Beruflich Dokumente
Kultur Dokumente
1 SSS VS. MOONWALK DEVELOPMENT AND HOUSING notify Lustre until 16 months later when it wrote its
CORPORATION demand letter to Lustre.
SC: Lustre cannot be held liable for damages. Article
FACTS: 1170 of the Civil Code states that: those who in the
o Plaintiff SSS approved the application of Defendant performance of their obligations are guilty of delay are
Moonwalk for a loan of P30,000,000 for the purpose liable for damages. The delay in the performance of the
of developing and constructing a housing project. obligation, however, must be either malicious or
o Out of P30,000,000 approved loan, the sum of negligent. ICAB, there is no imputation, much less
P9,595,000 was released to defendant Moonwalk. evidence, that Lustre acted with malice or negligence in
o A third Amendment Deed of Mortgage was failing to sign the check. Such omission was mere
executed for the payment of the amount of inadvertence on the part of Lustre.
P9,595,000. FACTS:
o Moonwalk made a total payment of P23,657,901.84 Atty. Felipe Lustre purchased a Toyota Corolla from
to SSS for the loan principal of P12,254,700. Toyota Shaw, Inc. He made a down payment, and the
o After settlement of the account, SSS issued to balance of the purchase price to be paid in 24 equal
Moonwalk the release of Mortgage for Moonwalk’s monthly installments. Lustre thus issued 24 postdated
Mortgaged properties. checks. The 1st was dated 10 April 1991, subsequent
o In letter to Moonwalk, SSS alleged that it committed checks were dated every 10th of each succeeding
an honest mistake in releasing defendant. month.
o That Moonwalk has still 12% penalty for failure to As security, Lustre executed a contract of chattel
pay on time the amortization which is in the mortgage over the vehicle. Paragraph 11 thereof
penal clause of the contract. provided for an acceleration clause stating that should
o Moonwalk’s counsel told SSS that it had completely paid its the mortgagor default in the payment of any installment,
obligation to SSS and therefore there is no recovery the whole amount remaining unpaid shall become due.
of any penalty. In addition, the mortgagor shall be liable for 25% of the
principal due as liquidated damages.
ISSUE: Is the penalty demandable even after the Toyota Shaw assigned all its rights and interests in the
extinguishment of the principal obligation? chattel mortgage to RCBC.
The first 22 PDCs were encashed and debited by RCBC
HELD: No. There has been a waiver of the penal clause as from Lustre’s account, except the PDC dated 10 August
it was not demanded before the full obligation was fully paid 1991 (5th PDC out of 24 PDCs), which was unsigned.
and extinguished. Default begins from the moment the Previously, the amount of the 5th PDC was debited from
creditor demands the performance of the obligation. In Lustre’s account but was later recalled and re-credited to
this case, although there were late amortizations Lustre’s account. Because of the recall, RCBC refused
there was no demand made by SSS for the payment of the to encash the last 2 PDCs (pursuant to RCBC policy).
penalty hence Moonwalk is not in delay in the payment of Lustre was not informed of RCBC’s actions.
the penalty. No delay occurred and there was no On 21 January 1993, RCBC sent a demand letter to
occasion when the penalty became demandable and Lustre, demanding payment of balance of the debt (3
enforceable. Since there was no default in the installment payments), including liquidated damages.
performance of the main obligation-payment of the loan- Lustre refused. RCBC filed an action for replevin and
SSS was never entitled to recover any penalty. damages against Lustre. Lustre interposed a
If the demand for the payment of the penalty was made counterclaim for damages.
prior to the extinguishment of the obligation which
are: 1. principal obligation 2. The interest of 12% on the Procedure:
principal obligation 3.The penalty of 12% for late RTC: Dismissed RCBC’s complaint. RTC ordered RCBC
payment for after demand, Moonwalk would be in delay to accept the payment equivalent to the 3 checks and to
and therefore liable for the penalty. release/cancel the mortgage on the car. On the
counterclaim, RCBC ordered to pay Lustre moral
2 RCBC vs. CA damages, exemplary damages and attorney’s fees.
Short version/ Summary: RCBC filed an action for CA: Affirmed RTC.
replevin and damages against Felipe Lustre on the
ground that he defaulted in his payments of 3 PDCs Issue/s: WON Lustre is liable for damages on the
issued for installment payments of a Toyota Corolla. ground of delay in the performance of his obligation. NO.
The 4th PDC issued by Lustre was recalled for signature.
The subject check, however, was recalled only after the Held/Ratio:
amount covered thereby had been deducted from Assuming that Lustre was guilty of delay in payment of
Lustre’s account. It was subsequently re-credited back to the value of the unsigned check, he cannot be held liable
Lustre’s account for lack of signature. RCBC did not for damages. Article 1170 of the Civil Code states that:
those who in the performance of their obligations are
1
DUMLAO, Cheyenne Hope OBLICON Assignment #2 COMPILED DIGESTS San Beda College of Law - Mendiola
guilty of delay are liable for damages. The delay in the However, the materials were not delivered on time. The
performance of the obligation, however, must be petitioner went to the store several times to ask for the
either malicious or negligent. ICAB, there is no delivery. Eventually, the Petitioner was forced to dismiss
imputation, much less evidence, that Lustre acted with his hired workers since his materials did not arrive.
malice or negligence in failing to sign the check. Such Petitioner determined to fulfill his wife’s request,
omission was mere inadvertence on the part of Lustre. purchased materials from other stores. After his wife was
buried, Petitioner sued the Respondent for damages of
Toyota salesperson testified that he verified whether delay. Respondent claims that delay happened because
Lustre had signed all checks and in fact returned 3 or 4 of a fortuitous event since the truck tires were flat.
unsigned checks to him for signing. Lustre signed these Issue: Was there a delay in the performance of the
returned checks, and only then did the Toyota Respondent’s obligation?
salesperon release the car to Lustre.
Held: Yes. The Respondent was negligent and incurred
SC noted that RCBC did not object to the unsigned delay in performing his obligations. The Petitioner
check when all the PDCs were delivered to it by Toyota suffered as a consequence of the delay or contractual
Shaw. breach. There was a specific time, date and place
agreed upon the delivery of the materials. The said
In view of the lack of malice or negligence on the part of condition was agreed upon by both the Petitioner and
Lustre, RCBC’s blind and mechanical invocation of the Respondent.
paragraph 11 of the contract of chattel mortgage was There is a non performance of a reciprocal obligation
unwarranted. since according to Article 1169, the moment one of the
parties fulfill his obligation, delay by the other begins. In
SC also said that this whole controversy could have this contract of purchase and sale, the Petitioner had
been avoided if only RCBC bothered to call up Lustre already accomplished his part which is the payment of
and ask him to sign the check! RCBC failed to act with the price. It falls onto the Respondent now to
good faith and is therefore liable for moral damages immediately fulfill his obligation to deliver the goods
suffered by Lustre, who has been a client of RCBC for otherwise delay would attach. An award of moral
20 years. Lustre also suffered shame and damages is incumbent in this case as the Petitioner has
embarrassment after the case was filed as he was a suffered gravely.
lawyer, married to another lawyer, and known to the
community of golfers. SC also allowed exemplary 4 PANTALEON VS. AMEX
damages and attorney’s fees. FACTS: AMEX is a corporation engaged in providing
credit services through the operation of a charge card
3 BARZAGA VS. CA system. Pantaleon was a cardholder since 1980.
Facts: Ignacio Barzaga’s wife succumbed to a
debilitating ailment and died on December 19, 1990. Pantaleon, his wife, daughter and son went on a guided
Forewarned, she expressed her wish to be buried before European tour and subsequently arrived in Amsterdam.
Christmas. After her death on December 21, 1990 3pm, While in Coster Diamond House,his wife wanted to
Ignacio Barzaga (Petitioner) went to the hardware store purchase some diamond pieces, amounting to $13, 826.
of Angelito Alviar (Respondent) to inquire about the Pantaleon presented his credit card which was swiped.
availability of certain materials to be used in building his He was then asked to sign the charge slip which was
wife’s niche. Also asking if materials could be delivered electronically transferred to AMEX’s Amsterdam office.
at once, the Respondent’s employee replied that if the However, Coster was not able to receive approval from
store had pending deliveries that afternoon then all AMEX for the purchase so Pantaleon asked the clerk to
subsequent purchases made would be delivered the cancel the sale. The store manager convinced
following day. Pantaleon to wait for a few minutes and subsequently
told Pantaleon that AMEX was asking for bank
Petitioner left that day and returned the following day on references and Pantaleon responded by giving names of
December 22, 1990, 7am. Petitioner came to follow up his Phil. depository banks. Still, it was not approved. But
his purchase of construction materials, stressing to the Coster decided to release the items even without
employees of the hardware store that he would need the AMEX’s approval since the tour couldn’t go on without
materials to be delivered to the cemetery (only a them.
kilometer away from the hardware store) by 8 am as he
would have hired workers who would start working at the In all, it took AMEX a total of 78 minutes to approve
site. Respondent’s employee agreed to deliver at the Pantaleon’s purchase and to transmit the approval to the
specified time, date and place and with such assurance jewelry store.
Barzaga purchased the materials and paid in full P
2,100.00. This was followed by two similar incidents when the
family then had another trip to the US. They also
2
DUMLAO, Cheyenne Hope OBLICON Assignment #2 COMPILED DIGESTS San Beda College of Law - Mendiola
experienced inconvenience using the AMEX credit card petitioner before any delay would redound to the injury of
in purchasing golf equipment and children’s shoes. his several traveling companions – gave rise to the
moral shock, mental anguish, serious anxiety, wounded
When they got to Manila, Pantaleon sent a letter to feelings and social humiliation sustained by Pantaleon,
AMEX, demanding an apology for the humiliation and as concluded by the RTC.
inconvenience. AMEX responded that the delay in
Amsterdam was due to the amount involved, saying that 5 LORENZO SHIPPING vs. BJ MARTHEL
the purchase deviated from his established charge
purchase pattern. Dissatisfied, Pantaleon filed an action FACTS: Petitioner Lorenzo Shipping is engaged in
for damages in RTC. coastwise shipping and owns the cargo M/V Dadiangas
Express. BJ Marthel is engaged in trading, marketing an
The testimony of AMEX’s credit authorizer Edgardo dselling various industrial commodities. Lorenzo
Jaurique, the approval time for credit card charges would Shipping ordered for the second time cylinder lines from
be three to four seconds under regular circumstances. the respondent stating the term of payment to be 25%
Here, it took AMEX 78 minutes to approve the upon delivery, the balance payable in 5 bi-monthly equal
Amsterdam purchase. SC attributed the unwarranted installments, no again stating the date of the cylinder’s
delay to Jaurique, who had to go over Pantaleon’s past delivery. It was allegedly paid through post dated checks
credit history, his payment record and his credit and but the same was dishonored due to insufficiency of
bank references before he approved the purchase. funds. Despite due demands by the respondent,
In 2009, the SC reversed the ruling in CA; and said that petitioner failed contending that time was of the essence
AMEX was guilty of mora solvendi or debtor’s default. in the delivery of the cylinders and that there was a delay
AMEX as debtor had an obligation as the credit provider since the respondent committed said items “within two
to act on Pantaleon’s purchase requests, whether to months after receipt of fir order”. RTC held respondents
approve or disapprove them, with "timely dispatch." bound to the quotation with respect to the term of
payment, which was reversed by the Court of appeals
ISSUES: ordering appellee to pay appellant P954,000 plus
1. Whether or not AmEx had committed a breach of its interest. There was no delay since there was no
obligations to Pantaleon. demand.
2. Whether or not AmEx is liable for damages.
ISSUE: Whether or not respondent incurred delay in
RULING: performing its obligation under the contract of sale
1. Yes. The popular notion that credit card purchases
are approved “within seconds,” there really is no strict, RULING: By accepting the cylinders when they were
legally determinative point of demarcation on how long delivered to the warehouse, petitioner waived the
must it take for a credit card company to approve or claimed delay in the delivery of said items. Supreme
disapprove a customer’s purchase, much less one Court geld that time was not of the essence. There
specifically contracted upon by the parties. One hour having been no failure on the part of the respondent to
appears to be patently unreasonable length of time to perform its obligations, the power to rescind the contract
approve or disapprove a credit card purchase. is unavailing to the petitioner.
HELD: Culpa contractual. It is settled that in culpa ISSUE: Whether or not the Asian financial crisis could be
contractual, the mere proof of the existence of the considered a fortuitous event.
contract and the failure of its compliance justify, prima
facie, a corresponding right of relief. In the instant case, HELD: No. The Supreme Court held that the Asian
we find that, when petitioner was shot inside the campus financial crisis cannot be generalized as unforeseeable
by no less the security guard who was hired to maintain and beyond the control of the business corporation. A
peace and secure the premises, there is a prima facie real estate enterprise engaged in the pre-selling of
showing that respondents failed to comply with its condominium units is concededly a master in projections
obligation to provide a safe and secure environment to on commodities and currency movements and business
its students. risks. The fluctuating movement of the Philippine peso in
the foreign exchange market is an everyday occurrence,
No. Respondents cannot be held liable for damages and fluctuations in currency exchange rates happen
under Article 2180 of the Civil Code because every day, thus, not an instance of caso fortuito.
respondents are not the employers of Rosete. The latter
was employed by Galaxy. The instructions issued by 17 SEONE vs. FRANCO
9
DUMLAO, Cheyenne Hope OBLICON Assignment #2 COMPILED DIGESTS San Beda College of Law - Mendiola
Lulu, joined by her husband Cesar, filed a complaint
FACTS: This is an appeal from a judgment of the Court against Sicam with the RTC of Makati seeking
of First Instance of Zamboanga in favor of the plaintiff, indemnification for the loss of pawned jewelry and
holding that the right of action upon the mortgage debt payment of AD, MD and ED as well as AF.
which was the basis of the claim presented against the
plaintiff’s estate had already prescribed. The mortgage in The RTC rendered its Decision dismissing respondents’
question, which is to secure the payment of the sum of complaint as well as petitioners’ counterclaim.
P4,876.01, the debtor agreeing to pay the sum “little by Respondents appealed the RTC Decision to the CA
little.” After 27 years, nothing has been paid either of the which reversed the RTC, ordering the appellees to pay
principal or of the interest. The obligation seems to leave appellants the actual value of the lost jewelry and AF.
the duration of the period for the payment thereof to the Petitioners MR denied, hence the instant petition for
will of the debtor. It appears also that it was the intention review on Certiorari.
of the instrument to give the debtor time within which to
pay the obligation. ISSUE: Are the petitioners liable for the loss of the
pawned articles in their possession? (Petitioners insist
ISSUE: Whether or not the creditor may demand that they are not liable since robbery is a fortuitous event
immediate performance of the obligation, given that and they are not negligent at all.)
there is no date stipulated by the parties as to when it
should become due and payable. HELD: The Decision of the CA is AFFIRMED. YES
Article 1174 of the Civil Code provides:
HELD: In such cases this court has held, on several Art. 1174. Except in cases expressly specified
occasions, that the obligation is not due and payable by the law, or when it is otherwise declared by
until an action has been commenced by the mortgagee stipulation, or when the nature of the obligation requires
against the mortgagor for the purpose of having the the assumption of risk, no person shall be responsible
court fix the date on and after which the instrument shall for those events which could not be foreseen or which,
be payable and the date of maturity is fixed in pursuance though foreseen, were inevitable.
thereof. Such being the case, as action should have
been brought for the purpose of having the court set a Fortuitous events by definition are extraordinary events
date on which the instrument should become due and not foreseeable or avoidable. It is therefore, not enough
payable. Until such action was prosecuted no suit could that the event should not have been foreseen or
be instrument. It is, therefore, clear that this action is anticipated, as is commonly believed but it must be one
premature. The instrument has been sued upon before it impossible to foresee or to avoid. The mere difficulty to
is due. The action must accordingly be dismissed. foresee the happening is not impossibility to foresee the
Ordinarily when an action of this sort is dismissed the same.
plaintiff may at once begin his action for the purpose of
fixing a date upon which the instrument shall become To constitute a fortuitous event, the following elements
due. From the undisputed facts in this case and from the must concur:
facts and conditions that very probably cannot be (a) the cause of the unforeseen and unexpected
charged hereafter, it is our present opinion that such occurrence or of the failure of the debtor to comply with
action is itself prescribed. The judgment was affirmed, obligations must be independent of human will;
with cost against the appellant. (b) it must be impossible to foresee the event that
constitutes the caso fortuito or, if it can be foreseen, it
19 SICAM vs. JORGE must be impossible to avoid;
(c) the occurrence must be such as to render it
FACTS: On different dates, Lulu Jorge pawned several impossible for the debtor to fulfill obligations in a normal
pieces of jewelry with Agencia de R. C. Sicam located in manner; and,
Parañaque to secure a loan. (d) the obligor must be free from any participation in the
aggravation of the injury or loss.
On October 19, 1987, two armed men entered the
pawnshop and took away whatever cash and jewelry The burden of proving that the loss was due to a
were found inside the pawnshop vault. fortuitous event rests on him who invokes it. And, in
On the same date, Sicam sent Lulu a letter informing her order for a fortuitous event to exempt one from liability, it
of the loss of her jewelry due to the robbery incident in is necessary that one has committed no negligence or
the pawnshop. Respondent Lulu then wroteback misconduct that may have occasioned the loss.
expressing disbelief, then requested Sicam to prepare Sicam had testified that there was a security guard in
the pawned jewelry for withdrawal on November 6, but their pawnshop at the time of the robbery. He likewise
Sicam failed to return the jewelry. testified that when he started the pawnshop business in
1983, he thought of opening a vault with the nearby bank
for the purpose of safekeeping the valuables but was
10
DUMLAO, Cheyenne Hope OBLICON Assignment #2 COMPILED DIGESTS San Beda College of Law - Mendiola
discouraged by the Central Bank since pawned articles We expounded in Cruz v. Gangan that negligence is the
should only be stored in a vault inside the pawnshop. omission to do something which a reasonable man,
The very measures which petitioners had allegedly guided by those considerations which ordinarily regulate
adopted show that to them the possibility of robbery was the conduct of human affairs, would do; or the doing of
not only foreseeable, but actually foreseen and something which a prudent and reasonable man would
anticipated. Sicam’s testimony, in effect, contradicts not do. It is want of care required by the circumstances.
petitioners’ defense of fortuitous event.
A review of the records clearly shows that petitioners
Moreover, petitioners failed to show that they were free failed to exercise reasonable care and caution that an
from any negligence by which the loss of the pawned ordinarily prudent person would have used in the same
jewelry may have been occasioned. situation. Petitioners were guilty of negligence in the
operation of their pawnshop business. Sicam’s testimony
Robbery per se, just like carnapping, is not a fortuitous revealed that there were no security measures adopted
event. It does not foreclose the possibility of negligence by petitioners in the operation of the pawnshop.
on the part of herein petitioners. Evidently, no sufficient precaution and vigilance were
adopted by petitioners to protect the pawnshop from
Petitioners merely presented the police report of the unlawful intrusion. There was no clear showing that
Parañaque Police Station on the robbery committed there was any security guard at all. Or if there was one,
based on the report of petitioners’ employees which is that he had sufficient training in securing a pawnshop.
not sufficient to establish robbery. Such report also does Further, there is no showing that the alleged security
not prove that petitioners were not at fault. On the guard exercised all that was necessary to prevent any
contrary, by the very evidence of petitioners, the CA did untoward incident or to ensure that no suspicious
not err in finding that petitioners are guilty of concurrent individuals were allowed to enter the premises. In fact, it
or contributory negligence as provided in Article 1170 of is even doubtful that there was a security guard, since it
the Civil Code, to wit: is quite impossible that he would not have noticed that
the robbers were armed with caliber .45 pistols each,
Art. 1170. Those who in the performance of their which were allegedly poked at the employees.
obligations are guilty of fraud, negligence, or delay, and Significantly, the alleged security guard was not
those who in any manner contravene the tenor thereof, presented at all to corroborate petitioner Sicam’s claim;
are liable for damages. not one of petitioners’ employees who were present
during the robbery incident testified in court.
**
Article 2123 of the Civil Code provides that with regard Furthermore, petitioner Sicam’s admission that the vault
to pawnshops and other establishments which are was open at the time of robbery is clearly a proof of
engaged in making loans secured by pledges, the petitioners’ failure to observe the care, precaution and
special laws and regulations concerning them shall be vigilance that the circumstances justly demanded.
observed, and subsidiarily, the provisions on pledge,
mortgage and antichresis. The robbery in this case happened in petitioners’
pawnshop and they were negligent in not exercising the
The provision on pledge, particularly Article 2099 of the precautions justly demanded of a pawnshop.
Civil Code, provides that the creditor shall take care of
the thing pledged with the diligence of a good father of a NOTES:
family. This means that petitioners must take care of the
pawns the way a prudent person would as to his own We, however, do not agree with the CA when it found
property. petitioners negligent for not taking steps to insure
themselves against loss of the pawned jewelries.
In this connection, Article 1173 of the Civil Code further
provides: Under Section 17 of Central Bank Circular No. 374,
Art. 1173. The fault or negligence of the obligor consists Rules and Regulations for Pawnshops, which took effect
in the omission of that diligence which is required by the on July 13, 1973, and which was issued pursuant to
nature of the obligation and corresponds with the Presidential Decree No. 114, Pawnshop Regulation Act,
circumstances of the persons, of time and of the place. it is provided that pawns pledged must be insured, to wit:
When negligence shows bad faith, the provisions of
Articles 1171 and 2201, paragraph 2 shall apply. Sec. 17. Insurance of Office Building and Pawns- The
place of business of a pawnshop and the pawns pledged
If the law or contract does not state the diligence which to it must be insured against fire and against burglary as
is to be observed in the performance, that which is well as for the latter(sic), by an insurance company
expected of a good father of a family shall be required. accredited by the Insurance Commissioner.
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DUMLAO, Cheyenne Hope OBLICON Assignment #2 COMPILED DIGESTS San Beda College of Law - Mendiola
However, this Section was subsequently amended by - Austria’s theory is for robbery to fall under the category
CB Circular No. 764 which took effect on October 1, of a fortuitous event and relieve the obligor from his
1980, to wit: obligation under a contract, pursuant to A1174, NCC,
there ought to be prior finding on the guilt of the persons
Sec. 17 Insurance of Office Building and Pawns – The responsible therefor. To adopt a different view, he
office building/premises and pawns of a pawnshop must argued, would be to encourage persons accountable for
be insured against fire. (emphasis supplied). goods or properties received in trust or consignment to
where the requirement that insurance against burglary connive with others, who would be willing to be accused
was deleted. Obviously, the Central Bank considered it in court for the robbery, in order to be absolved from civil
not feasible to require insurance of pawned articles liability for the loss or disappearance of the entrusted
against burglary. articles.
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DUMLAO, Cheyenne Hope OBLICON Assignment #2 COMPILED DIGESTS San Beda College of Law - Mendiola
o There is also no merit in Austria’s argument that Art 1174: no person shall be responsible for a
to allow the fact of robbery to be recognized in the civil fortuitous event which could not be foreseen, or
case before conviction is secured in the criminal action, which, though foreseen, was inevitable
would prejudice the latter case, or would result in tire blowout - mechanical defect of the conveyance
inconsistency should the accused obtain an acquittal or or a fault in its equipment which was easily
should the criminal case be dismissed. A court finding discoverable if the bus had been subjected to a
that a robbery has happened would not necessarily more thorough or rigid check-up before it took to the
mean that those accused in the criminal action should be road
found guilty of the crime; nor would a ruling that those When a passenger boards a common carrier, he
actually accused did not commit the robbery be takes the risks incidental to the mode of travel he
inconsistent with a finding that a robbery did take place. has taken. After all, a carrier is not an insurer of the
The evidence to establish these facts would not safety of its passengers and is not bound absolutely
necessarily be the same. and at all events to carry them safely and without
injury. However, when a passenger is injured or
22 YOBIDO vs. CA dies while travelling, the law presumes that the
FACTS: Spouses Tito and Leny Tumboy and their minor common carrier is negligent. (see Art. 1756)
children named Ardee and Jasmin, boarded a Yobido Art. 1755 provides that a common carrier is bound
Liner bus bound for Davao City. Along the trip, the left to carry the passengers safely as far as human care
front tire of the bus exploded. The bus fell into a ravine and foresight can provide, using the utmost
around 3 ft. from the road and struck a tree. The incident diligence of very cautious persons, with a due
resulted in the death of Tito and physical injuries to other regard for all the circumstances. In culpa
passengers. contractual, once a passenger dies or is injured, the
Factual backdrop based on testimony of Leny: the carrier is presumed to have been at fault or to have
winding road the bus traversed was not cemented and acted negligently. This disputable presumption may
was wet due to the rain; it was rough with crushed rocks. only be overcome by evidence that the carrier had
The bus which was full of passengers had cargoes on observed extraordinary diligence as prescribed by
top. Since it was running fast, (at a speed of 50-60kph Arts. 1733, 1755 and 1756 or that the death or
based on another witness’ testimony) she cautioned the injury of the passenger was due to a fortuitous
driver to slow down but he merely stared at her through event.
the mirror. The explosion of the new tire may not be
considered a fortuitous event; there are human
A complaint for breach of contract of carriage was filed factors involved in the situation; the fact that the tire
by Leny and her children against Alberta Yobido, the was new did not imply that it was entirely free from
owner of the bus, and Cresencio Yobido, its driver; manufacturing defects or that it was properly
Yobidos raised the affirmative defense of caso fortuito; mounted on the vehicle.
they also filed a third-party complaint against Philippine
Phoenix Surety and Insurance, Inc. 23 JUNTILLA vs. FONTANAR
Facts: Herein plaintiff was a passenger of the public
Upon a finding that the third party defendant was not utility jeepney on course from Danao City to Cebu City.
liable under the insurance contract, the lower court The jeepney was driven by driven by defendant Berfol
dismissed the third party complaint. Camoro and registered under the franchise of Clemente
Fontanar. When the jeepney reached Mandaue City, the
ISSUE: Whether the tire blow-out is a fortuitous event right rear tire exploded causing the vehicle to turn turtle.
In the process, the plaintiff who was sitting at the front
HELD: No. seat was thrown out of the vehicle. Plaintiff suffered a
Characteristics of fortuitous event: lacerated wound on his right palm aside from the injuries
a) The cause of the unforeseen and unexpected he suffered on his left arm, right thigh, and on his back.
occurrence, or the failure of the debtor to comply with his
obligations, must be independent of human will; Plaintiff filed a case for breach of contract with damages
b) It must be impossible to foresee the event which before the City Court of Cebu City. Defendants, in their
constitutes the caso fortuito, or if it can be foreseen, it answer, alleged that the tire blow out was beyond their
must be impossible to avoid; control, taking into account that the tire that exploded
c) The occurrence must be such as to render it was newly bought and was only slightly used at the time
impossible for the debtor to fulfill his obligation in a it blew up.
normal manner; and
d) the obligor must be free from any participation in the Issue: Whether or not the tire blow-out is a fortuitous
aggravation of the injury resulting to the creditor event?
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DUMLAO, Cheyenne Hope OBLICON Assignment #2 COMPILED DIGESTS San Beda College of Law - Mendiola
Held: No. In the case at bar, the cause of the unforeseen Magsarili and Charlie Antolin in the amount of P4,000.00
and unexpected occurrence was not independent of the each or a total of P12,000.00.
human will. The accident was caused either through the
negligence of the driver or because of mechanical The insurance policy involved explicitly limits PCSI's
defects in the tire. Common carriers should teach drivers liability to P12,000.00 per person and to P50,000.00 per
not to overload their vehicles, not to exceed safe and accident.
legal speed limits, and to know the correct measures to
take when a tire blows up thus insuring the safety of We have ruled in Stokes vs. Malayan Insurance Co.,
passengers at all times. Inc., that the terms of the contract constitute the
measure of the insurer's liability and compliance
24 PERLA COMPANIA DE SEGUROS vs. SARANGAY therewith is a condition precedent to the insured's right
FACTS: Milagros Cayas was the registered owner of a of recovery from the insurer.
Mazda bus. Said passenger vehicle was insured with
Perla Compania de Seguros, Inc. (PCSI) under a policy In the case at bar, the insurance policy clearly and
issued on February 3, 1978. On December 17, 1978, the categorically placed PCSI's liability for all damages
bus figured in an accident in Naic, Cavite injuring several arising out of death or bodily injury sustained by one
of its passengers. One of them, 19-year old Edgardo person as a result of any one accident at P12,000.00.
Perea, sued Milagros Cayas for damages in the Court of Said amount complied with the minimum fixed by the law
First Instance; while three others, namely: Rosario del then prevailing, Section 377 of Presidential Decree No.
Carmen, Ricardo Magsarili and Charlie Antolin, agreed 612 (which was retained by P.D. No. 1460, the
to a settlement of P4,000.00 each. At the pre-trial, Insurance Code of 1978), which provided that the liability
Milagros Cayas failed to appear and hence, she was of land transportation vehicle operators for bodily injuries
declared as in default. After trial, the court rendered a sustained by a passenger arising out of the use of their
decision in favor of Perea to compensate the Perea with vehicles shall not be less than P12,000. In other words,
damages of Pl0,000.00 for medical fees; P10,000.00 for under the law, the minimum liability is P12,000 per
exemplary damages; P5,000.00 for moral damages; passenger. PCSI's liability under the insurance contract
P7,000.00 for Attorney's fees. not being less than P12,000.00, and therefore not
contrary to law, morals, good customs, public order or
On November 11, 1981, Milagros Cayas filed a public policy, said stipulation must be upheld as
complaint for a sum of money and damages against effective, valid and binding as between the parties.
PCSI in the Court of First Instance. Milagros Cayas filed
a motion to declare PCSI in default for its failure to file In like manner, we rule as valid and binding upon Cayas
an answer. The motion was granted and Cayas was the condition in the policy in requiring her to secure the
allowed to adduce evidence ex-parte. On July 13, 1982, written permission of PCSI before effecting any payment
the court rendered judgment by default ordering PCSI to in settlement of any claim against her. There is nothing
pay Milagros Cayas P50,000 as compensation for the unreasonable, arbitrary or objectionable in this
injured passengers, P5,000 as moral damages and stipulation as would warrant its nullification. The same
P5,000 as attorney's fees. was obviously designed to safeguard the insurer's
Said decision was set aside after the PCSI filed a motion interest against collusion between the insured and the
therefor. In due course, the court promulgated a decision claimants.
in favor of Cayas, but removed the award of moral
damages. In her cross-examination before the trial court, Milagros
Cayas admitted that PCSI did not give any written
PCSI appealed to the Court of Appeals, which, in its authority that Cayas were supposed to pay those claims.
decision of May 8, 1987 the lower court's decision. Its It being specifically required that PCSI's written consent
motion for reconsideration having been denied, PCSI be first secured before any payment in settlement of any
filed the instant petition charging the Court of Appeals claim could be made, Cayas is precluded from seeking
with having erred in affirming in toto the decision of the reimbursement of the payments made to del Carmen,
lower court. Magsarili and Antolin in view of her failure to comply with
the condition contained in the insurance policy.
ISSUE: Whether or not the amount of award of damages
was proper. Clearly, the fundamental principle that contracts are
respected as the law between the contracting parties
RULING: NO. PCSI seeks to limit its liability only to the finds application in the present case. Thus, it was error
payment made by Cayas to Perea and only up to the on the part of the trial and appellate courts to have
amount of P12,000.00. It altogether denies liability for disregarded the stipulations of the parties and to have
the payments made by Cayas to the other three (3) substituted their own interpretation of the insurance
injured passengers Rosario del Carmen, Ricardo policy.
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DUMLAO, Cheyenne Hope OBLICON Assignment #2 COMPILED DIGESTS San Beda College of Law - Mendiola
We observe that although Milagros Cayas was able to HELD: No. The Supreme Court held that the Asian
prove a total loss of only P44,000.00, PCSI was made financial crisis cannot be generalized as unforeseeable
liable for the amount of P50,000.00, the maximum and beyond the control of the business corporation. A
liability per accident stipulated in the policy. This is real estate enterprise engaged in the pre-selling of
patent error. An insurance indemnity, being merely an condominium units is concededly a master in projections
assistance or restitution insofar as can be fairly on commodities and currency movements and business
ascertained, cannot be availed of by any accident victim risks. The fluctuating movement of the Philippine peso in
or claimant as an instrument of enrichment by reason of the foreign exchange market is an everyday occurrence,
an accident. and fluctuations in currency exchange rates happen
every day, thus, not an instance of caso fortuito.
WHEREFORE, the decision of the Court of Appeals is
hereby modified in that petitioner shall pay Milagros
Cayas the amount of Twelve Thousand Pesos (P12,000.
00) plus legal interest from the promulgation of the
decision of the lower court until it is fully paid and
attorney's fees in the amount of P5,000.00. No
pronouncement as to costs.
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