TORTS AND DAMEGES: ISSUES AND RULINGS (based on the syllabus of Atty.

Huigit)
QUASI-DELICT
Vergara vs. CA 154 SCRA 564
[G.R. No. 77679. September 30, 1987.]
VICENTE VERGARA, petitioner, vs. THE COURT OF APPEALS and AMADEO AZARCON, respondents. FGU Insurance vs.
CA, 287 SCRA 718
ISSUE: WON the petitioner is guilty of fault or negligence. YES
It was established by competent evidence that the requisites of a quasi-delict are present in the case at bar.
These requisites are: (1) damages to the plaintiff; (2) negligence, by act or omission, of which defendant, or some
person for whose-acts he must respond, was guilty; and (3) the connection of cause and effect between such
negligence and the damages.
It is undisputed that private respondent suffered damages as a result of an act or omission of petitioner. The
issue of whether or not this act or omission can be considered as a "negligent" act or omission was passed upon by the
trial court. The findings of said court, affirmed by the respondent court, which we are not prepared to now disturb,
show that the fact of occurrence of the "vehicular accident" was sufficiently established by the policy report and the
testimony of Patrolman Masiclat. And the fact of negligence may be deduced from the surrounding circumstances
thereof. According to the police report, "the cargo truck was travelling on the right side of the road going to Manila and
then it crossed to the center line and went to the left side of the highway; it then bumped a tricycle; and then another
bicycle; and then said cargo truck rammed the storewarehouse of the plaintiff."
According to the driver of the cargo truck, he applied the brakes but the latter did not work due to mechanical
defect. Contrary to the claim of the petitioner, a mishap caused by defective brakes cannot be considered as fortuitous
in character. Certainly, the defects were curable and the accident preventable.
Furthermore, the petitioner failed to adduce any evidence to overcome the disputable presumption of
negligence on his part in the selection and supervision of his driver.
Based on the foregoing finding by the respondent Court that there was negligence on the part of the
petitioner, the petitioner's contention that the respondent court erred in awarding private respondent actual, moral
and exemplary damages as well as attorney's fees and costs, is untenable.
ACCORDINGLY, the petition is DENIED.

Singson vs. 132 Phil 597

[G.R. No. L-24837. June 27, 1968.]
JULIAN C. SINGSON and RAMONA DEL CASTILLO, plaintiffs, vs. BANK OF THE PHILIPPINE ISLANDS and SANTIAGO
FREIXAS, in his capacity as President of the said Bank, defendants.
ISSUE: WON the existence of a contractual relation between the parties bars recovery for quasi delict?
The lower court held that plaintiffs' claim for damages cannot be based upon a tort or quasi-delict, their
relation with the defendants being contractual in nature. We have repeatedly held, however, that 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 therefor. 2 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 the 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 plaintiffs 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 P500.00, would, suffice to
vindicate plaintiff's rights.
WHEREFORE, the judgment appealed from is hereby reversed and another one shall be entered sentencing the
defendant Bank of the Philippine Islands to pay to the plaintiffs said sums of P1,000, as nominal damages, and P500.00,
as attorney's fees, apart from the costs. It is so ordered.

GAN vs. CA 165 SCRA 378

[G.R. No. L-44264. September 19, 1988.]
HEDY GAN y YU, petitioner, vs. THE HONORABLE COURT OF APPEALS and the PEOPLE OF THE PHILIPPINES,
respondents.
ISSUE: WON the petitioner is guilty of the crime of Homicide thru Simple Imprudence? NO
The test for determining whether or not a person is negligent in doing an act whereby injury or damage results
to the person or property of another is this: Would a prudent man in the position of the person to whom negligence is
attributed foresee harm to the person injured as a reasonable consequence of the course about to be pursued? If so,
the law imposes the duty on the doer to take precaution against its mischievous results and the failure to do so
constitutes negligence.
A corollary rule is what is known in the law as the emergency rule. "Under that rule, one who suddenly finds
himself in a place of danger, and is required to act without time to consider the best means that may be adopted to
avoid the impending danger, is not guilty of negligence, if he fails to adopt what subsequently and upon reflection may
appear to have been a better method, unless the emergency in which he finds himself is brought about by his own
negligence."
Applying the above test to the case at bar, we find the petitioner not guilty of the crime of Simple Imprudence
resulting in Homicide.
The appellate court in finding the petitioner guilty said:
"The accused should have stepped on the brakes when she saw the car going in the opposite direction
followed by another which overtook the first by passing towards its left. She should not only have swerved the
car she was driving to the right but should have also tried to stop or lessen her speed so that she would not
bump into the pedestrian who was crossing at the time but also the jeepney which was then parked along the
street."
The course of action suggested by the appellate court would seem reasonable were it not for the fact that such
suggestion did not take into account the amount of time afforded petitioner to react to the situation she was in. For it
is undeniable that the suggested course of action presupposes sufficient time for appellant to analyze the situation
confronting her and to ponder on which of the different courses of action would result in the least possible harm to
herself and to others.
Due to the lack of eyewitnesses, no evidence was presented by the prosecution with respect to the relative distances
of petitioner to the parked jeepney and the oncoming overtaking vehicle that would tend to prove that petitioner did
have sufficient time to reflect on the consequences of her instant decision to swerve her car to the right without
stepping on her brakes.
The prosecution having presented this exhibit as its own evidence, we cannot but deem its veracity to have
been admitted by it. Thus, under the circumstances narrated by petitioner, we find that the appellate court is asking
too much from a mere mortal like the petitioner who in the blink of an eye had to exercise her best judgment to
extricate herself from a difficult and dangerous situation caused by the driver of the overtaking vehicle. Petitioner
certainly could not be expected to act with all the coolness of a person under normal conditions." The danger
confronting petitioner was real and imminent, threatening her very existence. She had no opportunity for rational
thinking but only enough time to heed the very powerful instinct of self-preservation.
Also, the respondent court itself pronounced that the petitioner was driving her car within the legal limits. We
therefore rule that the "emergency rule" enunciated above applies with full force to the case at bar and consequently
absolve petitioner from any criminal negligence in connection with the incident under consideration.
We further set aside the award of damages to the heirs of the victim, who by executing a release of the claim due
them, had effectively and clearly waived their right thereto.
WHEREFORE, judgment is hereby rendered acquitting petitioner HEDY GAN y YU of the crime of Homicide thru Simple
Imprudence. She is no longer liable for the P12,000.00 civil indemnity awarded by the appellate court to the heirs of
the victim. SO ORDERED.

People vs. De Los Santos 355 SCRA 415

[G.R. No. 131588. March 27, 2001.]
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. GLENN DE LOS SANTOS, accused-appellant.
ISSUE:
In its decision of 26 August 1997, the trial court convicted GLENN of the complex crime of multiple murder,
multiple frustrated murder and multiple attempted murder, with the use of motor vehicle as the qualifying
circumstance. It sentenced him to suffer the penalty of death and ordered him to indemnify each group of the heirs
of the deceased in the amount of P75,000; each of the victims of frustrated murder in the amount of P30,000; and
each of the victims of attempted murder in the amount of P10,000.

Hence, this automatic review, wherein GLENN contends that the trial court erred (a) in finding that he caused
the Isuzu Elf truck to hit the trainees even after seeing the rear guards waving and the PNP trainees jogging; (b) in
finding that he caused the truck to run even faster after noticing the first thuds; and (c) in finding that he could still
have avoided the accident from a distance of 150 meters, despite the bright and glaring light from the oncoming
vehicle.

In convicting GLENN, the trial court found that "the accused out of mischief and dare-devilness, in the
exhilaration of the night breeze and having drunk at least three bottles of beer earlier, merely wanted to scare the
rear guard[s] and see them scamper away as they saw him and his vehicle coming at them to ram them down."

Likewise, the OSG posits that "the evil motive of the appellant in injuring the jogging trainees was probably
brought by the fact that he had drunk a total of three (3) bottles of beer earlier before the incident."

Not to be outdone, the defense also advances another speculation, i.e., "the possibility that [GLENN] could
have fallen asleep out of sheer fatigue in that unholy hour of 3:30 in the early morning, and thus was not able to stop
his Isuzu Elf truck when the bumping thuds were occurring in rapid succession; and after he was able to wake up upon
hearing the shout of his companions, it was already too late, as the bumping thuds had already occurred."

Considering that death penalty is involved, the trial court should have been more scrupulous in weighing the
evidence. If we are to subscribe to the trial court's finding that GLENN must have merely wanted to scare the rear
guards, then intent to kill was wanting. In the absence of a criminal intent, he cannot be held liable for an intentional
felony. All reasonable doubt intended to demonstrate negligence, and not criminal intent, should be indulged.

From the convergence of circumstances, we are inclined to believe that the tragic event was more a product
of reckless imprudence than of a malicious intent on GLENN's part.

First, as testified to by prosecution rebuttal witness Danilo Olarita, the place of the incident was "very dark,"
as there was no moon. And according to PAG-ASA's observed weather report within the vicinity of Cagayan de Oro
City covering a radius of 50 kilometers, at the time the event took place, the sky was overcast, i.e., there was
absolutely no break in the thick clouds covering the celestial dome globe; hence, there was no way for the moon and
stars to be seen. Neither were there lampposts that illuminated the highway.

Second, the jogging trainees and the rear guards were all wearing black T-shirts, black short pants, and black
and green combat shoes, which made them hard to make out on that dark and cloudy night. The rear guards had
neither reflectorized vests or gloves nor flashlights in giving hand signals.

Third, GLENN was driving on the proper side of the road, the right lane. On the other hand, the jogging
trainees were occupying the wrong lane, the same lane as GLENN's vehicle was traversing. Worse, they were facing
the same direction as GLENN's truck such that their backs were turned towards the oncoming vehicles from behind.

Fourth, no convincing evidence was presented to rebut GLENN's testimony that he had been momentarily
blinded by the very bright and glaring lights of the oncoming vehicle at the opposite direction as his truck rounded the
curve. He must have been still reeling from the blinding effect of the lights coming from the other vehicle when he
plowed into the group of police trainees.

Indeed, as pointed out by appellant, instinct tells one 'to stop or swerve to a safe place the moment he sees a
cow, dog, or cat on the road, in order to avoid bumping or killing the same"; and more so if the one on the road is a
person. It would therefore be inconceivable for GLENN, then a young college graduate with a pregnant wife and three
very young children who were dependent on him for support, to have deliberately hit the group with his truck.

The conclusion of the trial court and the OSG that GLENN intentionally rammed and hit the jogging trainees
was premised on the assumption that despite the first bumping thuds, he continued to accelerate his vehicle instead
of applying his brakes, as shown by the absence of brake marks or skid marks along the traffic scene.

For its part, the defense attributed the continuous movement of GLENN's vehicle to the confluence of the
following factors:

1. The Isuzu Elf truck, a huge vehicle, was moving fast that even if the brakes were applied the
truck would have still proceeded further on account of its momentum, albeit at a reduced
speed, and would have stopped only after a certain distance.

2. The national highway, from Alae to Puerto, Cagayan de Oro City, was made of ne and
smooth asphalt, free from obstructions on the road such as potholes or excavations.
Moreover, the highway was going a little bit downward, more particularly from the first
curve to the place of incident. Hence, it was easier and faster to traverse a distance of "20
to 25 meters which was the approximate aggregate distance" from the first elements up to
the 22nd or 23rd elements of the columns.

3. The weight of each of the trainees (the average of which could be 50 kilograms only) could
hardly make an impact on the 3,900 kilograms truck, which was moving at a speed ranging
from 60 to 70 kilometers per hour.

4. Considering that the width of the truck from the right to the left tires
was wide and the under chassis was elevated, the truck could just pass over two persons
lying at on the ground without its rubber tires running over the bodies. Thus, GLENN would
not notice any destabilization of the rubber tires.

5. Since the police trainees were jogging in the same direction as the truck was proceeding,
the forward movements constituted a force parallel to the momentum of the forward-
 moving truck such that there was even much lesser force resisting the said ongoing
momentum.

It is a well-entrenched rule that if the inculpatory facts are capable of two or more explanations — one
consistent with the innocence or lesser degree of liability of the accused, and the other consistent with his guilt or
graver responsibility — the Court should adopt the explanation which is more favorable to the accused.

We are convinced that the incident, tragic though it was in light of the number of persons killed and seriously
injured, was an accident and not an intentional felony. It is significant to note that there is no shred of evidence that
GLENN had an axe to grind against the police trainees that would drive him into deliberately hitting them with intent
to kill.

Although proof of motive is not indispensable to a conviction especially where the assailant is positively
identified, such proof is, nonetheless, important in determining which of two conflicting theories of the incident is
more likely to be true. Thus, in People v. Godinez, this Court said that the existence of a motive on the part of the
accused becomes decisive in determining the probability or credibility of his version that the shooting was purely
accidental.

Neither is there any showing of "a political angle of a leftist-sponsored massacre of police elements disguised
in a vehicular accident." Even if there be such evidence, i.e., that the motive of the killing was in furtherance of a
rebellion movement, GLENN cannot be convicted because if such were the case, the proper charge would be
rebellion, and not murder.

GLENN's offense is in failing to apply the brakes, or to swerve his vehicle to the left or to a safe place the
moment he heard and felt the first bumping thuds. Had he done so, many trainees would have been spared. We have
once said:
A man must use common sense, and exercise due reflection in all his acts; it is his duty to
be cautious, careful, and prudent, if not from instinct, then through fear of incurring punishment.
He is responsible for such results as anyone might foresee and for acts which no one would have
performed except through culpable abandon. Otherwise his own person, rights and property, and
those of his fellow beings, would ever be exposed to all manner of danger and injury.

The test for determining whether a person is negligent in doing an act whereby injury or damage results to
the person or property of another is this: Could a prudent man, in the position of the person to whom negligence is
attributed, foresee harm to the person injured as a reasonable consequence of the course actually pursued? If so,
the law imposes a duty on the actor to refrain from that course or to take precautions to guard against its
mischievous results, and the failure to do so constitutes negligence. Reasonable foresight of harm, followed by the
ignoring of the admonition born of this prevision, is always necessary before negligence can be held to exist.

GLENN showed an inexcusable lack of precaution. Article 365 of the Revised Penal Code states that reckless
imprudence consists in voluntarily, but without malice, doing or failing to do an act from which material damage
results by reason of inexcusable lack of precaution on the part of the person performing or failing to perform such act,
taking into consideration (1) his employment or occupation; (2) his degree of intelligence; (4) his physical condition;
and (3) other circumstances regarding persons, time and place.

GLENN, being then a young college graduate and an experienced driver, should have known to apply the
brakes or swerve to a safe place immediately upon hearing the first bumping thuds to avoid further hitting the other
trainees. By his own testimony, it was established that the road was slippery and slightly going downward; and, worse,
the place of the incident was foggy and dark. He should have observed due care in accordance with the conduct of a
reasonably prudent man, such as by slackening his speed, applying his brakes, or turning to the left side even if it
would mean entering the opposite lane (there being no evidence that a vehicle was coming from the opposite
direction). It is highly probable that he was driving at high speed at the time. And even if he was driving within the
speed limits, this did not mean that he was exercising due care under the existing circumstances and conditions at the
time.

Considering that the incident was not a product of a malicious intent but rather the result of a single act of
reckless driving, GLENN should be held guilty of the complex crime of reckless imprudence resulting in multiple
homicide with serious physical injuries and less serious physical injuries.

As far as the award of damages is concerned, we find a necessity to modify the same. Conformably with
current jurisprudence, we reduce the trial court's award of death indemnity from P75,000 to P50,000 for each group
of heirs of the trainees killed. Likewise, for lack of factual basis, we delete the awards of P30,000 to each of those who
suffered serious physical injuries and of P10,000 to each of those who suffered minor physical injuries.

WHEREFORE, the decision of the Regional Trial Court, Branch 38, Cagayan de Oro
City, is hereby SET ASIDE, and another one is rendered holding herein accused-appellant GLENN DE LOS SANTOS guilty
beyond reasonable doubt of (1) the complex crime of reckless imprudence resulting in multiple homicide with serious
physical injuries and less serious physical injuries, and sentencing him to suffer an indeterminate penalty of four (4)
years of prision correccional as minimum, to ten (10) years of prision mayor, as maximum; and (2) ten (10) counts of
reckless imprudence resulting in slight physical injuries and sentencing him, for each count, to the penalty of two (2)
months of arresto mayor. Furthermore, the awards of death indemnity for each group of heirs of the trainees killed
are reduced to P50,000; and the awards in favor of the other victims are deleted. Costs against accused-appellant. SO
ORDERED.

Phoenix Construction , & Carbonel vs. ICA DIONISIO 148 SCRA 353
[G.R. No. L-65295. March 10, 1987.]
PHOENIX CONSTRUCTION, INC. and ARMANDO U. CARBONEL, petitioners, vs. THE INTERMEDIATE APPELLATE COURT
and LEONARDO DIONISIO, respondents.
ISSUE: WON Dionisio was negligent to bar recovery from the petitioner? YES, was negligent, but does not bar
recovery, doctrine of last clear chance is misplaced, negligence was merely contributory.
There are four factual issues that need to be looked into: (a) whether or not private respondent Dionisio had a
curfew pass valid and effective for that eventful night; (b) whether Dionisio was driving fast or speeding just before the
collision with the dump truck; (c) whether Dionisio had purposely turned off his car's headlights before contact with
the dump truck or whether those headlights accidentally malfunctioned moments before the collision; and (d) whether
Dionisio was intoxicated at the time of the accident.
As to the first issue relating to the curfew pass, it is clear that no curfew pass was found on the person of
Dionisio immediately after the accident nor was any found in his car. Phoenix's evidence here consisted of the
testimony of Patrolman Cuyno who had taken Dionisio, unconscious, to the Makati Medical Center for emergency
treatment immediately after the accident. At the Makati Medical Center, a nurse took off Dionisio's clothes and
examined them along with the contents of pockets together with Patrolman Cuyno. Private respondent Dionisio was
not able to produce any curfew pass during the trial. Instead, he offered the explanation that his family may have
misplaced his curfew pass. He also offered a certification (dated two years after the accident) issued by one Major
Benjamin N. Libarnes of the Zone Integrated Police Intelligence Unit of Camp Olivas, San
Fernando, Pampanga, which was said to have authority to issue curfew passes for Pampanga and Metro
Manila. This certification was to the effect that private respondent Dionisio had a valid curfew pass. This certification
did not, however, specify any pass serial number or date or period of effectivity of the supposed curfew pass. We find
that private respondent Dionisio was unable to prove possession of a valid curfew pass during the night of the accident
and that the preponderance of evidence shows that he did not have such a pass during that night. The relevance of
possession or non-possession of a curfew pass that night lies in the light it tends to shed on the other related issues:
whether Dionisio was speeding home and whether he had indeed purposely put out his headlights before the accident,
in order to avoid detection and possibly arrest by the police in the nearby police station for travelling after the onset of
curfew without a valid curfew pass.
On the second issue — whether or not Dionisio was speeding home that night — both the trial court and the
appellate court were completely silent.
The defendants in the trial court introduced the testimony of Patrolman Cuyno who was at the scene of the
accident almost immediately after it occurred, the police station where he was based being barely 200 meters away.
Patrolman Cuyno testified that people who had gathered at the scene of the accident told him that Dionisio's car was
"moving fast" and did not have its headlights on. 2 Dionisio, on the other hand, claimed that he was travelling at a
moderate speed at 30 kilometers per hour and had just crossed the intersection of General Santos and General Lacuna
Streets and had started to accelerate when his headlights failed just before the collision took place.
Private respondent Dionisio asserts that Patrolman Cuyno's testimony was hearsay and did not fall within any
of the recognized exceptions to the hearsay rule since the facts he testified to were not acquired by him through
official information and had not been given by the informants pursuant to any duty to do so. Private respondent's
objection fails to take account of the fact that the testimony of Patrolman Cuyno is admissible not under the official
records exception to the hearsay rule 4 but rather as part of the res gestae. 5 Testimonial evidence under this
exception to the hearsay rule consists of excited utterances made on the occasion of an occurrence or event
sufficiently startling in nature so as to render in-operative the normal reflective thought processes of the observer and
hence made as a spontaneous reaction to the occurrence or event, and not the result of reflective thought.
We think that an automobile speeding down a street and suddenly smashing into a stationary object in the
dead of night is a sufficiently startling event as to evoke spontaneous, rather than reflective, reactions from observers
who happened to be around at that time. The testimony of Patrolman Cuyno was therefore admissible as part of the
res gestae and should have been considered by the trial court. Clearly, substantial weight should have been ascribed to
such testimony, even though it did not, as it could not, have purported to describe quantitatively the precise velocity at
which Dionisio was travelling just before impact with the Phoenix dump truck.
A third related issue is whether Dionisio purposely turned off his headlights, or whether his headlights
accidentally malfunctioned, just moments before the accident. The Intermediate Appellate Court expressly found that
the headlights of Dionisio's car went off as he crossed the intersection but was non-committal as to why they did so. It
is the petitioners' contention that Dionisio purposely shut off his headlights even before he reached the intersection so
as not to be detected by the police in the police precinct which he (being a resident in the area) knew was not far away
from the intersection. We believe that the petitioners' theory is a more credible explanation than that offered by
private respondent Dionisio — i.e., that he had his headlights on but that, at the crucial moment, these had in some
mysterious if convenient way malfunctioned and gone off, although he succeeded in switching his lights on again at
"bright" split seconds before contact with the dump truck.
A fourth and final issue relates to whether Dionisio was intoxicated at the time of the accident. The evidence
here consisted of the testimony of Patrolman Cuyno to the effect that private respondent Dionisio smelled of liquor at
the time he was taken from his smashed car and brought to the Makati Medical Center in an unconscious condition. 7
This testimony has to be taken in conjunction with the admission of Dionisio that he had taken "a shot or two" of liquor
before dinner with his boss that night. We do not believe that this evidence is sufficient to show that Dionisio was so
heavily under the influence of liquor as to constitute his driving a motor vehicle per se an act of reckless imprudence. 8
There simply is not enough evidence to show how much liquor he had in fact taken and the effects of that upon his
physical faculties or upon his judgment or mental alertness. We are also aware that "one shot or two" of hard liquor
may affect different people differently.
The conclusion we draw from the factual circumstances outlined above is that private respondent Dionisio was
negligent the night of the accident. He was hurrying home that night and driving faster than he should have been.
Worse, he extinguished his headlights at or near the intersection of General Lacuna and General Santos Streets and
thus did not see the dump truck that was parked askew and sticking out onto the road lane.
Nonetheless, we agree with the Court of First Instance and the Intermediate Appellate Court that the legal and
proximate cause of the accident and of Dionisio's injuries was the wrongful or negligent manner in which the dump
truck was parked — in other words, the negligence of petitioner Carbonel. That there was a reasonable relationship
between petitioner Carbonel's negligence on the one hand and the accident and respondent's injuries on the other
hand, is quite clear. Put in a slightly different manner, the collision of Dionisio's car with the dump truck was a natural
and foreseeable consequence of the truck driver's negligence.
The petitioners, however, urge that the truck driver's negligence was merely a "passive and static condition"
and that private respondent Dionisio's negligence was an "efficient intervening cause," and that consequently
Dionisio's negligence must be regarded as the legal and proximate cause of the accident rather than the earlier
negligence of Carbonel. We note that the petitioners' arguments are drawn from a reading of some of the older cases
in various jurisdictions in the United States but we are unable to persuade ourselves that these arguments have any
validity for our jurisdiction. We note, firstly, that even in the United States, the distinctions between "cause" and
"condition" which the petitioners would have us adopt have already been "almost entirely discredited." Professors
Prosser and Keeton make this quite clear:
"Cause and condition. Many courts have sought to distinguish between the active "cause" of the
harm and the existing "conditions" upon which that cause operated. If the defendant has created only a
passive static condition which made the damage possible, the defendant is said not to be liable. But so far as
the fact of causation is concerned, in the sense of necessary antecedents which have played an important
part in producing the result, it is quite impossible to distinguish between active forces and passive situations,
particularly since, as is invariably the case, the latter are the result of other active forces which have gone
before. The defendant who spills gasoline about the premises creates a "condition," but the act may be
culpable because of the danger of fire. When a spark ignites the gasoline, the condition has done quite as
much to bring about the fire as the spark; and since that is the very risk which the defendant has created,
the defendant will not escape responsibility. Even the lapse of a considerable time during which the
"condition" remains static will not necessarily affect liability; one who digs a trench in the highway may still
be liable to another who falls into it a month afterward. "Cause" and "condition" still find occasional mention
in the decisions; but the distinction is now almost entirely discredited. So far as it has any validity at all, it
must refer to the type of case where the forces set in operation by the defendant have come to rest in a
position of apparent safety, and some new force intervenes. But even in such cases, it is not the distinction
between "cause" and "condition" which is important, but the nature of the risk and the character of the
intervening cause."
We believe, secondly, that the truck driver's negligence far from being a "passive and static condition" was
rather an indispensable and efficient cause. The collision between the dump truck and the private respondent's car
would in all probability not have occurred had the dump truck not been parked askew without any warning lights or
reflector devices. The improper parking of the dump truck created an unreasonable risk of injury for anyone driving
down General Lacuna Street and for having so created this risk, the truck driver must be held responsible. In our
view, Dionisio's negligence, although later in point of time than the truck driver's negligence and therefore closer to
the accident, was not an efficient intervening or independent cause. What the petitioners describe as an
"intervening cause" was no more than a foreseeable consequence of the risk created by the negligent manner in
which the truck driver had parked the dump truck. In other words, the petitioner truck driver owed a duty to private
respondent Dionisio and others similarly situated not to impose upon them the very risk the truck driver had created.
Dionisio's negligence was not of an independent and overpowering nature as to cut, as it were, the chain of causation
in fact between the improper parking of the dump truck and the accident, nor to sever the juris vinculum of liability. It
is helpful to quote once more from Prosser and Keeton:
"Foreseeable Intervening Causes. If the intervening cause is one which in ordinary human
experience is reasonably to be anticipated, or one which the defendant has reason to anticipate under the
particular circumstances, the defendant may be negligent, among other reasons, because of failure to guard
against it; or the defendant may be negligent only for that reason. Thus one who sets a fire may be required
to foresee that an ordinary, usual and customary wind arising later will spread it beyond the defendant's
own property, and therefore to take precautions to prevent that event. The person who leaves the
combustible or explosive material exposed in a public place may foresee the risk of fire from some
independent source. . . . In all of these cases there is an intervening cause combining with the defendant's
conduct to produce the result, and in each case the defendant's negligence consists in failure to protect the
plaintiff against that very risk.
Obviously the defendant cannot be relieved from liability by the fact that the risk or a substantial
and important part of the risk, to which the defendant has subjected the plaintiff has indeed come to pass.
Foreseeable intervening forces are within the scope of the original risk, and hence of the defendant's
negligence. The courts are quite generally agreed that intervening causes which fall fairly in this category will
not supersede the defendant's responsibility.
Thus it has been held that a defendant will be required to anticipate the usual weather of the
vicinity, including all ordinary forces of nature such as usual wind or rain, or snow or frost or fog or even
lightning; that one who leaves an obstruction on the road or a railroad track should foresee that a vehicle or
a train will run into it; . . . .
The risk created by the defendant may include the intervention of the foreseeable negligence of
others. . . . [T]he standard of reasonable conduct may require the defendant to protect the plaintiff against
`that occasional negligence which is one of the ordinary incidents of human life, and therefore to be
anticipated.' Thus, a defendant who blocks the sidewalk and forces the plaintiff to walk in a street where the
plaintiff will be exposed to the risks of heavy traffic becomes liable when the plaintiff is run down by a car,
even though the car is negligently driven; and one who parks an automobile on the highway without lights at
night is not relieved of responsibility when another negligently drives into it. ---"
We hold that private respondent Dionisio's negligence was "only contributory," that the "immediate and
proximate cause" of the injury remained the truck driver's "lack of due care" and that consequently respondent
Dionisio may recover damages though such damages are subject to mitigation by the courts (Article 2179, Civil Code of
the Philippines).
Petitioners also ask us to apply what they refer to as the "last clear chance" doctrine. The theory here of
petitioners is that while the petitioner truck driver was negligent, private respondent Dionisio had the "last clear
chance" of avoiding the accident and hence his injuries, and that Dionisio having failed to take that "last clear chance"
must bear his own injuries alone. The last clear chance doctrine of the common law was imported into our jurisdiction
by Picart vs. Smith but it is a matter for debate whether, or to what extent, it has found its way into the Civil Code of
the Philippines. The historical function of that doctrine in the common law was to mitigate the harshness of another
common law doctrine or rule — that of contributory negligence. The common law rule of contributory negligence
prevented any recovery at all by a plaintiff who was also negligent, even if the plaintiff's negligence was relatively
minor as compared with the wrongful act or omission of the defendant. The common law notion of last clear chance
permitted courts to grant recovery to a plaintiff who had also been negligent provided that the defendant had the last
clear chance to avoid the casualty and failed to do so. Accordingly, it is difficult to see what role, if any, the common
law last clear chance doctrine has to play in a jurisdiction where the common law concept of contributory negligence
as an absolute bar to recovery by the plaintiff, has itself been rejected, as it has been in Article 2179 of the Civil Code of
the Philippines.
Is there perhaps a general concept of "last clear chance" that may be extracted from its common law matrix
and utilized as a general rule in negligence cases in a civil law jurisdiction like ours? We do not believe so. Under Article
2179, the task of a court, in technical terms, is to determine whose negligence — the plaintiff's or the defendant's —
was the legal or proximate cause of the injury. That task is not simply or even primarily an exercise in chronology or
physics, as the petitioners seem to imply by the use of terms like "last" or "intervening" or "immediate." The relative
location in the continuum of time of the plaintiff's and the defendant's negligent acts or omissions, is only one of the
relevant factors that may be taken into account. Of more fundamental importance are the nature of the negligent act
or omission of each party and the character and gravity of the risks created by such act or omission for the rest of the
community. The petitioners urge that the truck driver (and therefore his employer) should be absolved from
responsibility for his own prior negligence because the unfortunate plaintiff failed to act with that increased diligence
which had become necessary to avoid the peril precisely created by the truck driver's own wrongful act or omission. To
accept this proposition is to come too close to wiping out the fundamental principle of law that a man must respond
for the foreseeable consequences of his own negligent act or omission. Our law on quasi-delicts seeks to reduce the
risks and burdens of living in society and to allocate them among the members of society. To accept the petitioners'
proposition must tend to weaken the very bonds of society.
Petitioner Carbonel's proven negligence creates a presumption of negligence on the part of his employer
Phoenix in supervising its employees properly and adequately. The respondent appellate court in effect found,
correctly in our opinion, that Phoenix was not able to overcome this presumption of negligence. The circumstance that
Phoenix had allowed its truck driver to bring the dump truck to his home whenever there was work to be done early
the following morning, when coupled with the failure to show any effort on the part of Phoenix to supervise the
manner in which the dump truck is parked when away from company premises, is an affirmative showing of culpa in
vigilando on the part of Phoenix.
Turning to the award of damages and taking into account the comparative negligence of private respondent
Dionisio on one hand and petitioners Carbonel and Phoenix upon the other hand, we believe that the demands of
substantial justice are satisfied by allocating most of the damages on a 20-80 ratio. Thus, 20% of the damages awarded
by the respondent appellate court, except the award of P10,000.00 as exemplary damages and P4,500.00 as attorney's
fees and costs, shall be borne by private respondent; only the balance of 80% needs to be paid by petitioners Carbonel
and Phoenix who shall be solidarily liable therefor to the former. The award of exemplary damages and attorney's fees
and costs shall be borne exclusively by the petitioners. Phoenix is of course entitled to reimbursement from Carbonel.
We see no sufficient reason for disturbing the reduced award of damages made by the respondent appellate court.
WHEREFORE, the decision of the respondent appellate court is modified by reducing the aggregate amount of
compensatory damages, loss of expected income and moral damages private respondent Dionisio is entitled to by 20%
of such amount. Costs against the petitioners. SO ORDERED.
Calalas vs. CA 332 SCRA 356
[G.R. No. 122039. May 31, 2000.]
VICENTE CALALAS, petitioner, vs. COURT OF APPEALS, ELIZA JUJEURCHE SUNGA and FRANCISCO SALVA,
respondents.
ISSUE:
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 petition has no merit.
The argument that Sunga is bound by the ruling in Civil Case No. 3490 finding the driver and the owner of the
truck liable for quasi-delict ignores the fact that she was never a party to that case and, therefore, the principle of res
judicata does not apply.
 Nor are the issues in Civil Case No. 3490 and in the present case the same. The issue in Civil Case No. 3490 was
whether Salva and his driver Verena were liable for quasi-delict for the damage caused to petitioner's jeepney. On
the other hand, the issue in this case is whether petitioner is liable on his contract of carriage. The first, quasi-delict ,
also known as culpa aquiliana or culpa extra contractual, has as its source the negligence of the tort feasor. 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.

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.

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. 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. Insofar as contracts of carriage are concerned, some aspects regulated by the Civil Code are
those respecting the diligence required of common carriers with regard to the safety of passengers as well as the
presumption of negligence in cases of death or injury to passengers. It provides:

ARTICLE 1733. Common carriers, from the nature of their business and for reasons of public
policy, are bound to observe extraordinary diligence in the vigilance over the goods and for the
safety of the passengers transported by them, according to all the circumstances of each case.

Such extraordinary diligence in the vigilance over the goods is further expressed in Articles
1734, 1735, and 1746, Nos. 5, 6, and 7, while the extraordinary diligence for the safety of the
passengers is further set forth in Articles 1755 and 1756. LLjur

ARTICLE 1755. A common carrier is bound to carry the passengers safely as far as human
care and foresight can provide, using the utmost diligence of very cautious persons, with due regard
for all the circumstances.

ARTICLE 1756. In case of death of or injuries to passengers, common carriers are presumed
to have been at fault or to have acted negligently, unless they prove that they observed
extraordinary diligence as prescribed by Articles 1733 and 1755.

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, which provides:
SECTION 54. Obstruction of Traffic. — No person shall drive his motor vehicle in such a
manner as to obstruct or impede the passage of any vehicle, nor, while discharging or taking on
passengers or loading or unloading freight, obstruct the free passage of other vehicles on the
highway.

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.

We find it hard to give serious thought to petitioner's contention that Sunga's taking an "extension seat"
amounted to an implied assumption of risk. It is akin to arguing that the injuries to the many victims of the tragedies in
our seas should not be compensated merely because those passengers assumed a greater risk of drowning by boarding
an overloaded ferry. This is also true of petitioner's contention that the jeepney being bumped while it was improperly
parked constitutes caso fortuito. A caso fortuito is an event which could not be foreseen, or which, though foreseen,
was inevitable. This requires that the following requirements be present: (a) the cause of the breach is independent of
the debtor's will; (b) the event is unforeseeable or unavoidable; (c) the event is such as to render it impossible for the
debtor to fulfill his obligation in a normal manner, and (d) the debtor did not take part in causing the injury to the
creditor. Petitioner should have foreseen the danger of parking his jeepney with its body protruding two meters into
the highway.

WHEREFORE, the decision of the Court of Appeals, dated March 31, 1995, and its resolution, dated September
11, 1995, are AFFIRMED, with the MODIFICATION that the award of moral damages is DELETED SO ORDERED.

PCIB vs CA 350 SCRA 464

[G.R. No. 121413. January 29, 2001.]
PHILIPPINE COMMERCIAL INTERNATIONAL BANK (formerly INSULAR BANK OF ASIA AND AMERICA), petitioner, vs .
COURT OF APPEALS and FORD PHILIPPINES, INC. and CITIBANK, N.A., respondents.
[G.R. No. 121479. January 29, 2001.]
FORD PHILIPPINES, INC., petitioner-plaintiff, vs. COURT OF APPEALS and CITIBANK, N.A. and PHILIPPINE
COMMERCIAL INTERNATIONAL BANK, respondents.
[G.R. No. 128604. January 29, 2001.]
FORD PHILIPPINES, INC., petitioner, vs . CITIBANK, N.A., PHILIPPINE COMMERCIAL INTERNATIONAL BANK and THE
COURT OF APPEALS, respondents.
ISSUE: Has petitioner Ford the right to recover from the collecting bank (PCIBank) and the drawee bank
(Citibank) the value of the checks intended as payment to the Commissioner of Internal Revenue? Or has Ford's cause
of action already prescribed?

SYNOPSIS: Ford Philippines drew and issued Citibank Check. No. SN 04867 on October 19, 1977, Citibank Check No. SN
10597 on July 19, 1978 and Citibank Check No. SN-16508 on April 20, 1979, all in favor of the Commissioner of Internal
Revenue (CIR) for payment of its percentage taxes. The checks were crossed and deposited with the IBAA, now PCIB,
BIR's authorized collecting bank. The First check was cleared containing an indorsement that "all prior indorsements
and/or lack of indorsements guaranteed." The same, however, was replaced with two (2) IBAA's managers' checks
based on a call and letter request made by Godofredo Rivera, Ford's General Ledger Accountant, on an alleged error in
the computation of the tax due without IBAA verifying the authority of Rivera. These manager's checks were later
deposited in another bank and misappropriated by the syndicate. The last two checks were cleared by the Citibank but
failed to discover that the clearing stamps do not bear any initials. The proceeds of the checks were also illegally
diverted or switched by officers of PCIB — members of the syndicate, who eventually encashed them. Ford, which was
compelled to pay anew the percentage taxes, sued in two actions for collection against the two banks on January 20,
1983, barely six years from the date the first check was returned to the drawer. The direct perpetrators of the crime
are now fugitives from justice.
Note that in these cases, the checks were drawn against the drawee bank, but the title of the person
negotiating the same was allegedly defective because the instrument was obtained by fraud and unlawful means, and
the proceeds of the checks were not remitted to the payee. It was established that instead of paying the checks to the
CIR, for the settlement of the appropriate quarterly percentage taxes of Ford, the checks were diverted and encashed
for the eventual distribution among the members of the syndicate. As to the unlawful negotiation of the check the
applicable law is Section 55 of the Negotiable Instruments Law (NIL), which provides:

"When title defective — The title of a person who negotiates an instrument is defective
within the meaning of this Act when he obtained the instrument, or any signature thereto, by
fraud, duress, or force and fear, or other unlawful means, or for an illegal consideration, or when he
negotiates it in breach of faith or under such circumstances as amount to a fraud."

Pursuant to this provision, it is vital to show that the negotiation is made by the perpetrator in breach of faith
amounting to fraud. The person negotiating the checks must have gone beyond the authority given by his principal. If
the principal could prove that there was no negligence in the performance of his duties, he may set up the personal
defense to escape liability and recover from other parties who, through their own negligence, allowed the commission
of the crime.

In this case, we note that the direct perpetrators of the offense, namely the embezzlers belonging to a
syndicate, are now fugitives from justice. They have, even if temporarily, escaped liability for the embezzlement of
millions of pesos. We are thus left only with the task of determining who of the present parties before us must bear
the burden of loss of these millions. It all boils down to the question of liability based on the degree of negligence
among the parties concerned.

Foremost, we must resolve whether the injured party, Ford, is guilty of the "imputed contributory
negligence" that would defeat its claim for reimbursement, bearing in mind that its employees, Godofredo Rivera and
Alexis Marindo, were among the members of the syndicate.

Citibank points out that Ford allowed its very own employee, Godofredo Rivera, to negotiate the checks to his
co-conspirators, instead of delivering them to the designated authorized collecting bank (Metrobank-Alabang) of the
payee, CIR. Citibank bewails the fact that Ford was remiss in the supervision and control of its own employees,
inasmuch as it only discovered the syndicate's activities through the information given by the payee of the checks
after an unreasonable period of time.
 PCI Bank also blames Ford of negligence when it allegedly authorized Godofredo Rivera to divert the proceeds
of Citibank Check No. SN-04867, instead of using it to pay the BIR. As to the subsequent run-around of funds of
Citibank Check Nos. SN-10597 and 16508, PCI Bank claims that the proximate cause of the damage to Ford lies in its
own officers and employees who carried out the fraudulent schemes and the transactions. These circumstances were
not checked by other officers of the company, including its comptroller or internal auditor. PCI Bank contends that the
inaction of Ford despite the enormity of the amount involved was a sheer negligence and stated that, as between two
innocent persons, one of whom must suffer the consequences of a breach of trust, the one who made it possible, by
his act of negligence, must bear the loss.

For its part, Ford denies any negligence in the performance of its duties. It avers that there was no evidence
presented before the trial court showing lack of diligence on the part of Ford. And, citing the case of Gempesaw vs.
Court of Appeals, Ford argues that even if there was a finding therein that the drawer was negligent, the drawee bank
was still ordered to pay damages.

Furthermore, Ford contends that Godofredo Rivera was not authorized to make any representation in its
behalf, specifically, to divert the proceeds of the checks. It adds that Citibank raised the issue of imputed negligence
against Ford for the first time on appeal. Thus, it should not be considered by this Court.

On this point, jurisprudence regarding the imputed negligence of employer in a master-servant relationship
is instructive. Since a master may be held for his servant's wrongful act, the law imputes to the master the act of the
servant, and if that act is negligent or wrongful and proximately results in injury to a third person, the negligence or
wrongful conduct is the negligence or wrongful conduct of the master, for which he is liable. The general rule is that
if the master is injured by the negligence of a third person and by the concurring contributory negligence of his own
servant or agent, the latter's negligence is imputed to his superior and will defeat the superior's action against the
third person, assuming, of course that the contributory negligence was the proximate cause of the injury of which
complaint is made.

Accordingly, we need to determine whether or not the action of Godofredo Rivera, Ford's General Ledger
Accountant, and/or Alexis Marindo, his assistant, was the proximate cause of the loss or damage. As defined,
proximate cause is that which, in the natural and continuous sequence, unbroken by any efficient intervening cause
produces the injury, and without which the result would not have occurred.

It appears that although the employees of Ford initiated the transactions attributable to an organized
syndicate, in our view, their actions were not the proximate cause of encashing the checks payable to the CIR. The
degree of Ford's negligence, if any, could not be characterized as the proximate cause of the injury to the parties.

The Board of Directors of Ford, we note, did not confirm the request of Godofredo Rivera to recall Citibank
Check No. SN-04867. Rivera's instruction to replace the said check with PCI Bank's Manager's Check was not in the
ordinary course of business which could have prompted PCI Bank to validate the same.

As to the preparation of Citibank Checks Nos. SN-10597 and 16508, it was established that these checks were
made payable to the CIR. Both were crossed checks. These checks were apparently turned around by Ford's
employees, who were acting on their own personal capacity.

Given these circumstances, the mere fact that the forgery was committed by a drawer-payor's confidential
employee or agent, who by virtue of his position had unusual facilities for perpetrating the fraud and imposing the
forged paper upon the bank, does not entitle the bank to shift the loss to the drawer-payor, in the absence of some
circumstance raising estoppel against the drawer. This rule likewise applies to the checks fraudulently negotiated or
diverted by the confidential employees who hold them in their possession.

With respect to the negligence of PCI Bank in the payment of the three checks involved, separately, the trial
courts found variations between the negotiation of Citibank Check No. SN-04867 and the misapplication of total
proceeds of Checks SN-10597 and 16508. Therefore, we have to scrutinize, separately, PCI Bank's share of negligence
when the syndicate achieved its ultimate agenda of stealing the proceeds of these checks.

G.R. Nos. 121413 and 121479

Citibank Check No. SN-04867 was deposited at PCI Bank through its Ermita Branch. It was coursed through
the ordinary banking transaction, sent to Central Clearing with the indorsement at the back "all prior indorsements
and/or lack of indorsements guaranteed," and was presented to Citibank for payment. Thereafter PCI Bank, instead of
remitting the proceeds to the CIR, prepared two of its Manager's checks and enabled the syndicate to encash the
same.

On record, PCI Bank failed to verify the authority of Mr. Rivera to negotiate the checks. The neglect of PCI
Bank employees to verify whether his letter requesting for the replacement of the Citibank Check No. SN-04867 was
duly authorized, showed lack of care and prudence required in the circumstances.

Furthermore, it was admitted that PCI Bank is authorized to collect the payment of taxpayers in behalf of the
BIR. As an agent of BIR, PCI Bank is duty bound to consult its principal regarding the unwarranted instructions given by
the payor or its agent. As aptly stated by the trial court, to wit:

". . . Since the questioned crossed check was deposited with IBAA [now PCIBank], which
claimed to be a depository/collecting bank of the BIR, it has the responsibility to make sure that the
check in question is deposited in Payee's account only.

xxx xxx xxx

As agent of the BIR (the payee of the check), defendant IBAA should receive instructions
only from its principal BIR and not from any other person especially so when that person is not
known to the defendant. It is very imprudent on the part of the defendant IBAA to just rely on the
alleged telephone call of one (Godofredo Rivera and in his signature to the authenticity of such
signature considering that the plaintiff is not a client of the defendant IBAA."

It is a well-settled rule that the relationship between the payee or holder of commercial paper and the bank
to which it is sent for collection is, in the absence of an agreement to the contrary, that of principal and agent. A
bank which receives such paper for collection is the agent of the payee or holder.

Even considering arguendo, that the diversion of the amount of a check payable to the collecting bank in
behalf of the designated payee may be allowed, still such diversion must be properly authorized by the payor.
Otherwise stated, the diversion can be justified only by proof of authority from the drawer, or that the drawer has
clothed his agent with apparent authority to receive the proceeds of such check.

Citibank further argues that PCI Bank's clearing stamp appearing at the back of the questioned checks stating
that ALL PRIOR INDORSEMENTS AND/OR LACK OF INDORSEMENTS GUARANTEED should render PCI Bank liable
because it made it pass through the clearing house and therefore Citibank had no other option but to pay it. Thus,
Citibank asserts that the proximate cause of Ford's injury is the gross negligence of PCI Bank. Since the questioned
crossed check was deposited with PCI Bank, which claimed to be a depository/collecting bank of the BIR, it had the
responsibility to make sure that the check in question is deposited in Payee's account only.
 Indeed, the crossing of the check with the phrase "Payee's Account Only," is a warning that the check should
be deposited only in the account of the CIR. Thus, it is the duty of the collecting bank PCI Bank to ascertain that the
check be deposited in payee's account only. Therefore, it is the collecting bank (PCI Bank) which is bound to scrutinize
the check and to know its depositors before it could make the clearing indorsement "all prior indorsements and/or lack
of indorsement guaranteed".

In Banco de Oro Savings and Mortgage Bank vs. Equitable Banking Corporation, we ruled:

"Anent petitioner's liability on said instruments, this court is in full accord with the ruling of the PCHC's Board
of Directors that:

'In presenting the checks for clearing and for payment, the defendant made an express guarantee on the
validity of "all prior endorsements." Thus, stamped at the back of the checks are the defendant's clear warranty: ALL
PRIOR ENDORSEMENTS AND/OR LACK OF ENDORSEMENTS GUARANTEED. Without such warranty, plaintiff would not
have paid on the checks.'

No amount of legal jargon can reverse the clear meaning of defendant's warranty. As the warranty has proven
to be false and inaccurate, the defendant is liable for any damage arising out of the falsity of its representation."

Lastly, banking business requires that the one who first cashes and negotiates the check must take some
precautions to learn whether or not it is genuine. And if the one cashing the check through indifference or other
circumstance assists the forger in committing the fraud, he should not be permitted to retain the proceeds of the
check from the drawee whose sole fault was that it did not discover the forgery or the defect in the title of the person
negotiating the instrument before paying the check. For this reason, a bank which cashes a check drawn upon
another bank, without requiring proof as to the identity of persons presenting it, or making inquiries with regard to
them, cannot hold the proceeds against the drawee when the proceeds of the checks were afterwards diverted to
the hands of a third party. In such cases the drawee bank has a right to believe that the cashing bank (or the collecting
bank) had, by the usual proper investigation, satisfied itself of the authenticity of the negotiation of the checks. Thus,
one who encashed a check which had been forged or diverted and in turn received payment thereon from the
drawee, is guilty of negligence which proximately contributed to the success of the fraud practiced on the drawee
bank. The latter may recover from the holder the money paid on the check.

Having established that the collecting bank's negligence is the proximate cause of the loss, we conclude that
PCIBank is liable in the amount corresponding to the proceeds of Citibank Check No. SN-04867.

G.R. No. 128604

The trial court and the Court of Appeals found that PCI Bank had no official act in the ordinary course of
business that would attribute to it the case of the embezzlement of Citibank Check Numbers SN-10597 and 16508,
because PCI Bank did not actually receive nor hold the two Ford checks at all. The trial court held, thus:

"Neither is there any proof that defendant PCI Bank contributed any official or conscious
participation in the process of the embezzlement. This Court is convinced that the switching
operation (involving the checks while in transit for "clearing") were the clandestine or hidden
actuations performed by the members of the syndicate in their own personal, covert and private
capacity and done without the knowledge of the defendant PCIBank. . . ."

In this case, there was no evidence presented confirming the conscious participation of PCI Bank in the
embezzlement. As a general rule, however, a banking corporation is liable for the wrongful or tortuous acts and
declarations of its officers or agents within the course and scope of their employment. A bank will be held liable for
the negligence of its officers or agents when acting within the course and scope of their employment. It may be
liable for the tortuous acts of its officers even as regards that species of tort of which malice is an essential element.
In this case, we find a situation where the PCI Bank appears also to be the victim of the scheme hatched by a syndicate
in which its own management employees had participated:

The pro-manager of San Andres Branch of PCI Bank, Remberto Castro, received Citibank Check Numbers SN
10597 and 16508. He passed the checks to a co-conspirator, an Assistant Manager of PCI Bank's Meralco Branch, who
helped Castro open a Checking account of a fictitious person named "Reynaldo Reyes." Castro deposited a worthless
Bank of America Check in exactly the same amount of Ford checks. The syndicate tampered with the checks and
succeeded in replacing the worthless checks and the eventual encashment of Citibank Check Nos. SN 10597 and
16508. The PCI Bank Pro-manager, Castro, and his co-conspirator Assistant Manager apparently performed their
activities using facilities in their official capacity or authority but for their personal and private gain or benefit.

A bank holding out its officers and agents as worthy of confidence will not be permitted to profit by the
frauds these officers or agents were enabled to perpetrate in the apparent course of their employment; nor will it
be permitted to shirk its responsibility for such frauds, even though no benefit may accrue to the bank therefrom.
For the general rule is that a bank is liable for the fraudulent acts or representations of an officer or agent acting
within the course and apparent scope of his employment or authority. And if an officer or employee of a bank, in
his official capacity, receives money to satisfy an evidence of indebtedness lodged with his bank for collection, the
bank is liable for his misappropriation of such sum.

Moreover, as correctly pointed out by Ford, Section 5 of Central Bank Circular No. 580, Series of 1977
provides that any theft affecting items in transit for clearing, shall be for the account of sending bank, which in this
case is PCI Bank.

But in this case, responsibility for negligence does not lie on PCI Bank's shoulders alone.

The evidence on record shows that Citibank as drawee bank was likewise negligent in the performance of its
duties. Citibank failed to establish that its payment of Ford's checks were made in due course and legally in order. In
its defense, Citibank claims the genuineness and due execution of said checks, considering that Citibank (1) has no
knowledge of any infirmity in the issuance of the checks in question (2) coupled by the fact that said checks were
sufficiently funded and (3) the endorsement of the Payee or lack thereof was guaranteed by PCI Bank (formerly IBAA),
thus, it has the obligation to honor and pay the same.

For its part, Ford contends that Citibank as the drawee bank owes to Ford an absolute and contractual duty to
pay the proceeds of the subject check only to the payee thereof, the CIR. Citing Section 62 of the Negotiable
Instruments Law, Ford argues that by accepting the instrument, the acceptor which is Citibank engages that it will pay
according to the tenor of its acceptance, and that it will pay only to the payee, (the CIR), considering the fact that here
the check was crossed with annotation "Payees Account Only."
As ruled by the Court of Appeals, Citibank must likewise answer for the damages incurred by Ford on
Citibank Checks Numbers SN 10597 and 16508, because of the contractual relationship existing between the two.
Citibank, as the drawee bank breached its contractual obligation with Ford and such degree of culpability contributed
to the damage caused to the latter. On this score, we agree with the respondent court's ruling.

Citibank should have scrutinized Citibank Check Numbers SN 10597 and 16508 before paying the amount of
the proceeds thereof to the collecting bank of the BIR. One thing is clear from the record: the clearing stamps at the
back of Citibank Check Nos. SN 10597 and 16508 do not bear any initials. Citibank failed to notice and verify the
absence of the clearing stamps. Had this been duly examined, the switching of the worthless checks to Citibank Check
Nos. 10597 and 16508 would have been discovered in time. For this reason, Citibank had indeed failed to perform
what was incumbent upon it, which is to ensure that the amount of the checks should be paid only to its designated
payee. The fact that the drawee bank did not discover the irregularity seasonably, in our view, constitutes negligence
in carrying out the bank's duty to its depositors. 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.

Thus, invoking the doctrine of comparative negligence, we are of the view that both PCI Bank and Citibank
failed in their respective obligations and both were negligent in the selection and supervision of their employees
resulting in the encashment of Citibank Check Nos. SN 10597 and 16508. Thus, we are constrained to hold them
equally liable for the loss of the proceeds of said checks issued by Ford in favor of the CIR.

Time and again, we have stressed that banking business is so impressed with public interest where the trust
and confidence of the public in general is of paramount importance such that the appropriate standard of diligence
must be very high, if not the highest, degree of diligence. A bank's liability as obligor is not merely vicarious but
primary, wherein the defense of exercise of due diligence in the selection and supervision of its employees is of no
moment.

Banks handle daily transactions involving millions of pesos. By the very nature of their work the degree of
responsibility, care and trustworthiness expected of their employees and officials is far greater than those of ordinary
clerks and employees. Banks are expected to exercise the highest degree of diligence in the selection and supervision
of their employees.

On the issue of prescription, PCI Bank claims that the action of Ford had prescribed because of its inability to
seek judicial relief seasonably, considering that the alleged negligent act took place prior to December 19, 1977 but
the relief was sought only in 1983, or seven years thereafter.

The statute of limitations begins to run when the bank gives the depositor notice of the payment, which is
ordinarily when the check is returned to the alleged drawer as a voucher with a statement of his account, and an
action upon a check is ordinarily governed by the statutory period applicable to instruments in writing.

Our laws on the matter provide that the action upon a written contract must be brought within ten years from
the time the right of action accrues. Hence, the reckoning time for the prescriptive period begins when the instrument
was issued and the corresponding check was returned by the bank to its depositor (normally a month thereafter).
Applying the same rule, the cause of action for the recovery of the proceeds of Citibank Check No. SN 04867 would
normally be a month after December 19, 1977, when Citibank paid the face value of the check in the amount of
P4,746,114.41. Since the original complaint for the cause of action was filed on January 20, 1983, barely six years had
lapsed. Thus, we conclude that Ford's cause of action to recover the amount of Citibank Check No. SN 04867 was
seasonably filed within the period provided by law.

Finally, we also find that Ford is not completely blameless in its failure to detect the fraud. Failure on the
part of the depositor to examine its passbook, statements of account, and cancelled checks and to give notice within a
reasonable time (or as required by statute) of any discrepancy which it may in the exercise of due care and diligence
find therein, serves to mitigate the banks' liability by reducing the award of interest from twelve percent (12%) to six
percent (6%) per annum. As provided in Article 1172 of the Civil Code of the Philippines, responsibility arising from
negligence in the performance of every kind of obligation is also demandable, but such liability may be regulated by
the courts, according to the circumstances. I n quasi-delicts, the contributory negligence of the plaintiff shall reduce
the damages that he may recover.

WHEREFORE, the assailed Decision and Resolution of the Court of Appeals in CAG.R. CV No. 25017 are
AFFIRMED. PCI Bank, known formerly as Insular Bank of Asia and America, is declared solely responsible for the loss of
the proceeds of Citibank Check No. SN 04867 in the amount P4,746,114.41, which shall be paid together with six
percent (6%) interest thereon to Ford Philippines Inc. from the date when the original complaint was filed until said
amount is fully paid.

However, the Decision and Resolution of the Court of Appeals in CA-G.R. No. 28430 are MODIFIED as follows:
PCI Bank and Citibank are adjudged liable for and must share the loss, (concerning the proceeds of Citibank Check
Numbers SN 10597 and 16508 totalling P12,163,298.10) on a fifty-fifty ratio, and each bank is ORDERED to pay Ford
Philippines Inc. P6,081,649.05, with six percent (6%) interest thereon, from the date the complaint was filed until full
payment of said amount.

Costs against Philippine Commercial International Bank and Citibank, N.A. SO ORDERED.

Picart vs. Smith 37 Phil 809 (memorize the ruling: emphasized by Atty. Huigit)
[G.R. No. L-12219. March 15, 1918.]
AMADO PICART , plaintiff-appellant, vs . FRANK SMITH, jr., defendant-appellee.
ISSUE: WON the defendant in maneuvering his car in the manner above described was guilty of negligence such as
gives rise to a civil obligation to repair the damage done? and we are of the opinion that he is so liable?

As the defendant started across the bridge, he had the right to assume that the horse and rider would pass
over to the proper side; but as he moved toward the center of the bridge it was demonstrated to his eyes that this
would not be done; and he must in a moment have perceived that it was too late for the horse to cross with safety in
front of the moving vehicle. In the nature of things this change of situation occurred while the automobile was yet
some distance away; and from this moment it was no longer within the power of the plaintiff to escape being run
down by going to a place of greater safety. The control of the situation had then passed entirely to the defendant; and
it was his duty either to bring his car to an immediate stop or, seeing that there were no other persons on the bridge,
to take the other side and pass sufficiently far away from the horse to avoid the danger of collision. Instead of doing
this, the defendant ran straight on until he was almost upon the horse. He was, we think, deceived into doing this by
the fact that the horse had not yet exhibited fright. But in view of the known nature of horses, there was an
appreciable risk that, if the animal in question was unacquainted with automobiles, he might get excited and jump
under the conditions which here confronted him. When the defendant exposed the horse and rider to this danger he
was, in our opinion, negligent in the eye of the law.
The test by which to determine the existence of negligence in a particular case may be stated as follows: Did
the defendant in doing the alleged negligent act use that 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.
The question as to what would constitute the conduct of a prudent man in a given situation must of course
be always determined in the light of human experience and in view of the facts involved in the particular case .
Abstract speculation cannot here be of much value but his much can be profitably said: Reasonable men govern their
conduct by the circumstances which are before them or known to them. They are not, and are not supposed to be,
omniscient of the future. Hence they can be expected to take care only when there is something before them to
suggest or warn of danger.
Could a prudent man, in the case under consideration, foresee harm as a result of the course actually
pursued? If so, it was the duty of the actor to take precautions to guard against that harm. Reasonable foresight of
harm, followed by the ignoring of the suggestion born of this prevision, is always necessary before negligence can be
held to exist. Stated in these terms, the proper criterion for determining the existence of negligence in a given case is
this: Conduct is said to be negligent when a prudent man in the position of the tortfeasor would have foreseen that
an effect harmful to another was sufficiently probable to warrant his foregoing the conduct or guarding against its
consequences.
Applying this test to the conduct of the defendant in the present case we think that negligence is clearly
established. A prudent man, placed in the position of the defendant, would, in our opinion, have recognized that the
course which he was pursuing was fraught with risk, and would therefore have foreseen harm to the horse and rider as
a reasonable consequence of that course. Under these circumstances the law imposed on the defendant the duty to
guard against the threatened harm.
It goes without saying that the plaintiff himself was not free from fault, for he was guilty of antecedent
negligence in planting himself on the wrong side of the road. But as we have already stated, the defendant was also
negligent; and in such case the problem always is to discover which agent is immediately and directly responsible. It
will be noted that the negligent acts of the two parties were not contemporaneous, since the negligence of the
defendant succeeded the negligence of the plaintiff by an appreciable interval. Under these circumstances the law is
that the person who has the last fair chance to avoid the impending harm and fails to do so is chargeable with the
consequences, without reference to the prior negligence of the other party.
The decision in the case of Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil. Rep., 359) should perhaps be
mentioned in this connection. This Court there held that while contributory negligence on the part of the person
injured did not constitute a bar to recover, it could be received in evidence to reduce the damages which would
otherwise have been assessed wholly against the other party. It was held that while the defendant was liable to the
plaintiff by reason of its negligence in having failed to keep the track in proper repair, nevertheless the amount of the
damages should be reduced on account of the contributory negligence of the plaintiff. As will be seen the defendant's
negligence in that case consisted in an omission only. The liability of the company arose from its responsibility for the
dangerous condition of its track. In a case like the one now before us, where the defendant was actually present and
operating the automobile which caused the damage, we do not feel constrained to attempt to weigh the negligence
of the respective parties in order to apportion the damage according to the degree of their relative fault. It is enough
to say that the negligence of the defendant was in this case the immediate and determining cause of the accident
and that the antecedent negligence of the plaintiff was a more remote factor in the case.
From what has been said it results that the judgment of the lower court must be reversed, and judgment is
here rendered that the plaintiff recover of the defendant the sum of two hundred pesos (P200), with costs of both
instances. The sum here awarded is estimated to include the value of the horse, medical expenses of the plaintiff, the
loss or damage occasioned to articles of his apparel, and lawful interest on the whole to the date of this recovery. The
other damages claimed by the plaintiff are remote or otherwise of such characters as not to be recoverable. So
ordered.

Del Prado vs. Meralco 52 Phil 901

[G.R. No. 29462. March 7, 1929.]
IGNACIO DEL PRADO, plaintiff-appellee, vs. MANILA ELECTRIC CO., defendant-appellant .
ISSUE:
With respect to the legal aspects of the case we may observe at the outset that there is no obligation on the
part of a street railway company to stop its cars to let on intending passengers at other points than those appointed for
stoppage. In fact it would be impossible to operate a system of street cars if a company engaged in this business were
required to stop any and everywhere to take on people who are too indolent, or who imagine themselves to be in too
great a hurry, to go to the proper places for boarding the cars. Nevertheless, although the motorman of this car was
not bound to stop to let the plaintiff on, it was his duty to do no act that would have the effect of increasing the
plaintiff's peril while he was attempting to board the car. The premature acceleration of the car was, in our opinion, a
breach of this duty.
The relation between a carrier of passengers for hire and its patrons is of a contractual nature; and a failure on
the part of the carrier to use due care in carrying its passengers safely is a breach of duty ( culpa contractual) under
articles 1101, 1103, and 1104 of the Civil Code. Furthermore, the duty that the carrier of passengers owes to its
patrons extends to persons boarding the cars as well as to those alighting therefrom. The case of Cangco vs. Manila
Railroad Co. (38 Phil., 768), supplies an instance of the violation of this duty with respect to a passenger who was
getting off of a train. In that case the plaintiff stepped off of a moving train, while it was slowing down in a station, and
at a time when it was too dark for him to see clearly where he was putting his feet. The employees of the company had
carelessly left watermelons on the platform at the place where the plaintiff alighted, with the result that his feet
slipped and he fell under the car, where his right arm was badly injured. This court held that the railroad company was
liable for breach of positive duty (culpa contractual), and the plaintiff was awarded damages in the amount of P2,500
for the loss of his arm. In the opinion in that case the distinction is clearly drawn between a liability for negligence
arising from breach of contractual duty and that arising under articles 1902 and 1903 of the Civil Code (culpa
aquiliana).
The distinction between these two sorts of negligence is important in this jurisdiction, for the reason that
where liability arises from a mere tort (culpa aquiliana), not involving a breach of positive obligation, an employer, or
master, may exculpate himself, under the last paragraph of article 1903 of the Civil Code, by proving that he had
exercised due diligence to prevent the damage; whereas this defense is not available if the liability of the master
arises from a breach of contractual duty (culpa contractual). in the case before us the company pleaded as a special
defense that it had used all the diligence of a good father of a family to prevent the damage suffered by the plaintiff;
and to establish this contention the company introduced testimony showing that due care had been used in training
and instructing the motorman in charge of this car in his art. But this proof is irrelevant in view of the fact that the
liability involved was derived from a breach of obligation under article 1101 of the Civil Code and related provisions.
(Manila Railroad Co. vs. Compañia Trasatlantica and Atlantic, Gulf & Pacific Co., 38 Phil., 875, 887; De Guia vs. Manila
Electric Railroad & Light Co., 40 Phil., 706, 710.)
Another practical difference between liability for negligence arising under article 1902 of the Civil Code and
liability arising from negligence in the performance of a positive duty, under article 1101 and related provisions of the
Civil Code, is that, in dealing with the latter form of negligence, the court is given a discretion to mitigate liability
according to the circumstances of the case (art 1103). No such general discretion is given by the Code in dealing with
liability arising under article 1902; though possibly the same end is reached by courts in dealing with the latter form of
liability because of the latitude of the considerations pertinent to cases arising under this article.
As to the contributory negligence of the plaintiff, we are of the opinion that it should be treated, as in Rakes
vs. Atlantic, Gulf and Pacific Co. (7 Phil., 359), as a mitigating circumstance under article 1103 of the Civil Code. It is
obvious that the plaintiff's negligence in attempting to board the moving car was not the proximate cause of the
injury. The direct and proximate cause of the injury was the act of appellant's motorman in putting on the power
prematurely. A person boarding a moving car must be taken to assume the risk of injury from boarding the car under
the conditions open to his view, but he cannot fairly be held to assume the risk that the motorman, having the
situation in view, will increase his peril by accelerating the speed of the car before he is planted safely on the
platform. Again, the situation before us is one where the negligent act of the company's servant succeeded the
negligent act of the plaintiff, and the negligence of the company must be considered the proximate cause of the
injury. The rule here applicable seems to be analogous to, if not identical with that which is sometimes referred to as
the doctrine of "the last clear chance." In accordance with this doctrine, the contributory negligence of the party
injured will not defeat the action if it be shown that the defendant might, by the exercise of reasonable care and
prudence, have avoided the consequences of the negligence of the injured party (20 R. C. L., p. 139; Carr vs.
Interurban Ry. Co., 185 Iowa, 872; 171 N. W., 167). The negligence of the plaintiff was, however, contributory to the
accident and must be considered as a mitigating circumstance.
With respect to the effect of this injury upon the plaintiff's earning power, we note that, although he lost his
foot, he is able to use an artificial member without great inconvenience and his earning capacity has probably not been
reduced by more than 30 per centum. In view of the precedents found in our decisions with respect to the damages
that ought to be awarded for the loss of a limb, and more particularly Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil.,
359); Cangco vs. Manila Railroad Co. (38 Phil., 768); and Borromeo vs. Manila Electric Railroad and Light Co. (44 Phil.,
165), and in view of all the circumstances connected with the case, we are of the opinion that the plaintiff will be
adequately compensated by an award of P2,500.
It being understood, therefore, that the appealed judgment is modified by reducing the recovery to the sum of
P2,500, the judgment, as thus modified, is affirmed. So ordered, with costs against the appellant.
Taylor vs. Manila Electric Railroad and Light Co., 16 Phil 8
[G.R. No. 4977. March 22, 1910.]
DAVID TAYLOR, plaintiff-appellee, vs. THE MANILA ELECTRIC RAILROAD AND LIGHT COMPANY, defendant-appellant.
ISSUE:
The facts set out in the foregoing statement are to our mind fully and conclusively established by the evidence
of record, and are substantially admitted by counsel. The only questions of fact which are seriously disputed are
plaintiff's allegations that the caps which were found by plaintiff on defendant company's premises were the property
of the defendant, or that they had come from its possession and control, and that the company or some of its
employees left them exposed on its premises at the point where they were found.
The evidence in support of these allegations is meager, and the defendant company, apparently relying on the
rule of law which places the burden of proof of such allegations upon the plaintiff, offered no evidence in rebuttal, and
insists that plaintiff failed in his proof. We think, however, the plaintiff's evidence is sufficient to sustain a finding in
accord with his allegations in this regard.
It was proven that caps, similar to those found by the plaintiff, were used, more or less extensively, on the
McKinley extension of the defendant company's track; that some of these caps were used in blasting a well on the
company's premises a few months before the accident; that not far from the place where the caps were found the
company has a storehouse for the materials, supplies, and so forth, used by it in its operations as a street railway and
a purveyor of electric light; and that the place, in the neighborhood of which the caps were found, was being used by
the company as a short of dumping ground for ashes and cinders. Fulminating caps or detonators for the discharge by
electricity of blasting charges by dynamite are not articles in common use by the average citizen, and under all the
circumstances, and in the absence of all evidence to the contrary, we thing that the discovery of twenty or thirty of
these caps at the place where they were found by the plaintiff on defendant's premises fairly justifies the inference
that the defendant company was either the owner of the caps in question or had these caps under its possession and
control. We think also that the evidence tends to disclose that these caps or detonators were willfully and knowingly
thrown by the company or its employees at the spot where they were found, with the expectations that they would
be buried out of sight by the ashes which it was engaged in dumping in that neighborhood, they being old and perhaps
defective; and, however this may be, we are satisfied that the evidence is sufficient to sustained a finding that the
company or some of employees either willfully or through an oversight left them exposed at a point on its premises
which the general public including children at play, were not prohibited from visiting, and over which the company
knew or ought to have known that young boys were likely to roam abound in pastime or in play.
Counsel for appellant endeavors to weaken or destroy the probative value of the facts on which these
conclusions are based by intimating or rather assuming that the blasting worked on the company's well and on its
McKinley extension was done by contractors. It was conclusively proven, however, that while the workman employed
in blasting the well was regularly employed by J.G. White & Co., a firm of contractors, he did the work on the well
directly and immediately under the supervision and control of one of defendant company's foremen, and there is no
proof whatever in the record that the blasting on the McKinley extension was done by independent contractors. Only
one witness testified upon this point, and while he stated that he understood that a part of this work was done by
contract, he could not say so of his own knowledge, and knew nothing of the terms and conditions of the alleged
contract, or of the relations of the alleged contractor to the defendant company. The fact having been proven that
detonating caps were more or less extensively employed on work done by the defendant company's directions and on
its behalf, we think that the company should have introduced the necessary evidence to support its contention if it
wished to avoid the not unreasonable inference that it was the owner of the material used in these operations and
that it was responsible for tortious of negligent acts of the agents employed therein, on the ground that this work had
been intrusted to independent contractors as to whose acts the maxim respondent superior should not be applied. If
the company did not in fact own or make use of caps such as those found on its premises, as intimated by counsel, it
was a very simple matter for it to prove that fact, and in the absence of such proof we think that the other evidence in
the record sufficiently establishes the contrary, and justifies the court in drawing the reasonable inference that the
caps found on its premises were its property, and were left where they were found by the company or some of its
employees.
Plaintiff appears to have rested his case, as did the trial judge his decision in plaintiff's favor, upon the
provisions of article 1089 of the Civil Code read together with articles 1902, 1903, and 1908 of that Code.
"ART. 1089. Obligations are created by law, by contracts, by quasi— contracts, and by illicit acts
and omissions or by those in which any kind of fault or negligence occurs."
"ART. 1902. Any person who by an act or omission causes damage to another when there is
fault or negligence shall be obliged to repair the damage so done.
"ART. 1903. The obligation imposed by the preceding article is demandable, not only for
personal acts and omission, but also for those of the persons for whom they should be responsible.
"The father, and on his death or incapacity the mother, is liable for the damages caused by the
minors who alive with them. xxx xxx xxx
"Owners or directors of an establishment or enterprises are equally liable for the damages
caused by their employees in the service of the branches in which the latter may be employed or on
account of their duties. xxx xxx xxx
"The liability referred to in this article 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."
"ART. 1908. The owners shall be also be liable for the damages caused —
"1. By the explosion of machines which may not have been cared for with due diligence, and
for kindling of explosive substance which may not have been placed in a safe and proper place."
Counsel for defendant and appellant rests his appeal strictly upon his contention that the facts proven at the
trial do not establish the liability of the defendant company under the provisions of these articles, and since we agree
with this view of the case, it is not necessary for us to consider the various questions as to the form and the right of
action (analogous to those raised in the case of Rakes vs. Atlantic, Gulf & Pacific Co., 7 Phil. Rep., 359), which would
perhaps, be involved in a decision affirming the judgment of the court below.
We agree with counsel for appellant that under the Civil Code, as under the generally accepted doctrine in the
United States, 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.
The propositions are, or course, elementary, and do not admit of discussion, the real difficulty arising in the
application of these principles to the particular facts developed in the case under consideration.
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 a 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 premised, 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 accident, which should be deemed to be the direct result of defendant's negligence in leaving the caps exposed
at the pace where they were found by the plaintiff, and this latter the proximate cause of the accident which
occasioned the injuries sustained by him.
In support of his contention, counsel for plaintiff relied on the doctrine laid down in many of the courts of last
result in the United States in the cases known as the "Torpedo" and "Turntable" cases, and the cases based thereon.
In the typical cases, the question involved has been whether a railroad company is liable for an injury received
by an infant of tender years, who from mere idle curiosity, or for purposes of amusement, enters upon the railroad
company's premises, at a place where the railroad company's premises, at a place where the railroad company knew,
or had a good reason to suppose, children who would likely to come, and there found explosive signal torpedoes left
exposed by the railroad company's employees, one of which when carried away by the visitor, exploded and injured
him; or where such infant found upon the premises a dangerous machine, such as a turntable left in such condition as
to make it probable that children in playing with it would be exposed to accident or injury therefrom and where the
infant did in fact suffer injury in playing with such machine.
In these, and in a great variety of similar cases, the great weight of authority holds the owner of the premises
liable.
As laid down in Railroad Co. vs. Stout ( 17 Wall. (84 U.S.), 657), (wherein the principal question was whether a
railroad company was liable for an injury received by an infant while upon its premises, from idle curiosity, or for
purposed of amusement, if such injury was, under the circumstances, attributable to the negligence of the company),
the principles on which these cases turn are that "while railroad company is not bound to the same degree of care in
regard to mere strangers who are unlawfully upon its premises that it owes to passengers conveyed by it, it is not
exempt from responsibility to such strangers for injuries arising from its negligence or from its tortious acts;" and that
"the conduct of an infant of tender years is not to be judged by the same rule which governs that of an adult. While it
is the general rule in regard to an adult that to entitle him to recover damages for an injury resulting from the fault or
negligence of another he must himself have been free from fault, such is not the rule in regard to an infant of tender
years. The care and caution required of a child is according to his maturity and capacity only, and this is to be
determined in such case by the circumstances of the case."
The doctrine of the case of Railroad Company vs. Stout was vigorously controverted and sharply criticized in
severally state courts, and the supreme court of Michigan in the case of Ryan vs. Towar (128 Mich., 463) formally
repudiated and disapproved the doctrine of the Turntable cased, especially that laid down in Railroad Company vs.
Stout, in a very able decision wherein it held, in the language of the syllabus: (1) That the owner of land is not liable to
trespassers thereon for injuries sustained by them, not due to his wanton or willful acts; (2) that no exception to this
rule exists in favor of children who are injured by dangerous machinery naturally calculated to attract them to the
premises; (3) that an invitation of license to cross the premises of another cannot be predicated on the mere fact that
no steps have been taken to interfere with such practice; (4) that there is no difference between children and adults of
an invitation or a license to enter upon another's premises.
Similar criticisms of the opinion in the case of Railroad Company vs. Stout were indulged in by the courts in
Connecticut and Massachusetts. (Nolan vs. Railroad Co., 53 Conn., 461; 154 Mass., 349). And the doctrine has been
questioned in Wisconsin, Pennsylvania, New Hampshire, and perhaps in other States.
On the other hand, many if not most of the courts of last resort in the United States, citing and approving the
doctrine laid down in England in the leading case of Lynch vs. Nurding (1 Q.B., 29, 35, 36), lay down the rule in these
cases in accord with that announced in Railroad Company vs. Stout (supra), and the Supreme Court of the United
States, in a unanimous opinion delivered by Justice Harlan in the case of Union Pacific Railway Co. vs. McDonald (152
U.S, 262) on the 5th of March, 1894, reexamined and reconsidered the doctrine laid down in Railroad Co. vs. Stout,
and after an exhaustive and critical analysis and review of many of the adjudged cases, both English and America,
formally declared that it adhered "to the principles announced in the case of Railroad Co. vs. Stout."
In the case of Union Pacific Railway Co. vs. McDonald (supra) the facts were as follows: The plaintiff, a boy 12
years of age, our of curiosity and for his own pleasure, entered upon and visited the defendant's premises, without
defendant's express permission or invitation, and, while there, was by an accident injured by failing into a burning
slack pile of whose existence he had knowledge, but which had been left by defendant on its premises without any
fence around it or anything to give warning of its dangerous condition, although defendant knew or had reason to
believe that it was in a place where it would attract the interest or curiosity of passers-by. On these facts the court
held that the plaintiff could not be regarded as a mere trespasser, for whose safety and protection while on the
premises in question, against the unseen danger referred to, the defendant was under no obligation to make
provision.
We quote at length from the discussion by the court of the application of the principles involved to the facts
in that case, because what is said there is strikingly applicable in the case at bar, and would seem to dispose of
defendant's contention that, the plaintiff in this case being a trespasser, the defendant's company owed him no duty,
and in no case could be held liable for injuries which would not have resulted but for the entry of plaintiff on
defendant's premises.
"We adhere to the principle announced in Railroad Co., vs. Stout (supra). Applied to the case
now before us, they require us to hold that the defendant was guilty of negligence in leaving unguarded
the slack pile, made by it in the vicinity of its depot building. It could have forbidden all the persons from
coming to its coal mine for purposes merely of curiosity and pleasure. But it did not do so. On the
contrary, it permitted all, without regard to age, to visit its mine, and witness its operation. It knew that
the usual approach to the mine was by a narrow path skirting its slack pit, close to its depot building, at
which the people of the village, old and young, would often assemble. It knew that children were in the
habit of frequenting that locality and playing around the shaft house in the immediate vicinity of the
slack pit. The slightest regard for the safety of these children would have suggested that they were in
danger from being so near a pit, beneath the surface of which was concealed (except when snow, wind,
or rain prevailed) a mass of burning coals into which a child might accidentally fall and be burned to
death. Under all the circumstances, the railroad company ought not to be heard to say that the plaintiff,
a mere lad, moved by curiosity to see the mine, in the vicinity of the slack pit, was a trespasser, to
whom it owed no duty, or for whose protection it was under no obligation to make provisions.
 "In Townsend vs. Wathen (9 East., 277, 281) it was held that if a man place dangerous traps,
baited with flesh, in his own ground, so near to a highway, or to the premises of another, that dogs
passing along the highway, or kept in his neighbors premises, would probably be attracted by their
instinct into the traps, and in consequence of such act his neighbor's dog be so attracted and thereby
injured, an action on the case would lie. 'What difference,' said Lord Ellenborough, C.J., 'is there a
reason between drawing the animal into the trap by means of his instinct which he cannot resist, and
putting him there by manual force?' What difference, in reason we may observe in this case, is there
between an express license to the children of this village to visit the defendant's coal mine, in the
vicinity of its slack pile, and an implied license, resulting from the habit of the defendant to permit
them, without objection or warning, to do so at will, for purposes of curiosity or pleasure? Referring to
the case of Townsend vs. Wathen, Judge Thompson, in his work on the Law of negligence, volume 1,
page 305, note, well ways: "It would be a barbarous rule of law that would make the owner of land
liable for setting a trap thereon, baited with stinking meat, so that his neighbor's dog attracted by his
natural instincts, might run into it and be killed, and which would exempt him from liability for the
consequences of leaving exposed and unguarded on his land a dangerous machine, so that his
neighbor's child attracted to it and tempted to intermeddle with it by instincts equally strong, might
thereby be killed of maimed for life."
Chief Justice Cooley, voicing the opinion of the supreme court of Michigan, in the case of Powers vs. Marlow
(53 Mich., 507), said that (p. 515):
"Children, wherever they go, must be expected to act upon childlike instincts and impulses; and
others who are chargeable with a duty of care and caution toward them must calculate upon this, and
take precautions accordingly. If they leave exposed to the observation of children anything which would
be tempting to them, and which they in their immature judgment might naturally suppose they were at
liberty to handle or play with, they should expect that liberty to be taken."
And the same eminent jurist in his treaties on torts, alluding to the doctrines of implied invitations to visit the
premises of another, says:
"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." (Chap. 10, p. 303.)
The reasoning which led the Supreme Court of the United States to its conclusions in the cases of Railroad Co.,
vs. Stout (supra) and Union Pacific Railroad Co. vs. McDonald (supra) is not less cogent and convincing in this
jurisdiction than in that than in that wherein those cases originated. Children here are actuated by similar childish
instincts and impulses. Drawn by curiosity and impelled by the restless spirit of youth, boys here as well as there will
usually be found wherever the public permitted to congregate. The movement of machinery, and indeed anything
which arouses the attention of the young and inquiring mind, will draw them to the neighborhood as inevitably as
does the magnet draw the iron which comes within the range of its magnetic influence. The owners of premises,
therefore, whereon things attractive to children are exposed, or upon which the public are expressively or impliedly
permitted to enter to or upon which the owner knows or ought to know children are likely to roam about for pastime
and in play, "must calculate upon this, and take precautions accordingly." In such cases the owner of the premises
cannot be heard to say that because the child has entered upon his premises without his express permission he is a
trespasser to whom the owner owes no duty or obligation whatever. The owner's failure to take reasonable
precautions to prevent the child form entering premises at a place where he knows or ought to know that children are
accustomed to roam about or to which their childish instincts and impulses are likely to attract them is at least
equivalent to an implied license to enter, and where the child does not enter under such conditions the owner's
failure to make reasonable precaution to guard the child against the injury from unknown or unseen dangers, placed
upon such premises by the owner, is clearly a breach of duty, a negligent omission, for which he may and should be
held responsible, if the child is actually injured, without other fault on its part than that it had entered on the premises
of a stranger without his express invitation or permission. To hold otherwise would be expose to all the children in the
community to unknown perils and unnecessary danger at the whim of the owners or occupants of land upon which
they might naturally and reasonably be expected to enter.
This conclusion is founded on reason, justice, and necessary, and neither the contention that a man has a
right to do what he will with his own property of that children should be kept under the care of the parents or
guardian, so as to prevent their entering on the premises of others is of sufficient weight to put it in doubt. In this
jurisdiction as well as in the United States all private property is acquired and held under the tacit condition that it
shall not be so used as to injure the equal rights of others or greatly impair the public rights and interests of the
community (see U.S. vs. Toribio, 1 No. 5060, decided January 26, 1910), and except as to infants of very tender years it
would be absurd and unreasonable in community organized as is that in which we live to hold that parents or
guardians are guilty of negligence or imprudence in every case wherein they permit growing boys and girls to leave
the parental roof unattended, even if in the event of accident to the child the negligence of the parents could in any
event be imputed to the child so as to deprive it of a right to recover in such cases — a point which we neither discuss
not decide.
But while we hold that the entry of the plaintiff upon defendant's property without defendant's express
invitation or permission would not have relieved defendant from responsibility for injuries incurred there by the
plaintiff, without other fault on his part, if such injury were attributable to the negligence of the defendant, 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.
Plaintiff contends, upon the authority of the Turntable and Torpedo cases, that because of plaintiff's youth the
intervention of his action between the negligent act of the defendant leaving the caps exposed on its premises and the
explosion which resulted in his injury should not be held to have contributed in any wise to the accident; and it is
because we cannot agree with this proposition, although we accept the doctrine on the Turntable and Torpedo cases,
that we have thought of proper to discuss and to consider that doctrine at length in this decision. As was said in case
of Railroad Co. vs. Stout (supra), "While it is the general rule in regard to an adult that entitle him to recover damages
for an injury resulting from the fault or negligence of another he must himself have been free from fault, such is not
the rule in regard to an infant of tender years. The care and caution required of a child is according to his maturity and
capacity only, and this is to be determined in each case by the circumstance of the case." As we think we have shown,
under the reasoning on which rests the doctrine of the Turntable and Torpedo cases, no fault which would relieve
defendant of responsibility for injuries resulting from negligence can be attributed to the plaintiff, a well-grown boy of
15 years of age, because of his entry upon defendant's uninclosed premises without express permission or invitation;
but it is a wholly different question whether such a youth can be said to have been free from fault when he willfully
and deliberately cut upon the detonating cap, and placed a match to the contents, knowing, as he undoubtedly did,
that his action would result in an explosion. On this point, which must be determined by "the particular circumstances
of this case," the doctrine laid down in the Turntable and Torpedo cases lends us no direct aid, although it is worthy of
observation that in all of the "Torpedo" and analogous cases to which our attention has been directed, the record
discloses that the plaintiffs, is whose favor judgments have been affirmed, were of such tender years that they were
held not to have the capacity to understand the nature or character of the explosive instruments which fell into their
hands.
In the case at bar, plaintiff at the time of the accident was well—grown youth of 15, more mature both
mentally and physically than the average boy of his age; he had been to sea as a cabin boy; was able to earn P2.50 a
day as a mechanical draftsman thirty days after the injury was incurred; and the record discloses throughout that he
was exceptionally well qualified to take care. The evidence of record leaves no room for doubt that, despite his denials
on the witness stands, he well knew the explosive character of the cap with which he was amusing himself. The series
of experiments made by him in his attempt to produce an explosion, as described by the little girl who was present,
admit of no other explanation. His attempt to discharge the cap by the use of electricity, followed by his efforts to
explode it with a stone or a hammer, and the final success of his endeavors brought about by the applications of a
match to the contents of the cap, show clearly that he knew what he was about. Nor can there be any reasonable
doubt that he had reason to anticipate that the explosion might be dangerous, in view of the fact that the little girl, 9
years of age, who was with him at the time when he put the match to the contents of the cap, became frightened and
ran away.
True, he may not have known and probably did not know the precise nature of the explosion which might be
expected from the ignition of the contents of the cap, and of course he did not anticipate the resultant injuries which
he incurred; but he well knew that a more or less dangerous explosion might be expected from his act, and yet he
willfully, recklessly, and knowingly produced the explosion. It would be going far to say that "according to his maturity
and capacity" he exercised such "care and caution" as might reasonably be required of him, or that the defendant or
anyone else should be held civilly responsible for injuries incurred by him under such circumstances.
The law fixed no arbitrary age at which a minor can be said to have the necessary capacity to understand and
appreciate the nature and consequences of his own acts, so as to make it negligence on his part to fail to exercise with
due care an precaution in the commission of such acts; and indeed it would be impracticable and perhaps impossible
so to do, for in the very nature of things the question of negligence necessarily depends on the ability of the minor to
understand the character of his own acts and their consequences; and the age at which a minor can be said to have
such ability will necessarily vary in accordance with the varying nature of the infinite variety of acts which may be
done by him. But some idea of the presumed capacity of infants under the laws in force in these Islands may be
gathered from an examination of the varying ages fixed by our laws at which minors are conclusively presumed to be
capable to exercising certain rights and incurring certain responsibilities, through it cannot be said that these
provisions of law are of much practical assistance in cases such as that at bar, except so far as they illustrate the rule
that the capacity of a minor to become responsible for his own acts varies with the varying circumstances of each
case. Under the provisions of the Penal code a minor over fifteen years of age is presumed to be capable of
committing a crime and is to be held criminally responsible therefore, although the fact that he is less than eighteen
years of age will be taken into consideration as an extenuating circumstance (Penal code, arts, 8 and 9). At 10 years of
age a child may, under certain circumstances, choose which parent it prefers to live with (Code of Civil Procedure, sec.
771). At 14 it may petition for the appointment of a guardian (Id., sec. 551), and may consent or refuse to be adopted
(Id., sec. 765). And males of 14 and females of 12 are capable of contracting of legal marriage (Civil Code, art. 83; G.O.,
No., 68, sec. 1).
We are satisfied that the plaintiff in this case had sufficient capacity and understanding to be sensible to the
danger to which he exposed himself when he put the match to the contents of the cap; that he was sui juris in the
sense that his age and his experience qualified him to understand and appreciate the necessity for the exercise of that
degree of caution which would have avoided the injury which resulted from his own deliberate act; and that the injury
incurred by him must be held to have been the direct and immediate result of his own willful and reckless act, so that
while it may be true that these injuries would not have been incurred but for the negligent act of the defendant in
leaving the caps exposed on its premises, nevertheless plaintiff's own act was the proximate and principal cause of the
accident which inflicted the injury.
The rule of the Roman law was: Quod quis ex culpa sua damnum sentit, non intelligitur damnum sentire.
(Digest, book 50, tit. 17, rule 203.) The partidas contain the following provisions:
"The just thing is that a man should suffer the damage which comes to him through his own
fault, and that he cannot demand reparation therefore from another." (Law 25, tit. 5 Partida 3.)
"And they even said that when a man received an injury through his own negligence he should
blame himself for it." (Rule 22, tit. 34 Partida 7.)
"According to ancient sages, when a man received an injury through his
own acts the grievance should be against himself and not against another." (Law 2, tit. 7 Partida 2.)
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 judgment of the supreme court of Spain of the 7th of March, 1902 (93 Jurispredencia Civil, 391), is
directly in point. In that case the court said:
"According to the doctrine expressed in article 1902 of the Civil Code, fault or negligence is a
source of obligation when between such negligence and the injury there exists, the relation of cause
and effect: but if the injury produced should not be the result of acts or omissions of a third party, the
latter has no obligation to repair the same, although such acts or omissions were imprudent or
unlawful, and much less when it is shown that the immediate cause of the injury was the negligence of
the injured party himself."
The same court, in its decision of June 12, 1900, said that "the existence of the alleged fault or negligence is
not sufficient without proof that it, and no other cause, gave rise to the damage."
See also judgment of October 21, 1903.
To similar effect Scaevola, the learned Spanish writer, writing under that title in his Jurisprudencia del Codigo
Civil (1902 Anuario, p. 455), commenting on the decision of March 7, 1902, says that "in accordance with the doctrine
expressed by article 1902 of the Civil Code, fault or negligence gives rise to an obligation when between it and the
damage there exists the relation of cause and effect' but if the damage caused does not arise from acts or omissions of
a third person, there is no obligation to make good upon the latter, even though such acts or omissions be imprudent
or illegal, and much less so when it is shown that the immediate cause of the damage has been the recklessness the
injured party himself." And again —
"In accordance with the fundamental principle of proof, that the burden thereof is upon the
plaintiff, it is apparent that it is the duty of him who shall claim damages to establish their existence.
The decisions of April 9, 1896, and March 18, July 6, and September 27, 1898, have especially supported
the principle, the rst setting forth in detail the necessary points of the proof, which are two: An act or
omission on the part of the person who is to be charged with the liability, and the production of the
damage by said act or omission.
"This includes, by inference, the establishment of a relation of cause or effect between the act
or the omission and the damage; the latter must be direct result of one of the rst two. As the decision of
March 22, 1881, said, it is necessary that damages result immediately and directly from an act
performed culpably and wrongfully' 'necessarily presupposing a legal ground for imputability.'"
 (Decision of October 29, 1877.)
"Negligence is not presumed, but be proven by him who alleges it."
(Scaevola, Jurisprudencia del Codigo Civil, vol. 6, pp. 551, 552.)
(Cf. decisions of supreme court of Spain of June 12, 1900. and June 23, 1900.)
Finally, we think the doctrine is in this jurisdiction applicable to the case at bar
was definitely settled in this court in the maturely considered case of Rakes vs. Atlantic,
Gulf and Paci c Co. (supra), wherein we held that while "There are many cases (personal injury cases) in the supreme
court of Spain in which the defendant was exonerated." on the ground that "the negligence of the plaintiff was
immediate cause of the casualty" (decisions of the 15th of January, the 19th of February, and the 7th of March, 1902,
stated in Alcubilla's Index of that year); none of the cases decided by the supreme court of Spain "de ne the effect to
be given the negligence of a plaintiff which contributed to his injury as one of its causes, though not the principal one,
and we left to seek the theory of the civil law in the law in the practice of another countries;" and in such cases we
declared the law in this jurisdiction to require the application of 'the principle of proportional damages," but expressly
and definitely denied the right of recovery when the acts of the injured party were the immediate causes of the
accident.
The doctrine as laid down in that case as follows:
"Difficulty seems to be apprehended in deciding which acts of the injured party shall be
considered immediate causes of the accident. The test is simple. Distinction must be made between the
accident and the injury, between the event itself, without which there could have been no accident, and
those acts of the victim not entering into it, independence of it, but contributing to his own proper hurt.
For instance, the cause of the accident under review was the displacement of the crosspiece or the
failure to replace it. This produced the event giving occasion for damages — that is, sinking of the track
and the sliding of the iron rails. To this event, the act of the plaintiff in walking by the side of the car did
not contribute, although it was an element of the damage which came to himself. Had the crosspiece
been out of place wholly or partly through this act or omission of duty, that would have been one of the
determining causes of the event or accident, for which he would have been responsible. Where he
contributes to the principal occurrence, as one of its determining factors, he cannot recover. Where, in
conjunction with the occurrence, he contributes only to his own injury, he may recover the amount that
the defendant responsible for the event should pay for such injury, less a sum deemed a suitable
equivalent for his own imprudence."
We think it is quite clear that under the doctrine thus stated, the immediate cause of the explosion, the
accident which resulted in plaintiff's injury, was his own act of putting a match to the contents of the cap, and that
having "contributed to the principal occurrence, as one of its determining factors, he cannot recover."
We have not deemed it necessary to examine the effect of plaintiff's action in picking up upon defendant's
premises the detonating caps, the property of the defendant, and carrying them sway to the home of his friend, as
interrupting the relation of cause and effect between the negligent act or omission of the defendant in leaving the
caps exposed on its premises and the injuries inflicted upon the plaintiff by the explosion of one of these caps. Under
the doctrine of the Torpedo cases, such action on the part of an infant of very tender years would have no effect in
relieving defendant of responsibility, but whether in view of the well known facts admitted in defendant's brief that
"boys are snappers-up of unconsidered trifles," a youth of the age and maturity of plaintiff should be deemed without
fault in picking up the caps in question under all the circumstances of this case, we neither discuss not decide.
Twenty days after the date of this decision let judgment be entered reversing the judgment of the court
below, without costs to either party in this instance, and ten days thereafter let the record be returned to the court
wherein it originated, where judgment will be entered in favor of the defendant for the costs in first instance and the
complaint dismissed without day. So ordered.

NAPOCOR vs. CA 161 SCRA 334

[G.R. No. L-47379. May 16, 1988.]
NATIONAL POWER CORPORATION, petitioner, vs. HONORABLE COURT OF APPEALS and ENGINEERING
CONSTRUCTION, INC., respondents
[G.R. No. L-47481. May 16, 1988.]
ENGINEERING CONSTRUCTION, INC., petitioner, vs. COURT OF APPEALS and NATIONAL POWER CORPORATION,
respondents.
Synopsis: In these consolidated petitions, NPC assails the appellate court's decision as being erroneous on the ground
that the destruction and loss of the ECI's equipment and facilities were due to force majeure. It argues that the rapid
rise of the water level in the reservoir of its Angat Dam due to heavy rains brought about by the typhoon was an
extraordinary occurrence that could not have been foreseen, and thus, the subsequent release of water through the
spillway gates and its resultant effect, if any, on ECI's equipment and facilities may rightly be attributed to force
majeure.
On the other hand, ECI assails the reduction of the consequential damages from P333,200.00 to P19,000.00 on
the grounds that the appellate court had no basis in concluding that ECI acquired a new Crawler-type crane and
therefore, it only can claim rentals for the temporary use of the leased crane for a period of one month; and that the
award of P4,000.00 a day or P120,000.00 a month bonus is justified since the period limitation on ECI's contract with
NAWASA had dual effects, ie., bonus for earlier completion and liquidated damages for delayed performance; and in
either case at the rate of P4,000.00 daily. Thus, since NPC's negligence compelled work stoppage for a period of one
month, the said award of P120,000.00 is justified. ECI further assails the reduction of attorney's fees and the total
elimination of exemplary damages.

ISSUE: WON the act that cause the damage to ECI is force majeure? WON NPC was negligent?
Both petitions are without merit.

It is clear from the appellate court's decision that based on its findings of fact and that of the trial court's,
petitioner NPC was undoubtedly negligent because it opened the spillway gates of the Angat Dam only at the height of
typhoon "Welming" when it knew very well that it was safer to have opened the same gradually and earlier, as it was
also undeniable that NPC knew of the coming typhoon at least four days before it actually struck. And even though the
typhoon was an act of God or what we may call force majeure, NPC cannot escape liability because its negligence
was the proximate cause of the loss and damage. As we have ruled in Juan F. Nakpil & Sons v. Court of Appeals, (144
SCRA 596, 606-607):

"Thus, if upon the happening of a fortuitous event or an act of God, there concurs a
corresponding fraud, negligence, delay or violation or contravention in any manner of the tenor
of the obligation as provided for in Article 1170 of the Civil Code, which results in loss or damage,
the obligor cannot escape liability.
"The principle embodied in the act of God doctrine strictly requires that the act must be one
occasioned exclusively by the violence of nature and human agencies are to be excluded from
creating or entering into the cause of the mischief. When the effect, the cause of which is to be
considered, is found to be in part the result of the participation of man, whether it be from active
intervention or neglect, or failure to act, the whole occurrence is thereby humanized, as it was,
and removed from the rules applicable to the acts of God. (1 Corpus Juris, pp. 1174-1175).
"Thus, it has been held that when the negligence of a person concurs with an act of God in
 producing a loss, such person is not exempt from liability by showing that the immediate cause
of the damage was the act of God. To be exempt from liability for loss because of an act of God,
he must be free from any previous negligence or misconduct by which the loss or damage may
have been occasioned. (Fish & Elective Co. v. Phil. Motors, 55 Phil. 129; Tucker v. Milan, 49 O.G.
4379; Limpangco & Sons v. Yangco Steamship Co., 34 Phil. 594, 604; Lasam v. Smith, 45 Phil. 657)."

Furthermore, the question of whether or not there was negligence on the part of NPC is a question of fact
which properly falls within the jurisdiction of the Court of Appeals and will not be disturbed by this Court unless the
same is clearly unfounded. Thus, in Tolentino v. Court of Appeals, (150 SCRA 26, 36) we ruled:
"Moreover, the findings of fact of the Court of Appeals are generally final and conclusive upon the
Supreme Court (Leonardo v. Court of Appeals, 120 SCRA 890 [1983]. In fact it is settled that the
Supreme Court is not supposed to weigh evidence but only to determine its substantantiality (Nuñez
v. Sandiganbayan, 100 SCRA 433 [1982] and will generally not disturb said findings of fact when
supported by substantial evidence (Aytona v. Court of Appeals, 113 SCRA 575 [1985]; Collector of
Customs of Manila v. Intermediate Appellate Court, 137 SCRA 3 [1985]). On the other hand
substantial evidence is defined as such relevant evidence as a reasonable mind might accept as
adequate to support a conclusion
(Philippine Metal Products, Inc. v. Court of Industrial Relations, 90 SCRA 135 [1979]; Police
Commission v. Lood, 127 SCRA 757 [1984]; Canete v. WCC, 136 SCRA 302 [1985])."

Therefore, the respondent Court of Appeals did not err in holding the NPC liable for damages.

Likewise, it did not err in reducing the consequential damages from P333,200.00 to P19,000.00. As shown by
the records, while there was no categorical statement or admission on the part of ECI that it bought a new crane to
replace the damaged one, a sales contract was presented to the effect that the new crane would be delivered to it by
Asian Enterprises within 60 days from the opening of the letter of credit at the cost of P106,336.75. The offer was
made by Asian Enterprises a few days after the flood. As compared to the amount of P106,336.75 for a brand new
crane and paying the alleged amount of P4,000.00 a day as rental for the use of a temporary crane, which use
petitioner ECI alleged to have lasted for a period of one year, thus, totalling P120,000.00, plus the fact that there was
already a sales contract between it and Asian Enterprises, there is no reason why ECI should opt to rent a temporary
crane for a period of one year. The appellate court also found that the damaged crane was subsequently repaired and
reactivated and the cost of repair was P77,000.00. Therefore, it included the said amount in the award of
compensatory damages, but not the value of the new crane. We do not find anything erroneous in the decision of the
appellate court that the consequential damages should represent only the service of the temporary crane for one
month. A contrary ruling would result in the unjust enrichment of ECI.

The P120,000.00 bonus was also properly eliminated as the same was granted by the trial court on the premise
that it represented ECI's lost opportunity "to earn the one month bonus from NAWASA . . ." As stated earlier, the loss
or damage to ECI's equipment and facilities occurred long after the stipulated deadline to finish the construction. No
bonus, therefore, could have been possibly earned by ECI at that point in time. The supposed liquidated damages for
failure to finish the project within the stipulated period or the opposite of the claim for bonus is not clearly presented
in the records of these petitions. It is not shown that NAWASA imposed them.

As to the question of exemplary damages, we sustain the appellate court in eliminating the same since it found
that there was no bad faith on the part of NPC and that neither can the latter's negligence be considered gross. In Dee
Hua Liong Electrical Equipment Corp. v. Reyes, (145 SCRA 713, 719) we ruled:
 "Neither may private respondent recover exemplary damages since he is not entitled to moral or
compensatory damages, and again because the petitioner is not shown to have acted in a wanton,
fraudulent, reckless or oppressive manner (Art. 2234, Civil Code; Yutuk v. Manila Electric Co., 2 SCRA
377; Francisco v. Government Service Insurance System, 7 SCRA 577; Gutierrez v. Villegas, 8 SCRA
527; Air France v. Carrascoso, 18 SCRA 155; Pan Pacific (Phil.) v. Phil. Advertising Corp., 23 SCRA 977;
Marchan v. Mendoza, 24 SCRA 888)."

We also affirm the reduction of attorney's fees from P50,000.00 to P30,000.00. There are no compelling
reasons why we should set aside the appellate court's finding that the latter amount suffices for the services rendered
by ECI's counsel.

WHEREFORE, the petitions in G.R. No. 47379 and G.R. No. 47481 are both DISMISSED for LACK OF MERIT. The decision
appealed from is AFFIRMED. SO ORDERED.

LBC Air Cargo vs. CA 241 SCRA 619

[G.R. No. 101683. February 23, 1995.]
LBC AIR CARGO, INC., FERNANDO M. YU and JAIME TANO, JR., petitioners, vs. HON. COURT OF APPEALS, Fourth
Division, SHERWIN MONTEROLA y OYON-OYON, represented by PATROCENIA GRONDIANO y MONTEROLA, and
PATROCENIA GRONDIANO y MONTEROLA, respondents.
ISSUE: WON the Court of Appeals erred in finding that Jaime Tano, Jr. was negligent in the driving of his vehicle and in
failing to give a signal to approaching vehicles of his intention to make a left turn? WON the Court of Appeals erred in
not finding that the proximate cause of the accident was the victim's negligence in the driving of his motorcycle in a
very fast speed and thus hitting the petitioner's cargo van?
The issues raised are thus essentially factual. The intrinsic merit of, as well as cogency in, the detailed analyses
made by the Court of Appeals in arriving at its findings is at once apparent. Said the appellate court:

"That visibility was poor when Jaime Tano made a left turn was admitted by the latter.
"Q When these two vehicles passed by your parked vehicle, as you said, there were
clouds of dust, did I get you right?
"A Yes sir, the road was dusty.
"Q So much so that you could no longer see the vehicles from the opposite direction
following these vehicles?
"A It is not clear, sir, so I even turned on my left signal and the headlight.
"Q What do you mean by it was not clear, you could not see the incoming vehicles?
"A I could not see because of the cloud of dust.
"Q And it was at this juncture, when you were to follow your theory, when you started your
LBC van again and swerved to the left leading to the Bislig airport?
"A I did not enter immediately the airport, I waited the dust to clear a little before I drove
"xxx xxx xxx
"Q In other words when you said that it was slightly clear, you would like to tell th e
Honorable Court that you could only clearly see big vehicles . . . but not small vehicles like a
motorcycle?
"A I could see clearly big vehicles but not small vehicles like a motorcycle.
"Q Like the motorcycle of Rogelio Monterola?
"A Yes, sir. I could not see clearly. (Tano, tsn, April 18, 1989, pp. 26-
30) (p. 15, Appellant's brief).
 "Tano should not have made a left turn under the conditions admitted by him. Under the Land
Transportation and Traffic Code, the driver of any vehicle upon a highway, before starting, stopping or
turning from a direct line, is called upon to first see that such movement can be made in safety, and
whenever the operation of any other vehicle approaching may be affected by such movement, shall
give a signal plainly visible to the driver of such other vehicles of the intention to make such movement
(Sec. 44, R.A. 4136, as amended). This means that before a driver turns from a direct line, in this case
to the left, the driver must first see to it that there are no approaching vehicles and, if there are, to
make the turn only if it can give a signal that is plainly visible to the driver of such other vehicle. Tano
did neither in this case, for he recklessly made a left turn even as visibility was still very poor, and thus
failed to see the approaching motorcycle and warn the latter of his intention to make a left turn. This is
plain and simple negligence.
"In thus making the left turn, he placed his vehicle directly at the path of the motorcycle
which, unaware of Tano's intention to make a left turn, smashed at Tano's vehicle. It was Tano's
negligence that created the risk or the condition of danger that set into operation the event that led to
the smashedup and untimely death of Rogelio Monterola.
"Rogelio Monterola's motorcycle would not have hit the cargo van had Tano, in operating it,
not recklessly turned left when visibility was still poor, and instead observed the directive of the Land
Transportation Code that before doing so, he should first see to it that such movement can be made in
safety, and that whenever any other vehicle approaching may be affected by such movement, should
give a signal plainly visible to the driver of such other vehicle of the intention to make such movement.
"That Rogelio Monterola was running fast despite poor visibility as evidenced by the
magnitude of the damage to the vehicles is no defense. His negligence would at most be contributory
(Article 2179, N.C.C.). Having negligently created the condition of danger, defendants may not avoid
liability by pointing to the negligence of the former.
"xxx xxx xxx
"Tano's proven negligence created a presumption of negligence on the part of his employer,
the LBC Air Cargo Corporation, in supervising its employees properly and adequately (Phoenix
Construction, Inc. vs. Intermediate Appellate Court, supra), which may only be destroyed by proof of
due diligence in the selection and supervision of his employees to prevent the damage (Article 2180,
N.C.C.). No such defense was interposed by defendants in their answer.
"We, however, fail to see Fernando Yu's liability as Manager of LBCMangagoy Branch Office,
there being no employer-employee relationship between him and Jaime Tano who is a driver of the
LBC Air Cargo Inc. It was held in Philippine Rabbit Bus Lines Inc., et al. vs. Phil. American Forwarders,
Inc., 63 SCRA 231, that the term 'Manager' in Article 2180 is used in the sense of 'employer.' Hence,
no tortuous or quasi-delictual liability can be fastened on Fernando Yu as branch manager of LBC Air
Cargo Inc.
"Now for the amount of damages. Aside from the indemnity for death which People v.
Sazon, 189 SCRA 700), the evidence disclose that as a result of the accident, Rogelio Monterola's
motorcycle was damaged, the repair cost of which amounted to P7,361.00 (Exh. E-1), for the
hospitalization, wake and burial expenses, plaintiff spent P15,000.00. There is likewise no question
that by reason of Rogelio Monterola's untimely death, his only child 14 years old Sherwin Monterola,
suffered mental anguish, fright, serious anxiety, wounded feelings and moral shock that entitles him
to moral damages which we hereby fix at P20,000.00. Because of defendants' refusal to indemnify
the plaintiff for his father's death, the latter was compelled to litigate and engage the services of
counsel. He is therefore entitled to an additional amount of P10,000.00 for
 attorney's fees and expenses of litigation.

"Considering, however, the contributory negligence of Rogelio Monterola in driving at a fast clip
despite the fact that the road was dusty, we reduce the aggregate amount of damages to which the
plaintiff is entitled by twenty per cent (Phoenix Construction Inc. v. Intermediate Appellate Court ,
supra.)."

For every indication, the proximate cause of the accident was the negligence of Tano who, despite
extremely poor visibility, hastily executed a left turn (towards the Bislig airport road entrance) without first
waiting for the dust to settle. It was this negligent act of Tano, which had placed his vehicle (LBC van) directly
on the path of the motorcycle coming from the opposite direction, that almost instantaneously caused the
collision to occur. Simple prudence required him not to attempt to cross the other lane until after it would
have been safe from and clear of any oncoming vehicle.

Petitioners poorly invoke the doctrine of "last clear chance" (also referred to, at times, as "supervening
negligence" or as "discovered peril"). The doctrine, in essence, is to the effect 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 impeding harm and failed to do so is chargeable with the consequences
thereof (see Picart vs. Smith , 37 Phil. 809). 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 (Pantranco North Express, Inc. vs. Baesa, 179 SCRA 384; Glan
People's Lumber and Hardware vs. Intermediate Appellate Court , 173 SCRA 464).

In the case at bench, the victim was traveling along the lane where he was rightly supposed to be. The
incident occurred in an instant. No appreciable time had elapsed, from the moment Tano swerved to his left to
the actual impact, that could have afforded the victim a last clear opportunity to avoid the collision.

It is true, however, that the deceased was not all that free from negligence in evidently speeding too
closely behind the vehicle he was following. We, therefore, agree with the appellate court that there indeed
was contributory negligence on the victim's part that could warrant a mitigation of petitioners' liability for
damages.

WHEREFORE, the appealed decision is AFFIRMED. Costs against petitioners. SO ORDERED.

China Airlines vs. CA G.R. No. 45985 May 18, 1990

[G.R. No. 45985. May 18, 1990.]
CHINA AIR LINES, LTD., petitioner, vs. COURT OF APPEALS, JOSE PAGSIBIGAN, PHILIPPINE AIR LINES, INC. and
ROBERTO ESPIRITU, respondents.
[G.R. No. 46036. May 18, 1990.]
PHILIPPINE AIR LINES, INC. and ROBERTO ESPIRITU, petitioners, vs. COURT OF APPEALS, JOSE PAGSIBIGAN and
CHINA AIR LINES, LTD., respondents.
In G.R. No. L-45985, respondent Pagsibigan contends, by way of refutation, that CAL,'s(China Air Lines ltd.)
liability is based on breach of contract of transportation which was the proximate result of the negligence and/or error
committed by PAL (Philippine Air Lines) and Espiritu; that even assuming that CAL has no share in the negligence of
PAL and Espiritu, the liability of CAL does not cease upon proof that it exercised all the diligence of a good father of a
family in the selection and supervision of its employees. Traversing such contentions, CAL argues that it cannot be
made liable under Article 2180 of the Civil Code because of the absence of employer-employee relationship between
it and PAL.
On the other hand, in G.R. No. L-46036, respondent Pagsibigan claims that PAL is liable under Article 1909 of
the said code which holds an agent responsible not only for fraud but also for negligence which shall be judged with
more or less rigor by the courts, according to whether the agency was or was not for a compensation. PAL, however,
maintains that for lack of privity with Pagsibigan, the suit for breach of contract should have been directed against
CAL.

ISSUE: WON a principal cannot be held liable, much less solidarily, for the negligence of the sub-agent, where the
former never participated in, ratified or authorized the latter's act or omission?

What surfaces as a procedural maneuver taken by respondent Pagsibigan in the course of the proceedings in
these cases has confused the real issues in the controversy subject of both petitions before us.
Respondent Pagsibigan has opted to seek redress by pursuing two remedies at the same time, that is, to
enforce the civil liability of CAL for breach of contract and, likewise, to recover from PAL and Espiritu for tort or culpa
aquiliana. What he has overlooked is the proscription against double recovery under Article 2177 of the Civil Code
which, while not preventing recourse to any appropriate remedy, prevents double relief for a single wrong.
To avoid inequitable effects under such confluence of remedies, the true nature of the action instituted by
respondent Pagsibigan must be determined. A careful perusal of the complaint of respondent Pagsibigan will readily
disclose that the allegations thereof clearly and unmistakably make out a case for a quasi-delict in this wise:
"4. That at all pertinent times particularly in June of 1968, defendant China Air Lines Ltd. has
been operating regular scheduled flights to and from Manila, and has offered accommodations
thereon through, among others, defendant PAL as its authorized sales agent and/or ticketing agent,
such that China Airlines Ltd. is here impleaded as being the principal of defendant PAL;
"5. That at all pertinent times, particularly in June of 1968, defendant Roberto Espiritu
has been in the employ of defendant PAL at its sales counter at the PAL Manila Hotel branch office and
is here impleaded as defendant as being the proximate malfeasor in this cause of action; xxx xxx xxx
"12. That plaintiff missed the initial Manila-Taipei leg (CI Flight 812) on June 10, 1968, as
set forth in his ticket (Annex 'A') solely and exclusively by reason of gross incompetence and
inexcusable negligence amounting to bad faith of defendant PAL — acting, through its sales
representative, the defendant Roberto Espiritu, of its Manila Hotel branch office — in the discharge of
its duties as sales agent and/or ticketing agent for defendant China Airlines Ltd. as principal.
"13. That as a direct result of culpable incompetence and negligence of defendant Roberto
Espiritu as sales representative of defendant PAL, plaintiff was unable to attend to previously
scheduled business commitments in Taipei . . . resulting in direct and indirect prejudice to plaintiff that
has yet to be fully assessed;" (Emphasis supplied)
xxx xxx xxx
Had the intention of respondent Pagsibigan been to maintain an action based on breach of contract of
carriage, he could have sued CAL alone considering that PAL is not a real party to the contract. Moreover, in cases of
such nature, the aggrieved party does not have to prove that the common carrier was at fault or was negligent. All
he has to prove is the existence of the contract and the fact of its non-performance by the carrier.
The records disclose that the trial court delved much into the issues of who was at fault, and its decision is
primarily anchored on its factual findings regarding the civil liability arising from culpa aquiliana of the erring party,
to this effect:
"Plaintiff said that the erroneous entry in his ticket which made it appear that his CAL flight of June
10, 1968 was to be at 5:20 in the afternoon was due to the fault or negligence of PAL's Roberto Espiritu, a
codefendant herein, as well as the employees of the defendant CAL. In making CAL co-responsible, plaintiff
appears to rely on the doctrine that the principal is responsible for the act of an agent done within the
scope of the agency.
"There is no proof extant that any of the employees of CAL had contributed to the erroneous entry
in plaintiff's CAL ticket for Taipei which placed his time of departure to 5:20 o'clock in the afternoon of
June 10, 1968. Only defendant Roberto Espiritu appears to be solely and exclusively responsible for such
error and therefor the conclusion becomes inevitable that CAL must be absolved from any blame because
defendant Roberto Espiritu who committed the error is not an employee or agent of the defendant CAL."
It, therefore, becomes evident that respondent Pagsibigan, having sensed that he cannot hold CAL liable on a
quasi-delict, decided on appeal to instead make a sinistral detour, so to speak, by claiming that his action against CAL
is based on a breach of contract of carriage.
We cannot permit respondent Pagsibigan to change his theory at this stage; it would be unfair to the adverse
party who would have no more opportunity to present further evidence, material to the new theory, which it could
have done had it been aware earlier of the new theory at the time of the hearing before the trial court.
There is indeed no basis whatsoever to hold CAL liable on a quasi-delict or culpa aquiliana. As hereinbefore
stated, the court a quo absolved CAL of any liability for fault or negligence. This finding was shared by respondent
court when it concluded that defendant CAL did not contribute to the negligence committed by therein defendants-
appellants PAL and Roberto Espiritu.
Respondent Pagsibigan insists that CAL was barred from proving that it observed due diligence in the
selection and supervision of its employees. This argument is obviously misplaced. CAL is not the employer of PAL or
Espiritu. In Duavit vs. The Hon. Court of Appeals, et al., we have stressed the need of first establishing the existence
of an employer-employee relationship before an employer may be vicariously liable under Article 2180 of the Civil
Code.
With respect to PAL and Espiritu, they disclaim any liability on the theory that the former is merely an agent
of CAL and that the suit should have been directed against CAL alone. There is no question that the contractual
relation between both air lines is one of agency. Suffice it to say, however, that in an action premised on the
employee's negligence, whereby respondent Pagsibigan seeks recovery for the resulting damages from both PAL and
Espiritu without qualification, what is sought to be imposed is the direct and primary liability of PAL as an employer
under said Article 2180.
When an injury is caused by the negligence of an employee, there instantly arises a presumption of law that
there was negligence on the part of the employer either in the selection of the employee or in the supervision over
him after such selection. The presumption, however, may be rebutted by a clear showing on the part of the
employer that it has exercised the care and diligence of a good father of a family in the selection and supervision of
his employee.
Hence, to escape solidary liability for the quasi-delict committed by Espiritu, it is imperative that PAL must
adduce sufficient proof that it exercised such degree of care. PAL failed to overcome the presumption. As found by
respondent court, CAL had revised its schedule of flights since April 1, 1968; that after the Civil Aeronautics Board
had approved the revised schedule of flights, PAL was duly informed thereof and, in fact, PAL's Manila Hotel branch
office had been issuing and selling tickets based on the revised time schedule before June 10, 1968.
PAL's main defense is that it is only an agent. As a general proposition, an agent who duly acts as such is not
personally liable to third persons. However, there are admitted exceptions, as in this case where the agent is being
sued for damages arising from a tort committed by his employee.
The respondent court found that the mistake committed by Espiritu was done in good faith. While there is
no evidence that he acted with malice, we cannot entirely condone his actuations. As an employee of PAL, the
nature of his functions requires him to observe for the protection of the interests of another person that degree of
care, precaution and vigilance which the circumstances justly demand. He committed a clear neglect of duty.
Ergo, for his negligence, Espiritu is primarily liable to respondent Pagsibigan under Article 2176 of the Civil
Code. For the failure of PAL to rebut the legal presumption of negligence in the selection and supervision of its
employee, it is also primarily liable under Article 2180 of the same code which explicitly provides that 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.
Under the aforesaid provision, all that is required is that the employee, by his negligence, committed a
quasi-delict which caused damage to another, and this suffices to hold the employer primarily and solidarily
responsible for the tortious act of the employee. PAL, however, can demand from Espiritu reimbursement of the
amount which it will have to pay the offended party's claim.
On the issue of damages, we agree, except as to the amount, that nominal damages may be awarded to
respondent Pagsibigan to vindicate the legal wrong committed against him. It appearing that the wrong committed
was immediately rectified when PAL promptly booked him for the next morning's flight to Taipei where he arrived
before noon of June 11, 1968 and was able to attend his scheduled conference, and considering the concept and
purpose of nominal damages, the award of P20,000.00 must accordingly be reduced to an amount equal or at least
commensurate to the injury sustained.
WHEREFORE, the decision of respondent Court of Appeals is MODIFIED accordingly. China Air Lines, Ltd. is
hereby absolved from liability. Philippine Air Lines, Inc. and Roberto Espiritu are declared jointly and severally liable
to pay the sum of P10,000.00 by way of nominal damages, without prejudice to the right of Philippine Air Lines, Inc.
to recover from Roberto Espiritu reimbursement of the damages that it may pay respondent Jose Pagsibigan. SO
ORDERED.
Exconde vs. Capuno G.R. No. L-10134, June 29, 1957
[G.R. No. L-10134. June 29, 1957.]
SABINA EXCONDE, plaintiff-appellant, vs. DELFIN CAPUNO and DANTE CAPUNO, defendants-appellees. First Malayan
vs. CA G.R. No. 91378, June 9 1992
ISSUE: WON defendant Delfin Capuno can be held civilly liable, jointly and severally with his son Dante, for damages
resulting from the death of Isidoro Caperiña caused by the negligent act of minor Dante Capuno.
The case comes under Article 1903 of the Spanish Civil Code, paragraph 1 and 5, which provides:
"ART. 1903. The obligation imposed by the next preceding articles is enforceable not only for
personal acts and omissions, but also for those of persons for whom another is responsible.
The father, and, in case of his death or incapacity, the mother, are liable for any damages
caused by the minor children who live with them. xxx xxx xxx
Finally, teachers or directors of arts and trades are liable for any damages caused by their
pupils or apprentices while they are under their custody."
Plaintiff contends that defendant Delfin Capuno is liable for the damages in question jointly and severally with
his son Dante because at the time the latter committed the negligent act which resulted in the death of the victim, he
was a minor and was then living with his father, and inasmuch as these facts are not disputed, the civil liability of the
father is evident. And so, plaintiff contends, the lower court erred in relieving the father from liability.
We find merit in this claim. It is true that under the law above quoted, "teachers or directors of arts and trades
are liable for any damages caused by their pupils or apprentices while they are under their custody", but this provision
only applies to an institution of arts and trades and not to any academic educational institution (Padilla, Civil Law,
1953, Ed., Vol. IV, p. 841; See 12 Manresa, 4th Ed., p. 557). Here Dante Capuno was then a student of the Balintawak
Elementary School and as part of his extracurricular activity, he attended the parade in honor of Dr. Jose Rizal upon
instruction of the city school's supervisor. And it was in connection with that parade that Dante boarded a jeep with
some companions and while driving it, the accident occurred. In the circumstances, it is clear that neither the head of
that school, nor the city school's supervisor, could be held liable for the negligent act of Dante because he was not
then a student of an institution of arts and trades as provided for by law.
The civil liability which the law imposes upon the father, and, in case of his death or incapacity, the mother, for
any damages that may be caused by the minor children who live with them, is obvious. This is a necessary
consequence of the parental authority they exercise over them which imposes upon the parents the "duty of
supporting them, keeping them in their company, educating them and instructing them in proportion to their means",
while, on the other hand, gives them the "right to correct and punish them in moderation" (Articles 154 and 155,
Spanish Civil Code). The only way by which they can relieve themselves of this liability is if they prove that they
exercised all the diligence of a good father of a family to prevent the damage (Article 1903, last paragraph, Spanish
Civil Code). This defendant’s failed to prove.
Wherefore, the decision appealed from is modified in the sense that defendants Delfin Capuno and Dante
Capuno shall pay to plaintiff, jointly and severally, the sum of P2,959.00 as damages, and the costs of action.
First Malayan vs. CA G.R. No. 91378, June 9 1992
[G.R. No. 91378. June 9, 1992.]
FIRST MALAYAN LEASING AND FINANCE CORPORATION, petitioner, vs. THE HON. COURT OF APPEALS, CRISOSTOMO
B. VITUG and ESTATE OF VICENTE TRINIDAD, represented by widow GLORIA D. TRINIDAD, respondents.
ISSUE: WON the motor vehicle registration is determinative of who should be liable for the death or injuries suffered
by passengers or third persons as a consequence of the operation of a motor vehicle?

After deliberating on the petition, the comments of the private respondents, and the petitioner's reply thereto,
we find the petition to the bereft of merit, hence, resolved to deny it.
In the first place, the factual finding of the trial court and the Court of Appeals that the Isuzu vehicle which
figured in the mishap was still registered in the name of FMLFC (FIRST MALAYAN LEASING AND FINANCE
CORPORATION) at the time of the accident, is not reviewable by this Court in a petition for certiorari under Rule 45 of
Rules of Court.
This Court has consistently ruled that regardless of who the actual owner of a motor vehicle might be, the
registered owner is the operator of the same with respect to the public and third persons, and as such, directly and
primarily responsible for the consequences of its operation. In contemplation of law, the owner/operator of record is
the employer of the driver, the actual operator and employer being considered merely as his agent (MYC-Agro-
Industrial Corporation vs. Vda. de Caldo, 132 SCRA 10, citing Vargas vs. Langcay, 6 SCRA 174; Tamayo vs. Aguino, 105
Phil. 949).

"We believe that it is immaterial whether or not the driver was actually employed by the
operator of record. It is even not necessary to prove who the actual owner of the vehicle and the
employer of the driver is. Granting that, in this case, the father of the driver is the actual owner and
that he is the actual employer, following the well-settled principle that the operator of record
continues to be the operator for the vehicle in contemplation of law, as regards the public and third
persons, and as such is responsible for the consequences incident to its operation, we must hold
and consider such owner-operator of record as the employer, in contemplation of law, of the
driver. And, to give effect to this policy of law as enunciated in the above cited decisions of this
Court, we must now extend the same and consider the actual operator and employer as the agent
 of the operator of record." (Vargas vs. Langcay, 6 SCRA 178; citing Montoya vs. Ignacio, G.R. No. L-
5868, Dec. 29, 1953; Timbol vs. Osias, G.R. No. L-7524, April 30, 1955; Vda. de Medina vs. Cresencia,
G.R. No. L-8194, July 11, 1956; Necesito vs. Paras, G.R. No. L-10605, June 30, 1955.)

". . . Were the registered owner allowed to evade responsibility by proving who the supposed
transferee or owner is, it would be easy for him by collusion with others or otherwise, to escape
said responsibility and transfer the same to an indefinite person, or to one who possesses no
property with which to respond financially for the damage or injury done."(Erezo vs. Jepte, 102 Phil.
103.)

". . . The registered owner or operator of record is the one liable for damages caused by a
vehicle regardless of any alleged sale or lease made thereon." (MYCAgro-Industrial Corp. vs. Vda. de
Caldo, 132 SCRA 11.)

In order for a transfer of ownership of a motor vehicle to be valid against third persons, it must be recorded in
the Land Transportation Office. For, although valid between the parties, the sale cannot affect third persons who rely
on the public registration of the motor vehicle as conclusive evidence of ownership. In law, FMLFC was the owner and
operator of the Isuzu cargo truck, hence, fully liable to third parties injured by its operation due to the fault or
negligence of the driver thereof.

WHEREFORE, the petition for review is DENIED for lack of merit. Costs against the petitioner. SO ORDERED.

Gelisan vs. Alday 154 SRCA 388

[G.R. No. L-30212. September 30, 1987.]
BIENVENIDO GELISAN, petitioner, vs. BENITO ALDAY, respondent.
The Court of Appeals, citing the case of Montoya vs. Ignacio, found that Bienvenido Gelisan is likewise liable for
being the registered owner of the truck; and that the lease contract, executed by and between Bienvenido Gelisan and
Roberto Espiritu, is not binding upon Benito Alday for not having been previously approved by the Public Service
Commission. Accordingly, it sentenced Bienvenido Gelisan to pay, jointly and severally with Roberto Espiritu, Benito
Alday the amount of P5,397.30, with legal interest thereon from the filing of the complaint; and to pay the costs.
Roberto Espiritu, in turn, was ordered to pay or refund Bienvenido Gelisan whatever amount the latter may have paid
to Benito Alday by virtue of the judgment.
Hence, the present recourse by Bienvenido Gelisan.
ISSUE: WON Bienvenido Gelisan is solidary liable with Roberto Espiritu?
The judgment rendered by the Court of Appeals, which is sought to be reviewed, is in accord with the facts and
the law on the case and we find no cogent reason to disturb the same. The Court has invariably held in several
decisions that the registered owner of a public service vehicle is responsible for damages that may arise from
consequences incident to its operation or that may be caused to any of the passengers therein. The claim of the
petitioner that he is not liable in view of the lease contract executed by and between him and Roberto Espiritu which
exempts him from liability to third persons, cannot be sustained because it appears that the lease contract, adverted
to, had not been approved by the Public Service Commission. It is settled in our jurisprudence that if the property
covered by a franchise is transferred or leased to another without obtaining the requisite approval, the transfer is not
binding upon the public and third persons.
We also find no merit in the petitioner's argument that the rule requiring the previous approval by the Public
Service Commission of the transfer or lease of the motor vehicle, may be applied only in cases where there is no
positive identification of the owner or driver, or where there are very scant means of identification, but not in those
instances where the person responsible for damages has been fixed or determined beforehand, as in the case at bar.
The reason for the rule we reiterate in the present case, was explained by the Court in Montoya vs. Ignacio, thus:
 "There is merit in this contention. The law really requires the approval of the Public Service
Commission in order that a franchise, or any privilege pertaining thereto, may be sold or leased
without infringing the certificate issued to the grantee. The reason is obvious. Since a franchise is
personal in nature any transfer or lease thereof should be notified to the Public Service Commission so
that the latter may take proper safeguards to protect the interest of the public. In fact, the law
requires that, before the approval is granted, there should be a public hearing, with notice to all
interested parties, in order that the Commission may determine if there are good and reasonable
grounds justifying the transfer or lease of the property covered by the franchise, or if the sale or lease
is detrimental to public interest. Such being the reason and philosophy behind this requirement, it
follows that if the property covered by the franchise is transferred, or leased to another without
obtaining the requisite approval the transfer is not binding against the Public Service Commission and
in contemplation of law the grantee continues to be responsible under the franchise in relation to the
Commission and to the Public. Since the lease of the jeepney in question was made without such
approval, the only conclusion that can be drawn is that Marcelino Ignacio still continues to be its
operator in contemplation of law, and as such is responsible for the consequences incident to its
operation, one of them being the collision under consideration."

Bienvenido Gelisan, the registered owner, is not however without recourse. He has a right to be indemnified
by Roberto Espiritu for the amount that he may be required to pay as damages for the injury caused to Benito Alday,
since the lease contract in question, although not effective against the public for not having been approved by the
Public Service Commission, is valid and binding between the contracting parties.

We also find no merit in the petitioner's contention that his liability is only subsidiary. The Court has
consistently considered the registered owner/operator of a public service vehicle to be jointly and severally liable with
the driver for damages incurred by passengers or third persons as a consequence of injuries sustained in the operation
of said vehicles. Thus, in the case of Vargas vs. Langcay, the Court said:

"We hold that the Court of Appeals erred in considering appellant-petitioner Diwata Vargas
only subsidiarily liable under Article 103 of the Revised Penal Code. This court, in previous decisions,
has always considered the registered owner/operator of a passenger vehicle, jointly and severally
liable with the driver, for damages incurred by passengers or third persons as a consequence of
injuries (or death) sustained in the operation of said vehicles. (Montoya vs. Ignacio, 94 Phil., 182;
Timbol vs. Osias, G.R. No. L-7547, April 30, 1955; Vda. de Medina vs. Cresencia, 99 Phil., 506; Necesito
vs. Paras, 104 Phil., 75; Erezo vs. Jepte, 102 Phil., 103; Tamayo vs. Aquino and Rayos vs. Tamayo, 105
Phil., 949; 56 Off. Gaz. [36] 5617.) In the case of Erezo vs. Jepte, Supra, We held:

". . . In synthesis, we hold that the registered owner, the defendant-appellant herein, is
primarily responsible for the damage caused . . ." (Emphasis supplied) In the case of Tamayo vs.
Aquino, supra, We said: ". . . As Tamayo is the registered owner of the truck, his responsibility to the
public or to any passenger riding in the vehicle or truck must be direct . . . (Emphasis supplied)

WHEREFORE, the petition is hereby DENIED. With costs against the petitioner. SO ORDERED.

City of Manila vs. Meralco 52 Phil 586 (print full text)

United States vs. Barias (none) 23 Phil 586 US VS SERAPIO

Rakes vs. Atlantic Gulf and Pacific Co., 7 Phil 329 (print full text)

Alba vs. Bulaong 101 Phil 434, 437(PRINT FULL TEXT)