CHAN V IGLESIA NI CRISTO

G.R. No. 160283; October 14, 2005

Solidary Liability

FACTS:

Chan owned the Aringay Shell Gas Station in Aringay, La Union. It is bounded on the
south by Iglesia ni Cristo’s chapel. The gas station was supposedly needed additional
sewerage and septic tanks for its washrooms. In view of this, the services Yoro, a
retired general of the AFP, was procured as Yoro was allegedly a construction contractor
in the locality.

They entered into a MOA which stipulated that ”[a]ny damage within or outside the
property of the FIRST PARTY (Chan) incurred during the digging shall be borne by the
SECOND PARTY (Yoro).” Further, the MOA discusses division of wealth in case hidden
treasure is found during the digging. After some time, Chan was informed by the
members of the INC that the digging traversed and penetrated a portion of the land
belonging to the latter. The foundation of the chapel was affected as a tunnel was dug
directly under it to the damage and prejudice of the respondent.

A complaint against petitioner was filed by the respondent before the RTC La Union.
Petitioner filed an Answer with Third-Party Complaint impleading Yoro.

RTC: The diggings were intended to find hidden treasure! Chan and Yoro solidarily liable
to the respondent on a 35%-65% basis!

CA: I agree with RTC.

Chan avers that no liability should attach to him by laying the blame solely on Yoro. He
argues that the MOA executed between him and Yoro is the law between them and
must be given weight by the courts. Since nothing in the MOA goes against the law,
morals, good customs and public policy, it must govern to absolve him from any
liability.

ISSUE: W/N the MOA entered into by Chan and Yoro has the effect of making the latter
solely responsible for damages to the respondent? NO
HELD AND RATIO: NO. Chan is still liable.

INC says that the MOA clearly shows that the intention of the parties therein was to
search for hidden treasure. The alleged digging for a septic tank was just a cover-up of
their real intention. The aim of the petitioner and Yoro to intrude and surreptitiously
hunt for hidden treasure in INC’s premises should make both parties liable.

It should be noted that findings of the lower courts on this point are in complete unison.
Petitioner and Yoro were in quest for hidden treasure and, undoubtedly, they were
partners in this endeavor.

The basis of their solidarity is not the Memorandum of Agreement but the fact
that they have become joint tortfeasors. There is solidary liability only when the
obligation expressly so states, or when the law or the nature of the obligation requires
solidarity.

All the requisites of a quasi-delict are attendant in the instant case. The tortious act was
the excavation which caused damage to the respondent because it was done
surreptitiously within its premises and it may have affected the foundation of the
chapel. The excavation on INC’s premises was caused by fault. Finally, there was no
pre-existing contractual relation between the petitioner and Yoro on the one hand, and
the respondent on the other. For the damage caused to respondent, petitioner and Yoro
are jointly liable as they are joint tortfeasors. Verily, the responsibility of two or more
persons who are liable for a quasi-delict is solidary.

The heavy reliance of petitioner in the MOA cited earlier cannot steer him clear of any
liability. As a general rule, joint tortfeasors are all the persons who command, instigate,
promote, encourage, advise, countenance, cooperate in, aid or abet the commission of
a tort, or who approve of it after it is done, if done for their benefit.

Indubitably, petitioner and Yoro cooperated in committing the tort. They even had
provisions in their MOA as to how they would divide the treasure if any was found
within or outside petitioners property line. Thus, the MOA, instead of exculpating
petitioner from liability, is the very noose that insures that he be so declared as liable.

Besides, petitioner cannot claim that he did not know that the excavation traversed the
respondents property. In fact, he had two (2) of his employees actually observe the
diggings, his security guard and his engineer Teofilo Oller.
Side issue (You may skip): INC wanted more exemplary damages. In quasi-delicts,
exemplary damages may be granted if the defendant acted with gross negligence.

Surreptitiously digging under the respondents chapel which may weaken the foundation
thereof, thereby endangering the lives and limbs of the people in worship,
unquestionably amounts to gross negligence. For such tortious act done with gross
negligence, the Court feels that the amount awarded by the Court of Appeals is
inadequate. The exemplary damages must correspondingly be increased to
P100,000.00.

SO ORDERED.

Marinduque Iron Mines v WCC (Torts)

MARINDUQUE IRON MINES AGENTS, INC v WCC (1956)

[G.R. No. L-8110. June 30, 1956.] MARINDUQUE IRON MINES AGENTS, INC.,
Petitioner, vs. THE WORKMEN’S COMPENSATION COMMISSION, THE HEIRS OF PEDRO
MAMADOR and GERONIMO MA. COLL, Respondents.

FACTS:

On August 23, 1951, at 6:00 a.m. in Bo. Sumangga, Mogpog, Marinduque, the
deceased Mamador together with other laborers of the Respondent-corporation,
(Marinduque Iron Mines Agents Inc.) boarded a truck belonging to the latter, which was
then driven by one Procopio Macunat, also employed by the corporation, and on its way
to their place of work at the mine camp at Talantunan, while trying to overtake another
truck on the company road, it turned over and hit a coconut tree, resulting in the death
of said Mamador and injury to the others.”

Procopio Macunat was prosecuted, convicted and sentenced to indemnify the heirs of
the deceased. (Criminal Case No. 1491). He has paid nothing however, to the latter.

DECISION OF LOWER COURTS:

(1) Workmen’s Compensation Commissioner: confirmed the referee’s award of

compensation to the heirs of Pedro Mamador for his accidental death.

ISSUE:

What is the effect of the deceased’s having violated the employer’s prohibition against
laborers riding the haulage trucks
RULING:

No.

There is no doubt that mere riding on haulage truck or stealing a ride thereon is not
negligence, ordinarily. It couldn’t be, because

transportation by truck is not dangerous per se. It is argued that there was notorious
negligence in this particular instance because there was the employer’s prohibition.

However there is practical unanimity in the proposition that violation of a rule

promulgated by a Commission or board is not negligence per se; but it may be
evidence of negligence. Section 6 provides as follows:

“Sec. 6. Liability of third parties. — In case an employee suffers an injury for which
compensation is due under this Act by any other person besides his employer, it shall
be optional with such injured employee either to claim compensation from his
employer, under this Act, or sue such other person for damages, in accordance with
law; and in case compensation is claimed and allowed in accordance with this Act, the
employer who paid such compensation or was found liable to pay the same, shall
succeed the injured employee to the right of recovering from such person what he paid:
Provided, That in case the employer recovers from such third person damages in excess
of those paid or allowed under this Act, such excess shall be delivered to the injured
employee or any other person entitled thereto, after deduction of the expenses of the
employer and the costs of the proceedings. The sum paid by the employer for
compensation or the amount of compensation to which the employee or his dependents
are entitled, shall not be admissible as evidence in any damage suit or action.”

It is the Petitioner’s contention that Criminal Case No. 1491 and its outcome constituted
an election by the employee (or his heirs) to sue the third person, such election having
the effect of releasing the employer. However, Criminal Case No. 1491 was not a suit
for damages against the third person, it being alleged, without contradiction that the
heirs did not intervene therein and have not so far received the indemnity ordered by
the court.

Indemnity granted the heirs in a criminal prosecution of the “other person” does not
affect the liability of the employer to pay compensation.

As to the alleged “amicable settlement,” it consists of an affidavit wherein, for the sum
of 150 pesos, Mamador’s widow promised “to forgive Macunat for the wrong committed
and not to bring him before the authorities for prosecution.” Upon making such promise
— Petitioner argues — she elected one of the remedies, (against the third person) and
is barred from the other remedy (against the employer). The contention may not be
sustained, inasmuch as all the widow promised was to forego the offender’s criminal
prosecution. Note further that a question may be raised whether she could bind the
other heirs of the deceased.

PICART vs. SMITH, JR.

PICART vs. SMITH, JR.

G.R. No. L-12219

March 15, 1918

STREET, J.:

FACTS: On the Carlatan Bridge in La Union. Picart was riding on his pony over said
bridge. Before he had gotten half way across, Smith approached from the opposite
direction in an automobile. As the defendant neared the bridge he saw a horseman on it
and blew his horn to give warning of his approach. He continued his course and after he
had taken the bridge he gave two more successive blasts, as it appeared to him that
the man on horseback before him was not observing the rule of the road.

Picart saw the automobile coming and heard the warning signals. However, being
perturbed by the novelty of the apparition or the rapidity of the approach, he pulled the
pony closely up against the railing on the right side of the bridge instead of going to the
left. He says that the reason he did this was that he thought he did not have sufficient
time to get over to the other side. As the automobile approached, Smith guided it
toward his left, that being the proper side of the road for the machine. In so doing the
defendant assumed that the horseman would move to the other side. Seeing that the
pony was apparently quiet, the defendant, instead of veering to the right while yet
some distance away or slowing down, continued to approach directly toward the horse
without diminution of speed. When he had gotten quite near, there being then no
possibility of the horse getting across to the other side, the defendant quickly turned his
car sufficiently to the right to escape hitting the horse; but in so doing the automobile
passed in such close proximity to the animal that it became frightened and turned its
body across the bridge, got hit by the car and the limb was broken. The horse fell and
its rider was thrown off with some violenceAs a result of its injuries the horse died. The
plaintiff received contusions which caused temporary unconsciousness and required
medical attention for several days.

From a judgment of the CFI of La Union absolving Smith from liability Picart has
appealed.

ISSUE: WON Smith was guilty of negligence such as gives rise to a civil obligation to
repair the damage done

HELD: the judgment of the lower court must be reversed, and judgment is here
rendered that the Picart recover of Smith damages

YES

The test by which to determine the existence of negligence in a particular case may be
stated as follows: Did the defendant in doing the alleged negligent act use that person
would have used in the same situation? If not, then he is guilty of negligence. The
existence of negligence in a given case is not determined by reference to the personal
judgment of the actor in the situation before him. The law considers what would be
reckless, blameworthy, or negligent in the man of ordinary intelligence and prudence
and determines liability by that. The question as to what would constitute the conduct
of a prudent man in a given situation must of course be always determined in the light
of human experience and in view of the facts involved in the particular case.

Could a prudent man, in the case under consideration, foresee harm as a result of the
course actually pursued? If so, it was the duty of the actor to take precautions to guard
against that harm. Reasonable foresight of harm, followed by ignoring of the suggestion
born of this prevision, is always necessary before negligence can be held to exist.
Stated in these terms, the proper criterion for determining the existence of negligence
in a given case is this: Conduct is said to be negligent when a prudent man in the
position of the tortfeasor would have foreseen that an effect harmful to another was
sufficiently probable to warrant his foregoing conduct or guarding against its
consequences.

Applying this test to the conduct of the defendant in the present case we think that
negligence is clearly established. A prudent man, placed in the position of the
defendant, would in our opinion, have recognized that the course which he was
pursuing was fraught with risk, and would therefore have foreseen harm to the horse
and the rider as reasonable consequence of that course. Under these circumstances the
law imposed on the Smith the duty to guard against the threatened harm.

It goes without saying that the plaintiff himself was not free from fault, for he was
guilty of antecedent negligence in planting himself on the wrong side of the road. But
as we have already stated, Smith was also negligent; and in such case the problem
always is to discover which agent is immediately and directly responsible. It will be
noted that the negligent acts of the two parties were not contemporaneous, since the
negligence of the defendant succeeded the negligence of the plaintiff by an appreciable
interval. Under these circumstances the law is that the person who has the last fair
chance to avoid the impending harm and fails to do so is chargeable with the
consequences, without reference to the prior negligence of the other party.

HEDY GAN y YU, Petitioner, v. THE HONORABLE COURT OF APPEALS and the
PEOPLE OF THE PHILIPPINES, Respondents. [G.R. No. L-44264. September
19, 1988.]

Doctrine: EMERGENCY RULE. — A corollary rule is what is known in the law as the
emergency rule. "Under that rule, one who suddenly finds himself in a place of danger,
and is required to act without time to consider the best means that may be adopted to
avoid the impending danger, is not guilty of negligence, if he fails to adopt what
subsequently and upon reflection may appear to have been a better method, unless the
emergency in which he finds himself is brought about by his own negligence."

Prior Proceedings:
CFI Manila- Gan was convicted of Homicide thru Reckless Imprudence.
CA- Judgment modified, Homicide thru simple imprudence.
SC- Reversed CA, acquitted Gan.

Facts of the Case: Hedy Gan was driving a Toyota car along North Bay Boulevard,
Tondo, Manila. While in front of house no. 694 of North Bay Boulevard, there were two
vehicles, a truck and a jeepney parked on one side of the road, one following the other
about two to three meters from each other. As the car driven by the accused
approached the place where the two vehicles were parked, there was a vehicle coming
from the opposite direction, followed by another which tried to overtake and bypass the
one in front of it and thereby encroached the lane of the car driven by the accused. To
avoid a head-on collision with the oncoming vehicle, the defendant swerved to the right
and as a consequence, the front bumper of the Toyota Crown Sedan hit an old man
who was about to cross the boulevard from south to north, pinning him against the rear
of the parked jeepney. The force of the impact caused the parked jeepney to move
forward hitting the rear of the parked truck ahead of it. The pedestrian was injured, the
Toyota Sedan was damaged on its front, the jeep suffered damages on its rear and
front parts, and the truck sustained scratches at the wooden portion of its rear. The
body of Isidoro Casino was immediately brought to the hospital but was (pronounced)
dead on arrival.

Issue: Did the CA erred in holding that when the petitioner saw a car travelling directly
towards her, she should have stepped on the brakes immediately or in swerving her
vehicle to the right should have also stepped on the brakes or lessened her speed, to
avoid the death of a pedestrian?

Held and Ratio: YES.

The test for determining whether or not a person is negligent in doing an act whereby
injury or damage results to the person or property of another is this: Would a prudent
man in the position of the person to whom negligence is attributed foresee harm to the
person injured as a reasonable consequence of the course about to be pursued? If so,
the law imposes the duty on the doer to take precaution against its mischievous results
and the failure to do so constitutes negligence.

Applying the emergency rule (as defined above), petitioner is not guilty of the crime.
The amount of time afforded to the petitioner to react to the situation she was in should
be taken into account for it is undeniable that the suggested course of action
presupposes sufficient time for appellant to analyze the situation confronting her and to
ponder on which of the different courses of action would result in the least possible
harm to herself and to others.

Under the circumstances narrated by petitioner, we find that the appellate court is
asking too much from a mere mortal like the petitioner who in the blink of an eye had
to exercise her best judgment to extricate herself from a difficult and dangerous
situation caused by the driver of the overtaking vehicle. Petitioner certainly could not be
expected to act with all the coolness of a person under normal conditions. The danger
confronting petitioner was real and imminent, threatening her very existence. She had
no opportunity for rational thinking but only enough time to heed the very powerful
instinct of self-preservation.

Also, the respondent court itself pronounced that the petitioner was driving her car
within the legal limits. We therefore rule that the "emergency rule" enunciated above
applies with full force to the case at bar and consequently absolve petitioner from any
criminal negligence in connection with the incident under consideration.
MA. LOURDES VALENZUELA, petitioner, vs. COURT OF APPEALS, RICHARD LI
and ALEXANDER COMMERCIAL, INC., respondents.

G.R. No. 115024 [February 7, 1996]

Facts:

At around 2:00 in the morning of June 24, 1990, plaintiff Ma. Lourdes Valenzuela was
driving a blue Mitsubishi lancer from her restaurant at Marcos highway to her home.
While travelling along Aurora Blvd., 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 car’s condition, she parked
along the sidewalk, about 1½ 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 defendant’s car. Plaintiff’s 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 Medical Memorial 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.

Issues:

1.) Whether or not Li was negligent.

2.) Whether or not Valenzuela was contributory negligent.

3.) Whether or not Alexander Commercial, Inc. Li’s employer is liable.

Held:

1.) Yes. A witness testified that Li’s car was being driven at a “very fast” speed, racing
towards the general direction of Araneta Avenue. He also saw the car hitValenzuela,
hurtling her against the windshield of the defendant’s Mitsubishi Lancer, from where
she eventually fell under the defendant’s car. Moreover the witness declared that he
observed Valenzuela’s car parked parallel and very near the sidewalk, contrary to Li’s
allegation that Valenzuela’s car was close to the center of the right lane.

2.) No. The Court held that Valenzuela was not negligent applying the emergency rule.

Under the “emergency rule,” 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.

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, the only
negligence ascribable was the negligence of Li on the night of the accident.

3.) Yes. Alexander Commercial, Inc. has not demonstrated, to the Court’s 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. 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.

Li was an Assistant Manager of Alexander Commercial, Inc. 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. 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 latter’s goodwill before its
clientele. It also facilitated meeting between Li and its clients by providing the former
with a convenient mode of travel.

MARIKINA AUTO LINE TRANSPORT CORPORATION and FREDDIE L. SUELTO vs.

PEOPLE OF THE PHILIPPINES and ERLINDA V. VALDELLON
[G.R. No. 152040 March 31, 2006]

FACTS:
Erlinda V. Valdellon is the owner of a two-door commercial apartment located at No. 31
Kamias Road, Quezon City. The Marikina Auto Line Transport Corporation (MALTC) is
the owner-operator of a passenger bus with Plate Number NCV-849. Suelto, its
employee, was assigned as the regular driver of the bus.

At around 2:00 p.m. on October 3, 1992, Suelto was driving the aforementioned
passenger bus along Kamias Road, Kamuning, Quezon City, going towards Epifanio de
los Santos Avenue (EDSA). The bus suddenly swerved to the right and struck the
terrace of the commercial apartment owned by Valdellon located along Kamuning Road.
Valdellon demanded payment of P148,440.00 to cover the cost of the damage to the
terrace. The bus company and Suelto offered a P30,000.00 settlement which Valdellon
refused.

Valdellon filed a criminal complaint for reckless imprudence resulting in damage to

property against Suelto. Valdellon also filed a separate civil complaint against Suelto
and the bus company for damages. Suelto maintained that, in an emergency case, he
was not, in law, negligent. Both the trial court and the CA ruled in against herein
petitioners.

ISSUE:
Whether or not the sudden emergency rule applies in the case at bar.

HELD:
No.

xxx

It was the burden of petitioners herein to prove petitioner Suelto’s defense that he
acted on an emergency, that is, he had to swerve the bus to the right to avoid colliding
with a passenger jeep coming from EDSA that had overtaken another vehicle and
intruded into the lane of the bus. The sudden emergency rule was enunciated by this
Court in Gan v. Court of Appeals,23 thus:

[O]ne who suddenly finds himself in a place of danger, and is required to act without
time to consider the best means that may be adopted to avoid the impending danger, is
not guilty of negligence if he fails to adopt what subsequently and upon reflection may
appear to have been a better method unless the emergency in which he finds himself is
brought about by his own negligence.

Under Section 37 of Republic Act No. 4136, as amended, otherwise known as the Land
Transportation and Traffic Code, motorists are mandated to drive and operate vehicles
on the right side of the road or highway:

SEC. 37. Driving on right side of highway. – Unless a different course of action is
required in the interest of the safety and the security of life, person or property, or
because of unreasonable difficulty of operation in compliance herewith, every person
operating a motor vehicle or an animal-drawn vehicle on a highway shall pass to the
right when meeting persons or vehicles coming toward him, and to the left when
overtaking persons or vehicles going the same direction, and when turning to the left in
going from one highway to another, every vehicle shall be conducted to the right of the
center of the intersection of the highway.

Section 35 of the law provides, thus:

Sec. 35. Restriction as to speed.—(a) Any person driving a motor vehicle on a highway
shall drive the same at a careful and prudent speed, not greater nor less than is
reasonable and proper, having due regard for the traffic, the width of the highway, and
of any other condition then and there existing; and no person shall drive any motor
vehicle upon a highway at such a speed as to endanger the life, limb and property of
any person, nor at a speed greater than will permit him to bring the vehicle to a stop
within the assured clear distance ahead.

In relation thereto, Article 2185 of the New Civil Code provides that "unless there is
proof to the contrary, it is presumed that a person driving a motor vehicle has been
negligent, if at the time of mishap, he was violating any traffic regulation." By his own
admission, petitioner Suelto violated the Land Transportation and Traffic Code when he
suddenly swerved the bus to the right, thereby causing damage to the property of
private respondent.

However, the trial court correctly rejected petitioner Suelto’s defense, in light of his
contradictory testimony vis-à-vis his Counter-Affidavit submitted during the preliminary
investigation:

It is clear from the photographs submitted by the prosecution (Exhs. C, D, G, H & I)

that the commercial apartment of Dr. Valdellon sustained heavy damage caused by the
bus being driven by Suelto. "It seems highly improbable that the said damages were
not caused by a strong impact. And, it is quite reasonable to conclude that, at the time
of the impact, the bus was traveling at a high speed when Suelto tried to avoid the
passenger jeepney." Such a conclusion finds support in the decision of the Supreme
Court in People vs. Ison, 173 SCRA 118, where the Court stated that "physical evidence
is of the highest order. It speaks more eloquently than a hundred witnesses." The
pictures submitted do not lie, having been taken immediately after the incident. The
damages could not have been caused except by a speeding bus. Had the accused not
been speeding, he could have easily reduced his speed and come to a full stop when he
noticed the jeep. Were he more prudent in driving, he could have avoided the incident
or even if he could not avoid the incident, the damages would have been less severe.

In addition to this, the accused has made conflicting statements in his counter-affidavit
and his testimony in court. In the former, he stated that the reason why he swerved to
the right was because he wanted to avoid the passenger jeepney in front of him that
made a sudden stop. But, in his testimony in court, he said that it was to avoid a
passenger jeepney coming from EDSA that was overtaking by occupying his lane. Such
glaring inconsistencies on material points render the testimony of the witness doubtful
and shatter his credibility. Furthermore, the variance between testimony and prior
statements renders the witness unreliable. Such inconsistency results in the loss in the
credibility of the witness and his testimony as to his prudence and diligence.

As already maintained and concluded, the severe damages sustained could not have
resulted had the accused acted as a reasonable and prudent man would. The accused
was not diligent as he claims to be. What is more probable is that the accused had to
swerve to the right and hit the commercial apartment of the plaintiff because he could
not make a full stop as he was driving too fast in a usually crowded street.

Moreover, if the claim of petitioners were true, they should have filed a third-party
complaint against the driver of the offending passenger jeepney and the
owner/operator thereof.

Petitioner Suelto’s reliance on the sudden emergency rule to escape conviction for the
crime charged and his civil liabilities based thereon is, thus, futile.

Spouses Cruz vs. Sun Holidays, Inc.

GR No. 186312
29 June 2010

FACTS
Spouses Cruz files a complaint for damages against Sun Holidays arising from the death
of their son who perished with his wife on board the boat M/B Coco Beach III that capsized
en route Batangas from Puerto Galera where the couple had stayed at Coco Beach Island
Resort owned and operated by respondent. Their stay was by virtue of a tour package-
contract with respondent that included transportation to and from the Resort and the
point of departure in Batangas. Eight of the passengers, including petitioners’ son and
his wife, died during the accident. Sun denied any responsibility for the incident which it
considered to be a fortuitous event. Petitioners allege that as a common carrier, Sun was
negligent in allowing the boat to sail despite the storm warning bulletins issued by
PAGASA. Respondent denied being a common carrier, alleging that its boats are not
available to the public but are only used as ferry resort carrier. It also claimed to have
exercised the utmost diligence in ensuring the safety of its passengers, and that contrary
to petitioners’ allegation, there was no storm as the Coast Guard in fact cleared the
voyage. M/B Coco Beach III was not filled to capacity and had sufficient life jackets for
its passengers.

RTC dismissed the complaint. CA denied the appeal holding that Sun is a private carrier
which is only required to observe ordinary diligence and that the proximate cause of the
incident was a fortuitous event.

ISSUE
Whether M/B Coco Beach III breached a contract of carriage

HELD
Respondent is a common carrier. Its ferry services are so intertwined with its business
as to be properly considered ancillary thereto. The constancy of respondent’s ferry
services in its resort operations is underscored by its having its own Coco Beach boats.
And the tour packages it offers, which include the ferry services, may be availed of by
anyone who can afford to pay the same. These services are thus available to the public.

In the De Guzman case, Article 1732 of the Civil Code defining “common carriers” has
deliberately refrained from making distinctions on whether the carrying of persons or
goods is the carrier’s principal business, whether it is offered on a regular basis, or
whether it is offered to the general public.

Under the Civil Code, common carriers, from the nature of their business and for
reasons of public policy, are bound to observe extraordinary diligence for the safety of
the passengers transported by them, according to all the circumstances of each case.
They are bound to carry the passengers safely as far as human care and foresight can
provide, using the utmost diligence of very cautious persons, with due regard for all the
circumstances.

When a passenger dies or is injured in the discharge of a contract of carriage, it is

presumed that the common carrier is at fault or negligent. In fact, there is even no
need for the court to make an express finding of fault or negligence on the part of the
common carrier. This statutory presumption may only be overcome by evidence that
the carrier exercised extraordinary diligence.

NAPOCOR VS CA

Facts:

1. Engineering Construction, Inc. (petitioner, ECI for brevity), being a successful

bidder, executed a contract in Manila with the National Waterworks and
Sewerage Authority (NAWASA), whereby the former undertook:

1. to furnish all tools, labor, equipment and materials, and

2. to construct the proposed 2nd Ipo-Bicti Tunnel, Intake and Outlet

Structures, and Appurtenant Structures, and Appurtenant Features at
Norzagaray, Bulacan and to complete said works within 800 calendar
days. (Angat Hydro-electric Project and Dam)

2. The project involves two (2) major phases: (1) tunnel work covering a distance
of 7 kilometres and (2) the outworks at both ends of the tunnel.

3. The ECI already had completed the first major phase of the work (Tunnel
Excavation Work), all the equipment no longer needed there were transferred to
another site where some projects were yet to be completed. Some portion of the
Bicti site were still under construction (2nd phase).

4. On November 4, 1967, Typhoon “Welming” hit Central Luzon, passing through

corporations’ Angat Hydro-electric Project and Dam.

5. Due to the heavy downpour, the water in the reservoir of the Angat Dam was
rising perilously at the rate of 60 cm per hour. To prevent an overflow of water
from the dam, the National Power Corporation(NPC) caused the opening of the
spillway gates.

6. Extraordinary large volume of water rushed out of the gates, and hit the
installations and construction works of ECI at Ipo site with terrific impact, as a
result of which the latter’s stockpile of materials supplies, camp facilities and
permanent structures and accessories whether washed away, lost or destroyed.
Issue/s:

1. Whether or not the destruction and loss of ECI’s equipment and facilities were
due to force majeure, which will exempt NPC from liability.

Ruling:

1. No, NPC will not be exempted from liability. NPC was undoubtedly negligent
because it opened the spillway gates of the Angat Dam only at the height of
typhoon “Welming” when it knew very well that it was safer to have opened the
same gradually and earlier, as it was also undeniable that NPC know of the
coming typhoon at least four days before it actually struck.

The typhoon was an act of God or what we may call force majeure, NPC cannot escape
liability because its negligence was the proximate cause of the loss and damage.

As we have ruled in Juan F. Nakpil & Sons v. Court of Appeals:

“If upon the happening of a fortuitous event or an act of God, there concurs a
corresponding fraud, negligence, delay or violation or contravention in any manner of
the tenor of the obligation, which results in loss or damage, the obligor cannot escape
liability.

The principle embodied in the act of God doctrine strictly requires that the act must be
one occasioned exclusively by the violence of nature and human agencies are to be
excluded from creating or entering into the cause of the mischief. When the effect, the
cause of which is to be considered, is found to be in part the result of the participation
of man, whether it be from active intervention or neglect, or failure to act, the whole
occurrence is thereby HUMANIZED, as it were, and removed from the rules applicable
to the acts of God.

ELIAS S. CIPRIANO and/or E.S. CIPRIANO ENTERPRISES

vs.
THE COURT OF APPEALS and MACLIN ELECTRONICS, INC., respondents.

[G.R. No. 107968; October 30, 1996] Obligations and Contracts| Fortuitous
Events|

FACTS:

Elias S. Cipriano is a business owner engaged in rustproofing of vehicles. Private

respondent Maclin Electronics, Inc., through an employee, brought a 1990 model Kia
Pride car to petitioner’s shop for rustproofing. Sometime in 1991, a fire broke out and
spread adjoining to petitioner’s rustproofing shop. The fire destroyed both the shop and
the restaurant, including private respondent’s Kia Pride. Private respondent then sent a
letter to petitioner, demanding reimbursement for the value of the car. In reply,
petitioner denied liability on the ground that the fire was a fortuitous event.
Private respondent filed a suit for the value of car and for damages citing that the
vehicle was lost due to the negligence and imprudence of the petitioner due to its
failure to register his business with the DTI under P.D. No. 1572 and to insure it as
required in the rules implementing the Decree.
ISSUE:

Whether petitioner’s failure to insure his business and vehicles constituted negligence,
rendering him liable for loss due to the risk required to be insured against.

HELD:

Yes. The answer is affirmative.

Violation of a statutory duty is negligence per se. Petitioner’s negligence is the source of
his obligation. He is held liable for for his negligence in not complying with a duty
imposed on him by law. It is therefore immaterial that the loss occasioned to private
respondent was due to a fortuitous event, since it was petitioner’s negligence in not
insuring against the risk which was the proximate cause of the loss. There is thus a
statutory duty imposed on petitioner and it is for his failure to comply with this duty
that he was guilty or negligence rendering him liable for damages to private
respondent. While the fire in this case may be considered a fortuitous event, this
circumstance cannot exempt petitioner from liability for loss.

FF Cruz and co vs CA

Facts:

A fire broke up from the furniture shop of the petitioner in Caloocan city early
September 6, 1974. Prior to that, neighbor of the said shop requested that the
petitioner should build a firewall but failed to do so. The cause of the fire was never
discovered. Private respondent got P35k from the insurance on their house and
contents thereof.

Issue:

Whether or not the 35k be deducted from the damages thereof

Ruling

Since P35k had already been claimed by the respondents, the court held that such
amount should be deducted from the award of damages in accordance with Art 2207
NCC

Art. 2207. If the plaintiff's property has been insured, and he has received indemnity
from the insurance company for the injury or loss arising out of the wrong or breach of
contract complained of, the insurance company shall be subrogated to the rights of the
insured against the wrongdoer or the person who has violated the contract. If the
amount paid by the insurance company does not fully cover the injury or loss, the
aggrieved party shall be entitled to recover the deficiency from the person causing the
loss or injury.

Having been indemnified by their insurer, private respondents are entitled only to
recover the deficiency from the petitioner.
Whether or not the insurer should exercise the rights of the insured to which it had
been subrogated lies solely within the former's sound discretion. Since the insurer is not
a party to the case, its identity is not of record and no claim is made on its behalf, the
private respondent's insurer has to claim his right to reimbursement of the P35,000.00
paid to the insured.