Torts and Damages Case Digests 7
for the tort committed by its teachers
Negligence of some business organizations
Schools and Administrators
Regino v. Pangasinan Colleges of Science and
Technology
Tort liability of school despite the existence of contract
between its students
FACTS: In February 2002, PCST held a fund
raising campaign dubbed the "Rave Party and
Dance Revolution," the proceeds of which were
to go to the construction of the school's tennis
and volleyball courts. Each student was required
to pay for two tickets at the price of P100 each.
The project was allegedly implemented by
recompensing students who purchased tickets
with additional points in their test scores; those
who refused to pay were denied the opportunity
to take the final examinations.
Financially strapped and prohibited by her religion
from attending dance parties and celebrations,
Regino refused to pay for the tickets. On March
14 and March 15, 2002, the scheduled dates of the
final examinations in logic and statistics, her
teachers -- Respondents Rachelle A. Gamurot and
Elissa Baladad -- allegedly disallowed her from
taking the tests. According to petitioner, Gamurot
made her sit out her logic class while her
classmates were taking their examinations. The
next day, Baladad, after announcing to the entire
class that she was not permitting petitioner and
another student to take their statistics
examinations for failing to pay for their tickets,
allegedly ejected them from the classroom.
Petitioner's pleas ostensibly went unheeded by
Gamurot and Baladad, who unrelentingly
defended their positions as compliance with
PCST's policy.
RTC ruling: It ruled in favour of respondents
herein on the ground that CHED should have
first dealt with the issue and not the courts
ISSUE: Whether respondent herein is liable
RULING: YES, it is liable for the tort
committed by its teachers
In Alcuaz v. PSBA,23 the Court characterized the
relationship between the school and the student as
a contract, in which "a student, once admitted by
the school is considered enrolled for one
semester."
The school-student relationship is also reciprocal.
Thus, it has consequences appurtenant to and
inherent in all contracts of such kind -- it gives rise
to bilateral or reciprocal rights and obligations.
The school undertakes to provide students with
education sufficient to enable them to pursue
higher education or a profession. On the other
hand, the students agree to abide by the academic
requirements of the school and to observe its rules
and regulations.2
We recognize the need of a school to fund its
facilities and to meet astronomical operating costs;
this is a reality in running it.
Crystal v. Cebu International School31 upheld the
imposition by respondent school of a "land
purchase deposit" in the amount of P50,000 per
student to be used for the "purchase of a piece of
land and for the construction of new buildings
and other facilities x x x which the school would
transfer [to] and occupy after the expiration of its
lease contract over its present site."
The amount was refundable after the student
graduated or left the school. After noting that the
imposition of the fee was made only after prior
consultation and approval by the parents of the
students, the Court held that the school
committed no actionable wrong in refusing to
admit the children of the petitioners therein for
their failure to pay the "land purchase deposit"
and the 2.5 percent monthly surcharge thereon.
In the present case, PCST imposed the assailed airline's liability as one arising from tort, not one
revenue-raising measure belatedly, in the middle arising form a contract of carriage. In effect, Air
of the semester. It exacted the dance party fee as a France is authority for the view that liability from
condition for the students' taking the final tort may exist even if there is a contract, for the
examinations, and ultimately for its recognition of act that breaks the contract may be also a tort.
their ability to finish a course. The fee, however,
was not part of the school-student contract Child Learning Center v. Tagario
entered into at the start of the school year. Hence,
Negligence of the school to ensure the facilities are
it could not be unilaterally imposed to the
functioning
prejudice of the enrollees.
FACTS: he complaint1 alleged that during the
In her Complaint, petitioner also charged that
school year 1990-1991, Timothy was a Grade IV
private respondents "inhumanly punish students x
student at Marymount School, an academic
x x by reason only of their poverty, religious
institution operated and maintained by Child
practice or lowly station in life, which inculcated
Learning Center, Inc. (CLC). In the afternoon of
upon [petitioner] the feelings of guilt, disgrace and
March 5, 1991, between 1 and 2 p.m., Timothy
unworthiness;"33 as a result of such punishment,
entered the boy’s comfort room at the third floor
she was allegedly unable to finish any of her
of the Marymount building to answer the call of
subjects for the second semester of that school
nature. He, however, found himself locked inside
year and had to lag behind in her studies by a full
and unable to get out. Timothy started to panic
year. The acts of respondents supposedly caused
and so he banged and kicked the door and yelled
her extreme humiliation, mental agony and
several times for help. When no help arrived he
"demoralization of unimaginable proportions" in
decided to open the window to call for help. In
violation of Articles 19, 21 and 26 of the Civil
the process of opening the window, Timothy went
Code
right through and fell down three stories. Timothy
Generally, liability for tort arises only between was hospitalized and given medical treatment for
parties not otherwise bound by a contract. An serious multiple physical injuries.
academic institution, however, may be held liable
In its defense,2 CLC maintained that there was
for tort even if it has an existing contract with its
nothing defective about the locking mechanism of
students, since the act that violated the contract
the door and that the fall of Timothy was not due
may also be a tort.
to its fault or negligence. CLC further maintained
A perusal of Article 2176 [of the Civil Code] that it had exercised the due care and diligence of
shows that obligations arising from quasi-delicts a good father of a family to ensure the safety, well-
or tort, also known as extra-contractual being and convenience of its students.
obligations, arise only between parties not
RTC and CA held the school liable for the
otherwise bound by contract, whether express or
damages sustained by Timothy, prompting them
implied. However, this impression has not
to appeal
prevented this Court from determining the
existence of a tort even when there obtains a ISSUE: Whether the school is negligent in
contract. In Air France v. Carrascoso (124 Phil. failing to ensure the facility are functioning
722), the private respondent was awarded damages
for his unwarranted expulsion from a first-class RULING: YES, the school is negligent
seat aboard the petitioner airline. It is noted,
In every tort case filed under Article 2176 of the
however, that the Court referred to the petitioner-
Civil Code, plaintiff has to prove by a
preponderance of evidence: (1) the damages
suffered by the plaintiff; (2) the fault or negligence
of the defendant or some other person for whose
act he must respond; and (3) the connection of
cause and effect between the fault or negligence
and the damages incurred.7
Fault, in general, signifies a voluntary act or
omission which causes damage to the right of
another giving rise to an obligation on the part of
the actor to repair such damage. Negligence is the
failure to observe for the protection of the interest
of another person that degree of care, precaution
and vigilance which the circumstances justly
demand. Fault requires the execution of a positive
act which causes damage to another while
negligence consists of the omission to do acts
which result in damage to another.8
The door knob was defective. After the incident
of March 5, 1991, said door knob was taken off
the door of the toilet where Timothy was in. The
architect who testified during the trial declared
that although there were standard specifications
for door knobs for comfort room[s], and he
designed them according to that requirement, he
did not investigate whether the door knob
specified in his plans during the construction [was]
actually put in place. This is so because he did not
verify whether the door knob he specified w[as]
actually put in place at the particular comfort
room where Timothy was barred from getting
outside.
The fact, however, that Timothy fell out through
the window shows that the door could not be
opened from the inside. That sufficiently points to
the fact that something was wrong with the door,
if not the door knob, under the principle of res
ipsa loquitor. The doctrine of res ipsa loquitor
applies where (1) the accident was of such
character as to warrant an inference that it would
not have happened except for the defendant’s
negligence; (2) the accident must have been caused
by an agency or instrumentality within the
exclusive management or control of the person
charged with the negligence complained of; and
(3) the accident must not have been due to any
voluntary action or contribution on the part of the
person injured.11 Petitioners are clearly
answerable for failure to see to it that the doors of
their school toilets are at all times in working
condition. The fact that a student had to go
through the window, instead of the door, shows
that something was wrong with the door.
As to the absence of grills on the window,
petitioners contend that there was no such
requirement under the Building Code.
Nevertheless, the fact is that such window, as
petitioners themselves point out, was
approximately 1.5 meters from the floor, so that it
was within reach of a student who finds the
regular exit, the door, not functioning. Petitioners,
with the due diligence of a good father of the
family, should have anticipated that a student,
locked in the toilet by a non-working door, would
attempt to use the window to call for help or even
to get out. Considering all the circumstances,
therefore, there is sufficient basis to sustain a
finding of liability on petitioners’ part.
Our pronouncement that Timothy climbed out of
the window because he could not get out using
the door, negates petitioners’ other contention
that the proximate cause of the accident was
Timothy’s own negligence. The injuries he
sustained from the fall were the product of a
natural and continuous sequence, unbroken by
any intervening cause, that originated from CLC’s
own negligence.
Banks
PNB v. Pike
Negligence of bank employees in failing to follow the
standard operating procedure in withdrawal by a
representative
FACTS: Complainant Pike often traveled to and
from Japan as a gay entertainer in said country.
Sometime in 1991, he opened U.S. Dollar Savings
Account No. 0265-704591-0 with herein
petitioner PNB Buendia branch for which he was
issued a corresponding passbook. The complaint
alleged in substance that before complainant Pike
left for Japan on 18 March 1993, he kept the
aforementioned passbook inside a cabinet under
lock and key, in his home; that on 19 April 1993, a
few hours after he arrived from Japan, he
discovered that some of his valuables were
missing including the passbook; that he
immediately reported the incident to the police
which led to the arrest and prosecution of a
certain Mr. Joy Manuel Davasol; that complainant
Pike also discovered that Davasol made two (2)
unauthorized withdrawals from his U.S. Dollar
Savings Account
Pike went to defendant PNB’s Buendia branch
and verbally protested the unauthorized
withdrawals and likewise demanded the return of
the total withdrawn amount of U.S. $7,500.00, on
the ground that he never authorized anybody to
withdraw from his account as the signatures
appearing on the subject withdrawal slips were
clearly forgeries; that defendant PNB refused to
credit said amount back to complainant’s U.S.
Dollar Savings Account without justifiable reason,
and instead, defendant bank wrote him that it
exercised due diligence in the handling of said
account
In their defense, PNB alleged that on March 15,
1993 at PNB Buendia Branch, Mr. Norman Y.
Pike, together with a certain Joy Davasol went to
see PNB AVP Mr. Lorenzo T. Val (sic), Jr.
purposely to withdraw the amount of $2,000.00.
Mr. Pike also informed AVP Val that he is leaving
for abroad (Japan) and made verbal instruction to
honor all withdrawals to be transmitted by his
Talent Manager and Choreographer, Joy Davasol
who shall present pre-signed withdrawal slips
bearing his (Pike’s) signature.
RTC and CA ruled in favour of Pike and holding
PNB liable for negligence: [T]hat the bank is
responsible for such unauthorized withdrawals.
The court is not impressed with the defense put
up by the bank. Its contention that the
withdrawals were authorized by the plaintiff
because there was an arrangement between the
bank represented by its Asst. Vice President
Lorenzo Bal, Jr. and the depositor Norman Y.
Pike to the effect that pre-signed withdrawal slips,
that is, withdrawal slip signed by the depositor in
the presence of Mr. Bal whereby it would be made
to appear that it was the depositor himself who
presented the same to the bank despite the fact
that it was another person who presented the
same should be honored by the bank cannot be
sanctioned by the court. Firstly, the court is not
satisfied that there was indeed such an
arrangement.
ISSUE: Whether PNB is negligent in allowing
the withdrawal to be made despite the alleged
agreement allowing withdrawal by another
person
RULING: YES, PNB is liable for damages
sustained by Pike
At this juncture, it bears emphasizing that
negligence of banking institutions should never be
countenanced. The negligence here lies in the
lackadaisical attitude exhibited by employees of
petitioner PNB in their treatment of respondent
Pike’s US Dollar Savings Account that resulted in
the unauthorized withdrawal of $7,500.00.
Nevertheless, though its employees may be the
ones negligent, a bank’s liability as an obligor is
not merely vicarious but primary, as banks are
expected to exercise the highest degree of
diligence in the selection and supervision of their
employees,19 and having such obligation, this
Court cannot ignore the circumstances
surrounding the case at bar – how the employees
of petitioner PNB turned their heads, nay, closed
their eyes to the suspicious circumstances
enfolding the two withdrawals subject of the case
at bar. It may even be said that they went out of
their ways to disregard standard operating
procedures formulated to ensure the security of
each and every account that they are handling.
Petitioner PNB does not deny that the withdrawal
slips used were in breach of standard operating
procedures of banks in the ordinary and usual
course of banking operations as testified to by one
of its witnesses, Mr. Lorenzo T. Bal
PNB’s witness was utterly remiss in protecting the
bank’s client, as well as the bank itself, when he
allowed an account holder to make it appear as if
he was the one actually withdrawing from an
account and actually receiving the withdrawn
amount. Ordinarily, banks allow withdrawal by
someone who is not the account holder so long as
the account holder authorizes his representative to
withdraw and receive from his account by signing
on the space provided particularly for such
transactions, usually found at the back of
withdrawal slips. As fittingly found by the courts a
quo, if indeed, respondent Pike signed the
withdrawal slips in the presence of Mr. Lorenzo
Bal, petitioner PNB’s AVP at its Buendia branch,
why did he not call respondent Pike’s attention
and refer him to the space provided for
authorizing representatives to withdraw from and
receive the proceeds of such withdrawal? Or, at
the very least, sign or initial the same so that he
could identify the pre-signed withdrawal slips
made by Mr. Pike?
By his own testimony, the witness negated the
very reason for the bank’s bizarre
"accommodation" of the alleged verbal request of
respondent Pike – that he was a "valued client."
From the aforequoted, it appears that the witness,
Lorenzo Bal, was not even reasonably familiar
with respondent Pike, yet, he was ready, willing
and able to accommodate the verbal request of
said depositor. Worse still, the witness still
approved the withdrawal transaction without
asking for any proof of identification for the
reason that: 1) Davasol was in possession of a pre-
signed withdrawal slip; and 2) the witness
"recognized" the signature of respondent Pike –
even after admitting that he did not bother to
counter check the signature on the slip with the
specimen signature card of respondent Pike and
that he met respondent Pike just once so that he
cannot seem to recall what the latter looks like.
Having admitted that pre-signed withdrawal slips
do not constitute the normal procedure with
respect to withdrawals by representatives should
have already put petitioner PNB’s employees on
guard. Rather than readily validating and
permitting said withdrawals, they should have
proceeded more cautiously. Clearly, petitioner
bank’s employee, Lorenzo T. Bal, an Assistant
Vice President at that, was exceedingly careless in
his treatment of respondent Pike’s savings
account.
Firearms Dealer
Pacis v. Morales
Degree of diligence required from dealers of dangerous
articles such as firearms required extraordinary diligence
FACTS: Defendant Morales was in Manila at the
time. His employee Armando Jarnague, who was
the regular caretaker of the gun store was also not
around. He left earlier and requested sales agents
Matibag and Herbolario to look after the gun
store while he and defendant Morales were away.
Jarnague entrusted to Matibag and Herbolario a
bunch of keys used in the gun store which
included the key to the drawer where the fatal gun
was kept.
It appears that Matibag and Herbolario later
brought out the gun from the drawer and placed it
on top of the table. Attracted by the sight of the
gun, the young Alfred Dennis Pacis got hold of
the same. Matibag asked Alfred Dennis Pacis to
return the gun. The latter followed and handed the
gun to Matibag. It went off, the bullet hitting the
young Alfred in the head.
A criminal case for homicide was filed against
Matibag before branch VII of this Court. Matibag,
however, was acquitted of the charge against him
because of the exempting circumstance of
"accident" under Art. 12, par. 4 of the Revised
Penal Code.
Subsequently, a civil case based on quasi-delict
was filed. The trial court rendered its decision in
favor of petitioners, as affirmed by CA.
ISSUE: Whether petitioner herein is liable for
negligence
RULING: YES, he is liable for negligence
Art. 2176. Whoever by act or omission causes
damage to another, there being fault or negligence,
is obliged to pay for the damage done. Such fault
or negligence, if there is no pre-existing
contractual relation between the parties, is called
quasi-delict and is governed by the provisions of
this Chapter.
This case involves the accidental discharge of a
firearm inside a gun store.1avvphi1 Under PNP
Circular No. 9, entitled the "Policy on Firearms
and Ammunition Dealership/Repair," a person
who is in the business of purchasing and selling of
firearms and ammunition must maintain basic
security and safety requirements of a gun dealer,
otherwise his License to Operate Dealership will
be suspended or canceled.14
Indeed, a higher degree of care is required of
someone who has in his possession or under his
control an instrumentality extremely dangerous in
character, such as dangerous weapons or
substances. Such person in possession or control
of dangerous instrumentalities has the duty to take
exceptional precautions to prevent any injury
being done thereby.15 Unlike the ordinary affairs
of life or business which involve little or no risk, a
business dealing with dangerous weapons requires
the exercise of a higher degree of care.
As a gun store owner, respondent is presumed to
be knowledgeable about firearms safety and
should have known never to keep a loaded
weapon in his store to avoid unreasonable risk of
harm or injury to others. Respondent has the duty
to ensure that all the guns in his store are not
loaded. Firearms should be stored unloaded and
separate from ammunition when the firearms are
not needed for ready-access defensive use.16 With
more reason, guns accepted by the store for repair
should not be loaded precisely because they are
defective and may cause an accidental discharge
such as what happened in this case. Respondent
was clearly negligent when he accepted the gun for
repair and placed it inside the drawer without
ensuring first that it was not loaded. In the first
place, the defective gun should have been stored
in a vault. Before accepting the defective gun for
repair, respondent should have made sure that it
was not loaded to prevent any untoward accident.
Indeed, respondent should never accept a firearm
from another person, until the cylinder or action is
open and he has personally checked that the
weapon is completely unloaded.17 For failing to
insure that the gun was not loaded, respondent
himself was negligent. Furthermore, it was not
shown in this case whether respondent had a
License to Repair which authorizes him to repair
defective firearms to restore its original
composition or enhance or upgrade firearms.18
Clearly, respondent did not exercise the degree of
care and diligence required of a good father of a
family, much less the degree of care required of
someone dealing with dangerous weapons, as
would exempt him from liability in this case.
Security Agency and Guards
Safeguard Security Agency v. Tangco
Diligence in the selection and supervision of employees
FACTS: On November 3, 1997, at about 2:50
p.m., Evangeline Tangco (Evangeline) went to
Ecology Bank, Katipunan Branch, Quezon City,
to renew her time deposit per advise of the bank's
cashier as she would sign a specimen card.
Evangeline, a duly licensed firearm holder with
corresponding permit to carry the same outside
her residence, approached security guard Pajarillo,
who was stationed outside the bank, and pulled
out her firearm from her bag to deposit the same
for safekeeping. Suddenly, Pajarillo shot
Evangeline with his service shotgun hitting her in
the abdomen instantly causing her death.
Lauro Tangco, Evangeline's husband, together
with his six minor children (respondents) filed
with the Regional Trial Court (RTC) of Quezon
City, a criminal case of Homicide against Pajarillo,
docketed as Criminal Case No. 0-97-73806 and
assigned to Branch 78. Respondents reserved their
right to file a separate civil action in the said
criminal case.
January 14, 1998, respondents filed with RTC,
Branch 273, Marikina City, a complaint5 for
damages against Pajarillo for negligently shooting
Evangeline and against Safeguard for failing to
observe the diligence of a good father of a family
to prevent the damage committed by its security
guard.
In their Answer,6 petitioners denied the material
allegations in the complaint and alleged that
Safeguard exercised the diligence of a good father
of a family in the selection and supervision of
Pajarillo; that Evangeline's death was not due to
Pajarillo's negligence as the latter acted only in
self-defense.
RTC ruled in favour of respondents herein as
affirmed by CA: It ruled that while it may be
conceded that Safeguard had perhaps exercised
care in the selection of its employees, particularly
of Pajarillo, there was no sufficient evidence to
show that Safeguard exercised the diligence of a
good father of a family in the supervision of its
employee; that Safeguard's evidence simply
showed that it required its guards to attend
trainings and seminars which is not the
supervision contemplated under the law; that
supervision includes not only the issuance of
regulations and instructions designed for the
protection of persons and property, for the
guidance of their servants and employees, but also
the duty to see to it that such regulations and
instructions are faithfully complied with.
ISSUE: Whether petitioner herein has
exercised the required diligence in the
supervision of its EEs
RULING: NO, it failed to exercise the
required diligence
Pajarillo testified that when Evangeline aimed the
gun at him at a distance of about one meter or one
arm's length26 he stepped backward, loaded the
chamber of his gun and shot her.27 It is however
unimaginable that petitioner Pajarillo could still
make such movements if indeed the gun was
already pointed at him. Any movement could have
prompted Evangeline to pull the trigger to shoot
him.
Petitioner Pajarillo would like to justify his action
in shooting Evangeline on his mere apprehension
that Evangeline will stage a bank robbery.
However, such claim is befuddled by his own
testimony. Pajarillo testified that prior to the
incident, he saw Evangeline roaming under the fly
over which was about 10 meters away from the
bank28 and saw her talking to a man thereat;29
that she left the man under the fly-over, crossed
the street and approached the bank. However,
except for the bare testimony of Pajarillo, the
records do not show that indeed Evangeline was
seen roaming near the vicinity of the bank and
acting suspiciously prior to the shooting incident.
In fact, there is no evidence that Pajarillo called
the attention of his head guard or the bank's
branch manager regarding his concerns or that he
reported the same to the police authorities whose
outpost is just about 15 meters from the bank.
Moreover, if Evangeline was already roaming the
vicinity of the bank, she could have already
apprised herself that Pajarillo, who was posted
outside the bank, was armed with a shotgun; that
there were two guards inside the bank30 manning
the entrance door. Thus, it is quite incredible that
if she really had a companion, she would leave
him under the fly-over which is 10 meters far
from the bank and stage a bank robbery all by
herself without a back-up. In fact, she would have
known, after surveying the area, that aiming her
gun at Pajarillo would not ensure entrance to the
bank as there were guards manning the entrance
door.
Considering that unlawful aggression on the part
of Evangeline is absent, Pajarillo's claim of self-
defense cannot be accepted specially when such
claim was uncorroborated by any separate
competent evidence other than his testimony
which was even doubtful. Pajarillo's apprehension
that Evangeline will shoot him to stage a bank
robbery has no basis at all. It is therefore clear that
the alleged threat of bank robbery was just a
figment of Pajarillo's imagination which caused
such unfounded unlawful aggression on his part.
As the employer of Pajarillo, Safeguard is
primarily and solidarily liable for the quasi-delict
committed by the former. Safeguard is presumed
to be negligent in the selection and supervision of
his employee by operation of law. This
presumption may be overcome only by
satisfactorily showing that the employer exercised
the care and the diligence of a good father of a
family in the selection and the supervision of its
employee.
In the selection of prospective employees,
employers are required to examine them as to
their qualifications, experience, and service
records.35 On the other hand, due diligence in the
supervision of employees includes the formulation
of suitable rules and regulations for the guidance
of employees and the issuance of proper
instructions intended for the protection of the
public and persons with whom the employer has
relations through his or its employees and the
imposition of necessary disciplinary measures
upon employees in case of breach or as may be
warranted to ensure the performance of acts
indispensable to the business of and beneficial to
their employer. To this, we add that actual
implementation and monitoring of consistent
compliance with said rules should be the constant
concern of the employer, acting through
dependable supervisors who should regularly
report on their supervisory functions.36 To
establish these factors in a trial involving the issue
of vicarious liability, employers must submit
concrete proof, including documentary evidence.
We agree with the RTC's finding that Safeguard
had exercised the diligence in the selection of
Pajarillo since the record shows that Pajarillo
underwent a psychological and neuro-psychiatric
evaluation conducted by the St. Martin de Porres
Center where no psychoses ideations were noted,
submitted a certification on the Pre-licensing
training course for security guards, as well as
police and NBI clearances.
The RTC did not err in ruling that Safeguard fell
short of the diligence required in the supervision
of its employee, particularly Pajarillo. In this case,
while Safeguard presented Capt. James Camero,
its Director for Operations, who testified on the
issuance of company rules and regulations, such as
the Guidelines of Guards Who Will Be Assigned
To Banks,37 Weapons Training,38 Safeguard
Training Center Marksmanship Training Lesson
Plan,39 Disciplinary/Corrective Sanctions,40 it
had also been established during Camero's cross-
examination that Pajarillo was not aware of such
rules and regulations.41 Notwithstanding
Camero's clarification on his re-direct examination
that these company rules and regulations are
lesson plans as a basis of guidelines of the
instructors during classroom instructions and not
necessary to give students copy of the same,42 the
records do not show that Pajarillo had attended
such classroom instructions.
The records also failed to show that there was
adequate training and continuous evaluation of the
security guard's performance. Pajarillo had only
attended an in-service training on March 1, 1997
conducted by Toyota Sta. Rosa, his first
assignment as security guard of Safeguard, which
was in collaboration with Safeguard. It was
established that the concept of such training was
purely on security of equipments to be guarded
and protection of the life of the employees.43
It had not been established that after Pajarillo's
training in Toyota, Safeguard had ever conducted
further training of Pajarillo when he was later
assigned to guard a bank which has a different
nature of business with that of Toyota. In fact,
Pajarillo testified that being on duty in a bank is
different from being on duty in a factory since a
bank is a very sensitive area.
Resort and Swimming Pool Operator
Ong v. Metropolitan Water District
Illustrative case of how diligence required was exercised
FACTS: Defendant owns and operates three
recreational swimming pools at its Balara filters,
Diliman, Quezon City, to which people are invited
and for which a nominal fee of P0.50 for adults
and P0.20 for children is charged. The main pool
it between two small pools of oval shape known
as the "Wading pool" and the "Beginners Pool."
There are diving boards in the big pools and the
depths of the water at different parts are indicated
by appropriate marks on the wall. The care and
supervision of the pools and the users thereof is
entrusted to a recreational section composed of
Simeon Chongco as chief, Armando Rule, a male
nurse, and six lifeguards who had taken the life-
saving course given by the Philippine Red Cross at
the YMCA in Manila. For the safety of its patrons,
defendant has provided the pools with a ring
buoy, toy roof, towing line, saving kit and a
resuscitator. There is also a sanitary inspector who
is in charge of a clinic established for the benefit
of the patrons. Defendant has also on display in a
conspicuous place certain rules and regulations
governing the use of the pools, one of which
prohibits the swimming in the pool alone or
without any attendant. Although defendant does
not maintain a full-time physician in the
swimming pool compound, it has however a nurse
and a sanitary inspector ready to administer
injections or operate the oxygen resuscitator if the
need should arise.
In the afternoon of July 5, 1952, at about 1:00
o'clock, Dominador Ong, a 14-year old high
school student and boy scout, and his brothers
Ruben and Eusebio, went to defendant's
swimming pools. This was not the first time that
the three brothers had gone to said natatorium for
they had already been there four or five times
before. They arrived at the natatorium at about
1:45 p.m. After paying the requisite admission fee,
they immediately went to one of the small pools
where the water was shallow. At about 4:35 p.m.,
Dominador Ong told his brothers that he was
going to the locker room in an adjoining building
to drink a bottle of coke. Upon hearing this,
Ruben and Eusebio went to the bigger pool
leaving Dominador in the small pool and so they
did not see the latter when he left the pool to get a
bottle of coke. In that afternoon, there were two
lifeguards on duty in the pool compound, namely,
Manuel Abaño and Mario Villanueva.
Between 4:40 to 4:45 p.m., some boys who were
in the pool area informed a bather by the name of
Andres Hagad, Jr., that somebody was swimming
under water for quite a long time. Another boy
informed lifeguard Manuel Abaño of the same
happening and Abaño immediately jumped into
the big swimming pool and retrieved the
apparently lifeless body of Dominador Ong from
the bottom. The body was placed at the edge of
the pool and Abaño immediately applied manual
artificial respiration. Soon after, male nurse
Armando Rule came to render assistance,
followed by sanitary inspector Iluminado Vicente
who, after being called by phone from the clinic
by one of the security guards, boarded a jeep
carrying with him the resuscitator and a medicine
kit, and upon arriving he injected the boy with
camphorated oil. After the injection, Vicente left
on a jeep in order to fetch Dr. Ayuyao from the
University of the Philippines. Meanwhile, Abaño
continued the artificial manual respiration, and
when this failed to revive him, they applied the
resuscitator until the two oxygen tanks were
exhausted. Not long thereafter, Dr. Ayuyao
arrived with another resuscitator, but the same
became of no use because he found the boy
already dead. The doctor ordered that the body be
taken to the clinic.
Plaintiffs spouses seek to recover from defendant,
a government-owned corporation, the sum of
P50,000 as damages, P5,000 as funeral expenses,
and P11,000 as attorneys' fees, for the death of
their son Dominador Ong in one of the
swimming pools operated by defendant.
Defendant admits the fact that plaintiffs' son was
drowned in one of its swimming pools but avers
that his death was caused by his own negligence or
by unavoidable accident. Defendant also avers
that it had exercised due diligence in the selection
of, and supervision over, its employees and that it
had observed the diligence required by law under
the circumstances.
After trial, the lower court found that the action
of plaintiffs is untenable and dismissed the
complaint without pronouncement as to costs.
ISSUE: Whether respondent herein had
exercised all the required diligence, thereby
exonerating them of liability
RULING: YES, they had exercised all the
required diligence
The claim of these two witnesses not only was
vehemently denied by lifeguard Abaño, but is
belied by the written statements given by them in
the investigation conducted by the Police
Department of Quezon City approximately three
hours after the happening of the accident. Thus,
these two boys admitted in the investigation that
they narrated in their statements everything they
knew of the accident, but, as found by the trial,
nowhere in said statements do they state that the
lifeguard was chatting with the security guard at
the gate of the swimming pool or was reading a
comic magazine when the alarm was given for
which reason he failed to immediately respond to
the alarm. On the contrary, what Ruben Ong
particularly emphasized therein was that after the
lifeguard heard the shouts for help, the latter
immediately dived into the pool to retrieve the
person under water who turned out to be his
brother. For this reason, the trial court made this
conclusion: "The testimony of Ruben Ong and
Andres Hagad, Jr. as to the alleged failure of the
lifeguard Abaño to immediately respond to their
call may therefore be disregarded because they are
belied by their written statements. (Emphasis
supplied.)
On the other hand, there is sufficient evidence to
show that appellee has taken all necessary
precautions to avoid danger to the lives of its
patrons or prevent accident which may cause their
death. Thus, it has been shown that the swimming
pools of appellee are provided with a ring buoy,
toy roof, towing line, oxygen resuscitator and a
first aid medicine kit. The bottom of the pools is
painted with black colors so as to insure clear
visibility. There is on display in a conspicuous
place within the area certain rules and regulations
governing the use of the pools. Appellee employs
six lifeguards who are all trained as they had taken
a course for that purpose and were issued
certificates of proficiency. These lifeguards work
on schedule prepared by their chief and arranged
in such a way as to have two guards at a time on
duty to look after the safety of the bathers. There
is a male nurse and a sanitary inspector with a
clinic provided with oxygen resuscitator. And
there are security guards who are available always
in case of emergency.
The record also shows that when the body of
minor Ong was retrieved from the bottom of the
pool, the employees of appellee did everything
possible to bring him back to life. Thus, after he
was placed at the edge of the pool, lifeguard
Abaño immediately gave him manual artificial
respiration. Soon thereafter, nurse Armando Rule
arrived, followed by sanitary inspector Iluminado
Vicente who brought with him an oxygen
resuscitator. When they found that the pulse of
the boy was abnormal, the inspector immediately
injected him with camphorated oil. When the
manual artificial respiration proved ineffective
they applied the oxygen resuscitator until its
contents were exhausted. And while all these
efforts were being made, they sent for Dr. Ayuyao
from the University of the Philippines who
however came late because upon examining the
body he found him to be already dead. All of the
foregoing shows that appellee has done what is
humanly possible under the circumstances to
restore life to minor Ong and for that reason it is
unfair to hold it liable for his death.
We do not see how this doctrine may apply
considering that the record does not show how
minor Ong came into the big swimming pool. The
only thing the record discloses is that minor Ong
informed his elder brothers that he was going to
the locker room to drink a bottle of coke but that
from that time on nobody knew what happened
to him until his lifeless body was retrieved. The
doctrine of last clear chance simply means that the
negligence of a claimant does not preclude a
recovery for the negligence of defendant where it
appears that the latter, by exercising reasonable
care and prudence, might have avoided injurious
consequences to claimant notwithstanding his
negligence. Or, "As the doctrine usually is stated, a
person who has the last clear chance or
opportunity of avoiding an accident,
notwithstanding the negligent acts of his
opponent or the negligence of a third person
which is imputed to his opponent, is considered in
law solely responsible for the consequences of the
accident."
Since it is not known how minor Ong came into
the big swimming pool and it being apparent that
he went there without any companion in violation
of one of the regulations of appellee as regards the
use of the pools, and it appearing that lifeguard
Abano responded to the call for help as soon as
his attention was called to it and immediately after
retrieving the body all efforts at the disposal of
appellee had been put into play in order to bring
him back to life, it is clear that there is no room
for the application of the doctrine now invoked by
appellants to impute liability to appellee.
Hotels
Makati Shangri-la v. Harper
Negligence brought about by various circumstance that
should have raised the hotel’s awareness
FACTS: In the first week of November 1999,
Christian Harper came to Manila on a business
trip as the Business Development Manager for
Asia of ALSTOM Power Norway AS, an
engineering firm with worldwide operations. He
checked in at the Shangri-La Hotel and was
billeted at Room 1428. He was due to check out
on November 6, 1999. In the early morning of
that date, however, he was murdered inside his
hotel room by still unidentified malefactors. He
was then 30 years old.
How the crime was discovered was a story in
itself. A routine verification call from the
American Express Card Company to cardholder
Harper’s residence in Oslo, Norway (i.e., Bygdoy
Terasse 16, 0287 Oslo, Norway) led to the
discovery. It appears that at around 11:00 am of
November 6, 1999, a Caucasian male of about 30–
32 years in age, 5’4" in height, clad in maroon long
sleeves, black denims and black shoes, entered the
Alexis Jewelry Store in Glorietta, Ayala Center,
Makati City and expressed interest in purchasing a
Cartier lady’s watch valued at ₱ 320,000.00 with
the use of two Mastercard credit cards and an
American Express credit card issued in the name
of Harper. But the customer’s difficulty in
answering the queries phoned in by a credit card
representative sufficiently aroused the suspicion of
saleslady Anna Liza Lumba (Lumba), who asked
for the customer’s passport upon suggestion of
the credit card representative to put the credit
cards on hold. Probably sensing trouble for
himself, the customer hurriedly left the store, and
left the three credit cards and the passport behind.
In the meanwhile, Harper’s family in Norway
must have called him at his hotel room to inform
him about the attempt to use his American
Express card. Not getting any response from the
room, his family requested Raymond Alarcon, the
Duty Manager of the Shangri-La Hotel, to check
on Harper’s room. Alarcon and a security
personnel went to Room 1428 at 11:27 a.m., and
were shocked to discover Harper’s lifeless body
on the bed.
Mendoza subsequently viewed the closed circuit
television (CCTV) tapes, from which he found
that Harper had entered his room at 12:14 a.m. of
November 6, 1999, and had been followed into
the room at 12:17 a.m. by a woman; that another
person, a Caucasian male, had entered Harper’s
room at 2:48 a.m.; that the woman had left the
room at around 5:33 a.m.; and that the Caucasian
male had come out at 5:46 a.m.
A case was filed by the heirs of the deceased
against petitioner herein for their negligence which
prompted the murderer to succeed in trespassing
into the area of the hotel’s private rooms area and
into the room of the said deceased on account of
the hotel’s gross negligence in providing the most
basic security system of its guests, the lack of
which owing to the acts or omissions of its
employees was the immediate cause of the tragic
death of said deceased.
RTC ruled in favour of the heirs, as affirmed by
CA.
ISSUE: Whether the hotel is liable for the
death of Harper due to its negligence
RULING: YES, it is liable for the death of
Harper
Of the witnesses presented by plaintiffs to prove
its (sic) case, the only one with competence to
testify on the issue of adequacy or inadequacy of
security is Col. Rodrigo De Guzman who was
then the Chief Security Officer of defendant hotel
for the year 1999. He is a retired police officer and
had vast experience in security jobs. He was
likewise a member of the elite Presidential Security
Group.
He testified that upon taking over the job as the
chief of the security force of the hotel, he made an
assessment of the security situation. Col. De
Guzman was not satisfied with the security set-up
and told the hotel management of his desire to
improve it. In his testimony, De Guzman testified
that at the time he took over, he noticed that there
were few guards in the elevated portion of the
hotel where the rooms were located. The existing
security scheme then was one guard for 3 or 4
floors. He likewise testified that he recommended
to the hotel management that at least one guard
must be assigned per floor especially considering
that the hotel has a long "L-shaped" hallway, such
that one cannot see both ends of the hallway. He
further opined that "even one guard in that
hallway is not enough because of the blind portion
of the hallway."
On cross-examination, Col. De Guzman testified
that the security of the hotel was adequate at the
time the crime occurred because the hotel was not
fully booked. He qualified his testimony on direct
in that his recommendation of one guard per floor
is the "ideal" set-up when the hotel is fully-
booked.
Be that as it may, it must be noted that Col. De
Guzman also testified that the reason why the
hotel management disapproved his
recommendation was that the hotel was not doing
well. It is for this reason that the hotel
management did not heed the recommendation of
Col. De Guzman, no matter how sound the
recommendation was, and whether the hotel is
fully-booked or not.
There is no dispute that even prior to the untimely
demise of Mr. Harper, defendant was duly
forewarned of the security lapses in the hotel. Col.
De Guzman was particularly concerned with the
security of the private areas where the guest
rooms are. He wanted not just one roving guard in
every three or four floors. He insisted there must
be at least one in each floor considering the length
and the shape of the corridors. The trained eyes of
a security officer was (sic) looking at that deadly
scenario resulting from that wide security breach
as that which befell Christian Harper.
In any case, the ghastly incident could have been
prevented had there been adequate security in
each of the hotel floors. This, coupled with the
earlier recommendation of Col. De Guzman to
the hotel management to act on the security lapses
of the hotel, raises the presumption that the crime
was foreseeable.
Moreover, in applying the premises liability rule in
the instant case as it is applied in some jurisdiction
(sic) in the United States, it is enough that guests
are injured while inside the hotel premises to make
the hotelkeeper liable. With great caution should
the liability of the hotelkeeper be enforced when a
guest died inside the hotel premises.
It also bears stressing that there were prior
incidents that occurred in the hotel which should
have forewarned the hotel management of the
security lapses of the hotel. As testified to by Col.
De Guzman, "there were ‘minor’ incidents" (loss
of items) before the happening of the instant case.
These "minor" incidents may be of little
significance to the hotel, yet relative to the instant
case, it speaks volume. This should have served as
a caveat that the hotel security has lapses.
Makati Shangri-La Hotel, to stress, is a five-star
hotel. The "reasonable care" that it must exercise
for the safety and comfort of its guests should be
commensurate with the grade and quality of the
accommodation it offers. If there is such a thing
as "five-star hotel security", the guests at Makati
Shangri-La surely deserves just that!
When one registers (as) a guest of a hotel, he
makes the establishment the guardian of his life
and his personal belongings during his stay. It is a
standard procedure of the management of the
hotel to screen visitors who call on their guests at
their rooms. The murder of Harper could have
been avoided had the security guards of the
Shangri-La Hotel in Makati dutifully observed this
standard procedure."
The hotel business is imbued with public interest.
Catering to the public, hotelkeepers are bound to
provide not only lodging for their guests but also
security to the persons and belongings of their
guests. The twin duty constitutes the essence of
the business.43 Applying by analogy Article
2000,44 Article 200145 and Article 200246 of the
Civil Code (all of which concerned the
hotelkeepers’ degree of care and responsibility as
to the personal effects of their guests), we hold
that there is much greater reason to apply the
same if not greater degree of care and
responsibility when the lives and personal safety
of their guests are involved. Otherwise, the
hotelkeepers would simply stand idly by as
strangers have unrestricted access to all the hotel
rooms on the pretense of being visitors of the
guests, without being held liable should anything
untoward befall the unwary guests. That would be
absurd, something that no good law would ever
envision.
Theater
Gotesco Investment Corporation v. Chatto
Where a patron of a theater or other place of public
amusement is injured, and the thing that caused the injury
is wholly and exclusively under the control and management
of the defendant
FACTS: The evidence shows that in the
afternoon of June 4, 1982 plaintiff Gloria E.
Chatto, and her 15-year old daughter, plaintiff
Lina Delza E. Chatto went to see the movie
"Mother Dear" at Superama I theater, owned by
defendant Gotesco Investment Corporation. They
bought balcony tickets but even then were unable
to find seats considering the number of people
patronizing the movie. Hardly ten (10) minutes
after entering the theater, the ceiling of its balcony
collapsed. The theater was plunged into darkness
and pandemonium ensued. Shocked and hurt,
plaintiffs managed to crawl under the fallen
ceiling.
Defendant tried to avoid liability by alleging that
the collapse of the ceiling of its theater was done
due to force majeure. It maintained that its theater
did not suffer from any structural or construction
defect.
RTC ruled in favour of Gloria Chatto, as affirmed
by CA.
ISSUE: Whether the incident was fortuitous
event, thereby absolving petitioner of any
liability
RULING: NO, it is not fortuitous event
because petitioner failed to prove its existence
The rule is well-settled that the jurisdiction of this
Court in cases brought to it from the Court of
Appeals is limited to reviewing and revising the
errors of law imputed to it, its findings of fact
being conclusive, 10 except only where a case is
shown as coming under the accepted exception.
11 None of the exceptions which this Court has
painstakingly summarized in several cases 12 has
been shown to exist in this petition. Petitioner's
claim that the collapse of the ceiling of the
theater's balcony was due to force majeure is not
even founded on facts because its own witness,
Mr. Jesus Lim Ong, admitted that "he could not
give any reason why the ceiling collapsed." Having
interposed it as a defense, it had the burden to
prove that the collapse was indeed caused by force
majeure. It could not have collapsed without a
cause. That Mr. Ong could not offer any
explanation does not imply force majeure.
Petitioner could have easily discovered the cause
of the collapse if indeed it were due to force
majeure. To Our mind, the real reason why Mr.
Ong could not explain the cause or reason is that
either he did not actually conduct the investigation
or that he is, as the respondent Court impliedly
held, incompetent. He is not an engineer, but an
architect who had not even passed the
government's examination. Verily, post-incident
investigation cannot be considered as material to
the present proceedings. What is significant is the
finding of the trial court, affirmed by the
respondent Court, that the collapse was due to
construction defects. There was no evidence
offered to overturn this finding. The building was
constructed barely four (4) years prior to the
accident in question. It was not shown that any of
the causes denominates as force majeure obtained
immediately before or at the time of the collapse
of the ceiling. Such defects could have been easily
discovered if only petitioner exercised due
diligence and care in keeping and maintaining the
premises. But as disclosed by the testimony of Mr.
Ong, there was no adequate inspection of the
premises before the date of the accident. His
answers to the leading questions on inspection
disclosed neither the exact dates of said.
inspection nor the nature and extent of the same.
That the structural designs and plans of the
building were duly approved by the City Engineer
and the building permits and certificate of
occupancy were issued do not at all prove that
there were no defects in the construction,
especially as regards the ceiling, considering that
no testimony was offered to prove that it was ever
inspected at all.
Where a patron of a theater or other place of
public amusement is injured, and the thing that
caused the injury is wholly and exclusively under
the control and management of the defendant,
and the accident is such as in the ordinary course
of events would not have happened if proper care
had been exercised, its occurrence raises a
presumption or permits of an inference of
negligence on the part of the defendant.
Besides, even assuming for the sake of argument
that, as petitioner vigorously insists, the cause of
the collapse was due to force majeure, petitioner
would still be liable because it was guilty of
negligence, which the trial court denominated as
gross. As gleaned from Bouvier's definition of and
Cockburn's elucidation on force majeure for one
to be exempt from any liability because of it, he
must have exercised care, i.e., he should not have
been guilty of negligence.
Building Contractors
De Guzman v. Tumolva
Failure to follow the required specification in the agreement
constitute negligence
FACTS: On September 6, 2004, petitioner
Emerita M. De Guzman (De Guzman),
represented by her attorneys-in-fact, Lourdes
Rivera and Dhonna Chan, and respondent
Antonio Tumolva, doing business under the name
and style A.M. Tumolva Engineering Works (the
Contractor), entered into a Construction
Agreement3 (Agreement) for the construction of
an orphanage consisting of an administration
building, directors/guests house, dining and
service building, children’s dormitory, male staff
house, and covered walkways in Brgy. Pulong
Bunga, Purok 4, Silang, Cavite, for a contract price
of ₱ 15,982,150.39. Incorporated in the
Agreement was the plan and specifications of the
perimeter fence. The Contractor, however, made
deviations from the agreed plan4 with respect to
the perimeter fence of the orphanage.
On September 6, 2005, after the completion of
the project, De Guzman issued a Certificate of
Acceptance. For his part, the Contractor issued a
quitclaim acknowledging the termination of the
contract and the full compliance therewith by De
Guzman.
In November 2006, during typhoon "Milenyo," a
portion of the perimeter fence collapsed and other
portions tilted. In her Letter dated December 5,
2006, De Guzman, through counsel, demanded
the repair of the fence in accordance with the
plan. In response, the Contractor claimed that the
destruction of the fence was an act of God and
expressed willingness to discuss the matter to
avoid unnecessary litigation. De Guzman,
however, reiterated her demand for the restoration
of the wall without additional cost on her part, or
in the alternative, for the Contractor to make an
offer of a certain amount by way of compensation
for the damages she sustained. Her demand was
not heeded.
On February 14, 2008, De Guzman filed a
Request for Arbitration5 of the dispute before the
Construction Industry Arbitration Commission
(CIAC).
In his Answer with Counterclaim, the Contractor
denied liability for the damaged fence claiming,
among others, that its destruction was an act of
God. He admitted making deviations from the
plan, but pointed out that the same were made
with the knowledge and consent of De Guzman
through her representatives, Architect Quin
Baterna and Project Engineer Rodello Santos
(Engineer Santos), who were present during the
construction of the fence.
CIAC ruled in favour of De Guzman and
affirmed by CA with modifications as to the award
of damages
ISSUE: Whether the destruction of the
perimeter fence due to the typhoon is
considered fortuitous event
RULING: NO, it is not considered as
fortuitous event
There is no doubt that De Guzman incurred
damages as a result of the collapse of the
perimeter fence. The Contractor is clearly guilty of
negligence and, therefore, liable for the damages
caused. As correctly found by the CA:
Nonetheless, the Court sustains the CIAC’s
conclusion that the CONTRACTOR was
negligent in failing to place weepholes on the
collapsed portion of the perimeter fence. Fault or
negligence of the obligor consists in his failure to
exercise due care and prudence in the
performance of the obligation as the nature of the
obligation so demands, taking into account the
particulars of each case. It should be emphasized
that even if not provided for in the plan, the
CONTRACTOR himself admitted the necessity
of putting weepholes and claimed to have actually
placed them in view of the higher ground
elevation of the adjacent lot vis-à-vis the level
ground of the construction site. Since he was the
one who levelled the ground and was, thus, aware
that the lowest portion of the adjoining land was
nearest the perimeter fence, he should have
ensured that sufficient weepholes were placed
because water would naturally flow towards the
fence.
However, the CONTRACTOR failed to refute
Mr. Ramos’ claim that the collapsed portion of the
perimeter fence lacked weepholes. Records also
show that the omission of such weepholes and/or
their being plastered over resulted from his failure
to exercise the requisite degree of supervision over
the work, which is the same reason he was unable
to discover the deviations from the plan until the
fence collapsed. Hence, the CONTRACTOR
cannot be relieved from liability therefor.10
The Court finds no compelling reason to deviate
from this factual finding by the CIAC, as affirmed
by the CA. It is settled that findings of fact of
quasi-judicial bodies, which have acquired
expertise because their jurisdiction is confined to
specific matters, are generally accorded not only
respect, but also finality, especially when affirmed
by the CA. In particular, factual findings of
construction arbitrators are final and conclusive
and not reviewable by this Court on appeal.
Towage
Cargolift Shipping Inc. v. L. Actuario
Marketing and Skyland Brokerage
A tug and its owners must observe ordinary diligence in the
performance of its obligation under a contract of towage.
FACTS: Sometime in March 1993, respondent L.
Acuario Marketing Corp., ("Acuario") and
respondent Skyland Brokerage, Inc., ("Skyland")
entered into a time charter agreement4 whereby
Acuario leased to Skyland its L. Acuario II barge
for use by the latter in transporting electrical posts
from Manila to Limay, Bataan. At the same time,
Skyland also entered into a separate contract5 with
petitioner Cargolift, for the latter’s tugboats to tow
the aforesaid barge.
In accordance with the foregoing contracts,
petitioner’s tugboat M/T Beejay left the Manila
South Harbor on April 1, 1993 with Acuario’s
barge in tow. It reached the port of Limay, Bataan
on April 3, 1993, whereupon M/T Beejay
disengaged and once again set sail for Manila.
Petitioner’s other tugboat, the M/T Count,
remained in Bataan to secure the barge for
unloading.
The barge was brought to Acuario’s shipyard
where it was allegedly discovered by Acuario’s dry-
docking officer, Guillermo Nacu, Jr., that the
barge was listing due to a leak in its hull.
According to Nacu, he was informed by the
skipper of the tugboat that the damage was
sustained in Bataan. To confirm the same, Nacu
ordered an underwater survey of the barge and
prepared a damage report dated April 14, 1993.
No representative of Skyland was present during
the inspection although it was furnished with a
copy of the said report.
The barge was consequently dry-docked for
repairs at the Western Shipyard from April 16 to
April 26, 1993. Acuario spent the total sum of
P97,021.20 for the repairs.6
Pursuant to its contract with Skyland which
provided that "(a)ny damage or loss on the barge
due to the fault or negligence of charterers shall be
the responsibility of the (c)harterer or his
representative,"7 Acuario wrote Skyland seeking
reimbursement of its repair costs, failing which, it
filed a complaint for damages against Skyland
before the Regional Trial Court of Caloocan City
Skyland, in turn, filed a third-party complaint8
against petitioner alleging that it was responsible
for the damage sustained by the barge.
According to Acuario and its witnesses, the
weather in Bataan shifted drastically at dawn of
April 7, 1993 while the barge was docked at the
Limay port eight meters away from the stone wall.
Due to strong winds and large waves, the barge
repeatedly hit its hull on the wall, thus prompting
the barge patron to alert the tugboat captain of the
M/T Count to tow the barge farther out to sea.
However, the tugboat failed to pull the barge to a
safer distance due to engine malfunction, thereby
causing the barge to sustain a hole in its hull.
Fortunately, no part of the cargo was lost even if
only half of it had been unloaded at that time.
On the other hand, petitioner and Skyland denied
that the barge had been damaged. One of its
witnesses, Salvador D. Ocampo, claimed that he
was involved in all aspects of the operation and
that no accident of any sort was brought to his
knowledge. He alleged that the barge patron and
tug master made no mention of any maritime
casualty during the clearing of the vessels at the
Philippine Ports Authority in Limay, Bataan. The
barge was in good condition and was not damaged
when it was turned over to Acuario on April 13,
1993.
The trial court gave credence to the testimonies of
Acuario’s witnesses that the barge sustained
damage while it was being chartered by Skyland. It
held that the positive testimonies of Acuario’s
witnesses, coupled with documentary evidence
detailing the nature and extent of the damage as
well as the repairs done on the barge, should
prevail over the bare denials of Skyland and
petitioner.
ISSUE: Whether Cargolift should be held
liable despite not being a privy to the contract
between respondents herein
RULING: YES, it should be liable
It is not Acuario that is seeking damages from
petitioner but Skyland, with whom it undoubtedly
had a juridical tie. While Acuario could hold
Skyland liable under its charter agreement, Skyland
in turn could enforce liability on petitioner based
on the latter’s obligation to Skyland. In other
words, petitioner is being held liable by Skyland
and not by Acuario.
Thus, in the performance of its contractual
obligation to Skyland, petitioner was required to
observe the due diligence of a good father of the
family. This much was held in the old but still
relevant case of Baer Senior & Co.’s Successors v.
La Compania Maritima21 where the Court
explained that a tug and its owners must observe
ordinary diligence in the performance of its
obligation under a contract of towage. The
negligence of the obligor in the performance of
the obligation renders him liable for damages for
the resulting loss suffered by the obligee. Fault or
negligence of the obligor consists in his failure to
exercise due care and prudence in the
performance of the obligation as the nature of the
obligation so demands.22
In the case at bar, the exercise of ordinary
prudence by petitioner means ensuring that its
tugboat is free of mechanical problems. While
adverse weather has always been a real threat to
maritime commerce, the least that petitioner could
have done was to ensure that the M/T Count or
any of its other tugboats would be able to secure
the barge at all times during the engagement. This
is especially true when considered with the fact
that Acuario’s barge was wholly dependent upon
petitioner’s tugboat for propulsion. The barge was
not equipped with any engine and needed a
tugboat for maneuvering.23
Needless to say, if petitioner only subjected the
M/T Count to a more rigid check-up or
inspection, the engine malfunction could have
been discovered or avoided. The M/T Count was
exclusively controlled by petitioner and the latter
had the duty to see to it that the tugboat was in
good running condition. There is simply no basis
for petitioner’s assertion that Skyland contractually
assumed the risk of any engine trouble that the
tugboat may encounter. Skyland merely procured
petitioner’s towing service but in no way assumed
any such risk.
That petitioner’s negligence was the proximate
cause of the damage to the barge cannot be
doubted. Had its tugboat been serviceable, the
barge could have been moved away from the
stone wall with facility. It is too late in the day for
petitioner to insist that the proximate cause of the
damage was the barge patron’s negligence in not
objecting to the position of the barge by the stone
wall. Aside from the fact that the position of the
barge is quite understandable since off-loading
operations were then still underway,24 the alleged
negligence of the barge patron is a matter that is
also being raised for the first time before this
Court.
Thus, the damage to the barge could have been
avoided had it not been for the tugboat’s inability
to tow it away from the stone wall. Considering
that a barge has no power of its own and is totally
defenseless against the ravages of the sea, it was
incumbent upon petitioner to see to it that it
could secure the barge by providing a seaworthy
tugboat. Petitioner’s failure to do so did not only
increase the risk that might have been reasonably
anticipated during the shipside operation but was
the proximate cause of the damage.25 Hence, as
correctly found by the courts below, it should
ultimately be held liable therefor.
Stevedoring
Mindanao Terminal and Brokerage Service v.
Phoenix Assurance Co.
Degree of diligence required for stevedores
FACTS: Del Monte Philippines, Inc. (Del Monte)
contracted petitioner Mindanao Terminal and
Brokerage Service, Inc. (Mindanao Terminal), a
stevedoring company, to load and stow a
shipment of 146,288 cartons of fresh green
Philippine bananas and 15,202 cartons of fresh
pineapples belonging to Del Monte Fresh Produce
International, Inc. (Del Monte Produce) into the
cargo hold of the vessel M/V Mistrau. The vessel
was docked at the port of Davao City and the
goods were to be transported by it to the port of
Inchon, Korea in favor of consignee Taegu
Industries, Inc. Del Monte Produce insured the
shipment under an "open cargo policy" with
private respondent Phoenix Assurance Company
of New York (Phoenix), a non-life insurance
company, and private respondent McGee & Co.
Inc. (McGee), the underwriting manager/agent of
Phoenix.4
Mindanao Terminal loaded and stowed the
cargoes aboard the M/V Mistrau. The vessel set
sail from the port of Davao City and arrived at the
port of Inchon, Korea. It was then discovered
upon discharge that some of the cargo was in bad
condition. The Marine Cargo Damage Surveyor of
Incok Loss and Average Adjuster of Korea,
through its representative Byeong Yong Ahn
(Byeong), surveyed the extent of the damage of
the shipment. In a survey report, it was stated that
16,069 cartons of the banana shipment and 2,185
cartons of the pineapple shipment were so
damaged that they no longer had commercial
value.
Del Monte Produce filed a claim under the open
cargo policy for the damages to its shipment.
McGee’s Marine Claims Insurance Adjuster
evaluated the claim and recommended that
payment in the amount of $210,266.43 be made.
A check for the recommended amount was sent
to Del Monte Produce; the latter then issued a
subrogation receipt6 to Phoenix and McGee.
Phoenix and McGee instituted an action for
damages7 against Mindanao Terminal in the
Regional Trial Court (RTC) of Davao City, Branch
12. After trial, the RTC,8 in a decision dated 20
October 1999, held that the only participation of
Mindanao Terminal was to load the cargoes on
board the M/V Mistrau under the direction and
supervision of the ship’s officers, who would not
have accepted the cargoes on board the vessel and
signed the foreman’s report unless they were
properly arranged and tightly secured to withstand
voyage across the open seas. Accordingly,
Mindanao Terminal cannot be held liable for
whatever happened to the cargoes after it had
loaded and stowed them. Moreover, citing the
survey report, it was found by the RTC that the
cargoes were damaged on account of a typhoon
which M/V Mistrau had encountered during the
voyage.
The appellate court reversed and set aside10 the
decision of the RTC in its 29 October 2003
decision. The same court ordered Mindanao
Terminal to pay Phoenix and McGee "the total
amount of $210,265.45 plus legal interest from the
filing of the complaint until fully paid and
attorney’s fees of 20% of the claim."11 It
sustained Phoenix’s and McGee’s argument that
the damage in the cargoes was the result of
improper stowage by Mindanao Terminal. It
imposed on Mindanao Terminal, as the stevedore
of the cargo, the duty to exercise extraordinary
diligence in loading and stowing the cargoes.
ISSUE: Whether petitioner’s required
diligence as held by CA is extraordinary
diligence
RULING: NO, it only need reasonable
diligence in the performance of its duty
Article 1173 of the Civil Code is very clear that if
the law or contract does not state the degree of
diligence which is to be observed in the
performance of an obligation then that which is
expected of a good father of a family or ordinary
diligence shall be required. Mindanao Terminal, a
stevedoring company which was charged with the
loading and stowing the cargoes of Del Monte
Produce aboard M/V Mistrau, had acted merely as
a labor provider in the case at bar. There is no
specific provision of law that imposes a higher
degree of diligence than ordinary diligence for a
stevedoring company or one who is charged only
with the loading and stowing of cargoes. It was
neither alleged nor proven by Phoenix and McGee
that Mindanao Terminal was bound by contractual
stipulation to observe a higher degree of diligence
than that required of a good father of a family. We
therefore conclude that following Article 1173,
Mindanao Terminal was required to observe
ordinary diligence only in loading and stowing the
cargoes of Del Monte Produce aboard M/V
Mistrau.
The relationship therefore between the consignee
and the arrastre operator must be examined. This
relationship is much akin to that existing between
the consignee or owner of shipped goods and the
common carrier, or that between a depositor and
a warehouseman[22 ]. In the performance of its
obligations, an arrastre operator should observe
the same degree of diligence as that required of a
common carrier and a warehouseman as
enunciated under Article 1733 of the Civil Code
and Section 3(b) of the Warehouse Receipts Law,
respectively. Being the custodian of the goods
discharged from a vessel, an arrastre operator's
duty is to take good care of the goods and to turn
them over to the party entitled to their possession.
(Emphasis supplied)23
There is a distinction between an arrastre and a
stevedore.24 Arrastre, a Spanish word which
refers to hauling of cargo, comprehends the
handling of cargo on the wharf or between the
establishment of the consignee or shipper and the
ship's tackle. The responsibility of the arrastre
operator lasts until the delivery of the cargo to the
consignee. The service is usually performed by
longshoremen. On the other hand, stevedoring
refers to the handling of the cargo in the holds of
the vessel or between the ship's tackle and the
holds of the vessel. The responsibility of the
stevedore ends upon the loading and stowing of
the cargo in the vessel.1avvphi1
It is not disputed that Mindanao Terminal was
performing purely stevedoring function while the
private respondent in the Summa case was
performing arrastre function. In the present case,
Mindanao Terminal, as a stevedore, was only
charged with the loading and stowing of the
cargoes from the pier to the ship’s cargo hold; it
was never the custodian of the shipment of Del
Monte Produce. A stevedore is not a common
carrier for it does not transport goods or
passengers; it is not akin to a warehouseman for it
does not store goods for profit. The loading and
stowing of cargoes would not have a far reaching
public ramification as that of a common carrier
and a warehouseman; the public is adequately
protected by our laws on contract and on quasi-
delict. The public policy considerations in legally
imposing upon a common carrier or a
warehouseman a higher degree of diligence is not
present in a stevedoring outfit which mainly
provides labor in loading and stowing of cargoes
for its clients.
It was further established that Mindanao Terminal
loaded and stowed the cargoes of Del Monte
Produce aboard the M/V Mistrau in accordance
with the stowage plan, a guide for the area
assignments of the goods in the vessel’s hold,
prepared by Del Monte Produce and the officers
of M/V Mistrau.31 The loading and stowing was
done under the direction and supervision of the
ship officers. The vessel’s officer would order the
closing of the hatches only if the loading was done
correctly after a final inspection.32 The said ship
officers would not have accepted the cargoes on
board the vessel if they were not properly
arranged and tightly secured to withstand the
voyage in open seas. They would order the
stevedore to rectify any error in its loading and
stowing. A foreman’s report, as proof of work
done on board the vessel, was prepared by the
checkers of Mindanao Terminal and concurred in
by the Chief Officer of M/V Mistrau after they
were satisfied that the cargoes were properly
loaded.33
Phoenix and McGee relied heavily on the
deposition of Byeong Yong Ahn34 and on the
survey report35 of the damage to the cargoes.
Byeong, whose testimony was refreshed by the
survey report,36 found that the cause of the
damage was improper stowage37 due to the
manner the cargoes were arranged such that there
were no spaces between cartons, the use of
cardboards as support system, and the use of
small rope to tie the cartons together but not by
the negligent conduct of Mindanao Terminal in
loading and stowing the cargoes. As admitted by
Phoenix and McGee in their Comment38 before
us, the latter is merely a stevedoring company
which was tasked by Del Monte to load and stow
the shipments of fresh banana and pineapple of
Del Monte Produce aboard the M/V Mistrau.
How and where it should load and stow a
shipment in a vessel is wholly dependent on the
shipper and the officers of the vessel. In other
words, the work of the stevedore was under the
supervision of the shipper and officers of the
vessel. Even the materials used for stowage, such
as ropes, pallets, and cardboards, are provided for
by the vessel. Even the survey report found that it
was because of the boisterous stormy weather due
to the typhoon Seth, as encountered by M/V
Mistrau during its voyage, which caused the
shipments in the cargo hold to collapse, shift and
bruise in extensive extent.39 Even the deposition
of Byeong was not supported by the conclusion in
the survey report that: