1. Pedro Elcano, Et Al., V. Reginal Hill Et Al.

(1977)
Laws Applicable: ART. 2177,Article 397,article 1093,Article 2180 of the Civil Code
Lessons Applicable: Quasi-delict (Tort and Damages)

FACTS:

 Reginald Hill, a minor, married but living with his father, Atty. Marvin Hill with whom
he was living and getting subsistence killed Agapito Elcano
 CFI Civil Case: dismissed on the ground that he was acquitted on the ground that
his act was not criminal, because of "lack of intent to kill, coupled with mistake
 Spouses Elcano appealed
ISSUES:
1. W/N the civil action should be barred by the acquittal of criminal action - NO
2. W/N the Civil Code can be applied to Atty. Marvin Hill even though Reginald is
already married -YES
HELD: order appealed from is reversed

1. NO.
 separate individuality of a cuasi-delito or culpa aquiliana, under the Civil Code has
been fully and clearly recognized, even with regard to a negligent act for which the
wrongdoer could have been prosecuted and convicted in a criminal case and for
which, after such a conviction, he could have been sued for this civil liability arising
from his crime.
 If we were to hold that articles 1902 to 1910 of the Civil Code refer only to fault or
negligence not punished by law, accordingly to the literal import of article 1093 of
the Civil Code, the legal institution of culpa aquiliana would have very little scope
and application in actual life
 to find the accused guilty in a criminal case, proof of guilt beyond reasonable doubt
is required, while in a civil case, preponderance of evidence is sufficient to make the
defendant pay in damages. . Otherwise. there would be many instances of
unvindicated civil wrongs. "Ubi jus Idemnified remedium."
 ART. 2177. Responsibility for fault or negligence under the preceding article is
entirely separate and distinct from the civil liability arising from negligence under
the Penal Code. But the plaintiff cannot recover damages twice for the same act or
omission of the defendant.
 in reiteration of Garcia, that culpa aquiliana includes voluntary and negligent acts
which may be punishable by law
 It results, therefore, that the acquittal of Reginal Hill in the criminal case has not
extinguished his liability for quasi-delict, hence that acquittal is not a bar to the
instant action against him.
2. YES
 While it is true that parental authority is terminated upon emancipation of the child
(Article 327, Civil Code), and under Article 397, emancipation takes place "by the
marriage of the minor (child)", it is, however, also clear that pursuant to Article
399, emancipation by marriage of the minor is not really full or absolute. Thus
"(E)mancipation by marriage or by voluntary concession shall terminate parental
authority over the child's person. It shall enable the minor to administer his
property as though he were of age, but he cannot borrow money or alienate or
encumber real property without the consent of his father or mother, or guardian. He
 can sue and be sued in court only with the assistance of his father, mother or
guardian."

 Article 2180, "(T)he obligation imposed by article 2176 is demandable not only for
one's own acts or omissions, but also for those of persons for whom one is
responsible
 the marriage of a minor child does not relieve the parents of the duty to see to it
that the child, while still a minor, does not give answerable for the borrowings of
money and alienation or encumbering of real property which cannot be done by
their minor married child without their consent
 Reginald is now of age, as a matter of equity, the liability of Atty. Hill has become
milling, subsidiary to that of his son.

2. Rafael Reyes Trucking vs Pp. GR 145391

Facts:

In the early morning of June 20, 1989, the White Truck driven by Dunca left Tuguegarao, Cagayan
bound to San Fernando, Pampanga loaded with 2,000 cases of empty beer “Grande” bottles. Seated at
the front right seat beside him was Ferdinand Domingo, his truck helper. At around 4:00 o’clock that
same morning while the truck was descending at a slight downgrade along the national road at
Tagaran, Cauayan, Isabela, it approached a damaged portion of the road covering the full width of the
truck’s right lane going south and about six meters in length. These made the surface of the road
uneven because the potholes were about five to six inches deep. The left lane parallel to this damaged
portion is smooth. As narrated by Ferdinand Domingo, before approaching the potholes, he and
Dunca saw the Nissan with its headlights on coming from the opposite direction. They used to evade
this damaged road by taking the left lance but at that particular moment, because of the incoming
vehicle, they had to run over it. This caused the truck to bounce wildly. Dunca lost control of the
wheels and the truck swerved to the left invading the lane of the Nissan. As a result, Dunca’s vehicle
rammed the incoming Nissan dragging it to the left shoulder of the road and climbed a ridge above
said shoulder where it finally stopped. The Nissan was severely damaged and its two passengers,
namely, Feliciano Balcita and Francisco Dy, Jr. died instantly. On October 10, 1989, Provincial
Prosecutor Durian filed with the RTC an amended information charging Dunca with reckless
imprudence resulting in double homicide and damage to property. On November 29, 1989, the
offended parties filed with the RTC a complaint against petitioner Rafael Reyes Trucking Corporation,
as employer of driver Dunca, based on quasi delict. Respondents opted to pursue the criminal action
but did not withdraw the civil case quasi ex delicto they filed against petitioner. On December 15,
1989, respondents withdrew the reservation to file a separate civil action against the accused and
manifested that they would prosecute the civil aspect ex delicto in the criminal action. However, they
did not withdraw the separate civil action based on quasi delict against petitioner as employer arising
from the same act or omission of the accused driver. The RTC held that the driver was guilty.
Respondents moved for amendment of the dispositive portion of the joint decision so as to hold
petitioner subsidiarily liable for the damages awarded to the private respondents in the event of
insolvency of the accused, which the lower court granted.

Issues:
(1) Whether or not petitioner as owner of the truck involved in the accident may be held subsidiarily
liable for the damages awarded to the offended parties in the criminal action against the truck driver
despite the filing of a separate civil action by the offended parties against the employer of the truck
driver; and

(2) Whether or not the Court may award damages to the offended parties in the criminal case despite
the filing of a civil action against the employer of the truck driver.

Held:

(1) No. In negligence cases, the aggrieved party has the choice between (1) an action to enforce civil
liability arising from crime under Article 100 of the Revised Penal Code; and (2) a separate action for
quasi delict under Article 2176 of the Civil Code of the Philippines. Once the choice is made, the
injured party can not avail himself of any other remedy because he may not recover damages twice
for the same negligent act or omission of the accused. This is the rule against double recovery.In other
words, “the same act or omission can create two kinds of liability on the part of the offender, that is,
civil liability ex delicto, and civil liability quasi delicto” either of which “may be enforced against the
culprit, subject to the caveat under Article 2177 of the Civil Code that the offended party can not
recover damages under both types of liability.” In the instant case, the offended parties elected to file
a separate civil action for damages against petitioner as employer of the accused, based on quasi
delict, under Article 2176 of the Civil Code of the Philippines. Petitioner, as employer of the accused
who has been adjudged guilty in the criminal case for reckless imprudence, cannot be held subsidiarily
liable because of the filing of the separate civil action based on quasi delict against it. In view of the
reservation to file, and the subsequent filing of the civil action for recovery of civil liability, the same
was not instituted with the criminal action. Such separate civil action was for recovery of damages
under Article 2176 of the Civil Code, arising from the same act or omission of the accused.

(2) No. The award of damages in the criminal case was improper because the civil action for the
recovery of civil liability was waived in the criminal action by the filing of a separate civil action
against the employer. The only issue brought before the trial court in the criminal action is whether
accused Dunca is guilty of reckless imprudence resulting in homicide and damage to property. The
action for recovery of civil liability is not included therein, but is covered by the separate civil action
filed against the petitioner as employer of the accused truck-driver. The policy against double
recovery requires that only one action be maintained for the same act or omission whether the action
is brought against the employee or against his employer. The injured party must choose which of the
available causes of action for damages he will bring.

3. Casapunan vs Laroya GR 145391

Facts:
Respondent filed a criminal action against petitioners for Reckless Imprudence Resulting
to Damage to Property. While the criminal case is pending, the Petitioners filed with the
MCTC a civil case for Quasi-delict. Respondent filed a motion to dismiss the said civil
action against him on the ground of forum-shopping considering the pendency of the
criminal case. The MCTC granted the motion. Petitioners filed a motion for
reconsideration which was denied by the MCTC. They appeal to the RTC, with was also
denied. Hence this case.

Issue:
whether an accused in a pending criminal case for reckless imprudence can validly file,
simultaneously and independently, a separate civil action for quasi-delict against the
private complainant in the criminal case.

Held:
Yes, Under Section 1 of the present Rule 111, the independent civil action in Articles 32,
33, 34 and 2176 of the Civil Code is not deemed instituted with the criminal action but
may be filed separately by the offended party even without reservation. The
commencement of the criminal action does not suspend the prosecution of the
independent civil action under these articles of the Civil Code. The suspension in Section
2 of the present Rule 111 refers only to the civil action arising from the crime, if such civil
action is reserved or filed before the commencement of the criminal action.

Thus, the offended party can file two separate suits for the same act or omission. The first
a criminal case where the civil action to recover civil liability ex-delicto is deemed
instituted, and the other a civil case for quasi-delict – without violating the rule on non-
forum shopping. The two cases can proceed simultaneously and independently of each
other. The commencement or prosecution of the criminal action will not suspend the civil
action for quasi-delict. The only limitation is that the offended party cannot recover
damages twice for the same act or omission of the defendant. In most cases, the offended
party will have no reason to file a second civil action since he cannot recover damages
twice for the same act or omission of the accused. In some instances, the accused may be
insolvent, necessitating the filing of another case against his employer or guardians.

4. Sps Santos vs Pizardo GR 151452

CRIMINAL SECTION 3, RULE 111

PROCEDURE
TITLE: G.R. No. 151452
Date: July 29, 2005
SPOUSES SANTOS vs. PIZARDO Ponente: TINGA, J.:
SPS. ANTONIO C. SANTOS and ESPERANZA
C. SANTOS, NORA BARNALO, BELINDA HON. NORMANDIE B. PIZARDO, and VIRON
LUMACTAD, MARIENELA DY, NIKKA TRANSPORTATION COMPANY, INC.,
SANTOS and LEONARDO FERRER, petitioners respondents
FACTS:
Case timeline:
Dionisio M. Sibayan (Sibayan) was charged with Reckless Imprudence Resulting to Multiple Homicide
and Multiple Physical Injuries in connection with a vehicle collision between a southbound Viron Transit
bus driven by Sibayan and a northbound Lite Ace Van, which claimed the lives of the vans driver and three
(3) of its passengers, including a two-month old baby, and caused physical injuries to five (5) of the vans
passengers.

After trial, Sibayan was convicted and sentenced to suffer the penalty of imprisonment for two (2) years, four
(4) months and one (1) day to four (4) years and two (2) months. However, as there was a reservation to
file a separate civil action, no pronouncement of civil liability was made by the municipal circuit trial
court in its decision promulgated on December 17, 1998.

On October 20, 2000, petitioners filed a complaint for damages against Sibayan, Viron Transit and its
President/Chairman, Virgilio Q. Rondaris, with the Regional Trial Court of Quezon City, pursuant to their
reservation to file a separate civil action.

The trial court dismissed the complaint on the principal ground that the cause of action had already prescribed
(4 years for action based on quasi-delict.

In this instant case, Petitioners insist that the liability sought to be enforced in the complaint arose ex
delicto and is not based on quasi delict.
ISSUE/S:
Whether or not the action has prescribed
RATIO:
NO.

A reading of the complaint reveals that the allegations therein are consistent with petitioner’s claim that
the action was brought to recover civil liability arising from crime. Although there are allegations of
negligence on the part of Sibayan and Viron Transit, such does not necessarily mean that petitioners were
pursuing a cause of action based on quasi delict, considering that at the time of the filing of the complaint, the
cause of action ex quasi delicto had already prescribed. Besides, in cases of negligence, the offended party
has the choice between an action to enforce civil liability arising from crime under the Revised Penal Code
and an action for quasi delict under the Civil Code.

At the time of the filing of the complaint for damages in this case, the cause of action ex quasi delicto had
already prescribed. Nonetheless, petitioners can pursue the remaining avenue opened for them by their
reservation, i.e., the surviving cause of action ex delicto. This is so because the prescription of the action ex
quasi delicto does not operate as a bar to an action to enforce the civil liability arising from crime
especially as the latter action had been expressly reserved.

Petitioners expressly made a reservation of their right to file a separate civil action as a result of the crime
committed by Sibayan. On account of this reservation, the municipal circuit trial court, in its decision
convicting Sibayan, did not make any pronouncement as to the latter’s civil liability.

We held that the dismissal of the action based on culpa aquiliana is not a bar to the enforcement of the
subsidiary liability of the employer. Once there is a conviction for a felony, final in character, the employer
 becomes subsidiarily liable if the commission of the crime was in the discharge of the duties of the employees.
This is so because Article 103 of the Revised Penal Code operates with controlling force to obviate the
possibility of the aggrieved party being deprived of indemnity even after the rendition of a final judgment
convicting the employee.

Seen in this light, the trial court should not have dismissed the complaint on the ground of prescription,
but instead allowed the complaint for damages ex delicto to be prosecuted on the merits, considering
petitioners’ allegations in their complaint, opposition to the motion to dismiss and motion for reconsideration
of the order of dismissal, insisting that the action was to recover civil liability arising from crime.
RULING:
WHEREFORE, judgment is hereby rendered SETTING ASIDE the resolutions of the Court of Appeals dated
September 10, 2001 and January 9, 2002, respectively dismissing the present action and denying petitioners
motion for reconsideration, as well as the orders of the lower court dated February 26, 2001 and July 16, 2001.
Let the case be REMANDED to the trial court for further proceedings.
NOTES:

5. Manliclic vs Caulanan GR 150157

FACTS:
1. The vehicles involved in this case are: (1) Philippine Rabbit Bus owned by petitioner PRBLI and
driven by petitioner Mauricio Manliclic; and (2) owner-type jeep owned by respondent Modesto
Calaunan and driven by Marcelo Mendoza
2. At approximately Kilometer 40 of the North Luzon Expressway in Barangay Lalangan, Plaridel,
Bulacan, the two vehicles collided.
- The front right side of the Philippine Rabbit Bus hit the rear left side of the jeep causing the
latter to move to the shoulder on the right and then fall on a ditch with water resulting to further
extensive damage.
- Respondent suffered minor injuries while his driver was unhurt.
3. By reason of such collision, a criminal case was filed charging petitioner Manliclic with Reckless
Imprudence Resulting in Damage to Property with Physical Injuries.
4. Subsequently on 2 December 1991, respondent filed a complaint for damages against petitioners
Manliclic and PRBLI
5. The criminal case was tried ahead of the civil case.
6. When the civil case was heard, counsel for respondent prayed that the transcripts of stenographic
notes (TSNs) of the testimonies in the criminal case be received in evidence in the civil case in as
much as these witnesses are not available to testify in the civil case.
7. The versions of the parties are summarized by the trial court as follows:

Respondent’s version:
- According to the respondent and his driver, the jeep was cruising at the speed of 60 to 70
kilometers per hour on the slow lane of the expressway when the Philippine Rabbit Bus overtook
the jeep and in the process of overtaking the jeep, the Philippine Rabbit Bus hit the rear of the
jeep on the left side.
- At the time the Philippine Rabbit Bus hit the jeep, it was about to overtake the jeep. In other
words, the Philippine Rabbit Bus was still at the back of the jeep when the jeep was hit.
- Fernando Ramos corroborated the testimony of and Marcelo Mendoza. He said that he was on
another jeep following the Philippine Rabbit Bus and the jeep of plaintiff when the incident took
place. He testified that the jeep of plaintiff swerved to the right because it was bumped by the
Philippine Rabbit bus from behind.

Petitioner’s version:
 - The petitioner explained that when the Philippine Rabbit bus was about to go to the left lane to
overtake the jeep, the latter jeep swerved to the left because it was to overtake another jeep
in front of it.
- Petitioner PRBLI maintained that it observed and exercised the diligence of a good father of a
family in the selection and supervision of its employee
8. RTC ruled in favor of the respondent. CA found no reversible error and affirmed the RTC’s decision.

ISSUES:
1. Whether the TSNs from the criminal case may be admitted in evidence for the civil case.
2. Whether the petitioner, Manliclic, may be held liable for the collision and be found negligent
notwithstanding the declaration of the CA in the criminal case that there was an absence of
negligence on his part.
3. Whether the petitioner, PRBLI, exercised due diligence and supervision of its employee.

HELD: The petitioner, Manliclic, is civilly liable for the damages for his negligence or reckless imprudence
based on quasi-delict. The PRBLI is held solidarily liable for the damages caused by the petitioner
Manliclic’s negligence.

1. Admissibility of the TSNs

Petitioner’s contention:
- The TSNs should not be admitted to evidence for failure to comply with the requisites of Sec.
47, Rule 130 of the ROC
- The petitioner, PRBLI, had no opportunity to cross examine the witnesses because the criminal
case was filed exclusively against Manliclic.
- Admission of the TSNs will deprive the petitioner of due process.
Court:
- The testimonies are still admissible on the ground that the petitioner failed to object on their
admissibility.
- Failure to object to the inclusion of the evidence is a waiver on the provision of the law.
- In addition, the petitioner even offered in evidence the TSN containing the testimony of Ganiban.
- The court disagrees that it would deprive the petitioner of due process. For the failure of the
petitioner to object at the proper time, it waived its right to object for the non compliance with
the ROC.

2. Civil liability arising from crime v. Quasi-delict/Culpa Acquiliana

Petitioner:
- The version of the petitioner deserves more credit as the petitioner was already acquitted by
the CA of the charge of Reckless imprudence resulting in damage to property with physical
injuries.
Court:
- From the complaint, it can be gathered that the civil case for damages was one arising from or
based on quasi-delict: Petitioner Manliclic was sued for his negligence or reckless imprudence in
causing the collision, while petitioner PRBLI was sued for its failure to exercise the diligence of
a good father in the selection and supervision of its employees
- it appears that petitioner Manliclic was acquitted not on reasonable doubt, but on the ground
that he is not the author of the act complained of which is based on Section 2(b) of Rule 111 of
the Rules of Criminal Procedure which reads:

(b) Extinction of the penal action does not carry with it extinction of the civil, unless the extinction
proceeds from a declaration in a final judgment that the fact from which the civil might arise did not
exist.

- In spite of said ruling, petitioner Manliclic can still be held liable for the mishap. The afore-quoted
section applies only to a civil action arising from crime or ex delicto and not to a civil action
arising from quasi-delict or culpa aquiliana.
- The extinction of civil liability referred to in the quoted provision, refers exclusively to civil
liability founded on Article 100 of the Revised Penal Code, whereas the civil liability for the same
 act considered as a quasi-delict only and not as a crime is not extinguished even by a declaration
in the criminal case that the criminal act charged has not happened or has not been committed
by the accused.

In sum, the court distinguished civil liability arising from a crime and that arising from quasi-delict:

CIVIL LIABILITY ARISING FROM A CRIME

(a) if an accused is acquitted based on reasonable doubt on his guilt, his civil liability arising from
the crime may be proved by preponderance of evidence only.
(b) if an accused is acquitted on the basis that he was not the author of the act or omission
complained of (or that there is declaration in a final judgment that the fact from which the civil
might arise did not exist), said acquittal closes the door to civil liability based on the crime or
ex delicto.

CIVIL LIABILITY ARISING FROM QUASI-DELICT

- A quasi-delict or culpa aquiliana is a separate legal institution under the Civil Code with a
substantivity all its own, and individuality that is entirely apart and independent from a delict or
crime.
- The same negligence causing damages may produce civil liability arising from a crime under the
Penal Code, or create an action for quasi-delicts or culpa extra-contractual under the Civil
Code. The acquittal of the accused, even if based on a finding that he is not guilty, does
not carry with it the extinction of the civil liability based on quasi delict.
- civil liability arising from quasi-delict or culpa aquiliana, same will not be extinguished by an
acquittal, whether it be on ground of reasonable doubt or that accused was not the author of
the act or omission complained of (or that there is declaration in a final judgment that the fact
from which the civil liability might arise did not exist).
- An acquittal or conviction in the criminal case is entirely irrelevant in the civil case based on
quasi-delict or culpa aquiliana.

- The petitioners urge the court to give more credence to their version of the story however, as
they constitute a question of fact, it may not be raised as a subject for a petition for review.
Findings of the trial court and appellate court are binding on the Supreme Court.
- The testimony of the petitioner about the jeep of the respondent overtaking another vehicle in
the criminal case was not consistent with what he gave to the investigator which is evidently a
product of an after-thought
- If one would believe the testimony of the defendant, Mauricio Manliclic, and his conductor, Oscar
Buan, that the Philippine Rabbit Bus was already somewhat parallel to the jeep when the collision
took place, the point of collision on the jeep should have been somewhat on the left side thereof
rather than on its rear. Furthermore, the jeep should have fallen on the road itself rather than
having been forced off the road.

3. PRBLI’s liability
- Under Article 2180 of the New Civil Code, when an injury is caused by the negligence of the
employee, there instantly arises a presumption of law that there was negligence on the part of
the master or employer either in the selection of the servant or employee, or in supervision over
him after selection or both.
- The liability of the employer under Article 2180 is direct and immediate; it is not conditioned
upon prior recourse against the negligent employee and a prior showing of the insolvency of
such employee. Therefore, it is incumbent upon the private respondents to prove that they
exercised the diligence of a good father of a family in the selection and supervision of their
employee.

Petitioner’s contention:
- PRBLI maintains that it had shown that it exercised the required diligence in the selection and
supervision of its employees
- In the matter of selection, it showed the screening process that petitioner Manliclic underwent
before he became a regular driver.
 - As to the exercise of due diligence in the supervision of its employees, it argues that presence
of ready investigators is sufficient proof that it exercised the required due diligence in the
supervision of its employees
Court:
- In the selection of prospective employees, employers are required to examine them as to their
qualifications, experience and service records. In the supervision of employees, the employer
must formulate standard operating procedures, monitor their implementation and impose
disciplinary measures for the breach thereof.
- As the negligence of the employee gives rise to the presumption of negligence on the part of
the employer, the latter has the burden of proving that it has been diligent not only in the
selection of employees but also in the actual supervision of their work.
- The trial court found that petitioner PRBLI exercised the diligence of a good father of
a family in the selection but not in the supervision of its employees
- it seems that the Philippine Rabbit Bus Lines has a very good procedure of recruiting its driver
as well as in the maintenance of its vehicles. There is no evidence though that it is as good in
the supervision of its personnel.
o no evidence introduced that there are rules promulgated by the bus company regarding the
safe operation of its vehicle and in the way its driver should manage and operate the vehicles
o no showing that somebody in the bus company has been employed to oversee how its driver
should behave while operating their vehicles
o The presence of ready investigators after the occurrence of the accident is not enough. Same
does not comply with the guidelines set forth with regard to the supervision.
o Regular supervision of employees, that is, prior to any accident, should have been shown
and established.
o the lack of supervision can further be seen by the fact that there is only one set of manual
containing the rules and regulations for all the drivers
- For failure to adduce proof that it exercised the diligence of a good father of a family
in the selection and supervision of its employees, petitioner PRBLI is held solidarily
responsible for the damages caused by petitioner Manliclic’s negligence.

6. Franco vs IAC GR 71137

FACTS:
The instant petition deals mainly with the nature of an employer's liability for his
employee's negligent act.
At about 7:30 in the evening of October 18, 1974, Macario Yuro swerved the
northbound Franco Bus with Plate No. XY320-PUB he was driving to the left to avoid
hitting a truck with a trailer parked facing north along the cemented pavement of the
MacArthur Highway at Barrio Talaga, Capas Tarlac, thereby taking the lane of an
incoming Isuzu Mini Bus bearing Plate No. YL-735 being driven by one Magdaleno Lugue
and making a collision between the two (2) vehicles an unavoidable and disastrous
eventuality.
Dragged fifteen (15) meters from the point of impact (midway the length of the
parked truck with trailer), the mini bus landed right side down facing south in the canal
of the highway, a total wreck. The Franco Bus was also damaged but not as severely.
The collision resulted in the deaths of the two (2) drivers, Macario Yuro and Magdaleno
Lugue, and two (2) passengers of the mini bus, Romeo Bue and Fernando Chuay.

Consequently, Antonio Reyes, the registered owner of the Isuzu Mini Bus, Mrs.
Susan Chuay, the wife of victim Fernando Chuay, and Mrs. Lolita Lugue, the wife of
driver-victim Magdaleno Lugue, filed an action for damages through reckless
imprudence against Mr. & Mrs. Federico Franco, the owners and operators of the Franco
Transportation Company

ISSUE:

Whether the action for recovery of damages instituted by herein private respondents
was predicated upon crime or quasi-delict.
yes under Articles 2176 and 2180 of the Civil Code

RULING:

Distinction should be made between the subsidiary liability of the employer under
the Revised Penal Code and the employer's primary liability under the Civil Code which
is quasi-delictual or tortious in character. The first type of liability is governed by Articles
102 and 103 of the Revised Penal Code which provide as follows:
Art. 102. Subsidiary civil liability of innkeepers, tavern-keepers and
proprietors of establishments. — In default of the persons criminally
liable, innkeepers, tavern-keepers, and any other persons or corporations
shall be civilly liable for crimes committed in their establishments, in all
cases where a violation of municipal ordinances or some general or special
police regulations shall have been committed by them or their employees.

Innkeepers are also subsidiarily liable for the restitution of goods

taken by robbery or theft within their houses from guests lodging therein,
or for the payment of the value thereof, provided that such guests shall
have notified in advance the innkeeper himself, or the person representing
him, of the deposits of such goods within the inn; and shall furthermore
have followed the directions which such innkeeper or his representative
may have given them with respect to the care and vigilance over such
goods. No liability shall attach in case of robbery with violence against or
intimidation of persons unless committed by the innkeeper's employees.
Art. 103. Subsidiary civil liability of other persons. — The
subsidiary liability established in the next preceding article shall also
apply to employers, teachers, persons, and corporations engaged in any
kind of industry for felonies committed by the servants, pupils, workmen,
apprentices, or employees in the discharge of their duties;
while the second kind is governed by the following provisions of the Civil Code:
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 a quasi-delict and is governed by the provisions of this Chapter.
 Art. 2177. Responsibility for fault or negligence under the preceding
article is entirely separate and distinct from the civil liability arising from
negligence under the Penal Code. But the plaintiff cannot recover damages twice
for the same act or omission of the defendant.

Art. 2180. The obligations imposed by article 2176 is demandable not only
for one's own acts or omissions, but also for those of persons for whom one is
responsible.
xxx xxx xxx
Employers shall be liable for the damages caused by their employees and
household helpers acting within the scope of their assigned tasks, even though
the former are not engaged in any business or industry,
xxx xxx xxx

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

Under Article 103 of the Revised Penal Code, liability originates from a
delict committed by the employee who is primarily liable therefor and upon whose
primary liability his employer's subsidiary liability is to be based. Before the
employer's subsidiary liability may be proceeded against, it is imperative that there
should be a criminal action whereby the employee's criminal negligence or delict and
corresponding liability therefor are proved.

In the case at bar, no criminal action was instituted because the person who
should stand as the accused and the party supposed to be primarily liable for the
damages suffered by private respondents as a consequence of the vehicular mishap
died. Thus, petitioners' subsidiary liability has no leg to stand on considering that
their liability is merely secondary to their employee's primary liability.
On the other hand, under Articles 2176 and 2180 of the Civil Code, liability
is based on culpa aquiliana which holds the employer primarily liable for tortious
acts of its employees subject, however, to the defense that the former exercised
all the diligence of a good father of a family in the selection and supervision of his
employees.

Having thus established that Civil Case No. 2154 is a civil action to impose the
primary liability of the employer as a result of the tortious act of its alleged reckless
driver, we confront ourselves with the plausibility of defendants-petitioners' defense that
they observed due diligence of a good father of a family in the selection and supervision
of their employees. On this point, the appellate court has unequivocally spoken in
affirmation of the lower court's findings, to wit:

“Anyway, a perusal of the record shows that the appellants were not able
to establish the defense of a good father of a family in the supervision of
their bus driver. “
Consequently, therefore, we find petitioners liable for the damages claimed pursuant
to their primary liability under the Civil Code.
7. Philippine School vs CA
FACTS: Carlitos Bautista was a third year student at the Philippine School of Business Administration.
Assailants, who were not members of the schools academic community, while in the premises of
PSBA, stabbed Bautista to death. This incident prompted his parents to file a suit against PSBA and
its corporate officers for damages due to their alleged negligence, recklessness and lack of security
precautions, means and methods before, during and after the attack on the victim.

The defendants filed a motion to dismiss, claiming that the compliant states no cause of action against
them based on quasi-delicts, as the said rule does not cover academic institutions. The trial court
denied the motion to dismiss. Their motion for reconsideration was likewise dismissed, and was
affirmed by the appellate court. Hence, the case was forwarded to the Supreme Court.

ISSUE: Whether or not PSBA is liable for the death of the student.

RULING: Because the circumstances of the present case evince a contractual relation between the
PSBA and Carlitos Bautista, the rules on quasi-delict do not really govern. A perusal of Article
2176 shows that obligations arising from quasi-delicts or tort, also known as extra-contractual
obligations, arise only between parties not otherwise bound by contract, whether express or implied.
However, this impression has not prevented this Court from determining the existence of a tort even
when there obtains a contract.

Article 2180, in conjunction with Article 2176 of the Civil Code, establishes the rule in in loco parentis.
Article 2180 provides that the damage should have been caused or inflicted by pupils or students of
the educational institution sought to be held liable for the acts of its pupils or students while in its
custody. However, this material situation does not exist in the present case for, as earlier indicated,
the assailants of Carlitos were not students of the PSBA, for whose acts the school could be made
liable. But it does not necessarily follow that PSBA is absolved form liability.

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

In the circumstances obtaining in the case at bar, however, there is, as yet, no finding that the contract
between the school and Bautista had been breached thru the former's negligence in providing proper
security measures. This would be for the trial court to determine. And, even if there be a finding of
negligence, the same could give rise generally to a breach of contractual obligation only. Using the
test of Cangco, supra, the negligence of the school would not be relevant absent a contract. In fact,
that negligence becomes material only because of the contractual relation between PSBA and
Bautista. In other words, a contractual relation is a condition sine qua nonto the school's liability. The
negligence of the school cannot exist independently of the contract, unless the negligence occurs
under the circumstances set out in Article 21 of the Civil Code.
EXCEPTIONS:
7.1 Singson vs BPI
FACTS:
Singson was one of the defendants in a civil case, in which judgment had been rendered sentencing
him and his co-defendants therein Lobregat and Villa-Abrille & Co., to pay a sum of money to the
plaintiff therein. Said judgment became final and executory as only against Ville-Abrille for its failure
to file an appeal. A writ of garnishment was subsequently served upon BPI — in which the Singsons
had a current account — insofar as Villa-Abrille’s credits against the Bank were concerned.
Upon receipt of the said Writ of Garnishment, a clerk of the bank, upon reading the name of the
Singson in the title of the Writ of Garnishment as a party defendants, without further reading the body
and informing himself that said garnishment was merely intended for the deposits of defendant Villa-
Abrille & Co., et al, prepared a letter informing Singson of the garnishment of his deposits by the
plaintiff in that case.
Subsequently, two checks issued by the plaintiff Julian C. Singson, one in favor of B. M. Glass Service
and another in favor of the Lega Corporation, were dishonored by the bank. B. M. Glass Service then
wrote to Singson that the check was not honored by BPI because his account therein had already
been garnished and that they are now constrained to close his credit account with them.
Singson wrote to BPI, claiming that his name was not included in the Writ of Execution and Notice of
Garnishment, which was served upon the bank. The defendants lost no time to rectify the mistake
that had been inadvertently committed.
Thus this action for damages.
ISSUE:
WON the existence of a contract between the parties bars a plaintiff’s claim for damages based on
torts?
HELD:
NO. The existence of a contract between the parties does not bar the commission of a tort by the one
against the order and the consequent recovery of damages therefore. Indeed, this view has been, in
effect, reiterated in a comparatively recent case. Thus, in Air France vs. Carrascoso, involving an
airplane passenger who, despite his first-class ticket, had been illegally ousted from his first-class
accommodation and compelled to take a seat in the tourist compartment, was held entitled to recover
damages from the air-carrier, upon the ground of tort on the latter’s part, for, although the relation
between a passenger and a carrier is “contractual both in origin and nature … the act that breaks the
contract may also be a tort”.
In view, however, of the facts obtaining in the case at bar, and considering, particularly, the
circumstance, that the wrong done to the plaintiff was remedied as soon as the President of the bank
realized the mistake he and his subordinate employee had committed, the Court finds that an award
of nominal damages — the amount of which need not be proven — in the sum of P1,000, in addition
to attorney’s fees in the sum of P500, would suffice to vindicate plaintiff’s rights.
7.2 Air France vs Carrascoso
AIR FRANCE
vs.
RAFAEL CARRASCOSO and the HONORABLE COURT OF APPEALS

G.R. No. L-21438 September 28, 1966

Facts:
 Rafael Carrascoso, a civil engineer, was a member of a group of 48 Filipino pilgrims that left Manila
for Lourdes on March 30, 1958.

On March 28, 1958, Air France, through its authorized agent, Philippine Air Lines, Inc., issued to
Carascoso a "first class" round trip airplane ticket from Manila to Rome. From Manila to Bangkok, he travelled
in "first class", but at Bangkok, the Manager of Air France forced him to vacate the "first class" seat that he
was occupying because there was a "white man”, who the Manager alleged, had a "better right" to the
seat. When asked to vacate his "first class" seat, a commotion ensued, many of the Filipino passengers got
nervous in the tourist class; when they found out that Mr. Carrascoso was having a hot discussion with the
white man, they came all across to Mr. Carrascoso and pacified Mr. Carrascoso to give his seat to the white
man"; and respondent reluctantly gave his "first class" seat in the plane.

Because of the incident, respondent filed an action for damages for breach of contract.

Respondent contended that he paid to and received from petitioner a first class ticket. But petitioner asserts
the following:
1. That the said ticket did not represent the true and complete intent and agreement of the parties;
2. That said respondent knew that he did not have confirmed reservations for first class on any specific flight,
although he had tourist class protection; and
3. That the issuance of a first class ticket was no guarantee that he would have a first class ride, but that such
would depend upon the availability of first class seats.

CFI/ RTC ruling:

-Petitioner tried to prove by the testimony of its witnesses Luis Zaldariaga and Rafael Altonaga that although
respondent paid for, and was issued a "first class" airplane ticket, the ticket was subject to confirmation in
Hongkong. The court cannot give credit to the testimony of said witnesses. Oral evidence cannot prevail
over written evidences presented by the plaintiff which clearly show that the respondent was issued, and
paid for, a first class ticket without any reservation whatever. It cannot be believe that after such
confirmation, petitioner had a verbal understanding with respondent that the "first class" ticket issued to him
by petitioner would be subject to confirmation in Hongkong.

-CFI ruled in favor of Carrascoso. It sentenced petitioner to pay respondent P25,000.00 by way of moral
damages; P10,000.00 as exemplary damages; P393.20 representing the difference in fare between first class
and tourist class for the portion of the trip Bangkok-Rome plus P3,000.00 for attorneys' fees; and the costs of
suit

CA ruling:

- CA slightly reduced the amount of refund on Carrascoso's plane ticket from P393.20 to P383.10, and voted
to affirm the appealed decision "in all other respects", with costs against petitioner.

Issues:
1. Whether or not Carrascoso was entitled to the first class seat

2. Whether or not he is entitled to damages

SC Ruling:

1. Yes. If airline companies would have the policy that a first-class-ticket holder is not entitled to a first class
seat, notwithstanding the fact that seat availability in specific flights is therein confirmed, then an air
 passenger is placed in the hollow of the hands of an airline. There is no security for the passengers. It will
always be an easy matter for an airline aided by its employees, to strike out the very stipulations in the ticket,
and say that there was a verbal agreement to the contrary. It is a rule that, a written document speaks a
uniform language. There must be adherence to the ticket issued by the airline company. Since Carrascoso
was given a “first class” airplane ticket, he is entitled to such.

2.
Yes.
-First, That there was a contract to furnish Carrascoso a first class passage covering, among others, the
Bangkok-Teheran leg;
Second, That said contract was breached when petitioner failed to furnish first class transportation at
Bangkok; and Third, that there was bad faith when petitioner's employee compelled Carrascoso to leave his
first class accommodation "after he was already, seated" and to take a seat in the tourist class, by reason of
which he suffered inconvenience, embarrassments and humiliations, thereby causing him mental anguish,
serious anxiety, wounded feelings and social humiliation, resulting in moral damages.

- A contract to transport passengers is quite different in kind and degree from any other contractual
obligation because of the relation which an air carrier sustains with the public. The contract of air
carriage, therefore, generates a relation attended with a public duty. Neglect or malfeasance of
the carrier's employees, could give ground for an action for damages. Petitioner's contract with
Carrascoso is one attended with public duty. The stress of Carrascoso's action is placed upon his
wrongful expulsion. This is a violation of public duty by the petitioner air carrier — a case of quasi-
delict. Damages are proper.

- Article 21 of the Civil Code provides that, “any person who willfully causes loss or injury to another in
a manner that is contrary to morals, good customs or public policy shall compensate the latter for
the damage.”

Exemplary damages are also well awarded since the action of the respondent is based on a
contract. In addition, the plaintiff’s act of ejecting the respondent in his first class seat is an act which
was done in a wanton, fraudulent, reckless, oppressive, or malevolent manner.

-SC affirmed the decision of CA.

7.3 Regino vs Pangasinan Colleges

8. Manila Railroad vs La Compania

Facts:

Two locomotive boilers owned by The Manila Railroad Company arrived at Manila via the Steamship Alicante owned by Compañia
Trasatlantica de Barcelona. The equipment of the ship for discharging heavy cargo was not sufficiently strong to handle these
boilers, so the Steamship Company had to procure assistance from The Atlantic, Gulf and Pacific Company (hereafter called the
Atlantic Company). The service to be performed by the Atlantic Company consisted in bringing its floating crane alongside
the Alicante, lifting the boilers out of the ship's hold, and transferring them to a barge which would be placed ready to receive
them.

While the boiler was being hoisted, it was not properly done as the rivet near the head of the boiler was caught under the edge of
the hatch. The weight on the crane was thus increased by a strain estimated at fifteen tons with the result that the cable of the
sling parted and the boiler fell to the bottom of the ship's hold. (natagak ang boiler unya nakaduha pa jud xa natagak)
The boiler was badly damaged that it had to be reshipped to England where it was rebuilt, and afterwards was returned to Manila.
The Railroad Company's damage by reason of the cost of repairs, expenses, and loss of the use of the boiler proved to be
P22,343.29; and as to the amount of the damage so resulting there is practically no dispute. To recover these damages the present
action was instituted by the Railroad Company against the Steamship Company who in turn caused the Atlantic Company to be
brought in as a codefendant, and insisted that whatever liability existed should be fixed upon the Atlantic Company as an
independent contractor who had undertaken to discharge the boilers and had become responsible for such damage as had been
done.

The judge of the Court of First Instance gave judgment in favor of the plaintiff against the Atlantic Company, but absolved the
Steamship Company from the complaint.

Issue:

(1) Is the Steamship Company liable to the plaintiff by reason of having delivered the boiler in question in a damaged condition?
(2) Is the Atlantic Company liable to be made to respond to the steamship company for the amount the latter may be required to
pay to the plaintiff for the damage done ? (3) Is the Atlantic Company directly liable to the plaintiff, as the trial court held?

Ruling:

The accident is to be attributed to the failure of Leyden (foreman) to exercise the degree of care which an ordinarily competent
and prudent person would have exhibited under the circumstances which then confronted him. This conclusion of fact cannot be
refuted; and, indeed, no attempt is here made by the appellant to reverse this finding of the trial court.

It will be observed that a contractual relation existed between the Railroad Company and the Steamship Company; and the duties
of the latter with respect to the carrying and delivery of the boilers are to be discovered by considering the terms and legal effect
of that contract. A contractual relation also existed between the Steamship Company and the Atlantic Company; and
the duties owing by the latter to the former with respect to the lifting and the transferring of the boilers are likewise to be discovered
by considering the terms and legal effect of the contract between these parties. On the other hand, no contractual relation
existed directly between the Railroad Company and the Atlantic Company.

Under the contract for transportation from England to Manila, the Steamship Company is liable to the plaintiff for the injury done
to the boiler while it was being discharged from the ship under articles 1103 and 1104 of the Civil Code, for the consequences of
the omission of the care necessary to the proper performance of its obligation. The contract to transport and deliver at the port of
Manila a locomotive boiler, which was received by it in proper condition, is not complied with by delivery at the port of destination
of a mass of iron the utility of which had been destroyed.

The Steamship Company cannot escape liability by reason of the fact that it employed a competent independent contractor to
discharge the boilers..

Defenses of Atlantic
Atlantic contends that by the terms of the engagement in accordance with which the Atlantic Company agreed to render the service,
all risk incident to the discharge of the boilers was assumed by the Steamship Company; and secondly, that the Atlantic Company
should be absolved under the last paragraph of article 1903 of the Civil Code, inasmuch as it had used due care in the selection of
the employee whose negligent act caused the damage in question.

At the hearing, the president of the Atlantic company said that the agreement was that their company would not assume
responsibility for any damage.

The Atlantic Company offered in evidence a number of letters which had been written by it at different times, extending over a
period of years, in response to inquiries made by other firms and persons in Manila concerning the terms upon which the Atlantic
Company would make heavy lifts. The company recognized its duty to exercise due supervisory care; and the exemption from
liability, whatever may have been its precise words, had reference to disasters which might result from some inherent hidden defect
in the lifting apparatus or other unforeseen occurrence not directly attributable to negligence of the company in the lifting
operations. Neither party could have supposed for a moment that it was intended to absolve the Atlantic Company from its duty to
use due care in the work.

The court said that if the exemption should be understood in the sense which counsel for the Atlantic Company now insists it should
bear, that is, as an absolute exemption from all responsibility for negligence, it is evident that the agreement was a most inequitable
and unfair one, and hence it is one that the Steamship Company can not be lightly assumed to have made. Understood in that
sense it is the equivalent of licensing the Atlantic Company to perform its tasks in any manner and fashion that it might please,
and to hold it harmless from the consequences.

There may have been in the minds of the officials of the Atlantic Company an idea that the promise to use due care in the lifting
operations was not accompanied by a legal obligation, such promise being intended merely for its moral effect as an assurance to
the steamship company that the latter might rely upon the competence and diligence of the employees of the Atlantic Company to
accomplish the work in a proper way. The contract can not be permitted to operate in this one-sided manner. The two features of
the engagement, namely, the promise to use due care and the exemption from liability for damage should be so construed as to
give some legal effect to both. The result is, as already indicated, that the Atlantic Company was bound by its undertaking to use
due care and that the exemption was intended to cover accidents due to hidden defects in the apparatus or other unforeseeable
occurrences not having their origin in the immediate personal negligence of the party in charge of the operations.

W/N Atlantic should be absolved

We now proceed to consider the contention that the Atlantic Company should be absolved from liability to the Steamship Company
under the last paragraph of article 1903 of the Civil Code, which declares that the liability there referred to shall cease when the
persons mentioned therein prove that they employed all the diligence of a good father of a family to avoid the damage. Even when
Atlantic used proper care in the selection of Leyden, the obligation of the Atlantic Company was created by contract, and
article 1903 is not applicable to negligence arising in the course of the performance of a contractual obligation.
Article 1903 is exclusively concerned with cases where the negligence arises in the absence of agreement.

In discussing the liability of the Steamship Company to the plaintiff Railroad Company we have already shown that a party is
bound to the full performance of his contractual engagements under articles 1101 et seq. of the Civil Code, and other
special provisions of the Code relative to contractual obligations; and if he falls short of complete performance by reason of his
own negligence or that of any person to whom he may commit the work, he is liable for the damages resulting therefrom.. It is
desirable, however, in this connection, to bring out somewhat more fully the distinction between negligence in the performance of
a contractual obligation (culpa contractual) and negligence considered as an independent source of obligation between parties not
previously bound (culpa aquiliana).

Justice Tracey, the author of the opinion from which we have quoted, proceeds to observe that Manresa, in commenting on articles
1102 and 1104, has described these two species of negligence as contractual and extra-contractual, the latter being the culpa
aquiliana of the Roman law. "This terminology is unreservedly accepted by Sanchez Roman (Derecho Civil, fourth section, chapter
XI, article II, No. 12), and the principle stated is supported by decisions of the supreme court of Spain, among them those of
November 20, 1896 (80 Jurisprudencia Civil, No. 151), and June 27, 1894 (75 Jurisprudencia Civil, No. 182.)"

The principle that negligence in the performance of a contract is not governed by article 1903 of the Civil Code but rather by article
1104 of the same Code was directly applied by this court in the case of Baer Senior & Co.'s Successors vs. Compañia Maritima (6
Phil. Rep., 215); and the same idea has been impliedly if not expressly recognized in other cases (N. T. Hashim & Co. vs. Rocha &
Co., 18 Phil. Rep., 315; Tan Chiong Sian vs. Inchausti & Co., 22 Phil. Rep., 152).

What has been said suffices in our opinion to demonstrate that the Atlantic Company is liable to the Steamship Company
for the damages brought upon the latter by the failure of the Atlantic Company to use due care in discharging the
boiler, regardless of the fact that the damage was caused by the negligence of an employee who was qualified for
the work and who had been chosen by the Atlantic Company with due care.

Can the Atlantic Company be held directly liable to the Railroad Company?
Having regard then to the bare fact that the Atlantic Company undertook to remove the boiler from the ship's hold and for this
purpose took the property into its power and control, there arose a duty to the owner to use due care in the performance of that
service and to avoid damaging the property in the course of such operation. This duty was obviously in existence before the
negligent act was done which resulted in damage, and said negligent act may, if we still ignore the existence of the express
contract, be considered as an act done in violation of this duty.

The duty thus to use due care is an implied obligation, of a quasi contractual nature, since it is created by implication
of law in the absence of express agreement. The conception of liability with which we are here confronted is somewhat similar
to that which is revealed in the case of the depositary, or commodatary, whose legal duty with respect to the property committed
to their care is defined by law even in the absence of express contract; and it can not be doubted that a person who takes
possession of the property of another for the purpose of moving or conveying it from one place to another, or for the purpose of
performing any other service in connection therewith (locatio operis faciendi), owes to the owner a positive duty to refrain from
damaging it, to the same extent as if an agreement for the performance of such service had been expressly made with the owner.
The obligation here is really a species of contract le, and it has its source and explanation in the vital fact that the active party has
taken upon himself to do something with or to the property and has taken it into his power and control for the purpose of performing
such service. (Compare art. 1889, Civil Code.)

In the passage which we have already quoted from the decision in the Rakes case this Court recognized the fact that the violation
of a quasi contractual duty is subject to articles 1101, 1103, and 1104 of the Civil Code and not within the purview of article 1903.
Manresa also, in the paragraph reproduced above, is of the opinion that negligence, considered as a substantive and independent
source of liability, does not include cases where the parties are previously bound by any other obligation. Again, it is instructive in
this connection to refer to the contents of article 1103 of the Civil Code, where it is declared that the liability proceeding from
negligence is demandable in the fulfillment of all kinds of obligations. These words evidently comprehend both forms of positive
obligations, whether arising from express contract or from implied contract (quasi contract).

In this connection it is instructive to recall the celebrated case of Coggs vs. Bernard (2 Ld. Raym, 909), decided in the court of the
King's Bench of England in the year 1703. The action was brought by the owner of certain casks of brandy to recover damages
from a person who had undertaken to transport them from one place to another. It was alleged that in so doing the defendant so
negligently and improvidently put them down that one of the casks was staved and the brandy lost. The complaint did not allege
that the defendant was a common carrier or that he was to be paid for his services. It was therefore considered that the complaint
did not state facts sufficient to support an action for breach of any express contract. This made it necessary for the court to go
back to fundamental principles and to place liability on the ground of a violation of the legal duty incident to the mere fact of
carriage. Said Powell, J.: "An action indeed will not lie for not doing the thing, for want of a sufficient consideration; but yet if the
bailee will take the goods into his custody, he shall be answerable for them; for the taking of the goods into his custody is his own
act." So Gould, J.: " . . . any man that undertakes to carry goods is liable to an action, be he a common carrier or whatever he is,
if through his neglect they are lost or come to any damage: . . .." Behind these expressions was an unbroken line of ancient English
precedents holding persons liable for damage inflicted by reason of a misfeasance in carrying out an undertaking. The principle
determined by the court in the case cited is expressed in the syllabus in these words: "If a man undertakes to carry goods safely
and securely, he is responsible for any damage they may sustain in the carriage through his neglect, though he was not a common
carrier and was to have nothing for the carriage." Though not stated in so many words, this decision recognizes that from the mere
fact that a person takes the property of another into his possession and control there arises an obligation in the nature of an
assumpsit that he will use due care with respect thereto. This must be considered a principle of universal jurisprudence, for it is
consonant with justice and common sense and as we have already seen harmonizes with the doctrine above deduced from the
provisions of the Civil Code.

The conclusion must therefore be that if there had been no contract of any sort between the Atlantic Company and the Steamship
Company, an action could have been maintained by the Railroad Company, as owner, against the Atlantic Company to recover the
damages sustained by the former. Such damages would have been demandable under article 1103 of the Civil Code and the action
would not have been subject to the qualification expressed in the last paragraph of article 1903.

The circumstance that a contract was made between the Atlantic Company and the Steamship Company introduces, however, an
important, and in our opinion, controlling factor into this branch of the case. It cannot be denied that the Steamship Company had
possession of this boiler in the capacity of carrier and that, as such, it was authorized to make a contract with the Atlantic Company
to discharge the same from the ship. Indeed, it appears in evidence that even before the contract of affreightment was made the
Railroad Company was informed that it would be necessary for the Steamship Company to procure the services of some contractor
in the port of Manila to effect the discharge, as the ship's tackle was inadequate to handle heavy cargo. It is therefore to be
assumed that the Railroad Company had in fact assented to the employment of a contractor to perform this service.

Now, it cannot be admitted that a person who contracts to do a service like that rendered by the Atlantic Company in this case
incurs a double responsibility upon entering upon performance, namely, a responsibility to the party with whom he contracted, and
another entirely different responsibility to the owner, based on an implied contract. The two liabilities can not in our opinion coexist.
It is a general rule that an implied contract never arises where an express contract has been made.

If double responsibility existed in such a case as this, it would result that a person who had limited his liability by express stipulation
might find himself liable to the owner without regard to the limitation which he had seen fit to impose by contract. There appears
to be no possibility of reconciling the conflict that would be developed in attempting to give effect to those inconsistent liabilities.
The contract which was in fact made, in our opinion, determines not only the character and extent of the liability of the Atlantic
Company but also the person or entity by whom the obligation is exigible. It is of course quite clear that if the Atlantic Company
had refused to carry out its agreement to discharge the cargo, the plaintiff could not have enforced specific performance and could
not have recovered damages for non-performance. (Art. 1257, Civil Code; Donaldson, Sim & Co. vs. Smith, Bell & Co., 2 Phil. Rep.,
766; Uy Tam and Uy Yet vs. Leonard, 30 Phil. Rep., 471.) In view of the preceding discussion it is equally obvious that, for lack of
privity with the contract, the Railroad Company can have no right of action to recover damages from the Atlantic Company for the
wrongful act which constituted the violation of said contract. The rights of the plaintiff can only be made effective through
the Compañia Trasatlantica de Barcelona with whom the contract of affreightment was made.

The judgment entered in the Court of First Instance must, therefore, be reversed not only with respect to the judgment entered in
favor of the plaintiff directly against the Atlantic Company but also with respect to the absolution of the Steamship Company and
the further failure of the court to enter judgment in favor of the latter against the Atlantic Company. The Compañia Trasatlantica
de Barcelona should be and is hereby adjudged to pay to the Manila Railroad Company the sum of twenty two thousand three
hundred forty three pesos and twenty nine centavos (P22,343.29), with interest from May 11, 1914, until paid; and when this
judgment is satisfied, the Compañia Trasatlantica de Barcelona is declared to be entitled to recover the same amount from the
Atlantic Gulf & Pacific Company, against whom judgment is to this end hereby rendered in favor of the Compañia Trasatlantica de
Barcelona. No express adjudication of costs of either instance will be made. So ordered.
||| (Manila Railroad Co. v. La Compa, G.R. No. 11318, [October 26, 1918], 38 PHIL 875-901)

9. Calalas vs CA GR 122039

Facts:
At 10 o'clock in the morning of August 23, 1989, private respondent Eliza Jujeurche G.
Sunga, then a college freshman majoring in Physical Education at the Siliman University,
took a passenger jeepney owned and operated by petitioner Vicente Calalas. As the
jeepney was filled to... capacity of about 24 passengers, Sunga was given by the conductor
an "extension seat," a wooden stool at the back of the door at the rear end of the vehicle.
On the way to Poblacion Sibulan, Negros Occidental, the jeepney stopped to let a
passenger off. As she was seated at the rear of the vehicle, Sunga gave way to the
outgoing passenger. Just as she was doing so, an Isuzu truck driven by Iglecerio Verena
and owned by Francisco
Salva bumped the left rear portion of the jeepney. As a result, Sunga was injured.
On October 9, 1989, Sunga filed a complaint for damages against Calalas, alleging violation
of the contract of carriage by the former in failing to exercise the diligence required of him
as a common carrier. Calalas, on the other hand, filed a third-party complaint against
Francisco Salva, the owner of the Isuzu truck.
The lower court rendered judgment against Salva as third-party defendant and absolved
Calalas of liability, holding that it was the driver of the Isuzu truck who was responsible for
the accident. It took cognizance of another case (Civil Case No. 3490), filed by Calalas
against
Salva and Verena, for quasi-delict, in which Branch 37 of the same court held Salva and his
driver Verena jointly liable to Calalas for the damage to his jeepney.
On appeal to the Court of Appeals, the ruling of the lower court was reversed on the ground
that Sunga's cause of action was based on a contract of carriage, not quasi-delict, and that
the common carrier failed to exercise the diligence required under the Civil Code. The...
appellate court dismissed the third-party complaint against Salva and adjudged Calalas
liable for damages to Sunga.
Issues:
the issue in this case is whether... petitioner is liable on his contract of carriage.
Ruling:
Petitioner contends that the ruling in Civil Case No. 3490 that the negligence of Verena was
the proximate cause of the accident negates his liability and that to rule otherwise would be
to make the common carrier an insurer of the safety of its passengers.
He contends that the bumping of the jeepney by the truck owned by Salva was a caso
fortuito. Petitioner further assails the award of moral damages to Sunga on the ground that
it is not supported by evidence.
The first, quasi-delict, also known as culpa aquiliana or culpa extra contractual, has as its
source the negligence of the tortfeasor. The second, breach of contract or culpa contractual,
is premised... upon the negligence in the performance of a contractual obligation.
Consequently, in quasi-delict, the negligence or fault should be clearly established because
it is the basis of the action, whereas in breach of contract, the action can be prosecuted
merely by proving the existence of the contract and the fact that the obligor, in this case
the... common carrier, failed to transport his passenger safely to his destination.[
There is, thus, no basis for the contention that the ruling in Civil Case No. 3490, finding
Salva and his driver Verena liable for the damage to petitioner's jeepney, should be binding
on Sunga. It is immaterial that the proximate cause of the collision between the jeepney
and... the truck was the negligence of the truck driver.
In the case at bar, upon the happening of the accident, the presumption of negligence at
once arose, and it became the duty of petitioner to prove that he had to observe
extraordinary diligence in the care of his passengers.
Now, did the driver of jeepney carry Sunga "safely as far as human care and foresight could
provide, using the utmost diligence of very cautious persons, with due regard for all the
circumstances" as required by Art. 1755? We do not think so. Several factors militate
against... petitioner's contention.
First, as found by the Court of Appeals, the jeepney was not properly parked, its rear portion
being exposed about two meters from the broad shoulders of the highway, and facing the
middle of the highway in a diagonal angle. This is a violation of the R.A. No. 4136, as
amended,... or the Land Transportation and Traffic Code,... Second, it is undisputed that
petitioner's driver took in more passengers than the allowed seating capacity of the jeepney,
a violation of §32(a) of the same law. It provides:
Exceeding registered capacity. - No person operating any motor vehicle shall allow more
passengers or more freight or cargo in his vehicle than its registered capacity.
The fact that Sunga was seated in an "extension seat" placed her in a peril greater than that
to which the other passengers were exposed. Therefore, not only was petitioner unable to
overcome the presumption of negligence imposed on him for the injury sustained by Sunga,
but... also, the evidence shows he was actually negligent in transporting passengers.
Principles:
In case of death or injuries to passengers, Art. 1756 of the Civil Code provides that common
carriers are presumed to have been at fault or to have acted negligently unless they... prove
that they observed extraordinary diligence as defined in Arts. 1733 and 1755 of the Code.
This provision necessarily shifts to the common carrier the burden of proof.
The doctrine of proximate cause is applicable only in actions for quasi-delict, not in actions
involving breach of contract. The doctrine is a device for imputing liability to a person where
there is no relation between him and... another party. In such a case, the obligation is
created by law itself. But, where there is a pre-existing contractual relation between the
parties, it is the parties themselves who create the obligation, and the function of the law is
merely to regulate the relation thus... created.

10. Construction Devt vs Estrella GR 147791

FACTS: Respondents Rebecca G. Estrella and her granddaughter, Rachel E. Fletcher, boarded in
San Pablo City, a BLTB bus bound for Pasay City. However, they never reached their destination
because their bus was rammed from behind by a tractor-truck of CDCP in the South Expressway.
The strong impact pushed forward their seats and pinned their knees to the seats in front of them.
They were injured due to the collision.
Thereafter, respondents filed a Complaint5 for damages against CDCP, BLTB, EspiridionPayunan,
Jr. and Wilfredo Datinguinoo. They alleged (1) that Payunan, Jr. and Datinguinoo, who were the
drivers of CDCP and BLTB buses, respectively, were negligent and did not obey traffic laws; (2) that
BLTB and CDCP did not exercise the diligence of a good father of a family in the selection and
supervision of their employees; (3) that BLTB allowed its bus to operate knowing that it lacked
proper maintenance thus exposing its passengers to grave danger; (4) that they suffered actual
damages amounting to P250,000.00 for Estrella and P300,000.00 for Fletcher; (5) that they suffered
physical discomfort, serious anxiety, fright and mental anguish, besmirched reputation and wounded
feelings, moral shock, and lifelong social humiliation; (6) that defendants failed to act with justice,
give respondents their due, observe honesty and good faith which entitles them to claim for
exemplary damage; and (7) that they are entitled to a reasonable amount of attorney's fees and
litigation expenses.

Trial court rendered a decision finding CDCP and BLTB and their employees liable for damages
jointly and severally to pay for actual damages, moral and exemplary damages and attorney’s fees.

The trial court held that BLTB, as a common carrier, was bound to observe extraordinary diligence in
the vigilance over the safety of its passengers. Thus, where a passenger dies or is injured, the
carrier is presumed to have been at fault or has acted negligently. BLTB's inability to carry
respondents to their destination gave rise to an action for breach of contract of carriage while its
failure to rebut the presumption of negligence made it liable to respondents for the breach.9

Regarding CDCP, the trial court found that the tractor-truck it owned bumped the BLTB bus from
behind. Evidence showed that CDCP's driver was reckless and driving very fast at the time of the
incident. The gross negligence of its driver raised the presumption that CDCP was negligent either in
the selection or in the supervision of its employees which it failed to rebut thus making it and its
driver liable to respondents.

CDCP appealed the decision contending that liability for actual damages and attorney's fees is
based on culpa contractual, thus, only BLTB should be held liable. Respondents, on the other hand,
argue that petitioner is also at fault, hence, it was properly joined as a party. There may be an action
arising out of one incident where questions of fact are common to all. Thus, the cause of action
based on culpa aquiliana in the civil suit they filed against it was valid.

ISSUE: 1) whether BLTB and its driver Wilfredo Datinguinoo are solely liable for the damages
sustained by respondents; (2) whether the damages, attorney's fees and legal interest awarded by
the CA are excessive and unfounded.

RULING: (1) CDCP is solidarily liable with BLTB for damages.The case filed by respondents against
petitioner is an action for culpa aquiliana or quasi-delict under Article 2176 of the Civil Code.13 In this
regard, Article 2180 provides that the obligation imposed by Article 2176 is demandable for the acts
or omissions of those persons for whom one is responsible. Consequently, an action based on
quasi-delict may be instituted against the employer for an employee's act or omission. The liability
for the negligent conduct of the subordinate is direct and primary, but is subject to the defense of
due diligence in the selection and supervision of the employee.14 In the instant case, the trial court
found that petitioner failed to prove that it exercised the diligence of a good father of a family in the
selection and supervision of Payunan, Jr.

The trial court and the Court of Appeals found petitioner solidarily liable with BLTB for the actual
damages suffered by respondents because of the injuries they sustained. It was established that
Payunan, Jr. was driving recklessly because of the skid marks as shown in the sketch of the police
investigator.
It is well-settled in Fabre, Jr. v. Court of Appeals,15 that the owner of the other vehicle which collided
with a common carrier is solidarily liable to the injured passenger of the same. The same rule of
liability was applied in situations where the negligence of the driver of the bus on which plaintiff was
riding concurred with the negligence of a third party who was the driver of another vehicle, thus
causing an accident. As in the case of BLTB, private respondents in this case and her co-plaintiffs
did not stake out their claim against the carrier and the driver exclusively on one theory, much less
on that of breach of contract alone.After all, it was permitted for them to allege alternative
causes of action and join as many parties as may be liable on such causes of action so long
as private respondent and her co-plaintiffs do not recover twice for the same injury. xxThe
difficulty in the contention of the appellants is that they fail to recognize that the basis of the present
action is tort. They fail to recognize the universal doctrine that each joint tort feasor is not only
individually liable for the tort in which he participates, but is also jointly liable with his tort feasors. x
xx

(2) Moral damages may be recovered in quasi-delicts causing physical injuries.21 The award
of moral damages in favor of Fletcher and Estrella in the amount of P80,000.00 must be reduced
since prevailing jurisprudence fixed the same at P50,000.00.22 While moral damages are not
intended to enrich the plaintiff at the expense of the defendant, the award should nonetheless be
commensurate to the suffering inflicted.23

The Court of Appeals correctly awarded respondents exemplary damages in the amount of
P20,000.00 each. Exemplary damages may be awarded in addition to moral and compensatory
damages.24 Article 2231 of the Civil Code also states that in quasi-delicts, exemplary damages may
be granted if the defendant acted with gross negligence.25 In this case, petitioner's driver was driving
recklessly at the time its truck rammed the BLTB bus. Petitioner, who has direct and primary liability
for the negligent conduct of its subordinates, was also found negligent in the selection and
supervision of its employees. In Del Rosario v. Court of Appeals,26 we held, thus:

ART. 2229 of the Civil Code also provides that such damages may be imposed, by way of
example or correction for the public good. While exemplary damages cannot be recovered
as a matter of right, they need not be proved, although plaintiff must show that he is entitled
to moral, temperate or compensatory damages before the court may consider the question of
whether or not exemplary damages should be awarded. Exemplary Damages are imposed
not to enrich one party or impoverish another but to serve as a deterrent against or as a
negative incentive to curb socially deleterious actions.

12. Joseph vs Bautista

13 Smith vs Borja GR 143008

Negligence is conduct that creates undue risk of harm to another. It is the failure to observe that
degree of care, precaution and vigilance that the circumstances justly demand, whereby that other
person suffers injury. Petitioner’s vessel was carrying chemical cargo—alkyl benzene and methyl
methacrylate monomer. While knowing that their vessel was carrying dangerous inflammable
chemicals, its officers and crew failed to take all the necessary precautions to prevent an accident.
Petitioner was, therefore, negligent.

Facts:
 Smith Bell filed a written request with the Bureau of Customs for inspection of vessel M/T King
Family which was due to arrive at the port of Manila. Said vessel contained 750 metric tons of alkyl
benzene and methyl methacrylate monomer. Respondent Catalino Borja was instructed to board said
vessel and perform his duties as inspector upon the vessel's arrival until its departure.

At about 11 o'clock am, while M/T King Family was unloading chemicals unto two (2) barges
owned by International Towage and Transport Corporation (ITTC), a sudden explosion occurred setting
the vessels afire. Upon hearing the explosion, Borja, ran outside to check what happened. Again,
another explosion was heard. Seeing the fire and fearing for his life, he hurriedly jumped over board to
save himself. However, the water was likewise on fire due mainly to the spilled chemicals. Despite the
tremendous heat, Borja swam his way for one (1) hour until he was rescued by the people living in the
squatters' area.

After weeks of intensive care at the hospital, his attending physician diagnosed Borja to be
permanently disabled due to the incident. [Borja] made demands against Smith Bell and ITTC for the
damages

caused by the explosion. However, both denied liabilities and attributed to each other negligence. The
RTC ruled in favor of Borja and held Smith Bell liable for damages and loss of income. The CA affirmed
the RTC decision.

Issue:

Whether or not Smith Bell is liable for Borja’s injuries

What is the proper amount of liability

Ruling:

Smith Bell is liable for Borja’s injuries.

"The attempts of [Petitioner] Smith Bell to shift the blame on x x x ITTC were all for naught. First,
the

testimony of its alleged eyewitness was stricken off the record for his failure to appear for cross-
examination (p. 361, Record). Second, the documents offered to prove that the fire originated from
barge ITTC-101 were all denied admission by the [c]ourt for being, in effect, hearsay (pp. 335 and 362). x
x x Thus, there is nothing in the record to support [petitioner's] contention that the fire and explosion
originated from barge ITTC-101

Negligence is conduct that creates undue risk of harm to another. It is the failure to observe that
degree of care, precaution and vigilance that the circumstances justly demand, whereby that other
person

suffers injury. Petitioner's vessel was carrying chemical cargo -- alkyl benzene and methyl methacrylate
monomer. While knowing that their vessel was carrying dangerous inflammable chemicals, its officers
and crew failed to take all the necessary precautions to prevent an accident. Petitioner was, therefore,
negligent.
 The three elements of quasi delict are: (a) damages suffered by the plaintiff, (b) fault or
negligence of the defendant, and (c) the connection of cause and effect between the fault or negligence
of the defendant and the damages inflicted on the plaintiff.[16] All these elements were established in
this case. Knowing fully well that it was carrying dangerous chemicals, petitioner was negligent in not
taking all the necessary precautions in transporting the cargo. Hence, the owner or the person in
possession and control of a vessel and the vessel are liable for all natural and proximate damage caused
to persons and property by reason of negligent management or navigation.

As to the amount of liability

In determining the reasonableness of the damages awarded under Article 1764 in conjunction
with Article 2206 of the Civil Code, the factors to be considered are: (1) life expectancy (considering the
health of the victim and the mortality table which is deemed conclusive) and loss of earning capacity; (b)
pecuniary loss, loss of support and service; and (c) moral and mental sufferings.[19] The loss of earning
capacity is based mainly on the number of years remaining in the person's expected life span. In turn,
this number is the basis of the damages.

The formula for the computation of loss of earning capacity is as follows:

Net earning capacity = Life expectancy x [Gross Annual Income - Living Expenses (50% of gross annual

income)], where life expectancy = 2/3 (80 - the age of the deceased)

Petitioner is correct in arguing that it is net income (or gross income less living expenses) which
is to be used in the computation of the award for loss of income. When there is no showing that the
living expenses constituted a smaller percentage of the gross income, we fix the living expenses at half
of the gross income.

Counsel for Respondent Borja is also correct in saying that life expectancy should not be based
on theretirement age of government employees, which is pegged at 65. The Court uses the American
Experience/Expectancy Table of Mortality or the Actuarial or Combined Experience Table of Mortality,
which consistently pegs the life span of the average Filipino at 80 years, from which it extrapolates the
estimated income to be Based on the foregoing discussion, the award for loss of earning capacity should
be computed as follows:

Loss of earning capacity = [2 (80-50)] x [(P2,752x12)-16,512] / 3 = P330,240

14. PBC vs CA GR 97626

FACTS:

Rommel's Marketing Corporation (RMC) engaged in the business of selling appliances, filed a complaint to
recover from PBC, the sum of P304,979.74 representing various deposits it had made in its current account
with said bank but which were not credited to its account, and were instead deposited to the account of
one Bienvenido Cotas, allegedly due to the gross and inexcusable negligence of the petitioner bank.
From May 5, 1975 to July 16, 1976, RMC’s President Romeo Lipana claims to have entrusted RMC funds in
the form of cash totalling P304,979.74 to his secretary, Irene Yabut, for the purpose of depositing said
funds in the current accounts of RMC with PBC.

It turned out, however, that these deposits, on all occasions, were not credited to RMC's account but were
instead deposited to the account of Yabut's husband, Bienvenido Cotas who likewise maintains an account
with the same bank.

During this period, petitioner bank had, however, been regularly furnishing Lipana with monthly statements
showing its current accounts balances. Unfortunately, it had never been the practice of Romeo Lipana to
check these monthly statements of account reposing complete trust and confidence on petitioner bank.

The (secretary) Irene Yabut's modus operandi was to accomplish two (2) copies of the deposit slip, an
original and a duplicate. The original showed the name of her husband as depositor and his current account
number. On the duplicate copy was written the account number of her husband but the name of the
account holder was left blank. PBC's teller, Azucena Mabayad, would, however, validate and stamp both
the original and the duplicate of these deposit slips retaining only the original copy despite the lack of
information on the duplicate slip. The second copy was kept by Irene Yabut allegedly for record purposes.
After validation, Yabut would then fill up the name of RMC in the space left blank in the duplicate copy and
change the account number written thereon, which is that of her husband's, and make it appear to be
RMC's account number.

This went on in a span of more than one (1) year without private respondent's knowledge.

Upon discovery of the loss of its funds, RMC demanded from the bank the return of its money, but as its
demand went unheeded, it filed a collection suit before the RTC.

RTC: found that the bank was negligent; PBC and (PBC Teller) Azucena Mabayad jointly and severally liable

CA: affirmed but deleted the awards of exemplary damages and attorney's fees

ISSUES:

What is the proximate cause of the loss, to the tune of P304,979.74, suffered by the private respondent
RMC — petitioner bank's negligence or that of private respondent's?

CONTENTIONS:

Petitioners submit that the proximate cause of the loss is the negligence of respondent RMC and Romeo
Lipana in entrusting cash to a dishonest employee in the person of Ms. Irene Yabut.5 According to them,
it was impossible for the bank to know that the money deposited by Ms. Irene Yabut belong to RMC; neither
was the bank forewarned by RMC that Yabut will be depositing cash to its account. Thus, it was impossible
for the bank to know the fraudulent design of Yabut considering that her husband, Bienvenido Cotas, also
maintained an account with the bank. For the bank to inquire into the ownership of the cash deposited by
Ms. Irene Yabut would be irregular. Otherwise stated, it was RMC's negligence in entrusting cash to a
dishonest employee which provided Ms. Irene Yabut the opportunity to defraud RMC.6

Private respondent, on the other hand, maintains that the proximate cause of the loss was the negligent
act of the bank, thru its teller Ms. Azucena Mabayad, in validating the deposit slips, both original and
duplicate, presented by Ms. Yabut to Ms. Mabayad, notwithstanding the fact that one of the deposit slips
was not completely accomplished.
HELD:

We sustain the private respondent.

Our law on quasi-delicts states:

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 a quasi-delict and is governed by the provisions of this Chapter.

There are three elements of a quasi-delict:

(a) damages suffered by the plaintiff;

(b) fault or negligence of the defendant, or some other person for whose acts he must
respond; and
(c) the connection of cause and effect between the fault or negligence of the defendant and
the damages incurred by the plaintiff.

First Element

In the case at bench, there is no dispute as to the damage suffered by RMC in the amount of
P304,979.74.

Second Element

It is in ascribing fault or negligence which caused the damage where the parties point to each other as the
culprit.

Negligence is the omission to do something which a reasonable man, guided by those considerations which
ordinarily regulate the conduct of human affairs, would do, or the doing of something which a prudent and
reasonable man would do. The seventy-eight (78)-year-old, yet still relevant, case of Picart v. Smith,
provides the TEST by which to determine the existence of negligence in a particular case which
may be stated as follows: Did the defendant in doing the alleged negligent act use that reasonable
care and caution which an ordinarily prudent person would have used in the same situation?
If not, then he is guilty of negligence. The law here in effect adopts the standard supposed to be
supplied by the imaginary conduct of the discreet paterfamilias of the Roman law. 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.

Applying the above test, it appears that the bank's teller, Ms. Azucena Mabayad, was negligent
in validating, officially stamping and signing all the deposit slips prepared and presented by
Ms. Yabut, despite the glaring fact that the duplicate copy was not completely accomplished
contrary to the self-imposed procedure of the bank with respect to the proper validation of
deposit slips, original or duplicate, as testified to by Ms. Mabayad herself, xxx.

Clearly, Ms. Mabayad failed to observe this very important procedure. The fact that the duplicate slip was
not compulsorily required by the bank in accepting deposits should not relieve the petitioner bank of
responsibility. The odd circumstance alone that such duplicate copy lacked one vital information — that of
the name of the account holder — should have already put Ms. Mabayad on guard. Rather than readily
validating the incomplete duplicate copy, she should have proceeded more cautiously by being more
probing as to the true reason why the name of the account holder in the duplicate slip was left blank while
that in the original was filled up. She should not have been so naive in accepting hook, line and sinker the
too shallow excuse of Ms. Irene Yabut to the effect that since the duplicate copy was only for her personal
record, she would simply fill up the blank space later on. 11 A "reasonable man of ordinary prudence" 12
would not have given credence to such explanation and would have insisted that the space left blank be
filled up as a condition for validation. Unfortunately, this was not how bank teller Mabayad proceeded thus
resulting in huge losses to the private respondent.

Negligence here lies not only on the part of Ms. Mabayad but also on the part of the bank itself
in its lackadaisical selection and supervision of Ms. Mabayad. This was exemplified in the testimony
of Mr. Romeo Bonifacio, then Manager of the Pasig Branch of the petitioner bank and now its Vice-President,
to the effect that, while he ordered the investigation of the incident, he never came to know that blank
deposit slips were validated in total disregard of the bank's validation procedures.

It was in fact only when he testified in this case in February, 1983, or after the lapse of more than seven
(7) years counted from the period when the funds in question were deposited in plaintiff's accounts (May,
1975 to July, 1976) that bank manager Bonifacio admittedly became aware of the practice of his teller
Mabayad of validating blank deposit slips. Undoubtedly, this is gross, wanton, and inexcusable negligence
in the appellant bank's supervision of its employees.

Third Element

IT WAS THIS NEGLIGENCE OF MS. AZUCENA MABAYAD, COUPLED BY THE NEGLIGENCE OF

THE PETITIONER BANK IN THE SELECTION AND SUPERVISION OF ITS BANK TELLER, WHICH
WAS THE PROXIMATE CAUSE OF THE LOSS SUFFERED BY THE PRIVATE RESPONDENT, AND
NOT THE LATTER'S ACT OF ENTRUSTING CASH TO A DISHONEST EMPLOYEE, AS INSISTED BY
THE PETITIONERS.

Proximate cause is determined on the facts of each case upon mixed considerations of logic, common
sense, policy and precedent. 15 Vda. de Bataclan v. Medina, 16 reiterated in the case of Bank of the Phil.
Islands v. Court of Appeals, 17 defines proximate cause as "that cause, which, in natural and continuous
sequence, unbroken by any efficient intervening cause, produces the injury, and without which the result
would not have occurred. . . ." In this case, absent the act of Ms. Mabayad in negligently validating
the incomplete duplicate copy of the deposit slip, Ms. Irene Yabut would not have the facility
with which to perpetrate her fraudulent scheme with impunity. Apropos, once again, is the
pronouncement made by the respondent appellate court, to wit:

. . . . Even if Yabut had the fraudulent intention to misappropriate the funds entrusted to her by
plaintiff, she would not have been able to deposit those funds in her husband's current account, and
then make plaintiff believe that it was in the latter's accounts wherein she had deposited them, had it
not been for bank teller Mabayad's aforesaid gross and reckless negligence. The latter's negligence
was thus the proximate, immediate and efficient cause that brought about the loss claimed by plaintiff
in this case, and the failure of plaintiff to discover the same soon enough by failing to scrutinize the
monthly statements of account being sent to it by appellant bank could not have prevented the fraud
and misappropriation which Irene Yabut had already completed when she deposited plaintiff's money
to the account of her husband instead of to the latter's accounts. 18

Doctrine of Last Clear Chance

Furthermore, under the doctrine of "last clear chance" (also referred to, at times as "supervening
negligence" or as "discovered peril"), petitioner bank was indeed the culpable party. This doctrine, in
essence, states that where both parties are negligent, but the negligent act of one is appreciably later in
time than that of the other, or when it is impossible to determine whose fault or negligence should be
attributed to the incident, the one who had the last clear opportunity to avoid the impending harm and
failed to do so is chargeable with the consequences thereof. 19 Stated differently, the rule would also mean
that an antecedent negligence of a person does not preclude the recovery of damages for the supervening
negligence of, or bar a defense against liability sought by another, if the latter, who had the last fair chance,
could have avoided the impending harm by the exercise of due diligence. 20 Here, assuming that RMC
was negligent in entrusting cash to a dishonest employee, thus providing the latter with the
opportunity to defraud the company, as advanced by the petitioner, yet it cannot be denied
that the petitioner bank, thru its teller, had the last clear opportunity to avert the injury
incurred by its client, simply by faithfully observing their self-imposed validation procedure.

Degree of diligence ought to be exercised by banks in dealing with their clients.

The New Civil Code provides:

Art. 1173. The fault or negligence of the obligor consists in the omission of that diligence which is
required by the nature of the obligation and corresponds with the circumstances of the persons, of
the time and of the place. When negligence shows bad faith, the provisions of articles 1171 and 2201,
paragraph 2, shall apply.

If the law or contract does not state the diligence which is to be observed in the performance, that
which is expected of a good father of a family shall be required. (1104a)

In the case of banks, however, the degree of diligence required is more than that of a good father of a
family. Considering the fiduciary nature of their relationship with their depositors, banks are duty bound to
treat the accounts of their clients with the highest degree of care.

As elucidated in Simex International (Manila), Inc. v. Court of Appeals, 22 in every case, the depositor
expects the bank to treat his account with the utmost fidelity, whether such account consists only of a few
hundred pesos or of millions. The bank must record every single transaction accurately, down to the last
centavo, and as promptly as possible. This has to be done if the account is to reflect at any given time the
amount of money the depositor can dispose as he sees fit, confident that the bank will deliver it as and to
whomever he directs. A blunder on the part of the bank, such as the failure to duly credit him his deposits
as soon as they are made, can cause the depositor not a little embarrassment if not financial loss and
perhaps even civil and criminal litigation.

The point is that as a business affected with public interest and because of the nature of its functions, the
bank is under obligation to treat the accounts of its depositors with meticulous care, always having in mind
the fiduciary nature of their relationship. In the case before us, it is apparent that the petitioner bank was
remiss in that duty and violated that relationship.

Contributory Negligence by RMC

Petitioners nevertheless aver that the failure of respondent RMC to cross-check the bank's statements of
account with its own records during the entire period of more than one (1) year is the proximate cause of
the commission of subsequent frauds and misappropriation committed by Ms. Irene Yabut.

We do not agree.

While it is true that had private respondent checked the monthly statements of account sent
by the petitioner bank to RMC, the latter would have discovered the loss early on, such cannot
be used by the petitioners to escape liability. This omission on the part of the private
respondent does not change the fact that were it not for the wanton and reckless negligence
of the petitioners' employee in validating the incomplete duplicate deposit slips presented by
Ms. Irene Yabut, the loss would not have occurred. Considering, however, that the fraud was
committed in a span of more than one (1) year covering various deposits, common human
experience dictates that the same would not have been possible without any form of collusion
between Ms. Yabut and bank teller Mabayad. Ms. Mabayad was negligent in the performance
of her duties as bank teller nonetheless. Thus, the petitioners are entitled to claim
reimbursement from her for whatever they shall be ordered to pay in this case.

The foregoing notwithstanding, it cannot be denied that, indeed, private respondent was
likewise negligent in not checking its monthly statements of account. Had it done so, the
company would have been alerted to the series of frauds being committed against RMC by its
secretary. The damage would definitely not have ballooned to such an amount if only RMC,
particularly Romeo Lipana, had exercised even a little vigilance in their financial affairs. This
omission by RMC amounts to contributory negligence which shall mitigate the damages that
may be awarded to the private respondent under Article 2179 of the New Civil Code, to wit:

. . . When the plaintiff's own negligence was the immediate and proximate cause of his injury, he
cannot recover damages. But if his negligence was only contributory, the immediate and proximate
cause of the injury being the defendant's lack of due care, the plaintiff may recover damages, but the
courts shall mitigate the damages to be awarded.

In view of this, we believe that the DEMANDS OF SUBSTANTIAL JUSTICE ARE SATISFIED BY
ALLOCATING THE DAMAGE ON A 60-40 RATIO. Thus, 40% of the damage awarded by the respondent
appellate court, except the award of P25,000.00 attorney's fees, shall be borne by private respondent RMC;
only the balance of 60% needs to be paid by the petitioners. The award of attorney's fees shall be
borne exclusively by the petitioners.

15. Taylor vs Manila Elec. Road

Facts:
The plaintiff, David Taylor, was at the time when he received the injuries complained
of, 15 years of age, the son of a mechanical engineer, more mature than the average boy
of his age, and having considerable aptitude and training in... mechanics.
On the 30th of September, 1905, plaintiff, with a boy named Manuel Claparols,
about 12 years of age, crossed the footbridge to the Isla del Provisor, for the purpose of
visiting one Murphy, an employee of the defendant, who had promised to make them... a
cylinder for a miniature engine. Finding on inquiry that Mr. Murphy was not in his quarters,
the boys, impelled apparently by youthful curiosity and perhaps by the unusual interest
which both seem to have taken in machinery, spent some time in... wandering about the
company's premises.
Here they... found some twenty or thirty brass fulminating caps scattered on the ground.
They then opened one of the caps with a knife, and finding that it was filled with
a yellowish substance they got matches, and David ... held the cap while Manuel applied
a lighted match to the contents.
The caps when found appeared to the boys who picked them up to have been lying there
for a considerable time, and ... from the place where they were found would seem to
have been discarded as defective or worthless and fit only to be thrown upon the rubbish
heap.
Issues:
the facts proven at the trial do not establish the liability of the defendant company under the
provisions of these articles,
Ruling:
the plaintiff in an action such as that under consideration, in order to establish his right to a
recovery, must establish by competent... evidence:
(1) Damages to the plaintiff.
(2) Negligence by act or omission of which defendant personally, or some person for
whose acts it must respond, was guilty.
(3) The connection of cause and effect between the negligence and the damage.
It is clear that the accident could not have happened had not the fulminating
caps been left exposed at the point where they were found, or if their owner had
exercised due care in keeping them in an appropriate place; but it is... equally clear that
plaintiff would not have been injured had he not, for his own pleasure and
convenience, entered upon defendant's premises, and strolled around thereon without
the express permission of the defendant, and... had he not picked up and carried away the
property of the defendant which he found on its premises, and had he not thereafter
deliberately cut open one of the caps and applied a match to its contents.
But counsel for plaintiff contends that because of plaintiff's youth and
inexperience, his entry upon defendant company's premises, and the intervention of
his action between the negligent act of defendant in leaving the caps exposed on its...
premises and the accident which resulted in his injury should not be held to have
contributed in any wise to the accident, which should be deemed to be the direct result of
defendant's negligence in leaving the caps exposed at the place where... they were found
by the plaintiff, and this latter the proximate cause of the accident which occasioned the
injuries sustained by him.
the great weight of authority holds the owner of the premises liable.
we are of opinion that under all the circumstances of this case the negligence of the
defendant in leaving the caps exposed on its premises was not the proximate cause of the
injury received by the... plaintiff, which therefore was not, properly speaking, "attributable to
the negligence of the defendant," and, on the other hand, we are satisfied that plaintiff's
action in cutting open the detonating cap and putting a match to its contents was the
proximate cause... of the explosion and of the resultant injuries inflicted upon the plaintiff,
and that the defendant, therefore, is not civilly responsible for the injuries thus incurred.
And while there does not appear to be anything in the Civil Code which expressly
lays down the law touching contributory negligence in this jurisdiction, nevertheless, the
interpretation placed upon its provisions by the supreme court of Spain,... and by this
court in the case of Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil. Rep., 359), clearly
deny to the plaintiff in the case at bar the right to recover damages from the defendant, in
whole or in part, for the injuries... sustained by him.
the immediate cause of the explosion, the accident which resulted in plaintiff's injury, was
his own act in putting a match to the contents of the cap, and that haying
"contributed to the principal occurrence, as one of its determining factors, he can not
recover."
Principles:
implied invitation
But is this doctrine really applicable here?

"In the case of young children, and other persons not fully sui juris, an implied license
might sometimes arise when it would not on behalf of others. Thus leaving a tempting
thing for children to play with exposed,... where they would be likely to gather for
that purpose, may be equivalent to an invitation to them to make use of it; and, perhaps, if
one were to throw away upon his premises, near the common way, things tempting to
children, the same implication... should arise.
16. Pacis vs Morales GR 169467
PACIS v MORALES
Topic: Owners and managers of establishments and enterprises

DOCTRINE: 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. 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.

FACTS: Alfredo Pacis and Cleopatra Pacis filed a civil case for damages against Jerome Jovanne Morales.
Spouses Paceis are the parents of Alfred, 17 y.o. who died in a shooting incident inside the Top Gun
Firearms and Ammunitions Store (gun store) in Baguio City. Morales is the owner.

Alfred died due to a gunshot wound in the head which he sustained while he was at gunstore. The bullet
which killed Alfred was fired from a gun brought in by a customer of the gun store for repair. The gun, was
left by Morales in a drawer of a table located inside the gun store.

Morales as in Manila at the time. His employee Armando Jarnague, who was the regular caretaker of the
gun store was also not around. Jarnague entrusted to Matibag and Herbolario a bunch of keys which
included the key to the drawer where the gun was kept. It appears that Matibag and Herbolario later brought
out the gun from the drawer and palced it in top of the table. Attacted by it, Alfred got hold of it. Matibag
asked Alfred to return the gun. Alfred followed but it went off the bullet hitting Alfred.

The trial court held Morales civilly liable for the death of Alftred under A2180 in relation to A2176, ruling that
the accidental shooting of Alfred which caused his death was partyl due to the negligence of Morales’
emplyee – Matibag. CA reversed, ruling that there was no employee-employer relationship because
Matibag was not under the control of Morales with respect to the means and methods in the performance
of his worK, thus A2180 cannot apply. And even if Matibag was an employee, Morales still cannot be held
civilly liable because there is no negligence can be attributed to Morales because he kept the gun.

ISSUE: WON Morales is civilly liable?

RULING: YES. 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. For failing to insure that the gun was not loaded,
Morales himself was negligent.

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.

As a gun store owner, Morales 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.
Morales 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.

In the first place, the defective gun should have been stored in a vault. Before accepting the defective gun
for repair, Morales should have made sure that it was not loaded to prevent any untoward accident. Indeed,
Morales 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

Clearly, Morales did not exercise the degree of care and diligence required of a good father of a family,
much less the The bullet which killed Alfred was fired from a gun brought in by a customer of the gun store
for repair.

Choice of claim of petitioners

This case for damages arouse out of the accidental shoting of Alfred. Under A1161 of the Civil Code
petitioners may enforce their claim for damages based on the civil liability arising from the crime under
Article 100 of the RPC or they may opt to file an independent civil action for damages under the Civil Code.

In this case, instead of enforcing their claim for damages in the homicide case filed against Matibag,
petitioners opted to file an independent civil action for damages against respondent whom they alleged was
Matibag’s employer. Petitioners based their claim for damages under Articles 2176 and 2180 of the Civil
Code.

17. Associated Bank vs Tan GR 156940

The degree of diligence required of banks is more than that of a good father of the family where
the fiduciary nature of their relationship with their depositors is concerned.

Did petitioner treat respondent’s account with the highest degree of care? From all indications, it
did not.

It is undisputed – nay, even admitted – that purportedly as an act of accommodation to a valued

client, the petitioner allowed the withdrawal of the face value of the deposited check prior to its
clearing. That act certainly disregarded the clearance requirement of the banking system. Such
a practice is unusual, because a check is not legal tender or money; and its value can properly
be transferred to depositor’s account only after the check has been cleared by the drawee bank.
18. American Express vs Cordero GR 138550

19. PLDT vs CA GR 57079

FACTS
Sps. Esteban were riding their jeep along the inside lane of Lacson Street where they resided [at 25km/hr as Antonio Esteban
claimed; CA said jeep ran fast; if the jeep braked at that speed, the spouses would not have been thrown against the windshield].
The jeep abruptly swerved from the inside lane, then it ran over a mound of earth and fell into an open trench, an excavation
allegedly undertaken by PLDT for the installation of its underground conduit system. Antonio failed to notice the open trench
which was left uncovered because of the darkness and the lack of any warning light or signs. The spouses were thrown against the
windshield. Gloria Esteban allegedly sustained injuries on her arms, legs and face, leaving a permanent scar on her cheek, while
Antonio suffered cut lips. The jeep’s windshield was also shattered.
PLDT denies liability, contending that the injuries sustained by the spouses were due to their own negligence, and that it
should be the independent contractor L.R. Barte and Co. [Barte] who should be held liable. PLDT filed a third-party complaint
against Barte, alleging that under the terms of their agreement, PLDT should not be answerable for any accident or injuries arising
from the negligence of Barte or its employees. Barte claimed that it was not aware, nor was it notified of the accident, and that it
complied with its contract with PLDT by installing the necessary and appropriate signs.
RTC ruled in favor of the spouses. CA reversed RTC and dismissed the spouses’ complaint, saying that the spouses were
negligent. Later, it set aside its earlier decision and affirmed in totoRTC’s decision. (SC declared this later decision null and void.
The first decision already became final and executory because no appeal was taken seasonably.)

ISSUE AND HOLDING

WON PLDT is liable for the injuries sustained by Sps. Esteban. NO

RATIO
The accident which befell the spouses was due to the lack of diligence of Antonio, and was not imputable to the negligent omission
on the part of PLDT. If the accident did not happen because thejeep was running quite fast on the inside lane and for some reason
or other it had to swerve suddenly to the right and had to climb over the accident mound, then Antonio had not exercised the
diligence of a good father of a family to avoid the accident. With the drizzle, he should not have run on dim lights, but should have
put on his regular lights which should have made him see the accident mound in time. The mound was relatively big and visible,
being 2-3 ft high and 1-1/2 ft wide. Also, he knew of the existence and location of the mound, having seen it many previous times.
The negligence of Antonio was not only contributory to his and his wife’s injuries but goes to thevery cause of the
occurrence of the accident, as one of its determining factors, and therebyprecludes their right to recover damages. The perils
of the road were known to the spouses. By exercising reasonable care and prudence, Antonio could have avoided the injurious
consequences of his act, even assuming arguendo that there was some alleged negligence on the part of PLDT.
The omission to perform a duty, such as the placing of warning signs on the site of the excavation, constitutes the
proximate cause only when the doing of the said omitted act would have prevented the injury. As a resident of Lacson Street,
he passed on that street almost everyday and had knowledge of the presence and location of the excavations there; hence, the
presence of warning signs could not have completely prevented the accident. Furthermore, Antonio had the last clear chance to
avoid the accident, notwithstanding the negligence he imputes to PLDT.
A person claiming damages for the negligence of another has the burden of proving the existence of such fault or
negligence causative thereof, otherwise, his action must fail. The facts constitutive of negligence must be affirmatively established
by competent evidence. In this case, there was insufficient evidence to prove any negligence on the part of PLDT. What was
presented was just the self-serving testimony of Antonio and the unverified photograph of a portion of the scene of the accident.
The absence of a police report and the non-submission of a medical report from the hospital where the spouses were allegedly
treated have not even been explained.

20. Far Eastern vs CA GR 130068

NATURE
Review on certiorari the CA decision affirming TC decision holding FESC and Gavino solidarily liable

FACTS
- On June 20, 1980, the M/V PAVLODAR, flying under the flagship of the USSR, owned and operated
by the Far Eastern Shipping Company (FESC), arrived at the Port of Manila from Vancouver, British
Columbia at about 7:00 o'clock in the morning. The vessel was assigned Berth 4 of the Manila
International Port, as its berthing space. Captain Roberto Abellana was tasked by the Philippine Port
Authority to supervise the berthing of the vessel. Appellant Senen Gavino was assigned by the Appellant
Manila Pilots' Association (MPA) to conduct docking maneuvers for the safe berthing of the vessel to
Berth No. 4.
- Gavino boarded the vessel at the quarantine anchorage and stationed himself in the bridge, with
the master of the vessel, Victor Kavankov, beside him. After a briefing of Gavino by Kavankov of the
particulars of the vessel and its cargo, the vessel lifted anchor from the quarantine anchorage and
proceeded to the Manila International Port. The sea was calm and the wind was ideal for docking
maneuvers. - When the vessel reached the landmark (the big church by the Tondo North Harbor) one-
half mile from the pier, Gavino ordered the engine stopped. When the vessel was already about 2,000
feet from the pier, Gavino ordered the anchor dropped. Kavankov relayed the orders to the crew of the
vessel on the bow. The left anchor, with 2 shackles, were dropped. However, the anchor did not take hold
as expected. The speed of the vessel did not slacken. A commotion ensued between the crew members.
A brief conference ensued between Kavankov and the crew members. When Gavino inquired what was
all the commotion about, Kavankov assured Gavino that there was nothing to it. - After Gavino noticed
that the anchor did not take hold, he ordered the engines half-astern. Abellana, who was then on the pier
apron noticed that the vessel was approaching the pier fast. Kavankov likewise noticed that the anchor
did not take hold. Gavino thereafter gave the "full-astern" code. Before the right anchor and additional
shackles could be dropped, the bow of the vessel rammed into the apron of the pier causing considerable
damage to the pier. The vessel sustained damage too. Kavankov filed his sea protest. Gavino submitted
his report to the Chief Pilot who referred the report to the Philippine Ports Authority. Abellana likewise
submitted his report of the incident. - The rehabilitation of the damaged pier cost the Philippine Ports
Authority the amount of P1,126,132.25.
PERTINENT RULES on PILOTAGE
- The Port of Manila is within the Manila Pilotage District which is under compulsory pilotage
pursuant to Section 8, Article III of Philippine Ports Authority Administrative Order No. 03-85:
SEC. 8. Compulsory Pilotage Service. — For entering a harbor and anchoring thereat, or passing
through rivers or straits within a pilotage district, as well as docking and undocking at any pier/wharf,
or shifting from one berth or another, every vessel engaged in coastwise and foreign trade shall be
under compulsory pilotage.

- In case of compulsory pilotage, the respective duties and responsibilities of the compulsory pilot
and the master have been specified by the same regulation:
SEC. 11. Control of vessels and liability for damage. — On compulsory pilotage grounds, the Harbor
Pilot providing the service to a vessel shall be responsible for the damage caused to a vessel or to life
and property at ports due to his negligence or fault. He can only be absolved from liability if the
accident is caused by force majeure or natural calamities provided he has exercised prudence and
extra diligence to prevent or minimize damage.

The Master shall retain overall command of the vessel even on pilotage grounds whereby he can
countermand or overrule the order or command of the Harbor Pilot on board. In such event, any
damage caused to a vessel or to life and property at ports by reason of the fault or negligence of the
Master shall be the responsibility and liability of the registered owner of the vessel concerned
without prejudice to recourse against said Master

Such liability of the owner or Master of the vessel or its pilots shall be determined by competent
authority in appropriate proceedings in the light of the facts and circumstances of each particular
case.

SEC. 32. Duties and responsibilities of the Pilot or Pilots' Association. — The duties and
responsibilities of the Harbor Pilot shall be as follows: xxx xxx xxx
 f) a pilot shall be held responsible for the direction of a vessel from the time he assumes his work
as a pilot thereof until he leaves it anchored or berthed safely; Provided, however, that his
responsibility shall cease at the moment the Master neglects or refuses to carry out his order.

- Customs Administrative Order No. 15-65 issued twenty years earlier likewise provided in Chapter I
thereof for the responsibilities of pilots:

Par. XXXIX. — A Pilot shall be held responsible for the direction of a vessel from the time he
assumes control thereof until he leaves it anchored free from shoal; Provided, That his responsibility
shall cease at the moment the master neglects or refuses to carry out his instructions.

xxx xxx xxx

Par. XLIV. — Pilots shall properly and safely secure or anchor vessels under their control when
requested to do so by the master of such vessels.

ISSUE WON both the pilot and the master were negligent

HELD
YES.

- The SC started by saying that in a collision between a stationary object and a moving object, there
is a presumption of fault against the moving object (based on common sense and logic). It then went on
to determine who between the pilot and the master was negligent.
PILOT
- A pilot, in maritime law, is a person duly qualified, and licensed, to conduct a vessel into or out
of ports, or in certain waters. He is an expert who’s supposed to know the seabed, etc. that a master of
a ship may not know because the pilot is familiar with the port. He is charged to perform his duties with
extraordinary care because the safety of people and property on the vessel and on the dock are at stake.
- Capt. Gavino was found to be negligent. The court found that his reaction time (4 minutes) to the
anchor not holding ground and the vessel still going too fast was too slow. As an expert he should’ve been
reacting quickly to any such happenings.
MASTER
- In compulsory pilotage, the pilot momentarily becomes the master of the vessel. The master,
however may intervene or countermand the pilot if he deems there is danger to the vessel because of
the incompetence of the pilot or if the pilot is drunk. - Based on Capt. Kavankov’s testimony, he never
sensed the any danger even when the anchor didn’t hold and they were approaching the dock too fast.
He blindly trusted the pilot. This is negligence on his part. He was right beside the pilot during the docking,
so he could see and hear everything that the pilot was seeing and hearing.
- The master’s negligence translates to unseaworthiness of the vessel, and in turn means
negligence on the part of FESC.
CONCURRENT TORTFEASORS
- As a general rule, that negligence in order to render a person liable need not be the sole cause of
an injury. It is sufficient that his negligence, concurring with one or more efficient causes other than
plaintiff's, is the proximate cause of the injury. Accordingly, where several causes combine to produce
injuries, person is not relieved from liability because he is responsible for only one of them, it being
sufficient that the negligence of the person charged with injury is an efficient cause without which the
injury would not have resulted to as great an extent, and that such cause is not attributable to the person
injured. It is no defense to one of the concurrent tortfeasors that the injury would not have resulted from
his negligence alone, without the negligence or wrongful acts of the other concurrent tortfeasor. Where
several causes producing an injury are concurrent and each is an efficient cause without which the injury
would not have happened, the injury may be attributed to all or any of the causes and recovery may be
had against any or all of the responsible persons although under the circumstances of the case, it may
appear that one of them was more culpable, and that the duty owed by them to the injured person was
not the same. No actor's negligence ceases to be a proximate cause merely because it does not exceed
the negligence of other actors. Each wrongdoer is responsible for the entire result and is liable as though
his acts were the sole cause of the injury. - There is no contribution between joint tortfeasors whose
liability is solidary since both of them are liable for the total damage. Where the concurrent or successive
negligent acts or omissions of two or more persons, although acting independently, are in combination
the direct and proximate cause of a single injury to a third person, it is impossible to determine in what
proportion each contributed to the injury and either of them is responsible for the whole injury. Where
their concurring negligence resulted in injury or damage to a third party, they become joint tortfeasors
and are solidarily liable for the resulting damage under Article 2194 of the Civil Code.
Disposition Petition denied. CA affirmed. Capt. Gavino and FESC are solidarily liable.

21. Añonuevo vs CA GR 130003

Facts:
Villagracia was traveling along Boni Ave. on his bicycle, while Añonuevo,traversing the
opposite lane was driving a Lancer car owned by Procter and Gamble Inc., the
employer of Añonuevo’s brother. Añonuevo was in the course of making a leftturn
towards Libertad Street when the collision occurred.

Villagracia sustained serious injuries and had to undergo four operations. Villagracia
instituted an action for damages against P&G Phils., Inc. and Añonuevo before the
RTC. He had also filed a criminal complaint against Añonuevobefore the Metropolitan
Trial Court of Mandaluyong, but the latter was subsequentlyacquitted of the criminal
charge.

Añonuevo claims that Villagracia violated traffic regulations when he failed to register
his bicycle or install safety gadgets. He posits that Article 2185 of the Civil Code
applies by analogy. Article 2185. Unless there is proof to the contrary, it is presumed
that a persondriving a motor vehicle has been negligent if at the time of the mishap he
was violating any traffic regulation.

Issues:
A. Whether or not Art. 2185 of the New Civil Code should apply to non-motorized
vehicles, making Villagracia presumptively negligent.
B. Whether or not Villagracia was negligent for failure to comply with traffic
regulations.
C. Whether or not Villagracia is guilty of contributory negligence

Held: No to all.

A. Application of Article 2185

Aonuevo claims that Villagracia violated traffic regulations when he failed to register his bicycle or
install safety gadgets thereon. He posits that Article 2185 of the New Civil Code applies by analogy.
The provision reads:
Article 2185. 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 the mishap he was violating any traffic regulation.

Aonuevo hypothesizes that Article 2185 should apply by analogy to all types of vehicles[23]. He points
out that modern-day travel is more complex now than when the Code was enacted, the number and
types of vehicles now in use far more numerous than as of then. He even suggests that at the time of
the enactment of the Code, the legislators must have seen that only motor vehicles were of such public
concern that they had to be specifically mentioned, yet today, the interaction of vehicles of all types
and nature has inescapably become matter of public concern so as to expand the application of the
law to be more responsive to the times.[24]
At the time Article 2185 was formulated, there existed a whole array of non-motorized vehicles ranging
from human-powered contraptions on wheels such as bicycles, scooters, and animal-drawn carts such
as calesas and carromata. These modes of transport were even more prevalent on the roads of the
1940s and 1950s than they are today, yet the framers of the New Civil Code chose then to exclude
these alternative modes from the scope of Article 2185 with the use of the term motorized vehicles. If
Aonuevo seriously contends that the application of Article 2185 be expanded due to the greater
interaction today of all types of vehicles, such argument contradicts historical experience. The ratio of
motorized vehicles as to non-motorized vehicles, as it stood in 1950, was significantly lower than as it
stands today. This will be certainly affirmed by statistical data, assuming such has been compiled,
much less confirmed by persons over sixty. Aonuevos characterization of a vibrant intra-road dynamic
between motorized and non-motorized vehicles is more apropos to the past than to the present.
There is pertinent basis for segregating between motorized and non-motorized
vehicles. A motorized vehicle, unimpeded by the limitations in physical exertion. Is
capable of greater speeds and acceleration than non-motorized vehicles. At the sam
etime, motorized vehicles are more capable in inflicting greater injury or damage in the
event of an accident or collision. This is due to a combination of factors peculiar to
themotor vehicle, such as the greater speed, its relative greater bulk of mass, and
greater combustibility due to the use of fuel.

B. Negligience on the part of Villagracia

The existence of negligence in a given case is not determined by the personal judgment
of the actor in a given situation, but rather, it is the law which determines what would be reckless
or negligent. Añonuevo asserts that Villagracia was negligent as the latter had
transgressed traffic regulations. However, Añonuevo was speeding as hemade the left
turn, and by his own admission, he had seen Villagracia at a good distance of ten (10) meters. Had
he been decelerating, as he should, as he made the turn, Aonuevo would have had ample
opportunity to avoid hitting Villagracia, such negligent act was the proximate cause of the
accident.

Even assuming that Añonuevo had failed to see Villagracia because the bicycle was
not equipped with headlights, such lapse on the cyclist’s part would not have acquitted
the driver of his duty to slow down as he proceeded to make the left turn.

C. Contributory Negligience
To hold a person as having contributed to his injuries, it must be shown that he performed an act that
brought about his injuries in disregard of warnings or signs of an impending danger to health and
body.[60] To prove contributory negligence, it is still necessary to establish a causal link, although not
proximate, between the negligence of the party and the succeeding injury. In a legal sense, negligence
is contributory only when it contributes proximately to the injury, and not simply a condition for its
occurrence.[61]
As between Añonuevo and Villagracia, the lower courts adjudged Añonuevo assolely responsible
for the accident. The petition does not demonstrate why this finding should be
reversed. It is hard to imagine that the same result would not have occurred even if
Villagracia’s bicycle had been equipped with safety equipment.

22. Africa vs Caltex GR L-12986

FACTS:
A fire broke out at the Caltex service station in Manila. It started while gasoline
was being hosed from a tank truck into the underground storage, right at the
opening of the receiving truck where the nozzle of the hose was inserted The
fire then spread to and burned several neighboring houses, including the
personal properties and effects inside them. The owners of the houses, among
them petitioners here, sued Caltex (owner of the station) and Boquiren (agent
in charge of operation).

Trial court and CA found that petitioners failed to prove negligence and that
respondents had exercised due care in the premises and with respect to the
supervision of their employees. Both courts refused to apply the doctrine of
res ipsa loquitur on the grounds that “as to its applicability xxx in the
Philippines, there seems to be nothing definite,” and that while the rules do
not prohibit its adoption in appropriate cases, “in the case at bar, however,
we find no practical use for such
docrtrine.”

ISSUE:
W/N without proof as to the cause and origin of the fire, the doctrine of res
ipsa loquitur should apply as to presume negligence on the part of the
appellees.

RULE:
Res ipsa Loquitur is a rule to the effect that “where the thing which caused
the injury complained of is shown to be under the management of defendant
or his servants and the accident is such as in the ordinary course of things
does not happen if those who have its management or control use proper care,
it affords reasonable evidence, in absence of explanation of defendant, that
the incident happened because of want of care.

The aforesaid principle enunciated in Espiritu vs. Philippine Power and

Development Co. is applicable in this case. The gasoline station, with all its
appliances, equipment and employees, was under the control of appellees. A
fire occurred therein and spread to and burned the neighboring houses. The
person who knew or could have known how the fire started were the appellees
and their employees, but they gave no explanation thereof whatsoever. It is
fair and reasonable inference that the incident happened because of want of
care. The report by the police officer regarding the fire, as well as the
statement of the driver of the gasoline tank wagon who was transferring the
contents thereof into the underground storage when the fire broke out,
strengthen the presumption of negligence. Verily, (1) the station is in a very
busy district and pedestrians often pass through or mill around the premises;
(2) the area is used as a car barn for around 10 taxicabs owned by Boquiren;
(3) a store where people hang out and possibly smoke cigarettes is located
one meter from the hole of the underground tank; and (4) the concrete walls
adjoining the neighborhood are only 2 . meters high at most and
cannot prevent the flames from leaping over it in case of fire.

23. FGU Insurance vs Sarmiento GR 141910

Facts:
G.P. Sarmiento Trucking Corporation (GPS) undertook to deliver on 18 June 1994 thirty
(30) units of Condura S.D. white refrigerators aboard one of its Isuzu truck, driven by
Lambert Eroles, from the plant site of Concepcion Industries, Inc., along South
Superhighway in
Alabang, Metro Manila, to the Central Luzon Appliances in Dagupan City. While the truck
was traversing the north diversion road along McArthur highway in Barangay Anupol,
Bamban, Tarlac, it collided with an unidentified truck, causing it to fall into a deep canal,
resulting in... damage to the cargoes.
FGU Insurance Corporation (FGU), an insurer of the shipment, paid to Concepcion
Industries, Inc., the value of the covered cargoes in the sum of P204,450.00. FGU, in turn,
being the subrogee of the rights and interests of Concepcion Industries, Inc., sought
reimbursement of... the amount it had paid to the latter from GPS. Since the trucking
company failed to heed the claim, FGU filed a complaint for damages and breach of
contract of carriage against GPS and its driver Lambert Eroles with the Regional Trial Court
The trial court, in its order of 30 April 1996,[1] granted the motion to dismis
"Accordingly, the application of the law on common carriers is not warranted and the
presumption of fault or negligence on the part of a common carrier in case of loss, damage
or deterioration of goods during transport under 1735 of the Civil Code is not availing.
"Thus, the laws governing the contract between the owner of the cargo to whom the plaintiff
was subrogated and the owner of the vehicle which transports the cargo are the laws on
obligation and contract of the Civil Code as well as the law on quasi delicts.
"Under the law on obligation and contract, negligence or fault is not presumed. The law on
quasi delict provides for some presumption of negligence but only upon the attendance of
some circumstances. Thus, Article 2185 provides:
'Art. 2185. 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 the mishap, he was violating any traffic
regulation.'
"Evidence for the plaintiff shows no proof that defendant was violating any traffic regulation.
Hence, the presumption of negligence is not obtaining.
"Considering that plaintiff failed to adduce evidence that defendant is a common carrier and
defendant's driver was the one negligent, defendant cannot be made liable for the damages
of the subject cargoes."
The Court of Appeals rejected the appeal of petitioner and ruled in favor of GPS. The
appellate court, in its decision of 10 June 1999, [4] discoursed, among other things, that -
"x x x in order for the presumption of negligence provided for under the law governing
common carrier (Article 1735, Civil Code) to arise, the appellant must first prove that the
appellee is a common carrier. Should the appellant fail to prove that the appellee is a
common... carrier, the presumption would not arise; consequently, the appellant would have
to prove that the carrier was negligent.
Issues:
WHETHER RESPONDENT GPS MAY BE CONSIDERED AS A COMMON CARRIER AS
DEFINED UNDER THE LAW AND EXISTING JURISPRUDENCE.
II
WHETHER RESPONDENT GPS, EITHER AS A COMMON CARRIER OR A PRIVATE
CARRIER, MAY BE PRESUMED TO HAVE BEEN NEGLIGENT WHEN THE GOODS IT
UNDERTOOK TO TRANSPORT SAFELY WERE SUBSEQUENTLY DAMAGED WHILE IN
ITS PROTECTIVE CUSTODY AND POSSESSION.
III
WHETHER THE DOCTRINE OF RES IPSA LOQUITUR IS APPLICABLE IN THE INSTANT
CASE.
Ruling:
the Court finds the conclusion of the trial court and the Court of Appeals to be amply
justified. GPS, being an exclusive contractor and hauler of Concepcion Industries, Inc.,
rendering or offering its services to no other individual or entity, cannot be... considered a
common carrier. Common carriers are persons, corporations, firms or associations engaged
in the business of carrying or transporting passengers or goods or both, by land, water, or
air, for hire or compensation, offering their services to the public,[8] whether to the public in
general or to a limited clientele in particular, but never on an exclusive basis.[9] The true
test of a common carrier is the carriage of passengers or goods, providing space for those
who opt to avail themselves of... its transportation service for a fee.[10] Given accepted
standards, GPS scarcely falls within the term "common carrier."
The above conclusion nothwithstanding, GPS cannot escape from liability.
In culpa contractual, upon which the action of petitioner rests as being the subrogee of
Concepcion Industries, Inc., the mere proof of the existence of the contract and the failure
of its compliance justify, prima facie, a corresponding right of relief.[11] The law, recognizing
the obligatory force of contracts,[12] will not permit a party to be set free from liability for any
kind of misperformance of the contractual undertaking or a contravention of the tenor
thereof.[13] A breach upon the contract confers upon the injured party a valid cause for
recovering that which may have been lost or suffered. The remedy serves to preserve the
interests of the promisee that may include his "expectation interest," which is his interest
in... having the benefit of his bargain by being put in as good a position as he would have
been in had the contract been performed, or his "reliance interest," which is his interest in
being reimbursed for loss caused by reliance on the contract by being put in as good a
position as... he would have been in had the contract not been made; or his "restitution
interest," which is his interest in having restored to him any benefit that he has conferred on
the other party.[14] Indeed, agreements can accomplish little, either for their makers... or for
society, unless they are made the basis for action.[15] The effect of every infraction is to
create a new duty, that is, to make recompense to the one who has been injured by the
failure of another to observe his contractual obligation[16] unless he can show extenuating
circumstances, like proof of his exercise of due diligence (normally that of the diligence of a
good father of a family or, exceptionally by stipulation or by law such as in the case of
common carriers, that of extraordinary... diligence) or of the attendance of fortuitous event,
to excuse him from his ensuing liability.
Respondent trucking corporation recognizes the existence of a contract of carriage between
it and petitioner's assured, and admits that the cargoes it has assumed to deliver have been
lost or damaged while in its custody. In such a situation, a default on, or failure of...
compliance with, the obligation in this case, the delivery of the goods in its custody to the
place of destination - gives rise to a presumption of lack of care and corresponding liability
on the part of the contractual obligor the burden being on him to establish otherwise. GPS...
has failed to do so.
Respondent driver, on the other hand, without concrete proof of his negligence or fault, may
not himself be ordered to pay petitioner. The driver, not being a party to the contract of
carriage between petitioner's principal and defendant, may not be held liable under the...
agreement. A contract can only bind the parties who have entered into it or their successors
who have assumed their personality or their juridical position.[17] Consonantly with the
axiom res inter alios acta aliis neque nocet prodest,... such contract can neither favor nor
prejudice a third person. Petitioner's civil action against the driver can only be based on
culpa aquiliana, which, unlike culpa contractual, would require the claimant for damages to
prove negligence or fault on the part of the... defendant.[18]
A word in passing. Res ipsa loquitur, a doctrine being invoked by petitioner, holds a
defendant liable where the thing which caused the injury complained of is shown to be
under the latter's management and the accident is such that, in the ordinary course of
things,... cannot be expected to happen if those who have its management or control use
proper care. It affords reasonable evidence, in the absence of explanation by the defendant,
that the accident arose from want of care.[19] It is not a rule of substantive law and,... as
such, it does not create an independent ground of liability. Instead, it is regarded as a mode
of proof, or a mere procedural convenience since it furnishes a substitute for, and relieves
the plaintiff of, the burden of producing specific proof of negligence. The maxim simply...
places on the defendant the burden of going forward with the proof.[20] Resort to the
doctrine, however, may be allowed only when (a) the event is of a kind which does not
ordinarily occur in the absence of negligence; (b) other responsible causes,... including the
conduct of the plaintiff and third persons, are sufficiently eliminated by the evidence; and (c)
the indicated negligence is within the scope of the defendant's duty to the plaintiff.[21] Thus,
it is not applicable when an unexplained accident... may be attributable to one of several
causes, for some of which the defendant could not be responsible.[22]
Res ipsa loquitur generally finds relevance whether or not a contractual relationship exists
between the plaintiff and the defendant, for the inference of negligence arises from the
circumstances and nature of the occurrence and not from the nature of the relation of... the
parties.[23] Nevertheless, the requirement that responsible causes other than those due to
defendant's conduct must first be eliminated, for the doctrine to apply, should be understood
as being confined only to cases of pure (non-contractual) tort since... obviously the
presumption of negligence in culpa contractual, as previously so pointed out, immediately
attaches by a failure of the covenant or its tenor. In the case of the truck driver, whose
liability in a civil action is predicated on culpa acquiliana,... while he admittedly can be said
to have been in control and management of the vehicle which figured in the accident, it is
not equally shown, however, that the accident could have been exclusively due to his
negligence, a matter that can allow, forthwith, res ipsa... loquitur to work against him.
If a demurrer to evidence is granted but on appeal the order of dismissal is reversed, the
movant shall be deemed to have waived the right to present evidence.[24] Thus,
respondent corporation may no longer offer proof to establish that it has exercised... due
care in transporting the cargoes of the assured so as to still warrant a remand of the case to
the trial court.
WHEREFORE, the order, dated 30 April 1996, of the Regional Trial Court, Branch 66, of
Makati City, and the decision, dated 10 June 1999, of the Court of Appeals, are AFFIRMED
only insofar as respondent Lambert M. Eroles is concerned, but said assailed order... of the
trial court and decision of the appellate court are REVERSED as regards G.P. Sarmiento
Trucking Corporation which, instead, is hereby ordered to pay FGU Insurance Corporation
the value of the damaged and lost cargoes in the amount of P204,450.00. No costs.
24. SAL vs CA 10356