents and guardians are responsible for the damage caused by the child under
their parental authority in accordance with the civil Code. (Emphasis supplied)

Article 221 of the Family Code of the Philippines 9 has similarly insisted upon the requisite that the child, doer of the
tortious act, shall have beer in the actual custody of the parents sought to be held liable for the ensuing damage:

Art. 221. Parents and other persons exercising parental authority shall be civilly liable for the injuries
and damages caused by the acts or omissions of their unemancipated children living in their
company and under their parental authority subject to the appropriate defenses provided by law.
(Emphasis supplied)

We do not believe that parental authority is properly regarded as having been retroactively transferred to and vested in
the adopting parents, the Rapisura spouses, at the time the air rifle shooting happened. We do not consider that
retroactive effect may be giver to the decree of adoption so as to impose a liability upon the adopting parents
accruing at a time when adopting parents had no actual or physically custody over the adopted child. Retroactive
affect may perhaps be given to the granting of the petition for adoption where such is essential to permit the accrual of
some benefit or advantage in favor of the adopted child. In the instant case, however, to hold that parental authority
had been retroactively lodged in the Rapisura spouses so as to burden them with liability for a tortious act that they
could not have foreseen and which they could not have prevented (since they were at the time in the United States
and had no physical custody over the child Adelberto) would be unfair and unconscionable. Such a result, moreover,
would be inconsistent with the philosophical and policy basis underlying the doctrine of vicarious liability. Put a little
differently, no presumption of parental dereliction on the part of the adopting parents, the Rapisura spouses, could
have arisen since Adelberto was not in fact subject to their control at the time the tort was committed.

Article 35 of the Child and Youth Welfare Code fortifies the conclusion reached above. Article 35 provides as follows:
 Art. 35. Trial Custody. No petition for adoption shall be finally granted unless and until the adopting
parents are given by the courts a supervised trial custody period of at least six months to assess their
adjustment and emotional readiness for the legal union. During the period of trial custody, parental
authority shall be vested in the adopting parents. (Emphasis supplied)

Under the above Article 35, parental authority is provisionally vested in the adopting parents during the period of trial
custody, i.e., before the issuance of a decree of adoption, precisely because the adopting parents are given actual
custody of the child during such trial period. In the instant case, the trial custody period either had not yet begun or
bad already been completed at the time of the air rifle shooting; in any case, actual custody of Adelberto was then with
his natural parents, not the adopting parents.

Accordingly, we conclude that respondent Bundoc spouses, Adelberto's natural parents, were indispensable parties to
the suit for damages brought by petitioners, and that the dismissal by the trial court of petitioners' complaint, the
indispensable parties being already before the court, constituted grave abuse of discretion amounting to lack or
excess of jurisdiction.

WHEREFORE, premises considered, the Petition for Review is hereby GRANTED DUE COURSE and the Decision of
the Court of Appeals dated 6 September 1988, in C.A.-G.R. No. SP-15016 is hereby REVERSED and SET ASIDE.
Petitioners' complaint filed before the trial court is hereby REINSTATED and this case is REMANDED to that court for
further proceedings consistent with this Decision. Costs against respondent Bundoc spouses. This Decision is
immediately executory.

SO ORDERED.
ST. MARYS ACADEMY, petitioner, vs. WILLIAM CARPITANOS and LUCIA S. CARPITANOS, GUADA DANIEL,
JAMES DANIEL II, JAMES DANIEL, SR., and VIVENCIO VILLANUEVA, respondents.

[G.R. No. 143363. February 6, 2002]

DECISION
PARDO, J.:

The Case

The case is an appeal via certiorari from the decision[1] of the Court of Appeals as well as the resolution denying
reconsideration, holding petitioner liable for damages arising from an accident that resulted in the death of a student
who had joined a campaign to visit the public schools in Dipolog City to solicit enrollment.

The Facts

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

Claiming damages for the death of their only son, Sherwin Carpitanos, spouses William Carpitanos and Lucia
Carpitanos filed on June 9, 1995 a case against James Daniel II and his parents, James Daniel Sr. and Guada Daniel,
the vehicle owner, Vivencio Villanueva and St. Marys Academy before the Regional Trial Court of Dipolog City.

On 20 February 1997, Branch 6 of the Regional Trial Court of Dipolog City rendered its decision the dispositive portion
of which reads as follows:

WHEREFORE, PREMISES CONSIDERED, judgment is hereby rendered in the following manner:

1. Defendant St. Marys Academy of Dipolog City, is hereby ordered to pay plaintiffs William Carpitanos and Luisa
Carpitanos, the following sums of money:

a. FIFTY THOUSAND PESOS (P50,000.00) indemnity for the loss of life of Sherwin S. Carpitanos;
b. FORTY THOUSAND PESOS (P40,000.00) actual damages incurred by plaintiffs for burial and
related expenses;
c. TEN THOUSAND PESOS (P10,000.00) for attorneys fees;
d. FIVE HUNDRED THOUSAND PESOS (P500,000.00) for moral damages; and to pay costs.

2. Their liability being only subsidiary, defendants James Daniel, Sr. and Guada Daniel are hereby ordered to pay
herein plaintiffs the amount of damages above-stated in the event of insolvency of principal obligor St. Marys
Academy of Dipolog City;

3. Defendant James Daniel II, being a minor at the time of the commission of the tort and who was under special
parental authority of defendant St. Marys Academy, is ABSOLVED from paying the above-stated damages, same
being adjudged against defendants St. Marys Academy, and subsidiarily, against his parents;

4. Defendant Vivencio Villanueva is hereby ABSOLVED of any liability. His counterclaim not being in order as earlier
discussed in this decision, is hereby DISMISSED.

IT IS SO ORDERED. (Decision, pp. 32-33; Records, pp. 205-206).

From the records it appears that from 13 to 20 February 1995, defendant-appellant St. Marys Academy of Dipolog City
conducted an enrollment drive for the school year 1995-1996. A facet of the enrollment campaign was the visitation of
schools from where prospective enrollees were studying. As a student of St. Marys Academy, Sherwin Carpitanos
was part of the campaigning group. Accordingly, on the fateful day, Sherwin, along with other high school students
were riding in a Mitsubishi jeep owned by defendant Vivencio Villanueva on their way to Larayan Elementary School,
Larayan, Dapitan City. The jeep was driven by James Daniel II then 15 years old and a student of the same
school. Allegedly, the latter drove the jeep in a reckless manner and as a result the jeep turned turtle.
Sherwin Carpitanos died as a result of the injuries he sustained from the accident. [2]

In due time, petitioner St. Marys academy appealed the decision to the Court of Appeals. [3]
On February 29, 2000, the Court of Appeals promulgated a decision reducing the actual damages to P25,000.00
but otherwise affirming the decision a quo, in toto.[4]
On February 29, 2000, petitioner St. Marys Academy filed a motion for reconsideration of the decision. However,
on May 22, 2000, the Court of Appeals denied the motion.[5]
Hence, this appeal.[6]

The Issues

1) Whether the Court of Appeals erred in holding the petitioner liable for damages for the death of Sherwin
Carpitanos.
2) Whether the Court of Appeals erred in affirming the award of moral damages against the petitioner.

The Courts Ruling

We reverse the decision of the Court of Appeals.

The Court of Appeals held petitioner St. Marys Academy liable for the death of Sherwin Carpitanos under Articles
218[7] and 219[8] of the Family Code, pointing out that petitioner was negligent in allowing a minor to drive and in not
having a teacher accompany the minor students in the jeep.
Under Article 218 of the Family Code, the following shall have special parental authority over a minor child while
under their supervision, instruction or custody: (1) the school, its administrators and teachers; or (2) the individual, entity
or institution engaged in child care. This special parental authority and responsibility applies to all authorized activities,
whether inside or outside the premises of the school, entity or institution. Thus, such authority and responsibility applies
to field trips, excursions and other affairs of the pupils and students outside the school premises whenever authorized
by the school or its teachers.[9]
Under Article 219 of the Family Code, if the person under custody is a minor, those exercising special parental
authority are principally and solidarily liable for damages caused by the acts or omissions of the unemancipated minor
while under their supervision, instruction, or custody.[10]
However, for petitioner to be liable, there must be a finding that the act or omission considered as negligent was
the proximate cause of the injury caused because the negligence must have a causal connection to the accident.[11]

In order that there may be a recovery for an injury, however, it must be shown that the injury for which recovery is
sought must be the legitimate consequence of the wrong done; the connection between the negligence and the injury
must be a direct and natural sequence of events, unbroken by intervening efficient causes. In other words, the
negligence must be the proximate cause of the injury. For, negligence, no matter in what it consists, cannot create a
right of action unless it is the proximate cause of the injury complained of. And the proximate cause of an injury is that
cause, which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces the injury,
and without which the result would not have occurred. [12]

In this case, the respondents failed to show that the negligence of petitioner was the proximate cause of the death
of the victim.
Respondents Daniel spouses and Villanueva admitted that the immediate cause of the accident was not the
negligence of petitioner or the reckless driving of James Daniel II, but the detachment of the steering wheel guide of the
jeep.
In their comment to the petition, respondents Daniel spouses and Villanueva admitted the documentary exhibits
establishing that the cause of the accident was the detachment of the steering wheel guide of the jeep. Hence, the
cause of the accident was not the recklessness of James Daniel II but the mechanical defect in the jeep of Vivencio
Villanueva. Respondents, including the spouses Carpitanos, parents of the deceased Sherwin Carpitanos, did not
dispute the report and testimony of the traffic investigator who stated that the cause of the accident was the detachment
of the steering wheel guide that caused the jeep to turn turtle.
Significantly, respondents did not present any evidence to show that the proximate cause of the accident was the
negligence of the school authorities, or the reckless driving of James Daniel II. Hence, the respondents reliance on
Article 219 of the Family Code that those given the authority and responsibility under the preceding Article shall be
principally and solidarily liable for damages caused by acts or omissions of the unemancipated minor was unfounded.
Further, there was no evidence that petitioner school allowed the minor James Daniel II to drive the jeep of
respondent Vivencio Villanueva. It was Ched Villanueva, grandson of respondent Vivencio Villanueva, who had
possession and control of the jeep. He was driving the vehicle and he allowed James Daniel II, a minor, to drive the
jeep at the time of the accident.
Hence, liability for the accident, whether caused by the negligence of the minor driver or mechanical detachment
of the steering wheel guide of the jeep, must be pinned on the minors parents primarily. The negligence of petitioner St.
Marys Academy was only a remote cause of the accident. Between the remote cause and the injury, there intervened
the negligence of the minors parents or the detachment of the steering wheel guide of the jeep.

The proximate cause of an injury is that cause, which, in natural and continuous sequence, unbroken by any efficient
intervening cause, produces the injury, and without which the result would not have occurred. [13]

Considering that the negligence of the minor driver or the detachment of the steering wheel guide of the jeep owned
by respondent Villanueva was an event over which petitioner St. Marys Academy had no control, and which was the
proximate cause of the accident, petitioner may not be held liable for the death resulting from such accident.
Consequently, we find that petitioner likewise cannot be held liable for moral damages in the amount of
P500,000.00 awarded by the trial court and affirmed by the Court of Appeals.
Though incapable of pecuniary computation, moral damages may be recovered if they are the proximate result of
the defendants wrongful act or omission.[14] In this case, the proximate cause of the accident was not attributable to
petitioner.
For the reason that petitioner was not directly liable for the accident, the decision of the Court of Appeals ordering
petitioner to pay death indemnity to respondent Carpitanos must be deleted. Moreover, the grant of attorneys fees as
part of damages is the exception rather than the rule. [15] The power of the court to award attorneys fees under Article
2208 of the Civil Code demands factual, legal and equitable justification.[16] Thus, the grant of attorneys fees against the
petitioner is likewise deleted.
Incidentally, there was no question that the registered owner of the vehicle was respondent Villanueva. He never
denied and in fact admitted this fact. We have held that the registered owner of any vehicle, even if not used for public
service, would primarily be responsible to the public or to third persons for injuries caused the latter while the vehicle
was being driven on the highways or streets.[17] Hence, with the overwhelming evidence presented by petitioner and the
respondent Daniel spouses that the accident occurred because of the detachment of the steering wheel guide of the
jeep, it is not the school, but the registered owner of the vehicle who shall be held responsible for damages for the death
of Sherwin Carpitanos.

The Fallo

WHEREFORE, the Court REVERSES and SETS ASIDE the decision of the Court of Appeals [18] and that of the trial
court.[19] The Court remands the case to the trial court for determination of the liability of defendants, excluding petitioner
St. Marys Academy, Dipolog City.
No costs.
SO ORDERED.
BENJAMIN SALVOSA and BAGUIO COLLEGES FOUNDATION, petitioners,
vs.
THE INTERMEDIATE APPELLATE COURT, EDUARDO B. CASTRO, DIOMEDES B. CASTRO, VIRGINIA B.
CASTRO and RODOLFO B. CASTRO., respondents.

G.R. No. 70458 October 5, 1988

PADILLA, J.:

In this petition for review on certiorari, petitioners seek the reversal of the
decision 1 of respondent Intermediate Appellate Court, dated 7 December 1984, in AC-G.R. No. CV 69876, in so far
as it affirmed the decision 2 of the Court of First Instance of Tarlac (hereinafter referred to as the Trial Court), which
held, among others, petitioners solidarily hable with Jimmy B. Abon, under Art. 2180 of the Civil Code.

The relevant facts, as found by the Trial Court and adopted by reference by the respondent Court, are:

... Baguio Colleges Foundation (BCF, hereafter) is an academic institution ... [However], it is also an institution of arts
and trade. It has so advertised itself, as its own evidence shows. Its brochure (Exh. 2) shows that BCF has a full-
fledged technical-vocational department offer Communication, Broadcast and Teletype Technician courses as well as
Electronics Serviceman and Automotive Mechanics courses... these courses divest BCF of the nature or character of
being purely or exclusively an academic institution. 3

Within the premises of the BCF is an ROTC Unit, the Baguio Colleges Foundation Reserve Officers Training Corps
(ROTC) Unit, which is under the fifth control of the Armed Forces of the Philippines. 4 The ROTC Unit, by way of
accommodation to the Armed Forces of the Philippines (AFP), pursuant to Department Order No. 14, Series of 1975
of the Department of Education and Culture, 5 is provided by the BCF an office and an armory located at the
basement of its main building. 6

The Baguio Colleges Foundation ROTC Unit had Jimmy B. Abon as its duly appointed armorer. 7 As armorer of the
ROTC Unit, Jimmy B. Abon received his appointment from the AFP. Not being an employee of the BCF, he also
received his salary from the AFP, 8 as well as orders from Captain Roberto C. Ungos, the Commandant of the Baguio
Colleges Foundation ROTC Unit, concurrent Commandant of other ROTC units in Baguio and an employee (officer) of
the AFP. 9Jimmy B. Abon was also a commerce student of the BCF. 10

On 3 March 1977, at around 8:00 p.m., in the parking space of BCF, Jimmy B. Abon shot Napoleon Castro a student
of the University of Baguio with an unlicensed firearm which the former took from the armory of the ROTC Unit of the
BCF. 11 As a result, Napoleon Castro died and Jimmy B. Abon was prosecuted for, and convicted of the crime of
Homicide by Military Commission No. 30, AFP. 12

Subsequently, the heirs of Napoleon Castro sued for damages, impleading Jimmy B. Abon, Roberto C. Ungos (ROTC
Commandant Benjamin Salvosa (President and Chairman of the Board of BCF), Jesus Salvosa (Executive Vice
President of BCF), Libertad D. Quetolio (Dean of the College of Education and Executive Trustee of BCF) and the
Baguio Colleges Foundation Inc. as party defendants. After hearing, the Trial Court rendered a decision, (1)
sentencing defendants Jimmy B. Abon, Benjamin Salvosa and Baguio Colleges Foundation, Inc., jointly and severally,
to pay private respondents, as heirs of Napoleon Castro: a) P12,000.00 for the death of Napoleon Castro, (b)
P316,000.00 as indemnity for the loss of earning capacity of the deceased, (c) P5,000.00 as moral damages, (d)
P6,000.00 as actual damages, and (e) P5,000.00 as attorney's fees, plus costs; (2) absolving the other defendants;
and (3) dismissing the defendants' counterclaim for lack of merit. 13 On appeal by petitioners, the respondent Court
affirmed with modification the decision of the Trial Court. The modification consisted in reducing the award for loss of
earning capacity of the deceased from P316,000.00 to P30,000.00 by way of temperate damages, and increasing the
indemnity for the death of Napoleon Castro from P12,000.00 to P30,000.00.

Hence, this petition.

The central issue in this case is whether or not petitioners can be held solidarity hable with Jimmy B. Abon for
damages under Article 2180 of the Civil Code, as a consequence of the tortious act of Jimmy B. Abon.

Under the penultimate paragraph of Art. 2180 of the Civil Code, teachers or heads of establishments of arts and
trades are hable for "damages caused by their pupils and students or apprentices, so long as they remain in their
custody." The rationale of such liability is that so long as the student remains in the custody of a teacher, the latter
"stands, to a certain extent, in loco parentis [as to the student] and [is] called upon to exercise reasonable supervision
over the conduct of the [student]." 14 Likewise, "the phrase used in [Art. 2180 'so long as (the students) remain in
their custody means the protective and supervisory custody that the school and its heads and teachers exercise over
the pupils and students for as long as they are at attendance in the school, including recess time." 15
In the case at bar, in holding that Jimmy B. Abon was stin in the protective and supervisory custody of the Baguio
Colleges Foundation when he shot Napoleon Castro, the respondent Court ruled that:

it is true that Abon was not attending any class or school function at the time of the shooting incident,
which was at about 8 o'clock in the evening; but considering that Abon was employed as an armorer
and property custodian of the BCF ROTC unit, he must have been attending night classes and
therefore that hour in the evening was just about dismissal time for him or soon thereafter. The time
interval is safely within the "recess time" that the trial court spoke of and envisioned by the Palisoc
case, supra. 16 (Emphasis supplied)

In line with the case of Palisoc, 17 a student not "at attendance in the school" cannot be in "recess" thereat. A "recess,"
as the concept is embraced in the phrase "at attendance in the school," contemplates a situation of temporary
adjournment of school activities where the student still remains within call of his mentor and is not permitted to leave
the school premises, or the area within which the school activity is conducted. Recess by its nature does not include
dismissal. 18Likewise, the mere fact of being enrolled or being in the premises of a school without more does not
constitute "attending school" or being in the "protective and supervisory custody' of the school, as contemplated in the
law.

Upon the foregoing considerations, we hold that Jimmy B. Abon cannot be considered to have been "at attendance in
the school," or in the custody of BCF, when he shot Napoleon Castro. Logically, therefore, petitioners cannot under
Art. 2180 of the Civil Code be held solidarity liable with Jimmy B. Abon for damages resulting from his acts.

Besides, the record shows that before the shooting incident, Roberto B. Ungos ROTC Unit Commandant, AFP, had
instructed Jimmy B. Abon "not to leave the office and [to keep the armory] well guarded." 19 Apart from negating a
finding that Jimmy B. Abon was under the custody of the school when he committed the act for which the petitioners
are sought to be held liable, this circumstance shows that Jimmy B. Abon was supposed to be working in the
armory with definite instructions from his superior, the ROTC Commandant, when he shot Napoleon Castro.

Petitioners also raise the issue that, under Art. 2180 of the Civil Code, a school which offers both academic and
technical/vocational courses cannot be held liable for a tort committed by a student enrolled only in its academic
program; however, considering that Jimmy B. Abon was not in the custody of BCF when he shot Napoleon Castro, the
Court deems it unnecessary to pass upon such other issue. 20

WHEREFORE, the decision appealed from is hereby REVERSED in so far as it holds petitioners solidarily liable with
Jimmy B. Abon for his tortious act in the killing of Napoleon Castro. No costs.

SO ORDERED.
UNIVERSITY OF THE EAST, petitioner,
vs.
ROMEO A. JADER, respondent.

G.R. No. 132344 February 17, 2000

YNARES-SANTIAGO, J.:

May an educational institution be held liable for damages for misleading a student into believing that the latter had
satisfied all the requirements for graduation when such is not the case? This is the issue in the instant petition for
review premised on the following undisputed facts as summarized by the trial court and adopted by the Court of
Appeals (CA),1 to wit:

Plaintiff was enrolled in the defendants' College of Law from 1984 up to 1988. In the first semester of his last
year (School year 1987-1988), he failed to take the regular final examination in Practice Court I for which he
was given an incomplete grade (Exhibits "2", also Exhibit "H"). He enrolled for the second semester as fourth
year law student (Exhibit "A") and on February 1, 1988 he filed an application for the removal of the
incomplete grade given him by Professor Carlos Ortega (Exhibits "H-2", also Exhibit "2") which was approved
by Dean Celedonio Tiongson after payment of the required fee. He took the examination on March 28, 1988.
On May 30, 1988, Professor Carlos Ortega submitted his grade. It was a grade of five (5). (Exhibits "H-4", also
Exhibits "2-L", "2-N").1wphi1.nt

In the meantime, the Dean and the Faculty Members of the College of Law met to deliberate on who among
the fourth year students should be allowed to graduate. The plaintiff's name appeared in the Tentative List of
Candidates for graduation for the Degree of Bachelor of Laws (LL.B) as of Second Semester (1987-1988) with
the following annotation:

JADER ROMEO A.

Def. Conflict of Laws x-1-87-88, Practice Court I Inc., 1-87-88 C-1 to submit transcript with S.O. (Exhibits
"3", "3-C-1", "3-C-2").

The 35th Investitures & Commencement Ceremonies for the candidates of Bachelor of Laws was scheduled
on the 16th of April 1988 at 3:00 o'clock in the afternoon, and in the invitation for that occasion the name of
the plaintiff appeared as one of the candidates. (Exhibits "B", "B-6", "B-6-A"). At the foot of the list of the
names of the candidates there appeared however the following annotation:

This is a tentative list Degrees will be conferred upon these candidates who satisfactorily complete
requirements as stated in the University Bulletin and as approved of the Department of Education,
Culture and Sports (Exhibit "B-7-A").

The plaintiff attended the investiture ceremonies at F. dela Cruz Quadrangle, U.E., Recto Campus, during the
program of which he went up the stage when his name was called, escorted by her (sic) mother and his eldest
brother who assisted in placing the Hood, and his Tassel was turned from left to right, and he was thereafter
handed by Dean Celedonio a rolled white sheet of paper symbolical of the Law Diploma. His relatives took
pictures of the occasion (Exhibits "C" to "C-6", "D-3" to "D-11").

He tendered a blow-out that evening which was attended by neighbors, friends and relatives who wished him
good luck in the forthcoming bar examination. There were pictures taken too during the blow-out (Exhibits "D"
to "D-1").

He thereafter prepared himself for the bar examination. He took a leave of absence without pay from his job
from April 20, 1988 to September 30, 1988 (Exhibit "G") and enrolled at the pre-bar review class in Far
Eastern University. (Exhibits "F" to "F-2"). Having learned of the deficiency he dropped his review class and
was not able to take the bar examination.2

Consequently, respondent sued petitioner for damages alleging that he suffered moral shock, mental anguish, serious
anxiety, besmirched reputation, wounded feelings and sleepless nights when he was not able to take the 1988 bar
examinations arising from the latter's negligence. He prayed for an award of moral and exemplary damages,
unrealized income, attorney's fees, and costs of suit.
In its answer with counterclaim, petitioner denied liability arguing mainly that it never led respondent to believe that he
completed the requirements for a Bachelor of Laws degree when his name was included in the tentative list of
graduating students. After trial, the lower court rendered judgment as follows:

WHEREFORE, in view of the foregoing judgment is hereby rendered in favor of the plaintiff and against the
defendant ordering the latter to pay plaintiff the sum of THIRTY FIVE THOUSAND FOUR HUNDRED
SEVENTY PESOS (P35,470.00) with legal rate of interest from the filing of the complaint until fully paid, the
amount of FIVE THOUSAND PESOS (P5,000.00) as attorney's fees and the cost of suit.

Defendant's counterclaim is, for lack of merit, hereby dismissed.

SO ORDERED.3

which on appeal by both parties was affirmed by the Court of Appeals (CA) with modification. The dispositive portion
of the CA decision reads:

WHEREFORE, in the light of the foregoing, the lower Court's Decision is hereby AFFIRMED with the
MODIFICATION that defendant-appellee, in addition to the sum adjudged by the lower court in favor of
plaintiff-appellant, is also ORDERED to pay plaintiff-appellant the amount of FIFTY THOUSAND (P50,000.00)
PESOS for moral damages. Costs against defendant-appellee.

SO ORDERED.4

Upon the denial of its motion for reconsideration, petitioner UE elevated the case to this Court on a petition for review
under Rule 45 of the Rules of Court, arguing that it has no liability to respondent Romeo A. Jader, considering that the
proximate and immediate cause of the alleged damages incurred by the latter arose out of his own negligence in not
verifying from the professor concerned the result of his removal exam.

The petition lacks merit.

When a student is enrolled in any educational or learning institution, a contract of education is entered into between
said institution and the student. The professors, teachers or instructors hired by the school are considered merely as
agents and administrators tasked to perform the school's commitment under the contract. Since the contracting parties
are the school and the student, the latter is not duty-bound to deal with the former's agents, such as the professors
with respect to the status or result of his grades, although nothing prevents either professors or students from sharing
with each other such information. The Court takes judicial notice of the traditional practice in educational institutions
wherein the professor directly furnishes his/her students their grades. It is the contractual obligation of the school to
timely inform and furnish sufficient notice and information to each and every student as to whether he or she had
already complied with all the requirements for the conferment of a degree or whether they would be included among
those who will graduate. Although commencement exercises are but a formal ceremony, it nonetheless is not an
ordinary occasion, since such ceremony is the educational institution's way of announcing to the whole world that the
students included in the list of those who will be conferred a degree during the baccalaureate ceremony have satisfied
all the requirements for such degree. Prior or subsequent to the ceremony, the school has the obligation to promptly
inform the student of any problem involving the latter's grades and performance and also most importantly, of the
procedures for remedying the same.

Petitioner, in belatedly informing respondent of the result of the removal examination, particularly at a time when he
had already commenced preparing for the bar exams, cannot be said to have acted in good faith. Absence of good
faith must be sufficiently established for a successful prosecution by the aggrieved party in a suit for abuse of right
under Article 19 of the Civil Code. Good faith connotes an honest intention to abstain from taking undue advantage of
another, even though the forms and technicalities of the law, together with the absence of all information or belief of
facts, would render the transaction unconscientious.5 It is the school that has access to those information and it is only
the school that can compel its professors to act and comply with its rules, regulations and policies with respect to the
computation and the prompt submission of grades. Students do not exercise control, much less influence, over the
way an educational institution should run its affairs, particularly in disciplining its professors and teachers and ensuring
their compliance with the school's rules and orders. Being the party that hired them, it is the school that exercises
general supervision and exclusive control over the professors with respect to the submission of reports involving the
students' standing. Exclusive control means that no other person or entity had any control over the instrumentality
which caused the damage or injury.6

The college dean is the senior officer responsible for the operation of an academic program, enforcement of rules and
regulations, and the supervision of faculty and student services. 7 He must see to it that his own professors and
teachers, regardless of their status or position outside of the university, must comply with the rules set by the latter.
The negligent act of a professor who fails to observe the rules of the school, for instance by not promptly submitting a
student's grade, is not only imputable to the professor but is an act of the school, being his employer.

Considering further, that the institution of learning involved herein is a university which is engaged in legal education, it
should have practiced what it inculcates in its students, more specifically the principle of good dealings enshrined in
Articles 19 and 20 of the Civil Code which states:

Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act with justice,
give everyone his due, and observe honesty and good faith.

Art. 20. Every person who, contrary to law, wilfully or negligently causes damage to another, shall indemnify
the latter for the same.

Art. 19 was intended to expand the concept of torts by granting adequate legal remedy for the untold number of moral
wrongs which is impossible for human foresight to provide specifically in statutory law. 8 In civilized society, men must
be able to assume that others will do them no intended injury that others will commit no internal aggressions upon
them; that their fellowmen, when they act affirmatively will do so with due care which the ordinary understanding and
moral sense of the community exacts and that those with whom they deal in the general course of society will act in
good faith. The ultimate thing in the theory of liability is justifiable reliance under conditions of civilized
society.9 Schools and professors cannot just take students for granted and be indifferent to them, for without the latter,
the former are useless.

Educational institutions are duty-bound to inform the students of their academic status and not wait for the latter to
inquire from the former. The conscious indifference of a person to the rights or welfare of the person/persons who may
be affected by his act or omission can support a claim for damages.10 Want of care to the conscious disregard of civil
obligations coupled with a conscious knowledge of the cause naturally calculated to produce them would make the
erring party liable.11 Petitioner ought to have known that time was of the essence in the performance of its obligation to
inform respondent of his grade. It cannot feign ignorance that respondent will not prepare himself for the bar exams
since that is precisely the immediate concern after graduation of an LL.B. graduate. It failed to act seasonably.
Petitioner cannot just give out its student's grades at any time because a student has to comply with certain deadlines
set by the Supreme Court on the submission of requirements for taking the bar. Petitioner's liability arose from its
failure to promptly inform respondent of the result of an examination and in misleading the latter into believing that he
had satisfied all requirements for the course. Worth quoting is the following disquisition of the respondent court:

It is apparent from the testimony of Dean Tiongson that defendant-appellee University had been informed
during the deliberation that the professor in Practice Court I gave plaintiff-appellant a failing grade. Yet,
defendant-appellee still did not inform plaintiff-appellant of his failure to complete the requirements for the
degree nor did they remove his name from the tentative list of candidates for graduation. Worse, defendant-
appellee university, despite the knowledge that plaintiff-appellant failed in Practice Court I, again included
plaintiff-appellant's name in the "tentative list of candidates for graduation which was prepared after the
deliberation and which became the basis for the commencement rites program. Dean Tiongson reasons out
that plaintiff-appellant's name was allowed to remain in the tentative list of candidates for graduation in the
hope that the latter would still be able to remedy the situation in the remaining few days before graduation
day. Dean Tiongson, however, did not explain how plaintiff appellant Jader could have done something to
complete his deficiency if defendant-appellee university did not exert any effort to inform plaintiff-appellant of
his failing grade in Practice Court I.12

Petitioner cannot pass on its blame to the professors to justify its own negligence that led to the delayed relay of
information to respondent. When one of two innocent parties must suffer, he through whose agency the loss occurred
must bear it.13 The modern tendency is to grant indemnity for damages in cases where there is abuse of right, even
when the act is not illicit.14 If mere fault or negligence in one's acts can make him liable for damages for injury caused
thereby, with more reason should abuse or bad faith make him liable. A person should be protected only when he acts
in the legitimate exercise of his right, that is, when he acts with prudence and in good faith, but not when he acts with
negligence or abuse.15

However, while petitioner was guilty of negligence and thus liable to respondent for the latter's actual damages, we
hold that respondent should not have been awarded moral damages. We do not agree with the Court of Appeals'
findings that respondent suffered shock, trauma and pain when he was informed that he could not graduate and will
not be allowed to take the bar examinations. At the very least, it behooved on respondent to verify for himself whether
he has completed all necessary requirements to be eligible for the bar examinations. As a senior law student,
respondent should have been responsible enough to ensure that all his affairs, specifically those pertaining to his
academic achievement, are in order. Given these considerations, we fail to see how respondent could have suffered
untold embarrassment in attending the graduation rites, enrolling in the bar review classes and not being able to take
the bar exams. If respondent was indeed humiliated by his failure to take the bar, he brought this upon himself by not
verifying if he has satisfied all the requirements including his school records, before preparing himself for the bar
examination. Certainly, taking the bar examinations does not only entail a mental preparation on the subjects thereof;
there are also prerequisites of documentation and submission of requirements which the prospective examinee must
meet.

WHEREFORE, the assailed decision of the Court of Appeals is AFFIRMED with MODIFICATION. Petitioner is
ORDERED to PAY respondent the sum of Thirty-five Thousand Four Hundred Seventy Pesos (P35,470.00), with legal
interest of 6% per annum computed from the date of filing of the complaint until fully paid; the amount of Five
Thousand Pesos (P5,000.00) as attorney's fees; and the costs of the suit. The award of moral damages is
DELEIED.1wphi1.nt

SO ORDERED.
JOSEPH SALUDAGA, petitioner,
vs.
FAR EASTERN UNIVERSITY and EDILBERTO C. DE JESUS in his capacity as President of FEU, respondents.

G.R. No. 179337 April 30, 2008

DECISION

YNARES-SANTIAGO, J.:

This Petition for Review on Certiorari1 under Rule 45 of the Rules of Court assails the June 29, 2007 Decision2 of the
Court of Appeals in CA-G.R. CV No. 87050, nullifying and setting aside the November 10, 2004 Decision 3 of the
Regional Trial Court of Manila, Branch 2, in Civil Case No. 98-89483 and dismissing the complaint filed by petitioner;
as well as its August 23, 2007 Resolution4 denying the Motion for Reconsideration.5

The antecedent facts are as follows:

Petitioner Joseph Saludaga was a sophomore law student of respondent Far Eastern University (FEU) when he was
shot by Alejandro Rosete (Rosete), one of the security guards on duty at the school premises on August 18, 1996.
Petitioner was rushed to FEU-Dr. Nicanor Reyes Medical Foundation (FEU-NRMF) due to the wound he
sustained.6 Meanwhile, Rosete was brought to the police station where he explained that the shooting was accidental.
He was eventually released considering that no formal complaint was filed against him.

Petitioner thereafter filed a complaint for damages against respondents on the ground that they breached their
obligation to provide students with a safe and secure environment and an atmosphere conducive to learning.
Respondents, in turn, filed a Third-Party Complaint7 against Galaxy Development and Management Corporation
(Galaxy), the agency contracted by respondent FEU to provide security services within its premises and Mariano D.
Imperial (Imperial), Galaxy's President, to indemnify them for whatever would be adjudged in favor of petitioner, if any;
and to pay attorney's fees and cost of the suit. On the other hand, Galaxy and Imperial filed a Fourth-Party Complaint
against AFP General Insurance.8

On November 10, 2004, the trial court rendered a decision in favor of petitioner, the dispositive portion of which reads:

WHEREFORE, from the foregoing, judgment is hereby rendered ordering:

1. FEU and Edilberto de Jesus, in his capacity as president of FEU to pay jointly and severally Joseph
Saludaga the amount of P35,298.25 for actual damages with 12% interest per annum from the filing
of the complaint until fully paid; moral damages of P300,000.00, exemplary damages of P500,000.00,
attorney's fees of P100,000.00 and cost of the suit;

2. Galaxy Management and Development Corp. and its president, Col. Mariano Imperial to indemnify
jointly and severally 3rd party plaintiffs (FEU and Edilberto de Jesus in his capacity as President of
FEU) for the above-mentioned amounts;

3. And the 4th party complaint is dismissed for lack of cause of action. No pronouncement as to costs.

SO ORDERED.9

Respondents appealed to the Court of Appeals which rendered the assailed Decision, the decretal portion of which
provides, viz:

WHEREFORE, the appeal is hereby GRANTED. The Decision dated November 10, 2004 is hereby
REVERSED and SET ASIDE. The complaint filed by Joseph Saludaga against appellant Far Eastern
University and its President in Civil Case No. 98-89483 is DISMISSED.

SO ORDERED.10

Petitioner filed a Motion for Reconsideration which was denied; hence, the instant petition based on the following
grounds:

THE COURT OF APPEALS SERIOUSLY ERRED IN MANNER CONTRARY TO LAW AND

JURISPRUDENCE IN RULING THAT:
 5.1. THE SHOOTING INCIDENT IS A FORTUITOUS EVENT;

5.2. RESPONDENTS ARE NOT LIABLE FOR DAMAGES FOR THE INJURY RESULTING FROM A
GUNSHOT WOUND SUFFERED BY THE PETITIONER FROM THE HANDS OF NO LESS THAN THEIR
OWN SECURITY GUARD IN VIOLATION OF THEIR BUILT-IN CONTRACTUAL OBLIGATION TO
PETITIONER, BEING THEIR LAW STUDENT AT THAT TIME, TO PROVIDE HIM WITH A SAFE AND
SECURE EDUCATIONAL ENVIRONMENT;

5.3. SECURITY GAURD, ALEJANDRO ROSETE, WHO SHOT PETITIONER WHILE HE WAS WALKING ON
HIS WAY TO THE LAW LIBRARY OF RESPONDENT FEU IS NOT THEIR EMPLOYEE BY VIRTUE OF THE
CONTRACT FOR SECURITY SERVICES BETWEEN GALAXY AND FEU NOTWITHSTANDING THE FACT
THAT PETITIONER, NOT BEING A PARTY TO IT, IS NOT BOUND BY THE SAME UNDER THE
PRINCIPLE OF RELATIVITY OF CONTRACTS; and

5.4. RESPONDENT EXERCISED DUE DILIGENCE IN SELECTING GALAXY AS THE AGENCY WHICH
WOULD PROVIDE SECURITY SERVICES WITHIN THE PREMISES OF RESPONDENT FEU.11

Petitioner is suing respondents for damages based on the alleged breach of student-school contract for a safe
learning environment. The pertinent portions of petitioner's Complaint read:

6.0. At the time of plaintiff's confinement, the defendants or any of their representative did not bother to visit
and inquire about his condition. This abject indifference on the part of the defendants continued even after
plaintiff was discharged from the hospital when not even a word of consolation was heard from them. Plaintiff
waited for more than one (1) year for the defendants to perform their moral obligation but the wait was
fruitless. This indifference and total lack of concern of defendants served to exacerbate plaintiff's miserable
condition.

xxxx

11.0. Defendants are responsible for ensuring the safety of its students while the latter are within the
University premises. And that should anything untoward happens to any of its students while they are within
the University's premises shall be the responsibility of the defendants. In this case, defendants, despite being
legally and morally bound, miserably failed to protect plaintiff from injury and thereafter, to mitigate and
compensate plaintiff for said injury;

12.0. When plaintiff enrolled with defendant FEU, a contract was entered into between them. Under this
contract, defendants are supposed to ensure that adequate steps are taken to provide an atmosphere
conducive to study and ensure the safety of the plaintiff while inside defendant FEU's premises. In the instant
case, the latter breached this contract when defendant allowed harm to befall upon the plaintiff when he was
shot at by, of all people, their security guard who was tasked to maintain peace inside the campus.12

In Philippine School of Business Administration v. Court of Appeals,13 we held that:

When an academic institution accepts students for enrollment, there is established a contract between them,
resulting in bilateral obligations which both parties are bound to comply with. For its part, the school
undertakes to provide the student with an education that would presumably suffice to equip him with the
necessary tools and skills to pursue higher education or a profession. On the other hand, the student
covenants to abide by the school's academic requirements and observe its rules and regulations.

Institutions of learning must also meet the implicit or "built-in" obligation of providing their students with an
atmosphere that promotes or assists in attaining its primary undertaking of imparting knowledge. Certainly, no
student can absorb the intricacies of physics or higher mathematics or explore the realm of the arts and other
sciences when bullets are flying or grenades exploding in the air or where there looms around the school
premises a constant threat to life and limb. Necessarily, the school must ensure that adequate steps are taken
to maintain peace and order within the campus premises and to prevent the breakdown thereof. 14

It is undisputed that petitioner was enrolled as a sophomore law student in respondent FEU. As such, there was
created a contractual obligation between the two parties. On petitioner's part, he was obliged to comply with the rules
and regulations of the school. On the other hand, respondent FEU, as a learning institution is mandated to impart
knowledge and equip its students with the necessary skills to pursue higher education or a profession. At the same
time, it is obliged to ensure and take adequate steps to maintain peace and order within the campus.

It is settled that in culpa contractual, the mere proof of the existence of the contract and the failure of its compliance
justify, prima facie, a corresponding right of relief.15 In the instant case, we find that, when petitioner was shot inside
the campus by no less the security guard who was hired to maintain peace and secure the premises, there is a prima
facie showing that respondents failed to comply with its obligation to provide a safe and secure environment to its
students.

In order to avoid liability, however, respondents aver that the shooting incident was a fortuitous event because they
could not have reasonably foreseen nor avoided the accident caused by Rosete as he was not their employee; 16 and
that they complied with their obligation to ensure a safe learning environment for their students by having exercised
due diligence in selecting the security services of Galaxy.

After a thorough review of the records, we find that respondents failed to discharge the burden of proving that they
exercised due diligence in providing a safe learning environment for their students. They failed to prove that they
ensured that the guards assigned in the campus met the requirements stipulated in the Security Service Agreement.
Indeed, certain documents about Galaxy were presented during trial; however, no evidence as to the qualifications of
Rosete as a security guard for the university was offered.

Respondents also failed to show that they undertook steps to ascertain and confirm that the security guards assigned
to them actually possess the qualifications required in the Security Service Agreement. It was not proven that they
examined the clearances, psychiatric test results, 201 files, and other vital documents enumerated in its contract with
Galaxy. Total reliance on the security agency about these matters or failure to check the papers stating the
qualifications of the guards is negligence on the part of respondents. A learning institution should not be allowed to
completely relinquish or abdicate security matters in its premises to the security agency it hired. To do so would result
to contracting away its inherent obligation to ensure a safe learning environment for its students.

Consequently, respondents' defense of force majeure must fail. In order for force majeure to be considered,
respondents must show that no negligence or misconduct was committed that may have occasioned the loss. An act
of God cannot be invoked to protect a person who has failed to take steps to forestall the possible adverse
consequences of such a loss. One's negligence may have concurred with an act of God in producing damage and
injury to another; nonetheless, showing that the immediate or proximate cause of the damage or injury was a
fortuitous event would not exempt one from liability. When the effect is found to be partly the result of a person's
participation - whether by active intervention, neglect or failure to act - the whole occurrence is humanized and
removed from the rules applicable to acts of God.17

Article 1170 of the Civil Code provides that those who are negligent in the performance of their obligations are liable
for damages. Accordingly, for breach of contract due to negligence in providing a safe learning environment,
respondent FEU is liable to petitioner for damages. It is essential in the award of damages that the claimant must have
satisfactorily proven during the trial the existence of the factual basis of the damages and its causal connection to
defendant's acts.18

In the instant case, it was established that petitioner spent P35,298.25 for his hospitalization and other medical
expenses.19 While the trial court correctly imposed interest on said amount, however, the case at bar involves an
obligation arising from a contract and not a loan or forbearance of money. As such, the proper rate of legal interest is
six percent (6%) per annum of the amount demanded. Such interest shall continue to run from the filing of the
complaint until the finality of this Decision.20 After this Decision becomes final and executory, the applicable rate shall
be twelve percent (12%) per annum until its satisfaction.

The other expenses being claimed by petitioner, such as transportation expenses and those incurred in hiring a
personal assistant while recuperating were however not duly supported by receipts. 21 In the absence thereof, no
actual damages may be awarded. Nonetheless, temperate damages under Art. 2224 of the Civil Code may be
recovered where it has been shown that the claimant suffered some pecuniary loss but the amount thereof cannot be
proved with certainty. Hence, the amount of P20,000.00 as temperate damages is awarded to petitioner.

As regards the award of moral damages, there is no hard and fast rule in the determination of what would be a fair
amount of moral damages since each case must be governed by its own peculiar circumstances. 22 The testimony of
petitioner about his physical suffering, mental anguish, fright, serious anxiety, and moral shock resulting from the
shooting incident23 justify the award of moral damages. However, moral damages are in the category of an award
designed to compensate the claimant for actual injury suffered and not to impose a penalty on the wrongdoer. The
award is not meant to enrich the complainant at the expense of the defendant, but to enable the injured party to obtain
means, diversion, or amusements that will serve to obviate the moral suffering he has undergone. It is aimed at the
restoration, within the limits of the possible, of the spiritual status quo ante, and should be proportionate to the
suffering inflicted. Trial courts must then guard against the award of exorbitant damages; they should exercise
balanced restrained and measured objectivity to avoid suspicion that it was due to passion, prejudice, or corruption on
the part of the trial court.24 We deem it just and reasonable under the circumstances to award petitioner moral
damages in the amount of P100,000.00.
Likewise, attorney's fees and litigation expenses in the amount of P50,000.00 as part of damages is reasonable in
view of Article 2208 of the Civil Code.25 However, the award of exemplary damages is deleted considering the
absence of proof that respondents acted in a wanton, fraudulent, reckless, oppressive, or malevolent manner.

We note that the trial court held respondent De Jesus solidarily liable with respondent FEU. In Powton Conglomerate,
Inc. v. Agcolicol,26 we held that:

[A] corporation is invested by law with a personality separate and distinct from those of the persons
composing it, such that, save for certain exceptions, corporate officers who entered into contracts in behalf of
the corporation cannot be held personally liable for the liabilities of the latter. Personal liability of a corporate
director, trustee or officer along (although not necessarily) with the corporation may so validly attach, as a
rule, only when - (1) he assents to a patently unlawful act of the corporation, or when he is guilty of bad faith
or gross negligence in directing its affairs, or when there is a conflict of interest resulting in damages to the
corporation, its stockholders or other persons; (2) he consents to the issuance of watered down stocks or
who, having knowledge thereof, does not forthwith file with the corporate secretary his written objection
thereto; (3) he agrees to hold himself personally and solidarily liable with the corporation; or (4) he is made by
a specific provision of law personally answerable for his corporate action. 27

None of the foregoing exceptions was established in the instant case; hence, respondent De Jesus should not be held
solidarily liable with respondent FEU.

Incidentally, although the main cause of action in the instant case is the breach of the school-student contract,
petitioner, in the alternative, also holds respondents vicariously liable under Article 2180 of the Civil Code, which
provides:

Art. 2180. The obligation imposed by Article 2176 is demandable not only for one's own acts or omissions, but
also for those of persons for whom one is responsible.

xxxx

Employers shall be liable for the damages caused by their employees and household helpers acting within the
scope of their assigned tasks, even though the former are not engaged in any business or industry.

xxxx

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

We agree with the findings of the Court of Appeals that respondents cannot be held liable for damages under Art.
2180 of the Civil Code because respondents are not the employers of Rosete. The latter was employed by Galaxy.
The instructions issued by respondents' Security Consultant to Galaxy and its security guards are ordinarily no more
than requests commonly envisaged in the contract for services entered into by a principal and a security agency. They
cannot be construed as the element of control as to treat respondents as the employers of Rosete. 28

As held in Mercury Drug Corporation v. Libunao:29

In Soliman, Jr. v. Tuazon,30 we held that where the security agency recruits, hires and assigns the works of its
watchmen or security guards to a client, the employer of such guards or watchmen is such agency, and not
the client, since the latter has no hand in selecting the security guards. Thus, the duty to observe the diligence
of a good father of a family cannot be demanded from the said client:

[I]t is settled in our jurisdiction that where the security agency, as here, recruits, hires and assigns
the work of its watchmen or security guards, the agency is the employer of such guards or watchmen.
Liability for illegal or harmful acts committed by the security guards attaches to the employer agency,
and not to the clients or customers of such agency. As a general rule, a client or customer of a
security agency has no hand in selecting who among the pool of security guards or watchmen
employed by the agency shall be assigned to it; the duty to observe the diligence of a good father of a
family in the selection of the guards cannot, in the ordinary course of events, be demanded from the
client whose premises or property are protected by the security guards.

xxxx
 The fact that a client company may give instructions or directions to the security guards assigned to it, does
not, by itself, render the client responsible as an employer of the security guards concerned and liable for their
wrongful acts or omissions.31

We now come to respondents' Third Party Claim against Galaxy. In Firestone Tire and Rubber Company of the
Philippines v. Tempengko,32 we held that:

The third-party complaint is, therefore, a procedural device whereby a 'third party' who is neither a party nor
privy to the act or deed complained of by the plaintiff, may be brought into the case with leave of court, by the
defendant, who acts as third-party plaintiff to enforce against such third-party defendant a right for
contribution, indemnity, subrogation or any other relief, in respect of the plaintiff's claim. The third-party
complaint is actually independent of and separate and distinct from the plaintiff's complaint. Were it not for this
provision of the Rules of Court, it would have to be filed independently and separately from the original
complaint by the defendant against the third-party. But the Rules permit defendant to bring in a third-party
defendant or so to speak, to litigate his separate cause of action in respect of plaintiff's claim against a third-
party in the original and principal case with the object of avoiding circuitry of action and unnecessary
proliferation of law suits and of disposing expeditiously in one litigation the entire subject matter arising from
one particular set of facts.33

Respondents and Galaxy were able to litigate their respective claims and defenses in the course of the trial of
petitioner's complaint. Evidence duly supports the findings of the trial court that Galaxy is negligent not only in the
selection of its employees but also in their supervision. Indeed, no administrative sanction was imposed against
Rosete despite the shooting incident; moreover, he was even allowed to go on leave of absence which led eventually
to his disappearance.34 Galaxy also failed to monitor petitioner's condition or extend the necessary assistance, other
than the P5,000.00 initially given to petitioner. Galaxy and Imperial failed to make good their pledge to reimburse
petitioner's medical expenses.

For these acts of negligence and for having supplied respondent FEU with an unqualified security guard, which
resulted to the latter's breach of obligation to petitioner, it is proper to hold Galaxy liable to respondent FEU for such
damages equivalent to the above-mentioned amounts awarded to petitioner.

Unlike respondent De Jesus, we deem Imperial to be solidarily liable with Galaxy for being grossly negligent in
directing the affairs of the security agency. It was Imperial who assured petitioner that his medical expenses will be
shouldered by Galaxy but said representations were not fulfilled because they presumed that petitioner and his family
were no longer interested in filing a formal complaint against them.35

WHEREFORE, the petition is GRANTED. The June 29, 2007 Decision of the Court of Appeals in CA-G.R. CV No.
87050 nullifying the Decision of the trial court and dismissing the complaint as well as the August 23, 2007 Resolution
denying the Motion for Reconsideration are REVERSED and SET ASIDE. The Decision of the Regional Trial Court of
Manila, Branch 2, in Civil Case No. 98-89483 finding respondent FEU liable for damages for breach of its obligation to
provide students with a safe and secure learning atmosphere, is AFFIRMED with the following MODIFICATIONS:

a. respondent Far Eastern University (FEU) is ORDERED to pay petitioner actual damages in the amount of
P35,298.25, plus 6% interest per annum from the filing of the complaint until the finality of this Decision. After this
decision becomes final and executory, the applicable rate shall be twelve percent (12%) per annum until its
satisfaction;

b. respondent FEU is also ORDERED to pay petitioner temperate damages in the amount of P20,000.00; moral
damages in the amount of P100,000.00; and attorney's fees and litigation expenses in the amount of P50,000.00;

c. the award of exemplary damages is DELETED.

The Complaint against respondent Edilberto C. De Jesus is DISMISSED. The counterclaims of respondents are
likewise DISMISSED.

Galaxy Development and Management Corporation (Galaxy) and its president, Mariano D. Imperial are ORDERED to
jointly and severally pay respondent FEU damages equivalent to the above-mentioned amounts awarded to petitioner.

SO ORDERED.