239382654 oblicon-case

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Oblicon Cases

Sagrada Orden vs. Nacoco 91 Phil. 503 (1952)

Nature: appeal from judgment of CFI of Manila

Facts and Background of the Case- On Jan 4, 1942, during the Japanese occupation, Taiwan Tekkosho (Japanese corporation) acquired the plaintiff’s property (land with warehouse in Pandacan, Manila) for Php140K- On April 4, 1946, after the liberation, the US took control and custody of the aforementioned enemy’s land under Sect 12 of the Trading with the Enemy Act- In the same year, the Copra Export Management Company occupied the property under custodianship agreement with the United States Alien Property Custodian- In August 1946, when the Copra Export Management Co. vacated the property, the National Coconut Corporation (NACOCO), the defendant, occupied it next

- Sagrada Orden (plaintiff) files claims on the property with the Court of First Instance of Manila and against the Philippine Alien Property Administrator- Plaintiff petitions that the sale of the property to Taiwan Tekkosho should be declared null and void as it was executed under duress, that the interest of the Alien Property Custodian be cancelled, and that NACOCO be given until February 28, 1949 to recover its equipment form the property and vacate the premise- The Republic of the Philippines is allowed to intervene- CFI: the defendant (Philippine Alien Property Administrator) and the intervenor (RP) are released from any liability but the plaintiff may reserve the right to recover from NACOCO reasonable rentals for the use and occupation of the premises- The sale of the property to the Taiwan Takkesho was declared void and the plaintiff was given the right to recover Php3,000/month as reasonable rental from August 1946 (date when NACOCO occupied property) to the date NACOCO vacates the premises- the judgment is appealed to the SC

Legal Issues1. WON the defendant is liable to pay rent for occupying the property in question

Judgment1. The CFI’s decision that the defendant should pay rent from August 1946 to February 28, 1949 was reversed, costs against the plaintiff

RatioObligations can only arise from four sources: law, contracts or quasi-contracts, crime, or negligence (Art 1089, Spanish Civil Code).

There were no laws or an express agreement between the defendant or the Alien Property Custodian with the plaintiff regarding payment of rent. The property was acquired by the Alien Property Administrator through law (Trading with the Enemy Act) on the seizure of alien property and not as a successor to the interests of the latter. There was no contract of rental b/w them and Taiwan Takkesho. NACOCO entered possession of the property from the Alien Property Custodian without any expectation of liability for its use. NACOCO did not commit any negligence or offense, and there was no contract, implied or otherwise, entered into, that can be used as basis for claiming rent on the property before the plaintiff obtained the judgment annulling the sale to Taiwan Takkesho. The plaintiff has no right to claim rent from NACOCO.

Important NotesArticle 1157 of the New Civil Code states that there are 5 sources of obligations: laws, contracts, quasi-contracts, felonies (acts or omissions punished by law), and quasi-delicts.

FACTS: On February 10, 1994, SEC Case No. 02-94-4679 was instituted by respondent Miguel V. Campus, who filed with the Securities, Investigation and Clearing Department (SICD) of the Securities and Exchange Commissions (SEC), a petition against the here in petitioners Makati Stock Exchange, Inc. (MKSE) and MKSE directors. Respondent sought the nullification of the resolution of the MKSE Board of Directors, which allegedly deprive him of his right to participate equally in the allocation of Initial Public Offerings (IPO). He also sought the delivery of the IPO shares he was allegedly deprived of, and the payment of P2

million as moral damages, P1 million as exemplary damages, and P500,000.00 as attorney’s fees and litigation expenses. On February 14, 1994 the SICD issued and order granting the respondent’s TRO. On March 10, 1994 issued another order for the respondent’s Writ of Preliminary Injunction. On March 11, 1994, petitioner filed a motion to dismiss respondent’s petition in SEC No. 02-94-4678, based on the following grounds: (1) the petition became moot due to the cancellation of the licence of MKSE; (2) the SICD had no jurisdiction over the Petition; and (3) the Petition failed to state a cause of action. This was dismissed by the SICD but was challenged by the petitioner during SEC en banc. On May 31, 1995, the SEC en banc nullified the order of the SICD. Respondent then filed a petition for certiorari with the CA, which on February 11, 1997 the court promulgated a decision in favour of the respondent. Petitioner then filed a Motion for Reconsideration but was denied by the CA, thus, the petition for review on certiorari. ISSUE: Whether or not the respondent’s petition in the SEC Case No. 02-94-4678 sufficiently states a cause of action? HELD: NO. The Supreme Court said that a cause of action is the act or omission by which a party violated a right of another. A complaint states a cause of action where it contains three essential elements of cause of action, namely: (1) the legal right of the plaintiff, (2) the correlative obligation of the defendant, and (3) the act or omission of the defendant in violation of said legal right. If these elements are absent, the complaint becomes vulnerable to dismissal on the ground of failure to state a cause of action. The test of sufficiency of the facts found in a complaint as constituting a cause of action is whether or not admitting the facts alleged. Hence, if the allegations in the complaint furnishes sufficient basis which the complaint can be maintained, the same should not be dismissed regardless of the defense that may be assessed by the defendant. Reading the exact text of the respondent the Supreme Court said that there is no question that the Petition in SEC Case No. 02-94-4679 asserts a right in favour

of the respondent, and obligation of petitioners to respect respondent’s right. However, such does not automatically lead to a conclusion that there is cause of action. Right and Obligation are legal terms with specific meaning. A right is a claim or title to an interest in anything whatsoever that is enforceable by law. An Obligation is defined in the Civil Code as a juridical necessity to give, to do, or not to do. The Civil Code enumerates the sources of obligations: Art. 1157. Obligations arise from: (1) Law; (2) Contracts; (3) Quasi-contracts; (4) Acts or omissions punished by law; and (5) Quasi-delicts. Thus an obligation imposed on a person and the corresponding right granted to another, must be rooted in at least one of these five sources. The mere assertion of right and claim of an obligation in an initiatory pleading is merely a conclusion of fact and law. A pleading should state ultimate facts essential to the rights of action or defense asserted, as distinguished from mere conclusion of fact or conclusion of law. In the case at bar, although in SEC Case No. 02-94-4679 does allege the respondent’s right to subscribe the IPOs and petitioners’ obligation to continue resecting and observing such right, the petitioner utterly failed to lay down the sources or basis of the respondent’s right and/or petitioners’ obligation. There is nothing in the said petition from which the Court deduce that the respondent, by virtue of his position as Chairman Ermictus of MKSE, was granted by law, contracts, or any other legal sources.

ANG YU V. CA (December 02, 1994)

FACTS:Petitioner Ang Yu Asuncion and Keh Tiong leased a property of respondents Bobby Cu Unjieng, Rose Cu Unjieng and Jose Tan in Binondo Manila.

Respondents informed plaintiffs that they are offering to sell the premises and are giving them priority to acquire the same.

Respondents 6M for the property but petitioners offered 5M. Respondents acceted and asked petitioners to put in writing the terms and conditions but the latter never provided such.

When defendants were about to sell the property, plaintiffs were compelled to file the complaint to compel defendants to sell the property to them. Court recognizes the right of first refusal of the petitioner. Notwithstanding the court’s decision, respondent sold the property to Buen Realty and Development Corporation.

ISSUE:WON petitioners can demand specific performance to the respondents to sell to them the property.

HELD:The petitioners never accepted the offer when they refused to make the terms and condition of the sale. As such, respondents has the right to sell the property to other parties.

Even if petitioners are aggrieved by the failure of private respondents to honor the right of first refusal, the remedy is not a writ of execution on the judgment, since there is none to execute, but an action for damages in a proper forum for the purpose 

PNCC vs. CA. G. R. No. 116896. May 5, 1997Nature: Petition for review on certiorari of decision made by the Court of Appeals (CA)Facts: On 18 November 1985, petitioner Philippine National Construction Corporation (PNCC) executed a contract of lease with private respondents, stipulating to pay rent for the use of land, at the monthly rate of P 20,000.00 payable yearly in advance. The said land is to be used by petitioner as site for a rock crushing plant. The term of lease is for five years, commencing on the date of issuance of an industrial clearance by the Ministry of Human Settlements (Ministry).On 7 January 1986 PNCC obtained a Temporary Use Permit from the Ministry for the proposed rock crushing project. Nine days later private respondents wrote to PNCC, asking for the first annual rental, and assuring that they have stopped considering proposals of other aggregates plants in favor of PNCC.In reply, PNCC argued that the contract must commence on the date of issuance by the Ministry of an industrial clearance in their favor. It also expressed its desire to terminate the contract it executed with respondents, due to “financial, as well as technical difficulties.” Respondents refused to accede to PNCC’s request for pre termination and on 19 May 1986, instituted an action against PNCC for Specific Performance with Damages. Trial court ruled in favor of respondents and ordered PNCC to pay rentals for two years, with legal interests plus attorney’s fees. The Court of Appeals affirmed the decision of the trial court upon appeal by PNCC; hence, this case.Issues:(1) WON contract commences on the date of issuance of clearance by Ministry;(2) WON PNCC should be released from its contract with respondents due to unforeseen events and causes beyond its control;

(3) WON sum of money ordered to be paid by the court is excessive and;(4) WON PNCC was deprived of right to due process.Held: Petition denied.Ratio:(1) PNCC is estopped from claiming that Lease Contract commences on the date of issuance of clearance by Ministry, because in its letter to respondents, PNCC recognized its obligation to pay rentals counted from the date the temporary permit was issued.(2) PNCC cites Art. 1266, asserting that it should be released from the obligatory force of the contract because its purpose did not materialize due to unforeseen events and causes beyond its control. However, this article applies only to obligations “to do” and not “to give”, while obligation arising out of said contract is an obligation “to do”. Further, PNCC executed the contract with open eyes on the deteriorating conditions of the country and mere pecuniary inability to fulfill an engagement does not discharge a contractual obligation. The “unforeseen events and causes beyond its control” cited by PNCC are not the legal and physical impossibilities contemplated in Art. 1266.(3) PNCC asserts that it was not able to use and enjoy the land and is not entitled to pay damages cited by the court. However, respondents suffered damages because of its inability to use the premises. Respondents are entitled to indemnification under Art. 1659 of the Civil Code.(4) PNCC was not deprived of due process because trial court granted several postponements to petitioner before it waived the presentation of evidence in petitioner’s behalf.

Case Digest on PELAYO vs. LAURON (Mutual Support)Facts: Oct. 13, 1906, nighttime – Arturo Pelayo, a physician based in Cebu, was called to the house of Marcelo Lauron & Juana Abella (defendants) in San Nicolas. Their daughter-in-law was about to give birth & they requested him to render medical assistance. Since it was a difficult birth, he had to perform a surgery to remove the fetus using forceps. He also removed the afterbirth. He finished all of these until the following morning.He visited the patient several times the following day. Just & equitable value for the services he rendered: P500.00. Without any good reason, defendants refused to pay said amount. Thus he filed a case praying for a judgment in his favor against defendants for the sum of P500.00 + costs along with other relief that may be deemed proper.

The Defendants alleged that their daughter-in-law died in consequence of the childbirth. Also, that their son & daughter-in-law lived independently & her giving birth in their house was only accidental. They prayed that they be absolved.CFI: Defendants absolved due to lack of sufficient evidence to establish right of action.ISSUE: WON the defendants are bound to pay the bill for the services Pelayo has rendered.HELD: NO. CFI judgment affirmed.RATIO:  Rendering of medical assistance in case of illness is among the mutual obligations to which spouses are bound by way of mutual support. (Arts. 142 & 143, CC) The party bound to give support should therefore be liable for all the expenses including the fees of the physician. Thus, it is the husband’s obligation to pay Pelayo and not the defendants. The husband would still be liable even if his parents were the one who called & requested for Pelayo’s assistance. The defendants are not under any obligation to pay the fees claimed (An obligation according to CC Art. 1089 is created by law, contracts, quasi-contracts, & by illicit acts & omissions or by those in which any kind of fault/negligence occurs.).  There was no contract between Pelayo & the defendants thus they can’t be compelled to pay him.

FACTSAn action was instituted in the Court of First Instance of the city of Manila by P. J. O'Brien to

recover the sum of P15,000 alleged to have been lost by Leung Ben to P.J. O’Brien in a series of gambling, banking and percentage games conducted during the two or three months prior to the institution of the suit. In Leung Ben’s verified complaint, O’Brien asked for an attachment against the property of Leung Ben on the ground that the latter was about to depart from the Philippine Islands with intent to defraud his creditors. This attachment was issued, and acting under that authority, the sheriff attached the sum of P15,000 which had been deposited by the O’Brien with the International Banking Corporation. Leung Bien filed a motion to quash the attachment, which was dismissed by the court. Hence this application for a writ ofcertiorari, the purpose of which was to quash an attachment issued from the Court of First Instance of the City of Manila.

ISSUE:Was the statutory obligation to restore money won at gaming an obligation arising from "contract, express or implied?"

RULING:Yes. Upon general principles, recognized both in the civil and common law, money lost in

gaming and voluntarily paid by the loser to the winner cannot, in the absence of statute, be recovered in a civil action. But Act No. 1757 of the Philippine Commission, which defines and penalizes several forms of gambling, contains numerous provisions recognizing the right to recover money lost in gambling or in playing certain games. The original complaint filed in the Court of First Instance was not clear as to the particular section of Act No. 1757 under which the action was brought, but was alleged that the money was lost at gambling, banking, and percentage game in which the defendant was a banker. It must therefore be assumed that the action was based upon the right of recovery given in section 7 of said Act, which declared that an action may be brought against the banker by any person losing money at a banking or percentage game. It was observed that according to the Civil Code obligations are supposed to be derived either from (1) the law, (2) contracts and quasi-contracts, (3) illicit acts and omission, or (4) acts in which some sort ob lame or negligence is present. This enumeration of sources of obligations and the obligation imposed by law are different types. The obligations which in the Code are indicated as quasi-contracts, as well as

those arising ex lege, are in the common la system, merged into the category of obligations imposed by law, and all are denominated implied contracts. In the case under consideration, the duty of O’Brien to refund the money which he won from the LeungBen at gaming was a duty imposed by statute. It therefore arose ex lege. Furthermore, it was a duty to return a certain sum which had passed from O’Brien to Leung Ben. By all the criteria which the common law supplies, this a duty in the nature of debt and is properly classified as an implied contract. It was well- settled by the English authorities that money lost in gambling or by lottery, if recoverable at all, can be recovered by the loser in an action of indebitatus assumpsit for money had and received. This meant that in the common law the duty to return money won in this way was an implied contract, or quasi-contract. The phase in question should be interpreted in such a way as to include all obligations, whether arising from consent or ex lege, because that was equivalent to eliminating all distinction between the first and the fifth paragraphs by practically striking out the first two lines of paragraph one. The Legislature had deliberately established this distinction, and while we may be unable to see any reason why it should have been made, it was our duty to apply and interpret the law, and we were not authorized under the guise of interpretation to virtually repeal part of the statute. Nor can it be said that the relations between the parties litigant constitute a quasi-contract. In the first place, quasi- contracts are "lawful and purely voluntary acts by which the authors thereof become obligated in favor of a third person. . . ." The act which gave rise to the obligation ex lege relied upon by Leung Ben in the court below is illicit an unlawful gambling game. In the second place, the first paragraph of section 412 of the Code of Civil Procedure does not authorize an attachment in actions arising out of quasi contracts, but only in actions arising out of contract, express or implied.

Jardine Davies Inc. vs. CA and Far East Mills Supply Corporation;  Pure Foods Corporation vs CA (June 19, 2000)Corporation entitled to Moral Damages (reputation besmirched) Facts: In 1992 Purefoods decided to install 2 generators in its food processing plant in San Roque, Marikina.  A bidding for the supply and installation was held among the bidders was Far East Mills Supply Corporation (FEMSCO).  Thereafter, in a letter addressed to FEMSCO president, Purefoods confirmed the award of the contract. Immediately FEMSCO submitted the requirements such as a performance bond and all risk insurance policy as well as purchasing the necessary materials.  However, in another letter, Purefoods unilaterally cancelled the award citing “significant factors” which were uncovered and brought to their attention “which dictate the cancellation and warrant a total review and re-bid of the project.”  FEMSCO protested the cancellation but before the matter could be resolve, Purefoods awarded the project with Jardine Nell, a division of Jardine Davies.FEMSCO sued both Purefoods and Jardine.  The RTC granted Jardine’s demurrer to evidence but found in favor of FEMSCO against Purefoods and order indemnification.  FEMSCO appealed the granting of the demurrer filed by Jardine and Purefoods appealed the decision of the court.  The CA affirmed the decision of the RTC but ordered Jardine to pay FEMSCO damages for inducing Purefoods to violate the contract as such, Jardine must pay moral damages. In addition, Purefoods was also directed to pay FEMSCO moral damages and exemplary damages  Both Purefoods and Jardine filed motions for reconsideration which were denied.Issue: Whether or not moral damages may be granted to a corporation?Held: The Court has awarded in the past moral damages to a corporation whose reputation has been besmirched.  (Asset Privatization Trust v. CA, 300 SCRA 379)  In this case, respondent FEMSCO has sufficiently shown that its reputation was tarnished after it immediately ordered equipment from its suppliers on account of the urgency of the project, only to be canceled later.  The Court thus, sustained respondent appellate court’s award of moral damages.  However, as there is no showing whatsoever that Jardine induced Purefoods, the decision of the CA is modified.  The order to Jardine Davies to pay FEMSCO moral damages is reversed and set aside.

PEOPLE’S CAR INC., vs Commando Security L-36840 May 22, 1973

Facts:Plaintiff, a car dealer, entered into a contract with defendant, a security agency, its duty is to guard theformer’s premises from theft, robbery, vandalism and other unlawful acts. On a certain night, thesecurity guard deployed by the defendant, without authority neither from the plaintiff nor fromdefendant, drove a car, which was entrusted to the plaintiff by a customer for service andmaintenance, outside of the plaintiff’s compound and around the city which after the security guardlost control of, fell into a ditch, causing it severe damage. Plaintiff complained against the securityguard for qualified theft. While the car is undergoing repair, plaintiff rented a car for its customer for47 days until the car is fixed, and took pain to repair the damaged car.Then plaintiff instituted a claim against the defendant for recovery of the actual damages it incurred dueto the unlawful act of the latter’s personnel, citing inter alia the Par. 5 of the contract that defendantaccepts “sole responsibility for the acts done during their watch hours”. Defendant on the other hand,interposed, that it may be liable but its liability is limited under Par. 4 of said contract providing: “that itsliability “shall not exceed one thousand (P1,000.00) pesos per guard post”. To quote the contract:‘Par. 4. — Party of the Second Part (defendant) through the negligence of its guards, after aninvestigation has been conducted by the Party of the First Part (plaintiff) wherein the Party of the SecondPart has been duly represented shall assume full responsibilities for any loss or damages that may occurto any property of the Party of the First Part for which it is accountable, during the watch hours of theParty of the Second Part, provided the same is reported to the Party of the Second Part within twenty-four(24) hours of the occurrence, except where such loss or damage is due to force majeure, providedhowever that after the proper investigation to be made thereof that the guard on post is found negligentand that the amount of the loss shall not exceed ONE THOUSAND (P1,000.00) PESOS per guard post.’‘Par. 5 — The party of the Second Part assumes the responsibility for the proper performance by theguards employed, of their duties and (shall) be solely responsible for the acts done during their watchhours, the Party of the First Part being specifically released from any and all liabilities to the former’semployee or to the third parties arising from the acts or omissions done by the guard during their tour ofduty.’ ... 8The trial court rendered judgment in favor of the defendant limiting its liability to P1,000.00 under par. 4and said that under paragraph 5, it is the customer who should bring the suit before the court.Issue:

Whether or not the plaintiff is entitled to recover its expenses from the defendant on account of the latter’semployee’s unlawful act, despite the provision under paragraph 5 it is the 3rd party who should institutethe claim which held the plaintiff harmless from any and all liabilities of the defendant’s employees?Held:Yes. 3rd parties, the customer in the case at bar, are not bound by the contract between the defendantand plaintiff. But the plaintiff is in law liable for the damages caused the customer’s car, which had beenentrusted into its custody. Plaintiff therefore was in law justified in making good such damages and relyingin turn on defendant to honor its contract and indemnify it for such undisputed damages, which had beencaused directly by the unlawful and wrongful acts of defendant’s security guard in breach of their contract.As ordained in Article 1159, Civil Code, “obligations arising from contracts have the force of law betweenthe contracting parties and should be complied with in good faith.”Plaintiff in law could not tell its customer, as per the trial court’s view, that “under the Guard ServiceContract it was not liable for the damage but the defendant” — since the customer could not holddefendant to account for the damages as he had no privity of contract with defendant. Such an approachof telling the adverse party to go to court, notwithstanding his plainly valid claim, aside from its ethicaldeficiency among others, could hardly create any goodwill for plaintiff’s business, in the same way thatdefendant’s baseless attempt to evade fully discharging its contractual liability to plaintiff cannot beexpected to have brought it more business.

PNB v CA

http://www.lawphil.net/judjuris/juri1993/jan1993/gr_97995_1993.html

Benedicto v Board of Admin

http://www.lawphil.net/judjuris/juri1992/mar1992/gr_87710_1992.html

RODZSSEN SUPPLY CO. INC. vs. FAR EAST BANK & TRUST CO.RODZSSEN SUPPLY CO. INC. vs. FAR EAST BANK & TRUST CO.

G.R. No. 109087. 9 May 2001.

Ponente: Panganiban, J.:

Facts: Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court,

assailing the January 21, 1993 Decision2 of the CA which affirmed with modification the

ruling of the RTC of Bacolod City.

On January 15, 1979, defendant Rodzssen Supply, Inc. opened with plaintiff Far East Bank

and Trust Co. a 30-day domestic letter of credit, in the amount of P190,000.00 in favor of

Ekman and Company, Inc. (Ekman) for the purchase from the latter of five units of

hydraulic loaders, to expire on February 15, 1979. The three loaders were delivered to

defendant for which plaintiff paid Ekman and which defendant paid plaintiff before expiry

date of LC. The remaining two loaders were delivered to defendant but the latter refused to

pay. Ekman pressed payment to plaintiff. Plaintiff paid Ekman for the two loaders and later

demanded from defendant such amount as it paid Ekman. Defendant refused payment

contending that there was a breach of contract by plaintiff who in bad faith paid Ekman,

knowing that the two units of hydraulic loaders had been delivered to defendant after the

expiry date of subject LC.

Issue: WON petitioner is liable to respondent.

Ruling: The SC agrees with the CA that petitioner should pay respondent bank the amount

the latter expended for the equipment belatedly delivered by Ekman and voluntarily

received and kept by petitioner. Equitable considerations behoove us to allow recovery by

respondent. True, it erred in paying Ekman, but petitioner itself was not without fault in

the transaction. It must be noted that the latter had voluntarily received and kept the

loaders since October 1979. When both parties to a transaction are mutually negligent in

the performance of their obligations, the fault of one cancels the negligence of the other

and, as in this case, their rights and obligations may be determined equitably under the law

proscribing unjust enrichment.

Bishop of Legazpi v Calleja

http://www.lawphil.net/judjuris/juri1960/may1960/gr_l-14134_1960.html

Rotea v Delupio

FACTS:Simplicio Birondo, father of Josefina and Sofia Birondo, entrusted to Atty.

Marcos J. Rotea the matter of obtaining the annulment of sale made by themother-in-law of Simplicio named Francisca Delupio and the issuance of aTorrens Certificate of Title of a piece of land, the right to buy the same in which itinherited by said minors from their deceased mother Beatriz Bartolome and itsownership later acquired by them from the government by purchase. Aspayment for the services rendered by said Atty. Marcos J. Rotea, Simplicio boundhimself to convey 1/3 of said land. Atty. Rotea took the necessary steps todisapprove or annul the sale made by Francisca Delupio in favor of Fabian Francoin which he was successful. The Court of First Instance acceded for the notationof Atty. Rotea’s right of retention over 1/3 of the said lot and ordered theRegister of Deeds of Rizal to note said right. Francisca Delupio, as guardian ofthe minors, filed a motion for reconsideration of the order directing the notationof the right of Atty. Rotea on the ground that Simplicio was not authorize to enterinto agreement with said Atty. Rotea regarding the properties of the minors.After hearing, the Court of First Instance of Rizal granted first by order and setaside the order for notation. Court of First Instance of Rizal issued another orderdirecting the notation of the right of retention of Atty. Rotea but withoutspecifying its value. Francisca Delupio accepted to this order and interposed thisappeal.ISSUE:Whether or not Atty. Marcos J. Rotea is entitled to the compensation forthe services he rendered by virtue of a contract entered into between him andthe father of the minors.RULING:The Court held that Atty. Rotea is considered a negotiorum gestor who isentitled to be indemnified for necessary and useful expenses incurred by himand the damages suffered in the discharge of his duties and to have his right ofretention noted, it being immaterial that said minors or their guardian did notnotify his undertaking, in accordance with the provisions of Article 1893 of theCivil Code and to have his lien as attorney noted.

Andres v Hanover

http://www.lawphil.net/judjuris/juri1989/sep1989/gr_82670_1989.html

Ramie Textile v Mathay Sr.

RAMIE TEXTILES, INC.vs.HON. ISMAEL MATHAY, SR.FACTS:Ramie Textiles, Inc. has been voluntary paying real estate taxes on itsplant machinery and equipment used in Bagbaguin, Valenzuela, Bulacan, andsince its existence in 1959, it reached the amount of P78,041.17. On 19 May1967, the petitioner said that under the Assessment Law, said machineries areexempt from realty tax so they claim for refund through the Provincial Assessorof Bulacan the amount of P78,041.17. The Provincial Treasurer denied the claimon the ground that under Section 359 of the Revised Manual of Instructions totreasurers, “a claim for refund of taxes erroneously paid or illegally collected orassessed should be presented within two (2) years from date of payment.

Petitioner replied alleging that Section 359 is inapplicable because said provisionrefers only to municipal ordinances which were subsequently declared illegallyassessed.ISSUE:Whether or not Ramie Textiles, Inc. is entitled for a refund.RULING:The Court held that Ramie Textiles, Inc. is allowed to recover the amountpaid thru error. The fact that petitioner paid thru error or mistake and thegovernment accepted the payment, gave rise to the application of the principleof solutio indebiti under Article 2154 of the New Civil Code, which provides that,“if something is received when there is no right to demand it and it was undulydelivered through mistake, the obligation to return it arises”. There is, therefore,created a tie or juridical relation in the nature of solutio indebiti expresslyclassified as quasi-contract under Section 2, Chapter I of Title XVII of the NewCivil Code.The quasi-contract of solutio indebiti is one of the concrete manifestationsof the ancient principle that no one shall enrich himself unjustly at the expenseof another. Hence, it would seem unedifying for the government that knowing ithas no right at all to collect or to receive money for alleged taxes paid bymistake, it would be reluctant to return the same.

CIR v Esso

http://www.lawphil.net/judjuris/juri1989/apr1989/gr_l28502_03_1989.html

Velez v Balzarsa

http://www.lawphil.net/judjuris/juri1942/jul1942/gr_l-48389_1942.html

MANILA RAILROAD CO. VS. COMPANIA TRANSATLANTICA

38 Phil 875

FACTS:

SS/Alicante, belonging to Compania Transatlantica de Barcelona was transporting two locomotive boilers for the Manila Railroad Company. The equipment of the ship for discharging the heavy cargo was not strong enough to handle the boilers. Compania Transatlantica contracted the services of Atlantic gulf and Pacific Co., which had the best equipment to lift the boilers out of the ship’s hold. When Alicante arrived in Manila, Atlantic company sent out its floating crane under the charge of one Leyden. When the first boiler was being hoisted out of the ship’s hold, the boiler could not be brought out because the sling was not properly placed and the head of the boiler was caught under the edge of the hatch. The weight on the crane was increased by a strain estimated at 15 tons with the result that the cable of the sling broke and the boiler fell to the bottom of the ship’s hold. The sling was again adjusted and the boiler was again lifted but as it was being brought up the bolt at the end of the derrick broke and the boiler fell

again. The boiler was so badly damaged that it had to be shipped back to England to be rebuilt. The damages suffered by Manila Railroad amounted to P23,343.29. Manila Railroad then filed an action against the Streamship Company to recover said damages. The Steamship Company caused Atlantic Company to be brought as co-defendant arguing that Atlantic Company as an independent contractor, who had undertaken to discharge the boilers had become responsible for the damage.

The Court of First Instance decided in favor of Manila Railroad, the plaintiff, against Atlantic Company and absolved the Steamship Company. Manila Railroad appealed from the decision because the Steamship Company was not held liable also. Atlantic Company also appealed from the judgment against it.

ISSUES:

1. Was the Steamship Company liable to Manila Railroad for delivering the boiler in a damaged condition?

2. Was Atlantic Company liable to the Steamship Company for the amount it may be required to pay the plaintiff?

Was Atlantic Company directly liable to plaintiff as held by the trial court?

RULING:

There was a contractual relation between the Steamship Company and Manila Railroad. There was also a contractual relation between the Steamship Company and Atlantic. But there was no contractual relation between the Railroad Company and Atlantic Company.

There was no question that the Steamship Company was liable to Manila Railroad as it had the obligation to transport the boiler in a proper manner safe and securely under the circumstances required by law and customs. The Steamship Company cannot escape liability simply because it employed a competent independent contractor to discharge the boiler.

Atlantic Company claimed that it was not liable, because it had employed all the diligence of a good father of a family and proper care in the selection of Leyden. Said argument was not tenable, because said defense was not applicable to negligence arising in the course of the performance of a contractual obligation. The same can be said with respect to the liability of Atlantic Company upon its contract with the Steamship Company. There was a distinction between negligence in the performance of a contractual obligation (culpa contractual) and negligence considered as an independent source of obligation (culpa aquiliana). Atlantic Company wasis liable to the Steamship Company for the damage brought upon the latter by the failure of Atlantic Company to use due care in discharging the boiler, regardless of the fact that the damage was caused by the negligence of an employee who was qualified for the work, duly chose with due care.

Since there was no contract between the Railroad Company and Atlantic Company, Railroad Company can had no right of action to recover damages from Atlantic Company for the wrongful act which constituted the violation of the contract. The rights of Manila Railroad can only be made effective through the Steamship Company with whom the contract of affreightment was made.

Alberta Yobido and Cresencio Yobido v. CA, Leny Tumboy, Ardee Tumboy andJasmin TumboyG.R. No. 113003 October 17, 1997Romero, J.FACTS: Spouses Tito and Leny Tumboy and their minor children named Ardee and Jasmin, boardeda Yobido Liner bus bound for Davao City. Along the trip, the left front tire of the busexploded. The bus fell into a ravine around 3 ft. from the road and struck a tree. Theincident resulted in the death of Tito and physical injuries to other passengers. Factual backdrop based on testimony of Leny: the winding road the bus traversed was notcemented and was wet due to the rain; it was rough with crushed rocks. The bus whichwas full of passengers had cargoes on top. Since it was running fast, (at a speed of 50-60kph based on another witness’ testimony) she cautioned the driver to slow down but hemerely stared at her through the mirror. A complaint for breach of contract of carriage was filed by Leny and her children againstAlberta Yobido, the owner of the bus, and Cresencio Yobido, its driver; Yobidos raised theaffirmative defense of caso fortuito; they also filed a third-party complaint againstPhilippine Phoenix Surety and Insurance, Inc. Upon a finding that the third party defendant was not liable under the insurance contract,the lower court dismissed the third party complaint.ISSUE: WON the tire blowout was a caso fortuito as to exempt Yobidos from liabilityHELD: No.tire blowout - mechanical defect of the conveyance or a fault in its equipment which waseasily discoverable if the bus had been subjected to a more thorough or rigid check-upbefore it took to the road when a passenger boards a common carrier, he takes the risks incidental to the mode oftravel he has taken. After all, a carrier is not an insurer of the safety of its passengers andis not bound absolutely and at all events to carry them safely and without injury. However,when a passenger is injured or dies while travelling, the law presumes that the commoncarrier is negligent. (see Art. 1756) Art. 1755 provides that a common carrier is bound to carry the passengers safely as far ashuman care and foresight can provide, using the utmost diligence of very cautiouspersons, with a due regard for all the circumstances. In culpa contractual, once apassenger dies or is injured, the carrier is presumed to have been at fault or to have actednegligently. This disputable presumption may only be overcome by evidence that thecarrier had observed extraordinary diligence as prescribed by Arts. 1733, 1755 and 1756or that the death or injury of the passenger was due to a fortuitous event. characteristics of fortuitous event: a) the cause of the unforeseen and unexpectedoccurrence, or the failure of the debtor to comply with his obligations, must beindependent of human will; b) it must be impossible to foresee the event which constitutesthe caso fortuito, or if it can be foreseen, it must be impossible to avoid; c) the occurrencemust be such as to render it impossible for the debtor to fulfill his obligation in a normalmanner; and d) the obligor must be free from any participation in the aggravation of theinjury resulting to the creditor Art 1174: no person shall be responsible for a fortuitous event which could not beforeseen, or which, though foreseen, was inevitable the explosion of the new tire may not be considered a fortuitous event; there are human

factors involved in the situation; the fact that the tire was new did not imply that it wasentirely free from manufacturing defects or that it was properly mounted on the vehicle

Necesito vs. ParasPRECILLANO NECESITO, ETC. vs. NATIVIDAD PARAS, ET AL.

G.R. No. L-10605, June 30, 1958)

FACTS: 

A mother and her son boarded a passenger auto-truck of the Philippine Rabbit Bus Lines. While entering a wooden bridge, its front wheels swerved to the right, the driver lost control and the truck fell into a breast-deep creek. The mother drowned and the son sustained injuries. These cases involve actions ex contractu against the owners of PRBL filed by the son and the heirs of the mother. Lower Court dismissed the actions, holding that the accident was a fortuitous event.

ISSUE:

Whether or not the carrier is liable for the manufacturing defect of the steering knuckle, and whether the evidence discloses that in regard thereto the carrier exercised the diligence required by law (Art. 1755, new Civil Code)

HELD:

Yes.

While the carrier is not an insurer of the safety of the passengers, the manufacturer of the defective appliance is considered in law the agent of the carrier, and the good repute of the manufacturer will not relieve the carrier from liability. The rationale of the carrier’s liability is the fact that the passengers has no privity with the manufacturer of the defective equipment; hence, he has no remedy against him, while the carrier has. We find that the defect could be detected. The periodical, usual inspection of the steering knuckle did not measure up to the “utmost diligence of a very cautious person” as “far as human care and foresight can provide” and therefore the knuckle’s failure cannot be considered a fortuitous event that exempts the carrier from responsibility.

DIANA VS. BATANGAS TRANSPORTATION, CO.

93 Phil 391

FACTS:

On June 21, 1945, Truck No. 14 belonging to the defendant Batangas Transportation, Co. driven by Vivencio Bristol ran into a ditch at Bay, Laguna resulting in the death of Florenio Diana and other passengers. Plaintiffs were the heirs of Diana. Bristol was charged and convicted of multiple homicide through reckless imprudence where he was ordered to indemnify the heirs of the deceased in the amount of Php 2,000. When the decision became final, a writ of execution was issued in order that the indemnity may be , but the sheriff filed a return stating that the accused had no visible leviable property. The present case (civil

case No. 9221) was started when defendant failed to pay the indemnity under its subsidiary liability under article 103 of the Revised Penal Code.

Defendant filed a motion to dismiss on the ground that there was another action pending between the same parties for the same cause (civil case No. 8023) in which the same plaintiffs sought to recover from the same defendant the amount of P4,500 as damages resulting from the death of Florenio Diana, who died while on board a truck of defendant due to the negligent act (culpa aquiliana) of the driver Vivencio Bristol.

Plaintiffs filed a written opposition to the motion to dismiss. The lower court, having found the motion well founded, dismissed the complaint, without special pronouncement as to costs, and their motion for reconsideration having been denied, plaintiffs took the present appeal.

ISSUE:

Did the lower court correctly dismiss the complaint on the sole ground that there was another action pending between the same parties for the same cause?

RULING:

No. The present case (civil case No. 9221) stemmed from a criminal case in which the driver of the defendant was found guilty of multiple homicide through reckless imprudence and was ordered to pay an indemnity of P2,000 for which the defendant was made subsidiarily liable under article 103 of the Revised Penal Code. While the other case (civil case No. 8023) was an action for damages based on culpa aquiliana which underlies the civil liability predicated on articles 1902 to 1910 of the old Civil Code. These two cases involved two different remedies. As this court aptly said: "A quasi-delict or culpa aquiliana is a separate legal institution under the Civil Code, with a substantivity all its own, and individuality that is entirely apart and independent from a delict or crime. * * *. A distinction exists between the civil liability arising from a crime and the responsibility for cuasi-delictos or culpa extra-contractual. The same negligent act causing damages may produce civil liability arising from a crime under article 100 of the Revised Penal Code, or create an action for cuasi-delito or culpa extra-contractual under articles 1902-1910 of the Civil Code.”

It was a mistake to say that the present action should be dismissed, because of the pendency of another action between the same parties involving the same cause. Evidently, both cases involved different causes of action.

JOSE CANGCO VS MANILA RAILROAD

38 PHIL. 768

FACTS:

Cangco, herein plaintiff, was an employee of the defendant in this case, Manila Railroad Company. Upon the occasion in question, plaintiff was returning home by train from his daily labors. As the train drew up to the station, plaintiff arose from his seat. As the train slowed down, plaintiff stepped off, but one or both of his feet came in contact with a sack of watermelons. As a result, his feet slipped from under him and he fell violently on the platform.

The accident occurred between 7-8 o’clock on a dark night as the railroad station was lighted dimly, objects on the platform were difficult to discern especially to a person emerging from a lighted car.

Plaintiff sued the defendant company for damages. The latter interposed the defense that the direct and proximate cause of the injury suffered by the plaintiff was his own contributory negligence in failing to wait until the train had come to a complete stop before alighting.

ISSUE:

Should Manila Railroad be held liable?

RULING:

Yes. The Supreme Court reversed the decision of the lower court holding that it was important to note that the foundation of the legal liability of the defendant was the contract of carriage, and that the obligation to respond for the damage which plaintiff has suffered arises, if at all, from the breach of that contract by reason of the failure of defendant to exercise due care in its performance. That was to say, its liability was direct and immediate, differing essentially, in legal viewpoint from that presumptive responsibility for the negligence of its servants, imposed by article 1903 of the Civil Code, which can be rebutted by proof of the exercise of due care in their selection and supervision. Article 1903 of the Civil Code is not applicable to obligations arising ex contractu, but only to extra-contractual obligations, or to use the technical form of expression, that article relates only to culpa aquiliana and not to culpa contractual.

Manresa (vol. 8, p. 67) in his commentaries upon articles 1103 and 1104 of the Civil Code, clearly points out this distinction, which was also recognized by this Court in its decision in the case of Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil. rep., 359). In commenting upon article 1093 Manresa clearly points out the difference between "culpa, substantive and independent, which of itself constitutes the source of an obligation between persons not formerly connected by any legal

tie" and culpa considered as an accident in the performance of an obligation already existing . . . ."

On the railroad company’s defense of contributory negligence on the part of Cangco, the Court held that the plaintiff was ignorant of the fact that the obstruction which was caused by the sacks of melds piled on the platform existed. Moreover, the place was dark or dimly lighted. Thus, there was failure on the part of the defendant to afford to its passengers facilities for safe egress from its trains.

GUTIERREZ V. GUTIERREZMALCOLM, J. / SEPT. 23, 1931FACTS: Feb. 2, 1930 – a passenger truck and a private vehiclecollided while attempting to pass each other on theTalon bridge Truck – driven by Abelardo Velasco, owned bySaturnino Cortez Private Vehicle – driven by Bonifactio Gutierrez, ownedby Mr. and Mrs. Manuel Gutierrez, Bonifacio’s parents The collision between the bus and the automobileresulted in Narciso Gutierrez, a passenger in the bus,suffering a fractured right leg which needed medicalassistance Narciso filed a case to recover damages for hisphysical injuries suffered as a result of the accidentISSUE: What are the respective legal obligations of thedefendantsHELD: Bonifacio Gutierrez’s obligation arises from culpaaquiliana while Saturnino Cortez and his chauffeurAbelardo Velasco’s obligation arise from culpacontractualRATIO: It is undisputed that the accident was caused bynegligence between both the passenger truck and theautomobile The case is one of 2 drivers approaching a narrowbridge from opposite directions with neither beingwilling to slow up and give the right of way to theother With regards to the automobile:o The youth Bonifacio was an incompetentchauffeur as he was driving at an excessiverate of speed and on approaching the bridgeand the truck, he lost his head and socontributed to the negligenceo His father is also responsible because he hasgiven guaranty at the time the son was grantedthe license to operate motor vehicles and assuch, he alone is liable for the damage causedby the minor With regards to the passenger truck:o The liability rests on that of contract, namely a

contract of carriage

Araneta v. De JoyaFacts:Respondent De Joya, general manager, proposed to the board of Ace Advsertising Corp., to sendRicardo Taylor to the US to take up special studies in television. The Board did not act upon the proposal.Nevertheless, sent Taylor to the US. Respondent assured Antonio Araneta, a compny director, thatexpenses will be handled by other parties which later was confirmed through a memorandum.While abroad, Taylor continued to receive his salaries. The items corresponding to his salaries appearedin vouchers prepared upon orders of, and approved by, the respondent. Petitioner Luis Araneta, signedthree of the vouchers, others signed by either respondent or Vicente Araneta, the company treasurer. Alltold, Ace Advertising disbursed P5,043.20 on account of Taylor’s travel and studies.Then a year after, Ace Advertising filed a complaint before the CFI against respondent for the recovery ofthe total sum disbursed to Taylor alleging that the trip was made without its knowledge, authority orratification.The respondent in his answer denied the charge and claimed that the trip was nonetheless ratified by thecompany’s board and at any event he had the discretion as general manager to authorize the trip whichwas for the company’s benefit.A third party complaint was file by respondent against, Vicente and Luis and Taylor. Respondent provedthat some of the checks to cover the expenses of Taylor were signed by Vicente and Luis.In their defense, Luis and Vicente claimed that they signed the checks in good faith as they wereapproved by respondent.The CFI rendered judgement ordering the respondent to pay Ace for the amount disbursed with interest ata legal rate until full payment and dismissed the third party complaint.Respondent appealed to CA. CA affirmed the decision of trial court with regard to its decision in favor ofAce but reversed the dismissal of the 3rd party complaint. CA found as a factthat Taylor’s trip had neitherbeen authorized nor ratified by Ace. It held that Luis and Vicente were also privy to the authorizeddisbursement of corporate monies with the respondent. That when they approved signed the checks, theyhave given their stamp of approval. As it is established that corporate funds were disbursed unauthorized,the case is of a simple quasi-delict committed by them against the corporation.Hence, this appeal.Issue:Whether or not petitioner is guilty of quasi-delict, notwithstanding that he was occupying a contractualposition at Ace? Otherwise stated, whether or not quasi-delict (tort) may be committed a party in a

contract?Held:Yes. The existence of a contract between the parties constitutes no bar to the commission of a tort by oneagainst the other and the consequent recovery of damages. His guilt is manifest on account of, in spite ofhis being a vice-president and director of Ace, petitioner remained passive, through out the period ofTaylor’s trip and to the payment of the latter’s salary. As such he neglected to perform his duties properlyto the damage of the firm of which he was an officer.Barredo vs. Garcia and Almario 1942Facts:A head-on collision between a taxicab owned by Barredo and a carretela occurred. The carretela wasoverturned and one of its passengers, a 16-year old boy, the son of Garcia and Almario, died as a resultof the injuries which he received. The driver of the taxicab, a employee of Barredo, was prosecuted forthe crime and was convicted. When the criminal case was instituted, Garcia and Almario reserved theirright to institute a separate civil action for damages. Subsequently, Garcia and Almario instituted a civilaction for damages against Barredo, the employer of the taxicab driver.It was found that Fontanilla has been found to have been previously violating traffic rules.Barredo set up his defense claiming that being only subsidiarily liable under the RPC and the accused notbeing imputed nor adjudged to pay damages in a civil action, then it is a bar for an action against him.The CFI ruled in favor of the plaintiff awarding them P2,000.00 against the Barredo.Issues:Whether or not an employer (Barredo) should be held principally and directly liable for the negligent act ofhis employee (or for the criminal act or omission of the employee)?Apropos the employee is acquitted in the criminal case and the employer is exonerated as subsidiaryliable, will it bar the civil action based on quasi-delict a.k.a culpa extra-contractual or culpa aquiliana?Whether or not the law is restrictive on the liability of the employer as subsidiary to that of the accused(confining itself within the provision of the penal code)?Held:(1)Yes. An employer (Barredo) is principally liable for the negligent acts (or even criminal acts) of hisemployee in the performance of his duties) because it is presumed by law that the employer (aswell as the father, guardian , etc.) committed an act of negligence in not preventing or avoidingthe damage. It is this fault that is condemned by law.(2) No. The reason for this is that the civil liability of the employer (in the criminal case) is groundedupon the crime committed by its employee, while the liability of the employer (in quasi-delict) iscompletely attributable to itself independent of the criminal act of the employee that is by not

carefully selecting and supervising its employees. Thus:Cuasi-delitos, include all acts in which “any king of fault or negligence intervenes” which means even ifsuch act or omission has nothing to do with the actual resulting damage, like, for example, then the ownerof a taxi company hires a driver who is known to him (or should have been known to him) that the latter isguilty of violating traffic rules. In case the driver causes damage as a result of his performance as a driver,then the owner is liable for the damage, not for the act of omission of the driver (because it is covered bythe penal code which makes the criminal or felon primarily liable for his injury cause) but for its negligencein employing the driver.(3)Articles 20 and 21 of the Penal Code, after distributing in their own way the civil responsibilitiesamong those who, for different reasons, are guilty of felony or misdemeanor, make such civilresponsibilities applicable to enterprises and establishments for which the guilty parties renderservice, but with subsidiary character, that is to say, according to the wording of the Penal Code,in default of those who are criminally responsible. In this regard, the Civil Code does not coincidebecause article 1903 says: “The obligation imposed by the next preceding article is demandable,not only for personal acts and omissions, but also for those of persons for whom another isresponsible.” (N.B. cause of liability is the bond or tie between the one who caused the injury andhis employer, father, guardian, etc.) Among the persons enumerated are the subordinates andemployees of establishments or enterprises, either for acts during their service or on the occasionof their functions. It is for this reason that it happens, and it is so observed in judicial decisions,that the companies or enterprises, after taking part in the criminal cases because of theirsubsidiary civil responsibility by reason of the crime, are sued and sentenced directly andseparately with regard to the obligation, before the civil courts.Workmen and employees should be carefully chosen and supervised in order to avoid injury to the public.It is the masters or employers who principally reap the profits resulting from the services of these servantsand employees. It is but right that they should guarantee the latter’s careful conduct for the personnel andpatrimonial safety of others.We will not use the literal meaning of the law to smother and render almost lifeless a principle of suchancient origin and such full-grown development as culpa aquiliana or cuasi-delito, which is conserved andmade enduring in articles 1902 to 1910 of the Spanish Civil Code.N.B. It is that Bond ( in the performance of the subordinate of the act) which will determine whether or notthe superior (employer, parents may be held liable.El Cano vs HillFacts:

Defendant Reginald Hill, a minor, married at the time of the occurrence, killed Agapito. He wasapprehended and charged appropriately before CFI. He acquitted on the ground that his act was notcriminal, because of “lack of intent to kill, coupled with mistake.”Thereupon, the parents of Agapito, filed a complaint for recovery of damages against the defendant andhis father, the defendant Marvin Hill, with whom he was living and getting subsistence, for the killing byReginald of the son of the plaintiffs.Defendants filed a motion to dismiss on the grounds that: first, the civil action is barred by the acquittal ofReginald, and; second, the father cannot be held liable for the act of his son because the latter is alreadymarried at the time of the commission, thus, is already emancipated.Issues:Whether or not quasi-delict is restricted to negligence and cannot apply to voluntary acts or omissionsproducing injury ( or felony)?Whether or not a father may be held liable for the act of his emancipated child constituting quasi-delict?Held:No. To repeat the Barredo case, under Article 2177, acquittal from an accusation of criminal negligence,whether on reasonable doubt or not, shall not be a bar to a subsequent civil action, not for civil liabilityarising from criminal negligence, but for damages due to a quasi-delict or ‘culpa aquiliana’ although itmentions the word “negligence” but according to Justice Bocobo it must be construed according to “thespirit that giveth lift- rather than that which is literal that killeth the intent of the lawmaker should beobserved in applying the same.” Criminal prosecution and civil action are two different things.On the second issue (obsolete), Yes, the father may be held liable. While it is true that marriage of a childemancipates him from the parental authority of his parents, what matters really is whether or not suchminor is completely emancipated as defined by law. In the case at bar, his emancipation is only partial foras provided by law he can sue and be sued in court with the assistance of his parents, he cannot managehis own properties without the approval of his parents, and third as in the facts, he relies for subsistencefrom his parents.Occena vs Icamina 1990 (Antique)Facts:On May 31, 1979, herein petitioner Eulogio Occena instituted before the Second Municipal Circuit TrialCourt of Sibalom Antique, Criminal Case No. 1717, a criminal complaint for Grave Oral Defamationagainst herein private respondent Cristina Vegafria for allegedly openly, publicly and maliciously utteringthe following insulting words and statements: “Gago ikaw nga Barangay Captain, montisco, traidor,

malugus, Hudas,” which, freely translated, mean: “You are a foolish Barangay Captain, ignoramus, traitor,tyrant, Judas” and other words and statements of similar import which caused great and irreparabledamage and injury to his person and honor.Accused pleaded not guilty. Trial ensued and judgment was rendered finding the accused guilty beyondreasonable doubt for slight oral deflation sentencing her to pay a fine of P50.00 and subsidiary in case ofinsolvency but no damages were awarded to petitioner as held by the trial court.Disagreeing, petitioner sought relief with the RTC which affirmed the decision of the MTC.Hence, this appeal.Issue:Whether or not the instant appeal should be dismissed on the ground that the decision rendered by theRTC has become final?Whether or not damages are warranted to petitioner?Held:No. While the criminal aspect of the case has become final, the civil aspect did not due to the timelyappeal filed by petitioner with regard to the civil aspect of the case (Peeple vs Coloma).Yes. Every person criminally liable for a felony is also civilly liable (Art. 100, RPC). Likewise, article 2219of the New Civil Code provides that moral damages may be recovered in libel, slander or any other formof defamation.In the ultimate analysis, what gives rise to the civil liability is really the obligation of everyone to repair orto make whole the damage caused to another by reason of his act or omission, whether done intentionalor negligently and whether or not punishable by law.Banal vs Tadeo 1987Facts:Petitioner herein is one of the complainants in the criminal cases filed against Rosario Claudio. Claudio ischarged with 15 separate information for violation of BP 22. Claudio pleaded not guilty, thus trial ensued.Petitioner moved to intervene through private prosecutor but it was rejected by respondent judge on theground that the charge is for the violation of Batas Pambansa Blg. 22 which does not provide for any civilliability or indemnity and hence, “it is not a crime against property but public order.” Petitioner filed amotion for reconsideration but was denied by the respondent judge. Hence this appeal.Issue:Whether or not a private prosecutor may intervene in the prosecution for violation of BP 22 (a specialpenal law) which does not provide for civil liability?Note:Intervention of a private prosecutor is for the purpose of protecting the private interest of the complainantto recover damages.Held:Yes! Under Art. 100 of the RPC, ‘every person criminally liable for a felony is also civilly liable.’ Thus a

person committing a felony offends namely (1) the society in which he lives in or the political entity calledthe State whose law he had violated; and (2) the individual member of that society whose person, right,honor, chastity or property was actually or directly injured or damaged by the same punishable act oromission.While an act or omission is felonious because it is punishable by law, it gives rise to civil liability not somuch because it is a crime but because it caused damage to another. Viewing things pragmatically, wecan readily see that what gives rise to the civil liability is really the obligation and the moral duty ofeveryone to repair or make whole the damage caused to another by reason of his own act or omission,done intentionally or negligently, whether or not the same be punishable by law. In other words, criminalliability will give rise to civil liability only if the same felonious act or omission results in damage or injury toanother and is the direct and proximate cause thereof. Damage or injury to another is evidently thefoundation of the civil action. Such is not the case in criminal actions for, to be criminally liable, it isenough that the act or omission complained of is punishable, regardless of whether or not it also causesmaterial damage to another. (Sangco, Philippine Law on Torts and Damages, 1978, Revised Edition, pp.246-247).Article 20 of the New Civil Code provides:“Every person who, contrary to law, wilfully or negligently causes damage to another,shall indemnify the latter for the same.”Regardless, therefore, of whether or not a special law so provides, indemnification of the offended partymay be had on account of the damage, loss or injury directly suffered as a consequence of the wrongfulact of another.

In January 1932, De Borja entered into a contract of sale with the NVSD Co., Inc. The subject of the sale was 4,000 cavans of rice valued at Php2.10 per cavan. On behalf of the company, the contract was executed by Vasquez as the company’s acting president. NVSD Co. only delivered 2,488 cavans and failed and refused despite demand to deliver the rest hence De Borja incurred damages (apparently, NVSD Co was insolvent). He then sue Vasquez for payment of damages.

ISSUE: Whether or not Vasquez is liable for damages.

HELD: No. Vasquez is not party to the contract as it was NVSD Co which De Borja contracted with. It is well known that a corporation is an artificial being invested by law with a personality of its own, separate and distinct from that of its stockholders and from that of its officers who manage and run its affairs. The mere fact that its personality is owing to a legal fiction and that it necessarily has to act thru its agents, does not make the latter personally liable on a contract duly entered into, or for an act lawfully performed, by them for an in its behalf.

The fact that the corporation, acting thru Vazquez as its manager, was guilty of negligence in the fulfillment of the contract did not make Vazquez principally or even subsidiarily liable for such negligence. Since it was the corporation’s contract, its non fulfillment, whether due to negligence or fault or to any other cause, made the corporation and not its agent liable.

JUSTICE PARAS Dissenting :

Vasquez as president of NVSD Co is liable for damages. Vasquez, as acting president and manager of Natividad-Vazquez Sabani Development Co., Inc., and with full knowledge of the then insolvent status of his company, agreed to sell to De Borja 4,000 cavans of palay. Further, NVSD Co was soon thereafter dissolved.

MANUEL DE GUIA, plaintiff vs. THE MANILA ELECTRIC RAILROAD & LIGHTCOMPANY, defendant & appellant [1920]Facts:Sept. 4, 1915, 8 p.m.de Guia, a physician & resident of Caloocan boarded a street-car (parang train ata ‘to…) in Caloocan. He boarded a car at the end of the line.30 meters from the starting point: car entered a switch, de Guia remained at theback of the platform holding the handle of the right hand doorUpon coming out of the switch, small wheels of rear truck left the track eventuallyshattering a concrete post at the left of the track. Defendant company claims it wascaused by a stone somewhat larger than a goose egg lodged accidentally betweenthe rails.

As the car stopped, de Guia was thrown against the door w/some violence w/cresulted to some bruises and probably some internal injuries.De Guia claims that he became unconscious due to the impact & he was taken to hishouse. Different physicians who checked on him had different testimonies. Oneclaimed that de Guia was walking while one said that he spit up blood due to thebruises on his side. Signs of physical & nervous derangement were also observed.However, defendant presented some experts who testified that de Guia’s injurieswere trivial & simulated.De Guia filed a suit for damages wanting to claim the following:1.compensation for money lost due to his inability to properly attend to hisprofessional labors for 3 mos & his practice was suspended during that time2.P3,900.00 w/c he should have earned P3,900.00 as a district health officer inOccidental Negros where he was supposed to serve for 2 years earning P1,600.00per annum. He even added P350.00 as earnings from possible outside practice.3.P40,000.00 - P10k for his medical treatment and P30k for injuries w/c he claimwould incapacitate him for exercise of medical profession in the future. He claimed tohave numerous diseases.*Breakdown for P10k medical expenses: P350 to Dr. Montes (doctor who first saw deGuia) plus payment to 3 other physicians.RTC: motorman negligent in maintaining a very rapid speed. P900.00

for loss of professional earnings. P3,900.00 for supposed salary as a district health officer inOccidental Negros. Total award amounts to P6,100.00Issues & Ratio:1. WON the motorman/car operator was negligent - YESDerailment is actually a fortuitous event as determined by cause. But operator’snegligence cannot be denied. He was moving at point four speed (about 5-6 milesper hour) but some witnesses observed that the train was moving at a higher ratesince the car was behind schedule. Another consideration would be the fact that thecar was practically empty.Main basis for imputing negligence: not so much because of the excessive speed butthe fact that the car was allowed to run a relatively long distance considering thatthe front wheels of the rear truck were derailed. An experienced & attentivemotorman should have discovered that something was wrong & would have stopped.2. WON the defendant company is liable - YESLiable for the damage resulting to de Guia due to the negligence. There was acontractual relationship bet him & the company. Company was bound to convey & deliver him safely & securely w/the degree of care required by law & custom (CC Art.1258).Defense of exercise of due care in selection & instruction of operator (CC Art. 1903)is immaterial because such is only applicable in negligence w/o contractual relation.However, the Court can moderate the company’s liability according to thecircumstances of the case (CC Art. 1103) especially since the company can beconsidered as a debtor in good faith due to its exercise of due diligence (CC Art.1107). Thus, defendant’s liability is limited to damages that might be directly causedby the physical injuries inflicted & w/c were in fact a necessary result of thoseinjuries.3. WON lower court erred in admitting as primary evidence the writtenstatements of 4 physicians who examined de Guia. – YES.Physicians merely identified their signatures. These cannot be classified as primaryevidence since they’re of a hearsay nature. Physicians should have been asked to testifyin court. Their statements cannot be used considering that there had been nofailure/exhaustion of memory.4. Damages claimed by de Guia:P900.00 award for loss of professional earnings sustained.P3,900.00 (health officer’s salary) denied since it’s way too speculative.Damages for supposed incapacitation denied. Court has reason to believe that deGuia wants to profit from the situation thus his promotion of the litigation. He madeuse of his medical knowledge coupled w/the help of his professional associates tomake it appear that he has a strong case.

Medical expenses: Limited to expenditures as were reasonably suited to the case.Defendant is only liable for the expenses incurred during the first check-up w/camounts to P350. However, only P200 was paid by plaintiff thus, that is the onlyamount w/c the defendant company is obliged to pay. Obligation WRT otherphysicians cannot be subj to recovery since:a.there’s no proof that these physicians charged for those services. They seem tobe gratuitous services. Physician’s testimonies re their rates do not mean thatde Guia did actually pay them.b.Court believes that de Guia employed many physicians to make sure of hissuccess in this litigation rather than to actually cure him.Holding:Modified. de Guia entitled to P1,100.00 w/legal interest from Nov. 8, 1916.

Amadora vs. CAGR No. L47745, April 15, 1988

FACTS:

Alfredo Amadora, while in the auditorium of the school, was mortally hit by a gun by Pablito Daffon resulting to the former’s death.  Daffon was convicted of homicide through reckless imprudence.  The victim’s parents, herein petitioners, filed a civil action for damages against Colegio de San Jose-Recoletos, its rectors, high school principal, dean of boys, the physics teacher together with Daffon and 2 other students.  Complaints against the students were dropped.  Respondent Court absolved the defendants completely and reversed CFI Cebu’s decision for the following reasons: 1. Since the school was an academic institution of learning and not a school of arts and trades 2. That students were not in the custody of the school since the semester has already ended 3. There was no clear identification of the fatal gun, and 4. In any event, defendants exercised the necessary diligence through enforcement of the school regulations in maintaining discipline.  Petitioners on othe other hand claimed their son was under school custody because he went to school to comply with a requirement for graduation (submission of Physics reports).

ISSUE: WON Collegio de San Jose-Recoletos should be held liable.

HELD:

The time Alfredo was fatally shot, he was in the custody of the authorities of the school notwithstanding classes had formally ended when the incident happened.  It was immaterial if he was in the school auditorium to finish his

physics requirement.  What was important is that he was there for a legitimate purpose.  On the other hand, the rector, high school principal and the dean of boys cannot be held liable because none of them was the teacher-in-charge as defined in the provision.  Each was exercising only a general authority over the students and not direct control and influence exerted by the teacher placed in-charge of particular classes. 

In the absence of a teacher- in charge, dean of boys should probably be held liable considering that he had earlier confiscated an unlicensed gun from a student and later returned to him without taking disciplinary action or reporting the matter to the higher authorities.  Though it was clear negligence on his part, no proof was shown to necessarily link this gun with the shooting incident.

Collegio San Jose-Recoletos cannot directly be held liable under the provision because only the teacher of the head of school of arts and trade is made responsible for the damage caused by the student.  Hence, under the facts disclosed, none of the respondents were held liable for the injury inflicted with Alfredo resulting to his death.

Petition was denied.

PSBA VS CAG. R. No. 84698February 4, 1992FACTS:On August 30, 1985, Carlitos Bautista, a third year commerce student of PSBA, was stabbed todeath while on the second floor premises of the said school. His parents filed a suit for damagesagainst PSBA and its corporate officers. It was established that the assailants were not membersof the school’s academic community but were elements from outside the school.PSBA sought to have the suit dismissed alleging that since they are presumably sued underArticle 2180 of the Civil Code, the complaint states no cause of action against them, as jurisprudence on the subject is to the effect thatacademic institutions, such as the PSBA, arebeyond the ambit of the rule in the afore-stated article. http://missaldea.blogspot.comThe trial court denied the motion to dismiss. CA affirmed the trialcourt’s decision based on thelaw of quasi-delicts holding that teachers and heads of the school are liable unless they prove thatthey observed all the diligence to prevent damage. http://missaldea.blogspot.comISSUE:Whether or not the petitioners are liable for the damages http://missaldea.blogspot.com

RULING:Article 2180 plainly provides that the damage should have been caused or inflicted bypupils or studentsof the educational institution sought to be held liable for the acts of its pupils or studentswhile in its custody. The assailants of Carlitos were NOT students of PSBA, for whose acts theschool could be made liable. http://missaldea.blogspot.comUpon enrolment, acontract between the academic institution and the students is established,resulting in bilateral obligations which both parties are bound to comply with. The schoolundertakes to provide the student with an education that would presumably suffice to equip himwith the necessary tools and skills to pursue higher education or a profession. On the other hand,the student covenants to abide by the school's academic requirements and observe its rules andregulations. http://missaldea.blogspot.com

Michelle It has been ruled in Cangco vs Manila Railroad that “the mere fact that a person is bound toanother by contract does not relieve him from extra-contractual liability to such person. Whensuch a contractual relation exists the obligor may break the contract under such conditions that the same act which constitutes a breach of the contract would have constituted the source of anextra-contractual obligation had no contract existed between the parties.In the case at bar, there is, as yet, no finding that the contract between the school and Bautistahad been breached thru the former's negligence in providing proper security measures. Thiswould be for the trial court to determine. And, even if there be a finding of negligence, the samecould give rise generally to a breach of contractual obligation only. Using the test of Cangco,supra, the negligence of the school would not be relevant absent a contract. In fact, thatnegligence becomes material only because of the contractual relation between PSBA andBautista. In other words, a contractual relation is a conditionsine qua nonto the school'sliability. The negligence of the school cannot exist independently of the contract, unless thenegligence occurs under the circumstances set out in Article 21 of the Civil Code.

Mendoza v. Arrieta

Facts: On October 22, 1969, at around 4pm, a 3-way vehicular accident occurred along Mac-Arthur Highway Bulacan, involving aMercedez Benz owned and driven by petitioner, a private jeep owned and driven by respondent Salazar and a gravel and sandtruck owned by respondent Timbol and driven by Montoya. As a consequence, separate informations were filed against Salazar and Montoya.

At the trial, petitioner testified that Salazar overtook the truck, swerved to the left and hit his car. He further testified that before impact, Salazar jumped from the jeep not knowing that Salazar was hit by the truck of Montoya. Montoya affirmed this. On the other hand, Salazar tried to show that after overtaking the truck, he flashed a signal showing his intention to turn left but was stopped at by a policeman directing traffic at the intersection which he contends to be the time he was hit by the truck causing his jeep to hit petitioner’s car. 

Issues:(1) Whether or not the damages ensued to the vehicle of petitioner shall be the liability of the driver of the jeep or of the truck.

(2) Whether or not the truck’s owner may be held liable for damages caused by him employee.

Held: Thus, the trial Court absolved jeep-owner-driver Salazar of any liability, civil and criminal, in view of its findings that the collision between Salazar's jeep and petitioner's car was the result of the former having been bumped from behind by the truck driven by Montoya. Neither was petitioner awarded damages as he was not a complainant against truck-driver Montoya but only against jeep-owner-driver Salazar.

That petitioner's cause of action against Timbol in the civil case is based on quasi-delict is evident from the recitals in the complaint to wit: that while petitioner was driving his car along MacArthur Highway at Marilao, Bulacan, a jeep owned and driven by Salazar suddenly swerved to his (petitioner's) lane and collided with his car That the sudden swerving of Salazar's jeep was caused either by the negligence and lack of skill of Freddie Montoya, Timbol's employee, who was then driving a gravel and sand truck iii the same direction as Salazar's jeep; and that as a consequence of the collision, petitioner's car suffered extensive damages. Clearly, therefore, the two factors that a cause of action must consist of, namely: (1) plaintiff's primary right, i.e., that he is the owner of a Mercedes Benz, and (2) defendant's delict or wrongful act or omission which violated plaintiff's primary right, i.e., the negligence or lack of skill either of jeep-owner Salazar or of Timbol's employee, Montoya, in driving the truck, causing Salazar's jeep to swerve and collide with petitioner's car, were alleged in the Complaint. 

Consequently, petitioner's cause of action being based on quasi-delict, respondent Judge committed reversible error when he dismissed the civil suit against the truck-owner, as said case may proceed independently of the criminal proceedings and regardless of the result of the latter.

In view of what has been proven and established during the trial, accused Freddie Montoya would be held able for having bumped and hit the rear portion of the jeep driven by the accused Rodolfo Salazar. Considering that the collision between the jeep driven by Rodolfo Salazar and the car owned and driven by Edgardo Mendoza was the result of the hitting on the rear of the jeep by the truck driven by Freddie Montoya, this

Court behaves that accused Rodolfo Salazar cannot be held able for the damages sustained by Edgardo Mendoza's car. 

Light Rail Transit Authority vs. Navidad397 SCRA 75 February 6, 2003 Ponente: Justice Vitug Nature: Petition for a review on certiorari of a decision of the Court of Appeals Facts:Nicanor Navidad, then drunk, entered the EDSA LRT station after purchasing a token. While he was standing on the platform, a security guard approached him. A misunderstanding occurred and led to a fist fight which resulted in Navidad falling onto the railway. At the exact moment Navidad fell, an LRT train was coming in which struck him, killing him instantaneously.Navidad¶s widow and her children filed a complaint for damages against Escartin (security guard), Roman (train operator), the LRTA, Metro Transit and Prudent for the death of her husband. The trial court rendered a decision in favor of Navidad and against Prudent and Escartin, and dismissed the complaint against LRTA and Roman.Prudent appealed to the CA which rendered a decision exonerating Prudent and Escartin, and instead, holding the LRTA and Roman liable for the death of NIcanor Navidad.Issue:1. Should the LRTA be held liable for the death of Nicanor Navidad?2. Should Prudent be likewise made liable?Held:1. Yes. The foundation of LRTA¶s liability is the contract of carriage

and its obligation to indemnify the victim arises from the breach of that contract by reason of its failure to exercise the high diligence required of the common carrier.

2. No. If at all, such liability could only be for tort. However, the Court is concluded by the factual finding of the CA that there is nothing to link Prudent to the death of Nicanor for the reason that the negligence of its employee, Escartin has not been duly proven. Since the premise for employer¶s liability is negligence or fault on the part of the employee, and Escartin¶s negligence has not been duly proved, his employer, Prudent may not be held liable.

Dispositive:Judgment is affirmed with modification (deleting award for nominal damages and absolving Roman from liability)