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Caravan Travel and Tours International, Inc. v.

10 February 2016 J. Leonen
Pet: Caravan Travel and Tours International, Inc.
Res: Ermilinda Abejar
Torts and Damages subtopic: Registered owner of vehicle

Doctrine: Facts:
- The plaintiff may first prove the ERs ownership - 13 July 2000: R was walking along the west-
of the vehicle involved in a mishap by presenting bound lane of Sam paguit a S t., Unit ed
the vehicles registration in evidence. Thereafter, Paranaque Subd. IV, Paranaque City. An L-300
a disputable presumption that the requirements van was traveling along the east-bound lane
for an ERs liability under Art. 2180, CC have opposite R. To avoid an incoming vehicle, the
been satisfied will arise. The burden of evidence van swerved to its left and hit R. E went to her
then shifts to the defendant to show that no aid and loaded her in the back of the van and
liability under Art. 2180 has ensued. This case told the driver, B, to bring R to the hospital.
harmonizes the requirement of Art. 2180, in Instead, B left the van parked inside a nearby
relation to Art. 2176, and the so-called subdivision (with R still in the van). Fortunately,
registered-owner rule an unidentified civilian helped and drove R to
- It is imperative to apply the registered-owner rule the hospital.
in a manner that harmonizes it with Arts. 2176 - C, a corporation engaged in organizing travels
and 2180, CC. Rules must be construed in a and tours, was the registered owner of the van.
manner that will harmonize them with other rules B was C's EE and was assigned to drive the van
so as to form a uniform and consistent system of as its service driver.
jurisprudenceArt. 2180 should defer to the - C shouldered the hospital expenses of R, but R
registered-owner rule, but it was never stated died two days after the accident.
that Art. 2180 should be completely abandoned. - A, Rs paternal aunt and the person who raised
her since R was 9 y.o., filed a Complaint for
Legend: damages against B and C in RTC Paranaque. A
R - Reyes, the victim alleged that B was an EE of C and that C is the
E - Espinosa, the witness registered owner of the van.
A - Abejar, res. and aunt of R - Summons could not be served on B, so A moved
B - Bautista, the driver of the van to drop B as a defendantRTC granted.
C - Caravan, pet. and employer of B - RTC found that B was grossly negligent in driving
EE - Employee the vehicle. RTC awarded damages in favor of
ER - Employer A1. Cs MR was denied.
RO - Registered-owner
ROR - Registered-owner Rule

1 WHEREFORE, considering that the [respondent] was able to provide by preponderance of evidence her cause of action against
the defendants, judgment is hereby rendered ordering defendants JIMMY BAUTISTA and CARAVAN TRAVEL and TOURS[,] INC., to
jointly and solidarity pay the plaintiff, the following, to wit:
1. The amount of P35,000.00 representing actual damages;
2. The amount of P300,000.00 as moral damages;
3. The amount of P30,000.00 as exemplary damages;
4. The amount of P50,000.00 as and by way of attorneys fees; and
5. The cost of suit. SO ORDERED
Page 1 of 6 Meg Sandoval
- CA affirmed with modification RTCs decision 2. - As Arguments:
Cs MR was denied. Hence this petition for C failed to provide proof that it exercised the
review on certiorari (on CA decision). requisite diligence in the selection and
supervision of B.
- Cs Arguments: CA ruling on damages should be upheld
A has no personality to bring this suit because Since C is the registered owner of the van, it is
she isnt a real party-in-interest directly, primarily, and solidarity liable for the
A doesnt exercise legal or substitute parental tortious acts of B.
authority, nor is she the judicially appointed
guardian of or only living relative of R, nor Issues:
the executor or administrator of the estate of I. WON A is a real party-in-interest who may
R. bring an action for damages against C on
Only the victim or the heirs can enforce an account of Rs deathYES.
action on culpa aquiliana (such as As action
II. WON C should be liable as an ER,
for damages).
pursuant to Art. 2180, CCYES.
A didnt offer documentary or testimonial
evidence to prove that B acted within the
scope of his assigned tasks when the accident PETITION DENIED.
- According to C, Bs tasks only pertained to Ratio is discussed below.
the transport of company personnel or Important points are underscored.
C argues it exercise the diligence of a good
father of a family in the selection and
supervision of its EEs.
A should not have been awarded damages,
and questions the Certificate provided by A as
proof of expenses since its signatory (Julian
Pealoza) was not present in court and that C
was denied the right to cross-examine him.
And that the Certificate constitutes hearsay.
C contends that based on Art. 2206(3), CC A
isn't entitled to moral damages because C
acted in good faith.
That C should not be held solidarity liable with
B since B was already dropped as a party.

2 WHEREFORE, premises considered, the instant appeal is DENIED for lack of merit. The assailed Decision dated 31 July 2003 and
Order dated 20 October 2003 of the Regional Trial Court, City of Para[]aque, Branch 258, in Civil Case No. 00-0447 are
AFFIRMED with the following MODIFICATIONS:
1. Moral Damages is REDUCED to Php200,000.00;
2. Death Indemnity of Php50,000.00 is awarded;
3. The Php35,000.00 actual damages, Php200,000.00 moral damages, Php30,000.00 exemplary damages and Php50,000.00
attorneys fees shall earn interest at the rate of 6% per annum computed from 31 July 2003, the date of the [Regional Trial Courts]
decision; and upon finality of this Decision, all the amounts due shall earn interest at the rate of 12% per annum, in lieu of 6% per
annum, until full payment; and
4. The Php50,000.00 death indemnity shall earn interest at the rate of 6% per annum computed from the date of promulgation of
this Decision; and upon finality of this Decision, the amount due shall earn interest at the rate of 12% per annum, in lieu of 6% per
annum, until full payment.
Costs against [Caravan]. SO ORDERED.
Page 2 of 6 Meg Sandoval
I. Yes, A is a real party-in-interest. II. Yes, C is liable.
- A exercised substitute parental authority and - As Complaint is anchored on an ERs liability for
suffered actual loss quasi-delict provided in Art. 2180 in relation to
- A properly filed an action based on quasi-delict Art. 2176, CC.
and she is a real party-in-interest, which is - It was not fatal to As cause that she herself did
defined in Sec. 2, Rule 3, 1997 Rules of CivPro not adduce proof that B acted within the scope
which states that xxx the party who stands to of his authority. It was sufficient that A proved
be benefited or injured by the judgement in the that C was the registered owner of the van that
suit, or the party entitled to the avails of the suit. hit R.
Unless otherwise authorized by law or these - According to the Court, two rules must be
Rules, every action must be prosecuted or considered:
defended in the name of the real party-in- 1. Art. 2180s specification that [ERs] shall be
interest. liable for the damages caused by their
- The Court also looked at Art. 216 and 233, FC [EEs]acting within the scope of their
to identify persons who exercise substitute assigned tasks[.]
parental authority. 2. The operation of the registered-owner rule
- Rs parents and paternal grandparents are (ROR) that registered owners are liable for
deceased, and the whereabouts of her maternal death or injuries caused by the operation of
grandparents are unknown. There is no record their vehicles.
of R having siblings. A took custody of R when R - These rules appear to be in conflict when it
was a child and A assumed the role of parent comes to cases in which the ER is also the
and exercised parental authority over R. registered owner of the vehicle.
- Consistent with Art. 220, FC, A supported Rs - Art. 2180 requires proof of two things:
education and provided for her personal needs 1. An ER-EE relationship between the driver
A treated R as her own daughter. and owner; and
- As right to proceed against against C is based 2. That the driver acted within the scope of
on two grounds: his/her assigned tasks.
A suffered actual personal loss. - On the other hand, applying the ROR only
A is capacitated to do what Rs actual parents requires the plaintiff to prove that defendant-ER
would have been to do. is the registered-owner (RO) of the vehicle.
- Although R was already 18 y.o. when she died - ROR can be seen as early as in the case of
(thus she had already reached the age of Erezo, et al. v. Jepte (1957) where this Court
majority and was emancipated), and parental explained that the registration of motor vehicles,
authority is terminated upon emancipation, A as required by Sec. 5(a), RA 4136 (Land
continued to support and care for Rthe Transportation and Traffic Code), was necessary
relationship remained the same. The anguish not to make said registration the operative act
and damage caused to [A] was by [Rs] death by which ownership in vehicles is transferred,
was no different because of [Rs] emancipation but to permit the use and operation of the
- In any case, termination of As parental vehicle upon any public highway[.] Its main
authority is not an insurmountable legal bar that aimis to identify the owner so that if any
precludes the filing of her Complaint. accident happens, or that any damage or injury
- The Court has held that Art. 1902, Old CC/Art. is caused by the vehicle on the public highways,
2176 , N e w C C i s b r o a d e n o u g h t o responsibility therefor can be fixed on a definite
accommodate even plaintiffs who are not individual, the registered owner.
relatives of the deceased.

Page 3 of 6 Meg Sandoval

- Erezo v. Jepte (notwithstanding Castilex v. for the accident as said provision should defer to
Vasquez3) relied on Art. 2180, CC even though the settled doctrine concerning accidents
the ER was also the RO of the vehicle. The ROR involving registered motor vehicles
was not mentioned. - Filcar Transport Services v. Espinas stated that
- In Castilex v. Vasquez, the Court absolved the RO of a vehicle can no longer use the
Castilex of liability reasoning that it was defenses found in Art. 2180.
incumbent upon the plaintiff to prove that the - In Mendoza v. Sps. Gomez the Court said:
negligent EE was acting within the scope of his However, Aguilar, Sr., Del Carmen, Filcar, and
assigned tasks, which Vasquez failed to do. The Mendoza should not be taken to mean that Art.
Court outlined the process necessary for an ER 2180, CC should be completely discarded in
to be held liable for the acts of its EE: cases where the registered-owner rule finds
Under the 5th par. of Art. 2180, WON application. As acknowledged in Filcar, there is
engaged in any business or industry, an ER is no categorical statutory pronouncement in the
liable for the torts committed by the EE within Land Transportation and Traffic Code (LTTC)
the scope of his assigned tasks. It is necessary stipulating the liability of a registered owner. The
to establish the ER-EE relationship and once source of a registered owners liability is not a
this is done, the plaintiff must show that the EE distinct statutory provision, but remains to be
was acting within the scope of his assigned Arts. 2176 and 2180,CC
task when the tort was committed. - It is imperative to apply the ROR in a
- Aguilar, Sr. v. Commercial Savings Bank4 ,
manner that harmonizes it with Arts.
recognized the seeming conflict between Art.
2180 and the ROR and applied the latter. The 2176 and 2180, CC. Rules must be
SC here reiterated the pronouncements in Erezo construed in a manner that will
v. Jepte in ruling that the bank, as the RO of the harmonize them with other rules so as to
vehicle, was primarily liable to the plaintiff. The form a uniform and consistent system of
SC here concluded that the LC erred when it
jurisprudenceArt. 2180 should defer to
concluded that the bank was not liable simply
because (a) petitioner did not prove that Borja the ROR, but it was never stated that Art.
was acting as the banks vice president at the 2180 should be completely abandoned.
time of the accident; and (b) Borja had, - Appropriate Approach: Where both apply
according to respondent bank, already bought 1. Plaintiff must establish that the ER is the RO
the car at the time of the mishap. For as long as of the vehicle
the respondent bank remained the registered 2. There then arises a disputable presumption
owner of the car involved in the vehicular that the requirements of Art. 2180 have been
accident, it could not escape primary liability. proven and as a consequence, the burden of
- P r e f e r e n c e f o r t h e RO R b e c a m e m o r e proof shifts to the defendant to show that no
pronounced in Del Carmen, Jr. v. Bacoy which liability under Art. 2180 has arisen.
reiterated Aguilar, stating that [d]espite Art. - This disputable presumption, insofar as the RO in
2180, we still held the bank liable for damages relation to the actual driver is concerned,

3 In Castilex Industrial Corp. v. Vasquez, Jr. Abad was a manager of Castilex and Castilex was also the registered owner of a
Toyota Hi-Lux. While Abad was driving the vehicle, it collided with a motorcycle driven by Vasquez. Vasquez died a few days after,
and his parents filed a case for damages against Abad and Castilex. Castilex denied liability, arguing that And was acting in his
private capacity at the time of the accident. Here, since there was no evidence that Abad was acting within the scope of the
functions entrusted to his, Castilex had no duty to show it exercised the diligence of a good father of a family in providing Abad
with a service vehicle.

4 Here, a Mitsubishi Lancer registered under the bank and driven by the banks assistant VP Borja hit and killed Aguilar, Jr. His
father, Aguilar, Sr., filed a case for damages against Borja and the bank. RTC found the bank solidarity liable with Borja. However,
the CA disagreed and dismissed the complaint against the bank reasoning that Art. 2180, CC requires the plaintiff to prove that at
the time of the accident, the EE was acting within the scope of his assigned taskCA found no evidence that Borja was acting as the
banks EE at the time. CA ruling was reversed by the SC.
Page 4 of 6 Meg Sandoval
recognizes that between the owner and the Side matters:
victim, it is the former that should carry the costs - Cs argument that it should be excused from
of moving forward with the evidence. liability because B was already dropped as a
- Registration of the vehicle is accessible to the party is equally unmeritorious. The liability
public. Recall that A presented a copy of the imposed on the registered owner is direct and
Certificate of Registration of the can that hit R primary. It does not depend on the inclusion of
this attests to C's ownership of the van, which C the negligent driver in the action.
did not dispute. Otherwise, it would render impotent the
- In order to satisf actor ily overcome t he rationale of the motor registration law in fixing
presumption, C should have: liability on a definite person.
1. Showed that it had no ER-EE relationship B was not an indispensable part under Sec. 7,
with B Rule 3 of the 1997 Rules of CivPro. Rather, he
2. That B acted outside the scope of his was a necessary party under Sec. 8.
assigned tasks; or Indispensable Party: parties-in-interest without
3. That it exercised the diligence of a good whom no final determination can be had of an
father of a family in the selection and actionnon-inclusion is debilitating. The
supervision of B. presence of indispensable parties is a
- They failed: condition for the exercise of juridical power
1. C admitted that B was its EE at the time of and when an indispensable party is not before
the accident; the court, the action should be dismissed.
2. C was unable to prove that B was acting Necessary Party: presence is not imperative,
outside the scope of his assigned tasks. 5 C and absence is not debilitating. Nevertheless,
presented no positive evidence to show that it is preferred that they be included in order
B was acting in his private capacity at the that relief may be complete.
time of the incident; SC: C could have opted to file a cross-claim
3. C failed to prove that it exercised the against B as its remedy.
requisite diligence. C contented itself with Bs Cs interest and liability is distinct from that of
submission of a nonprofessional drivers its driver.
license6 . - Regardless of Cs ER-EE relationship with B,
- Employing a person holding a nonprofessional liability attaches to C on account of its being the
drivers license to operate anothers motor RO of a vehicle that figures in a mishap.
vehicle violates Sec. 24, LTTC 7C did not only A determination of Cs liability as owner can
fail to exercise due diligence in selecting B, it proceed independently of a consideration of
also committed an actual violation of law. how B conducted himself as a driver. While
- Cs act of providing copies of memoranda and certainly it is desirable that a determination of
company rules was insufficient because they Bs liability be made alongside that of the
failed to prove actual compliance8 owner of the van he was driving, his non-
- For failing to overturn the presumption that the inclusion in these proceedings does not
requirements of Article 2180 have been satisfied, absolutely hamper a judicious resolution of As
petitioner must be held liable. plea for relief.

5Cs accountant and supervisor Sally Bellidos testimony that she didnt know what B was doing in the area does not affect the
presumption. Evidence must adduced.
Bellido testified that the license of B was nonprofessional and that they allowed him to be a service driver.
7 SEC. 24. Use of drivers license and badge.. . .No owner of a motor vehicle shall engage, employ, or hire any person to operate
such motor vehicle, unless the person sought to be employed is a duly licensed professional driver.

8 MMTC v. CA emphasized the need to prove compliance and not just show issuance of company policies.
Page 5 of 6 Meg Sandoval
- CA committed no reversible error when it - Dispositive: WHEREFORE, the Decision of the
awarded actual damages to A, which was based CA AFFIRMED with the following
on the Certificate issued by Pealoza showing MODIFICATIONS: (a) actual damages in the
that A paid P35k for funeral expenses. The amount of P35,000.00 shall earn interest at the
Certificate was not hearsay evidence. rate of 6% per annum from the time it was
Evidence is hearsay when its probative value judicially or extrajudicially demanded from
is based on the personal knowledge of a p e t i t i o n e r C a r a va n Tr a ve l a n d To u r s
person other than the person actually International, Inc. until full satisfaction; (b) moral
testifying. damages, exemplary damages, and attorneys
A herself identified the Certificate. She testified fees shall earn interest at the rate of 6% per
that she incurred funeral expenses amounting annum from the date of the RTCs Decision until
to P35k, that she paid this amount to full satisfaction; and (c) civil indemnity shall earn
Pealoza, and that she was present when interest at the rate of 6% per annum from the
Pealoza signed the Certificate. date of the CA Decision until full satisfaction. SO
A had personal knowledge of the facts sought ORDERED.
to be proved by the Certificate, i.e., that she
spent P35k for the funeral expenses of R.
Separate Concurring Opinion: J. Brion
- CA likewise did not err in awarding civil
Brion: A is a real party-in-interest, not because
indemnity and exemplary damages (based on
she exercised substitute parental authority
Art. 2206 and 2231, CC).
over R, but because she has an interest in
- CA and RTC found B grossly negligent in driving
claiming actual and exemplary damages from
the van and concluded that Bs gross negligence
C. Parental authority has no bearing on ones
was the proximate cause of Rs death.
status as a real party-in-interest in a quasi-
Negligence and causation are factual issues.
delict case.
Findings of fact, when established by the TC and
Brion: Courts may also impose exemplary
affirmed by the CA, are binding on this court
damages, in addition to compensator y
unless they are patently unsupported by
damages, if the defendant acted with gross
evidence or unless the judgment is grounded on
negligence. In the present case, Bs act of
a misapprehension of facts.
leaving R rather than bringing her to a
Neither has C presented evidence disputing hospital amounts to gross negligence.
the finding of the LCs. As such, these finding
Although J. Brion agrees that C is directly and
cannot be disturbed on appeal.
primarily liable for damages as Bs ER and as
- For deaths caused by quasi-delict, the recovery
the vans RO, he discusses the ROR in relation
of moral damages is limited to the spouse,
to Arts. 2180 and 2176 thus:
legitimate and illegitimate descendants, and - The Court in Filcar Transport Services v.
ascendants of the deceased. Persons exercising
Espinas ruled that the RO of a vehicle is
substitute parental aut hor ity are to be
deemed the ER of the vehicles driver. Thus,
considered ascendants for the purpose of
the vehicles RO is vicariously liable for the
awarding moral damages.
drivers negligent acts pursuant to Arts.

2176 and 2180, CC. The vicarious liability
remains with the RO even when the vehicle
had been sold to another person before the
accident but the registration has not yet
been transferred. The Court emphasized in
R. Transport Corporation v. Yu that the ERs
liability for the negligent acts of its
subordinate is direct and primary.
- Based on the foregoing, J. Brion concurs
with the ponencias results.
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