Dulay vs. CA; G.R. No. 108017.

April 3, 1995

petitioners clearly sustained an injury to their rights under the law, it would be more
just to allow them to present evidence of such injury. cdrep

SYLLABUS
1.
REMEDIAL LAW; CRIMINAL PROCEDURE; INDEPENDENT CIVIL
ACTION; RULE. It is well-settled that the filing of an independent civil action before
the prosecution in the criminal action presents evidence is even far better than a
compliance with the requirement of an express reservation (Yakult Philippines v. Court
of Appeals, 190 SCRA 357 [1990]).
2.
ID.; CIVIL PROCEDURE; CAUSE OF ACTION; ELEMENTS FOR
EXISTENCE THEREOF. A cause of action exists if the following elements are
present, namely: (1) a right in favor of the plaintiff by whatever means and under
whatever law it arises or is created; (2) an obligation on the part of the named
defendant to respect or not to violate such right; and (3) an act or omission on the part
of such defendant violative of the right of the plaintiff or constituting a breach of the
obligation of the defendant to the plaintiff for which the latter may maintain an action
for recovery of damages. (Del Bros Hotel Corporation v. CA, 210 SCRA 33 [1992]);
Development Bank of the Philippines v. Pundogar, 218 SCRA 118 [1993]).
3.
ID.; ID.; ID; DETERMINED BY THE ALLEGATIONS IN THE COMPLAINTS;
CASE AT BAR. The nature of a cause of action is determined by the facts alleged
in the complaint as constituting the cause of action (Republic v. Estenzo, 158 SCRA
282 [1988]). The purpose of an action or suit and the law to govern it is to be
determined not by the claim of the party filing the action, made in his argument or
brief, but rather by the complaint itself, its allegations and prayer for relief (De Tavera
v. Philippine Tuberculosis Society, 112 SCRA 243 [1982]). An examination of the
complaint in the present case would show that the plaintiffs, petitioners herein, are
invoking their right to recover damages against the private respondents for their
vicarious responsibility for the injury caused by Benigno Torzuela's act of shooting and
killing Napoleon Dulay, as stated in paragraphs 1 and 2 of the complaint. The general
rule is that the allegations in a complaint are sufficient to constitute a cause of action
against the defendants if, admitting the facts alleged, the court can render a valid
judgment upon the same in accordance with the prayer therein.
4.
ID.; ID.; ID.; ID.; PROOF OF ALLEGATIONS; WHEN NECESSARY. In
determining whether the allegations of a complaint are sufficient to support a cause of
action, it must be borne in mind that the complaint does not have to establish or allege
the facts proving the existence of a cause of action at the outset; this will have to be
done at the trial on the merits of the case. If the allegations in a complaint can furnish
a sufficient basis by which the complaint can be maintained, the same should not be
dismissed regardless of the defenses that may be assessed by the defendants (Rava
Dev't. Corp. v. CA, 211 SCRA 152 [1992] citing Consolidated Bank & Trust
Corporation v. Court of Appeals, 197 SCRA 663 [1991]). To sustain a motion to
dismiss for lack of cause of action, the complaint must show that the claim for relief
does not exist rather than that a claim has been defectively stated or is ambiguous,
indefinite or uncertain (Azur v. Provincial Board, 27 SCRA 50 [1969]). Since the

4.
CIVIL LAW; TORTS AND DAMAGES; QUASI-DELICT; CONSTRUED.
Well-entrenched is the doctrine that Article 2176 covers not only acts committed with
negligence, but also acts which are voluntary and intentional. As far back as the
definitive case of Elcano v. Hill (77 SCRA 98 [1977]), this Court already held that: ". . .
Article 2176, where it refers to 'fault or negligence,' covers not only acts 'not
punishable by law' but also acts criminal in character, whether intentional and
voluntary or negligent. Consequently, a separate civil action lies against the offender
in a criminal act, whether or not he is criminally prosecuted and found guilty or
acquitted, provided that the offended party is not allowed, if he is actually charged also
criminally, to recover damages on both scores, and would be entitled in such
eventuality only to the bigger award of the two, assuming the awards made in the two
cases vary. In other words, the extinction of civil liability referred to in Par. (e) of
Section 3, Rule 111, refers exclusively to civil liability founded on Article 100 of the
Revised Penal Code, whereas the civil liability for the same act considered as quasidelict only and not as a crime is not extinguished even by a declaration in the criminal
case that the criminal act charged has not happened or has not been committed by
the accused. Briefly stated, We here hold, in reiteration of Garcia, that culpa aquiliana
includes voluntary and negligent acts which may be punishable by law." The same
doctrine was echoed in the case of Andamo v. Intermediate Appellate Court (191
SCRA 195 [1990]), wherein the Court held: "Article 2176, whenever it refers to "fault or
negligence," covers not only acts "not punishable by law" but also acts criminal in
character, whether intentional and voluntary or negligent. Consequently, a civil action
lies against the offender in a criminal act, whether or not he is prosecuted or found
guilty or acquitted, provided that the offended party is not allowed, (if the tortfeasor is
actually also charged criminally), to recover damages on both scores, and would be
entitled in such eventuality only to the bigger award of the two, assuming the awards
made in the two cases vary." [Citing Virata v. Ochoa, 81 SCRA 472]
5.
ID.; ID.; RULE WHEN AN INJURY IS CAUSED BY THE NEGLIGENCE OF
THE EMPLOYEE. Under Article 2180 of the New Civil Code as aforequoted, when
an injury is caused by the negligence of the employee, there instantly arises a
presumption of law that there was negligence on the part of the master or employer
either in the selection of the servant or employee, or in supervision over him after
selection or both (Layugan v. Intermediate Appellate Court, 167 SCRA 363 [1988]).
The liability of the employer under Article 2180 is direct and immediate; it is not
conditioned upon prior recourse against the negligent employee and a prior showing
of the insolvency of such employee (Kapalaran Bus Lines v. Coronado, 176 SCRA
792 [1989]). Therefore, it is incumbent upon the private respondents to prove that they
exercised the diligence of a good father of a family in the selection and supervision of
their employee.
DECISION
BIDIN, J p:

This petition for certiorari prays for the reversal of the decision of the Court of Appeals
dated October 29, 1991 in CA-G.R. CV No. 24646 which affirmed the order of the
Regional Trial Court dismissing Civil Case No. Q-89-1751, and its resolution dated
November 17, 1991 denying herein petitioner's motion for reconsideration. cdll
The antecedent facts of the case are as follows:
On December 7, 1988, an altercation between Benigno Torzuela and Atty. Napoleon
Dulay occurred at the "Big Bang sa Alabang," Alabang Village, Muntinlupa as a result
of which Benigno Torzuela, the security guard on duty at the said carnival, shot and
killed Atty. Napoleon Dulay.
Herein petitioner Maria Benita A. Dulay, widow of the deceased Napoleon Dulay, in
her own behalf and in behalf of her minor children, filed on February 8, 1989 an action
for damages against Benigno Torzuela and herein private respondents Safeguard
Investigation and Security Co., Inc., ("SAFEGUARD") and/or Superguard Security
Corp. ("SUPERGUARD"), alleged employers of defendant Torzuela. The complaint,
docketed as Civil Case No. Q-89-1751 among others alleges the following:
1.

...

"Defendants SAFEGUARD INVESTIGATION AND SECURITY CO., INC, (Defendant

Safeguard) and SUPERGUARD SECURITY CORPORATION (Defendant
Superguard) are corporations duly organized and existing in accordance with
Philippine laws, with offices at 10th Floor, Manufacturers Building, Inc., Plaza Santa
Cruz, Manila. They are impleaded as alternative defendants for, while the former
appears to be the employer of defendant BENIGNO TORZUELA (defendant
TORZUELA), the latter impliedly acknowledged responsibility for the acts of defendant
TORZUELA by extending its sympathies to plaintiffs.
"Defendant BENIGNO TORZUELA is of legal age, an employee of defendant
SAFEGUARD and/or defendant SUPERGUARD and, at the time of the incident
complained of, was under their control and supervision. . . .
"3.
On December 7, 1988 at around 8:00 a.m., defendant TORZUELA, while he
was on duty as security guard at the "Big Bang sa Alabang," Alabang Village,
Muntinlupa, Metro Manila shot and killed NAPOLEON V. DULAY with a .38 caliber
revolver belonging to defendant SAFEGUARD, and/or SUPERGUARD (per police
Report dated January 7, 1989, copy attached as Annex A);
"4.
The incident resulting in the death of NAPOLEON V. DULAY was due to the
concurring negligence of the defendants. Defendant TORZUELA'S wanton and
reckless discharge of the firearm issued to him by defendant SAFEGUARD and/or
SUPERGUARD was the immediate and proximate cause of the injury, while the
negligence of defendant SAFEGUARD and/or SUPERGUARD consists in its having
failed to exercise the diligence of a good father of a family in the supervision and
control of its employee to avoid the injury.

xxx

xxx

xxx"

(Rollo, pp. 117-118)

Petitioners prayed for actual, compensatory, moral and exemplary damages, and
attorney's fees. The said Civil Case No. Q-89-1751 was raffled to Branch 84 of the
Regional Trial Court of Quezon City, presided by respondent Judge Teodoro Regino.
cdphil
On March 2, 1989, private respondent SUPERGUARD filed a Motion to Dismiss on
the ground that the complaint does not state a valid cause of action. SUPERGUARD
claimed that Torzuela's act of shooting Dulay was beyond the scope of his duties, and
that since the alleged act of shooting was committed with deliberate intent (dolo), the
civil liability therefor is governed by Article 100 of the Revised Penal Code, which
states:
"ARTICLE 100.
Civil liability of a person guilty of a felony. Every person
criminally liable for a felony is also civilly liable."
Respondent SUPERGUARD further alleged that a complaint for damages based on
negligence under Article 2176 of the New Civil Code, such as the one filed by
petitioners, cannot lie, since the civil liability under Article 2176 applies only to quasioffenses under Article 365 of the Revised Penal Code. In addition, the private
respondent argued that petitioners' filing of the complaint is premature considering
that the conviction of Torzuela in a criminal case is a condition sine qua non for the
employer's subsidiary liability (Rollo, p. 55-59).
Respondent SAFEGUARD also filed a motion praying that it be excluded as defendant
on the ground that defendant Torzuela is not one of its employees (Rollo, p. 96).
LibLex
Petitioners opposed both motions, stating that their cause of action against the private
respondents is based on their liability under Article 2180 of the New Civil Code, which
provides:
"ARTICLE 2180.
The obligation imposed by Article 2176 is demandable not only for
one's own acts or omissions, but also for those of persons for whom one is
responsible.
xxx

xxx

xxx

Employers shall be liable for the damages caused by their employees and household
helpers acting within the scope of their assigned tasks even though the former are not
engaged in any business or industry.
xxx

xxx

(Emphasis supplied)

xxx"

Petitioners contended that a suit against alternative defendants is allowed under Rule
3, Section 13 of the Rules of Court. Therefore, the inclusion of private respondents as
alternative defendants in the complaint is justified by the following: the Initial
Investigation Report prepared by Pat. Mario Tubon showing that Torzuela is an
employee of SAFEGUARD; and through overt acts, SUPERGUARD extended its
sympathies to petitioners (Rollo, pp. 64 and 98).
Meanwhile, an Information dated March 21, 1989 charging Benigno Torzuela with
homicide was filed before the Regional Trial Court of Makati and was docketed as
Criminal Case No. 89-1896.
On April 13, 1989, respondent Judge Regino issued an order granting
SUPERGUARD'S motion to dismiss and SAFEGUARD'S motion for exclusion as
defendant. The respondent judge held that the complaint did not state facts necessary
or sufficient to constitute a quasi-delict since it does not mention any negligence on
the part of Torzuela in shooting Napoleon Dulay or that the same was done in the
performance of his duties. Respondent judge ruled that mere allegations of the
concurring negligence of the defendants (private respondents herein) without stating
the facts showing such negligence are mere conclusions of law (Rollo, p. 106).
Respondent judge also declared that the complaint was one for damages founded on
crimes punishable under Articles 100 and 103 of the Revised Penal Code as
distinguished from those arising from quasi-delict. The dispositive portion of the order
dated April 13, 1989 states:
"WHEREFORE, this Court holds that in view of the material and ultimate facts alleged
in the verified complaint and in accordance with the applicable law on the matter as
well as precedents laid down by the Supreme Court, the complaint against the
alternative defendants Superguard Security Corporation and Safeguard Investigation
and Security Co., Inc., must be and (sic) it is hereby dismissed." (Rollo, p. 110).
The above order was affirmed by the respondent court and petitioners' motion for
reconsideration thereof was denied. cdphil
Petitioners take exception to the assailed decision and insist that quasi-delicts are not
limited to acts of negligence but also cover acts that are intentional and voluntary,
citing Andamo v. IAC (191 SCRA 195 [1990]). Thus, petitioners insist that Torzuela's
act of shooting Napoleon Dulay constitutes a quasi-delict actionable under Article
2176 of the New Civil Code.
Petitioners further contend that under Article 2180 of the New Civil Code, private
respondents are primarily liable for their negligence either in the selection or
supervision of their employees. This liability is independent of the employee's own
liability for fault or negligence and is distinct from the subsidiary civil liability under
Article 103 of the Revised Penal Code. The civil action against the employer may
therefore proceed independently of the criminal action pursuant to Rule 111, Section 3
of the Rules of Court. Petitioners submit that the question of whether Torzuela is an
employee of respondent SUPERGUARD or SAFEGUARD would be better resolved
after trial.

Moreover, petitioners argue that Torzuela's act of shooting Dulay is also actionable
under Article 33 of the New Civil Code, to wit:
"ARTICLE 33.
In cases of defamation, fraud, and physical injuries, a civil action
for damages, entirely separate and distinct from the criminal action, may be brought
by the injured party. Such civil action shall proceed independently of the criminal
prosecution, and shall require only a preponderance of evidence." (Emphasis
supplied)
In the same vein, petitioners cite Section 3, Rule 111 of the Rules of Court which
provides:
"Rule 111.

...

SECTION 3.
When civil action may proceed independently. In the cases
provided for in Articles 32, 33, 34 and 2176 of the Civil Code of the Philippines, the
independent civil-action which has been reserved may be brought by the offended
party, shall proceed independently of the criminal action, and shall require only a
preponderance of evidence." (Emphasis supplied)
The term "physical injuries" under Article 33 has been held to include consummated,
frustrated and attempted homicide. Thus, petitioners maintain that Torzuela's prior
conviction is unnecessary since the civil action can proceed independently of the
criminal action. On the other hand, it is the private respondents' argument that since
the act was not committed with negligence, the petitioners have no cause of action
under Articles 2176 and 2177 of the New Civil Code. The civil action contemplated in
Article 2177 is not applicable to acts committed with deliberate intent, but only applies
to quasi-offenses under Article 365 of the Revised Penal Code. Torzuela's act of
shooting Atty. Dulay to death, aside from being purely personal, was done with
deliberate intent and could not have been part of his duties as security guard. And
since Article 2180 of the New Civil Code covers only acts done within the scope of the
employee's assigned tasks, the private respondents cannot be held liable for
damages. LexLib
We find for petitioners.
It is undisputed that Benigno Torzuela is being prosecuted for homicide for the fatal
shooting of Napoleon Dulay. Rule 111 of the Rules on Criminal Procedure provides:
"SECTION 1.
Institution of criminal and civil actions. When a criminal action
is instituted, the civil action for the recovery of civil liability is impliedly instituted with
the criminal action, unless the offended party waives the civil action, reserves his right
to institute it separately, or institutes the civil action prior to the criminal action.
Such civil action includes recovery of indemnity under the Revised Penal Code, and
damages under Articles 32, 33, 34, and 2176 of the Civil Code of the Philippines
arising from the same act or omission of the accused." (Emphasis supplied)

It is well-settled that the filing of an independent civil action before the prosecution in
the criminal action presents evidence is even far better than a compliance with the
requirement of an express reservation (Yakult Philippines v. Court of Appeals, 190
SCRA 357 [1990]). This is precisely what the petitioners opted to do in this case.
However, the private respondents opposed the civil action on the ground that the
same is founded on a delict and not on a quasi-delict as the shooting was not
attended by negligence. What is in dispute therefore is the nature of the petitioner's
cause of action.
The nature of a cause of action is determined by the facts alleged in the complaint as
constituting the cause of action (Republic v. Estenzo, 158 SCRA 282 [1988]). The
purpose of an action or suit and the law to govern it is to be determined not by the
claim of the party filing the action, made in his argument or brief, but rather by the
complaint itself, its allegations and prayer for relief (De Tavera v. Philippine
Tuberculosis Society, 112 SCRA 243 [1982]). An examination of the complaint in the
present case would show that the plaintiffs, petitioners herein, are invoking their right
to recover damages against the private respondents for their vicarious responsibility
for the injury caused by Benigno Torzuela's act of shooting and killing Napoleon
Dulay, as stated in paragraphs 1 and 2 of the complaint. prLL
Article 2176 of the New Civil Code provides:
"ARTICLE 2176.
Whoever by act or omission causes damage to another, there
being fault or negligence, is obliged to pay for the damage done. Such fault or
negligence, if there is no pre-existing contractual relation between the parties is called
a quasi-delict and is governed by the provisions of this Chapter."
Contrary to the theory of private respondents, there is no justification for limiting the
scope of Article 2176 of the Civil Code to acts or omissions resulting from negligence.
Well-entrenched is the doctrine that Article 2176 covers not only acts committed with
negligence, but also acts which are voluntary and intentional. As far back as the
definitive case of Elcano v. Hill (77 SCRA 98 [1977]), this Court already held that:
". . . Article 2176, where it refers to "fault or negligence," covers not only acts "not
punishable by law" but also acts criminal in character, whether intentional and
voluntary or negligent. Consequently, a separate civil action lies against the offender
in a criminal act, whether or not he is criminally prosecuted and found guilty or
acquitted, provided that the offended party is not allowed, if he is actually charged also
criminally, to recover damages on both scores, and would be entitled in such
eventuality only to the bigger award of the two, assuming the awards made in the two
cases vary. In other words, the extinction of civil liability referred to in Par. (e) of
Section 3, Rule 111, refers exclusively to civil liability founded on Article 100 of the
Revised Penal Code, whereas the civil liability for the same act considered as quasidelict only and not as a crime is not extinguished even by a declaration in the criminal
case that the criminal act charged has not happened or has not been committed by
the accused. Briefly stated, We here hold, in reiteration of Garcia, that culpa aquiliana
includes voluntary and negligent acts which may be punishable by law." (Emphasis
supplied)

The same doctrine was echoed in the case of Andamo v. Intermediate Appellate Court
(191 SCRA 195 [1990]), wherein the Court held:
"Article 2176, whenever it refers to "fault or negligence," covers not only acts "not
punishable by law" but also acts criminal in character, whether intentional and
voluntary or negligent. Consequently, a civil action lies against the offender in a
criminal act, whether or not he is prosecuted or found guilty or acquitted, provided that
the offended party is not allowed, (if the tortfeasor is actually also charged criminally),
to recover damages on both scores, and would be entitled in such eventuality only to
the bigger award of the two, assuming the awards made in the two cases vary." [Citing
Virata v. Ochoa, 81 SCRA 472] (Emphasis supplied)
Private respondents submit that the word "intentional" in the Andamo case is
inaccurate obiter, and should be read as "voluntary" since intent cannot be coupled
with negligence as defined by Article 365 of the Revised Penal Code. In the absence
of more substantial reasons, this Court will not disturb the above doctrine on the
coverage of Article 2176.
Private respondents further aver that Article 33 of the New Civil Code applies only to
injuries intentionally committed pursuant to the ruling in Marcia v. CA (120 SCRA 193
[1983]), and that the actions for damages allowed thereunder are ex-delicto. However,
the term "physical injuries" in Article 33 has already been construed to include bodily
injuries causing death (Capuno v. Pepsi-Cola Bottling Co. of the Philippines 121 Phil.
638 [1965]; Carandang v. Santiago 97 Phil. 94 [1955]). It is not the crime of physical
injuries defined in the Revised Penal Code. It includes not only physical injuries but
also consummated, frustrated, and attempted homicide (Madeja v. Caro 126 SCRA
293 [1983]). Although in the Marcia case (supra), it was held that no independent civil
action may be filed under Article 33 where the crime is the result of criminal
negligence, it must be noted however, that Torzuela, the accused in the case at bar, is
charged with homicide, not with reckless imprudence, whereas the defendant in
Marcia was charged with reckless imprudence. Therefore, in this case, a civil action
based on Article 33 lies. Cdpr
Private respondents also contend that their liability is subsidiary under the Revised
Penal Code; and that they are not liable for Torzuela's act which is beyond the scope
of his duties as a security guard. It having been established that the instant action is
not ex-delicto, petitioners may proceed directly against Torzuela and the private
respondents. Under Article 2180 of the New Civil Code as aforequoted, when an injury
is caused by the negligence of the employee, there instantly arises a presumption of
law that there was negligence on the part of the master or employer either in the
selection of the servant or employee, or in supervision over him after selection or both
(Layugan v. Intermediate Appellate Court 167 SCRA 363 [1988]). The liability of the
employer under Article 2180 is direct and immediate; it is not conditioned upon prior
recourse against the negligent employee and a prior showing of the insolvency of such
employee (Kapalaran Bus Lines v. Coronado 176 SCRA 792 [1989]). Therefore, it is
incumbent upon the private respondents to prove that they exercised the diligence of a
good father of a family in the selection and supervision of their employee.

Since Article 2176 covers not only acts of negligence but also acts which are
intentional and voluntary, it was therefore erroneous on the part of the trial court to
dismiss petitioner's complaint simply because it failed to make allegations of attendant
negligence attributable to private respondents.
With respect to the issue of whether the complaint at hand states a sufficient cause of
action, the general rule is that the allegations in a complaint are sufficient to constitute
a cause of action against the defendants if, admitting the facts alleged, the court can
render a valid judgment upon the same in accordance with the prayer therein. A cause
of action exists if the following elements are present, namely: (1) a right in favor of the
plaintiff by whatever means and under whatever law it arises or is created; (2) an
obligation on the part of the named defendant to respect or not to violate such right;
and (3) an act or omission on the part of such defendant violative of the right of the
plaintiff or constituting a breach of the obligation of the defendant to the plaintiff for
which the latter may maintain an action for recovery of damages. (Del Bros Hotel
Corporation v. CA, 210 SCRA 33 [1992]); Development Bank of the Philippines v.
Pundogar 218 SCRA 118 [1993]).
This Court finds, under the foregoing premises, that the complaint sufficiently alleged
an actionable breach on the part of the defendant Torzuela and respondents
SUPERGUARD and/or SAFEGUARD. It is enough that the complaint alleged that
Benigno Torzuela shot Napoleon Dulay resulting in the latter's death; that the shooting
occurred while Torzuela was on duty; and that either SUPERGUARD and/or
SAFEGUARD was Torzuela's employer and responsible for his acts. This does not
operate however, to establish that the defendants below are liable. Whether or not the
shooting was actually reckless and wanton or attended by negligence and whether it
was actually done within the scope of Torzuela's duties; whether the private
respondents SUPERGUARD and/or SAFEGUARD failed to exercise the diligence of a
good father of a family; and whether the defendants are actually liable, are questions
which can be better resolved after trial on the merits where each party can present
evidence to prove their respective allegations and defenses.
In determining whether the allegations of a complaint are sufficient to support a cause
of action, it must be borne in mind that the complaint does not have to establish or
allege the facts proving the existence of a cause of action at the outset; this will have
to be done at the trial on the merits of the case (Del Bros Hotel Corporation v. CA,
supra). If the allegations in a complaint can furnish a sufficient basis by which the
complaint can be maintained, the same should not be dismissed regardless of the
defenses that may be assessed by the defendants (Rava Dev't. Corp. v. CA, 211
SCRA 152 [1992] citing Consolidated Bank & Trust Corporation v. Court of Appeals,
197 SCRA 663 [1991]). To sustain a motion to dismiss for lack of cause of action, the
complaint must show that the claim for relief does not exist rather than that a claim
has been defectively stated or is ambiguous, indefinite or uncertain (Azur v. Provincial
Board, 27 SCRA 50 [1969]). Since the petitioners clearly sustained an injury to their
rights under the law, it would be more just to allow them to present evidence of such
injury. cdrep

WHEREFORE, premises considered, the petition for review is hereby GRANTED. The
decision of the Court of Appeals as well as the Order of the Regional Trial Court dated
April 13, 1989 are hereby REVERSED and SET ASIDE. Civil Case No. Q-89-1751 is
remanded to the Regional Trial Court for trial on the merits. This decision is
immediately executory.SO ORDERED.
Air France vs. Carrascoso; G.R. No. L-21438 September 28, 1966
SYLLABUS
1.
JUDGMENT; FINDINGS OF FACT; REQUIREMENT OF LAW. Courts of
justice are not burdened with the obligation to specify in the sentence every bit and
piece of evidence presented by the parties upon the issues raised. The law solely
insists that a decision state the "essential ultimate facts" upon which the court's
conclusion is drawn.
2.
ID.; ID.; ID.; APPEAL AND ERROR; FAILURE TO MAKE FINDINGS ON
EVIDENCE AND CONTENTIONS OF ONE PARTY, EFFECT OF; DECISION NOT
TO BE CLOGGED WITH DETAILS. The mere failure to make specific findings of
fact on the evidence presented for the defense or to specify in the decision the
contentions of the appellant and the reasons for refusing to believe them is not
sufficient to hold the same contrary to the requirement of the law and the Constitution.
There is no law that so requires. A decision is not to be clogged with details such that
prolixity, if not confusion, may result.
3.
ID.; ID.; ID.; FINDINGS OF FACT BY COURTS DEFINED. Findings of
fact may be defined as the written statement of the ultimate facts as found by the court
and essential to support the decision and judgment rendered thereon; they consist of
the court's "conclusions with respect to the determinative facts on issue."
4.
ID.; ID.; ID.; QUESTION OF LAW EXPLAINED. A question of law is "one
which does not call for an examination of the probative value of the evidence
presented by the parties."
5.
PLEADING AND PRACTICE; APPEAL; WHAT MAY BE RAISED ON
APPEAL FROM COURT OF APPEALS. It is not appropriately the business of the
Supreme Court to alter the facts or to review the questions of fact because, by statute,
only questions of law may be raised in an appeal by certiorari from a judgment of the
Court of Appeals, which judgment is conclusive as to the facts.
6.
ID.; ID.; EFFECT OF AFFIRMANCE BY COURT OF APPEALS OF TRIAL
COURT'S DECISION. When the Court of Appeals affirms a judgment of the trial
court, and the findings of fact of said appellate court are not in any way at war with
those of the trial court, nor is said affirmance upon a ground or grounds different from
those which were made the basis of the trial court's conclusions, such judgment of
affirmance is (1) a determination by the Court of Appeals that the proceeding in the
lower court was free from prejudicial error; (7) that all questions raised by the

assignments of error and all questions that might have been so raised have been
finally adjudicated as free from all error.
7.
ID.; COMPLAINT; SPECIFIC MENTION OF THE TERM "BAD FAITH" IN
THE COMPLAINT NOT REQUIRED. Although there is no specific mention of the
term bad faith in the complaint, the inference of bad faith may be drawn from the facts
and circumstances set forth therein. 8. EVIDENCE; FINDING OF COURT OF
APPEALS THAT RESPONDENT WAS ENTITLED TO A FIRST CLASS SEAT. The
Court of Appeals properly found that a first class-ticket holder is entitled to first class
seat, given the fact that seat availability in specific flights is therein confirmed;
otherwise, an air passenger will be placed in the hollow of the hands of an airline,
because it will always be easy for an airline to strike out the very stipulations in the
ticket and say that there was verbal agreement to the contrary. If only to achieve
stability in the relations between passenger and air carrier, adherence to the ticket so
issued is desirable.
9.
ID.; LACK OF SPECIFIC AVERMENT OF BAD FAITH CURED BY NOTICE
TO DEFENDANT OF WHAT PLAINTIFF INTENDS TO PROVE AND BY EVIDENCE
PRESENTED WITHOUT OBJECTION; AMENDMENT OF COMPLAINT TO
CONFORM TO EVIDENCE UNNECESSARY. If there was lack of specific
averment of bad faith in the complaint, such deficiency was cured by notice, right at
the start of the trial, by plaintiff's counsel to defendant as to what plaintiff intended to
prove: while in the plane in Bangkok, plaintiff was ousted by defendant's manager who
gave his seat to a white man; and by evidence of bad faith in the fulfillment of the
contract presented without objection on the part of the defendant. An amendment of
the complaint to conform to the evidence is not even required.

13.
ID.; ID.; ID.; EMPLOYER IS RESPONSIBLE FOR TORTIOUS ACTS OF
HIS EMPLOYEE; CASE AT BAR. The responsibility of an employer for the tortious
act of his employees is well settled in law. (Art. 2130, Civil Code). Petitioner-aircarrier
must answer for the willful, malevolent act of its manager.
14.
ID.; ID.; ID.; LIABILITY FOR EXEMPLARY DAMAGES; POWER OF
COURTS TO GRANT; CASE AT BAR. The Civil Code gives the court ample power
to grant exemplary damages, the only condition being that defendant should have
"acted in a wanton, fraudulent, reckless, oppressive, or malevolent manner." As the
manner of ejectment of plaintiff from his first class seat fits into this legal precept,
exemplary damages are well awarded, in addition to moral damages.
15.
ID.; ID.; LIABILITY FOR ATTORNEY'S FEES; COURT DISCRETION WELL
EXERCISED SHOULD NOT BE DISTURBED. The grant of exemplary damages
justifies a similar judgment for attorney's fees. The court below felt that it is but just
and equitable that attorney's fees be given and the Supreme Court does not intend to
break faith with the tradition that discretion well-exercised as it is here should not
be disturbed.
16.
ID.; RIGHTS OF PASSENGERS. Passengers do not contract merely for
transportation. They have a right to be treated by the carrier's employees with
kindness, respect, courtesy and due consideration. They are entitled to be protected
against personal misconduct, injurious language, indignities and abuses from such
employees. So, any rude or discourteous conduct on the part of employees towards a
passenger gives the latter an action for damages against the carrier. (4 R. C. L-11741175).

10.
ID.; ADMISSIBILITY OF TESTIMONY ON AN ENTRY IN A NOTEBOOK;
TESTIMONY NOT COVERED BY BEST EVIDENCE RULE. The testimony of a
witness that the purser made an entry in his notebook reading "First Class passenger
was forced to go to the tourist class against his will and that the captain refused to
intervene," is competent and admissible because the subject of the inquiry is not the
entry but the ouster incident. It does not come within the prescription of the best
evidence rule.

17.
ID.; BREACH OF CONTRACT MAY BE A TORT. Although the relation of
passenger and carrier is contractual both in origin and nature, nevertheless, the act
that breaks the contract may also be a tort.

11.
CONTRACT OF CARRIAGE; QUASI-DELICT; LIABILITY OF COMMON
CARRIERS; CASE AT BAR. Neglect or malfeasance of the carrier's employees
could give ground for an action for damages. Damages here are proper because the
stress of respondent's action is placed upon his wrongful expulsion, which is a
violation of a public duty by petitioner-aircarrier a case of quasi-delict.

DECISION

12.
ID.; ID.; ID.; AWARD OF MORAL DAMAGES FOR BREACH OF
CONTRACT. Award of moral damages is proper, despite petitioner's argument that
respondent's action is planted upon breach of contract, where the stress of the action
is put on wrongful expulsion, the contract having been averred only to establish the
relation between the parties.

18.
WORDS AND PHRASES; BAD FAITH DEFINED. "Bad faith", as
understood in law, contemplates a state of mind affirmatively operating with furtive
design or with some motive of self-interest or ill will or for ulterior purpose

SANCHEZ, J p:
The Court of First Instance of Manila 1 sentenced petitioner to pay respondent Rafael
Carrascoso P25,000.00 by way of moral damages; P10,000.00 as exemplary
damages; P393.20 representing the difference in fare between first class and tourist
class for the portion of the trip Bangkok-Rome, these various amounts with interest at
the legal rate, from the date of the filing of the complaint until paid; plus P3,000.00 for
attorneys' fees; and the costs of suit.

On appeal, 2 the Court of Appeals slightly reduced the amount of refund on

Carrascoso's plane ticket from P393.20 to P383.10, and voted to affirm the appealed
decision "in all other respects", with costs against petitioner.
The case is now before us for review on certiorari.
The facts declared by the Court of Appeals as "fully supported by the evidence of
record", are:
"Plaintiff, a civil engineer, was a member of a group of 48 Filipino pilgrims that left
Manila for Lourdes on March 30, 1958.
On March 28, 1958, the defendant, Air France, through its authorized agent, Philippine
Air Lines, Inc., issued to plaintiff a 'first class' round trip airplane ticket from Manila to
Rome. From Manila to Bangkok, plaintiff traveled in 'first class', but at Bangkok, the
Manager of the defendant airline forced plaintiff to vacate the 'first class' seat that he
was occupying because, in the words of the witness Ernesto G. Cuento, there was a
'white man', who, the Manager alleged, had a 'better right to the seat. When asked to
vacate his 'first class' seat, the plaintiff, as was to be expected, refused, and told
defendant's Manager that his seat would be taken over his dead body; a commotion
ensued, and, according to said Ernesto G. Cuento, many of the Filipino passengers
got nervous in the tourist class; when they found out that Mr. Carrascoso was having a
hot discussion with the white man [manager], they came all across to Mr. Carrascoso
and pacified Mr. Carrascoso to give his seat to the 'white man' (Transcript, p. 12,
Hearing of May 26, 1959); and plaintiff reluctantly gave his 'first class' seat in the
plane." 3
1.
The thrust of the relief petitioner now seeks is that we review "all the
findings" 4 of respondent Court of Appeals. Petitioner charges that respondent court
failed to make complete findings of fact on all the issues properly laid before it. We are
asked to consider facts favorable to petitioner, and then, to overturn the appellate
court's decision.
Coming into focus is the constitutional mandate that "No decision shall be rendered by
any court of record without expressing therein clearly and distinctly the facts and the
law on which it is based". 5 This is echoed in the statutory demand that a judgment
determining the merits of the case shall state "clearly and distinctly the facts and the
law on which it is based", 6 and that "Every decision of the Court of Appeals shall
contain complete findings of fact on all issues properly raised before it." 7
A decision with absolutely nothing to support it is a nullity. It is open to direct attack. 8
The law, however, solely insists that a decision state the "essential ultimate facts"
upon which the court's conclusion is drawn. 9 A court of justice is not hidebound to
write in its decision every bit and piece of evidence 10 presented by one party and the
other upon the issues raised. Neither is it to be burdened with the obligation "to
specify in the sentence the facts" which a party "considered as proved". 11 This is but
a part of the mental process from which the Court draws the essential ultimate facts. A
decision is not to be so clogged with details such that prolixity, if not confusion, may

result. So long as the decision of the Court of Appeals contains the necessary facts to
warrant its conclusions, it is no error for said court to withhold therefrom "any specific
finding of facts with respect to the evidence for the defense". Because, as this Court
well observed, "There is no law that so requires". 12 Indeed, "the mere failure to
specify (in the decision) the contentions of the appellant and the reasons for refusing
to believe them is not sufficient to hold the same contrary to the requirements of the
provisions of law and the Constitution". It is in this setting that in Manigque, it was held
that the mere fact that the findings "were based entirely on the evidence for the
prosecution without taking into consideration or even mentioning the appellant's side
in the controversy as shown by his own testimony", would not vitiate the judgment. 13
If the court did not recite in the decision the testimony of each witness for, or each
item of evidence presented by, the defeated party, it does not mean that the court has
overlooked such testimony or such item of evidence. 14 At any rate, the legal
presumptions are that official duty has been regularly performed, and that all the
matters within an issue in a case were laid before the court and passed upon by it. 15
Findings of fact, which the Court of Appeals is required to make, may be defined as
"the written statement of the ultimate facts as found by the court . . . and essential to
support the decision and judgment rendered thereon". 16 They consist of the court's
"conclusions with respect to the determinative facts in issue" 17 A question of law,
upon the other hand, has been declared as "one which does not call for an
examination of the probative value of the evidence presented by the parties." 18
2.
By statute, "only questions of law may be raised" in an appeal by certiorari
from a judgment of the Court of Appeals 19 That judgment is conclusive as to the
facts. It is not appropriately the business of this Court to alter the facts or to review the
questions of fact. 20
With these guideposts, we now face the problem of whether the findings of fact of the
Court of Appeals support its judgment.
3.

Was Carrascoso entitled to the first class seat he claims?

It is conceded in all quarters that on March 28, 1958 he paid to and received from
petitioner a first class ticket. But petitioner asserts that said ticket did not represent the
true and complete intent and agreement of the parties; that said respondent knew that
he did not have confirmed reservations for first class on any specific flight, although he
had tourist class protection; that, accordingly, the issuance of a first class ticket was
no guarantee that he would have a first class ride, but that such would depend upon
the availability of first class seats.
These are matters which petitioner has thoroughly presented and discussed in its brief
before the Court of Appeals under its third assignment of error, which reads: "The trial
court erred in finding that plaintiff had confirmed reservations for, and a right to, first
class seats on the 'definite' segments of his journey, particularly that from Saigon to
Beirut." 21
And, the Court of Appeals disposed of this contention thus:

"Defendant seems to capitalize on the argument that the issuance of a first-class ticket
was no guarantee that the passenger to whom the same had been issued, would be
accommodated in the first-class compartment, for as in the case of plaintiff he had yet
to make arrangements upon arrival at every station for the necessary first class
reservation. We are not impressed by such a reasoning. We cannot understand how a
reputable firm like defendant airplane company could have the indiscretion to give out
ticket it never meant to honor at all. It received the corresponding amount in payment
of first-class tickets end yet it allowed the passenger to be at the mercy of its
employees. It is more in keeping with the ordinary course of business that the
company should know whether or not the tickets it issues are to be honored or not."
22
Not that the Court of Appeals is alone. The trial court similarly disposed of petitioner's
contention, thus:
"On the fact that plaintiff paid for, and was issued a 'First class ticket, there can be no
question. Apart from his testimony, see plaintiffs Exhibits 'A', 'A-1' 'B', 'B-1', 'B-2', 'C'
and 'C-1', and defendant's own witness, Rafael Altonaga, confirmed plaintiff's
testimony and testified as follows:
Q.
In these tickets there are marks 'O.K.' From what you know, what does this
O.K. mean?
A.

That the space is confirmed.

Q.

Confirmed for first class?

A.

Yes, 'first class'. (Transcript, p. 169)

xxx

xxx

xxx

"Defendant tried to prove by the testimony of its witnesses Luis Zaldariaga and Rafael
Altonaga that although plaintiff paid for, and was issued a 'first class' airplane ticket,
the ticket was subject to confirmation in Hongkong. The court cannot give credit to the
testimony of said witnesses. Oral evidence cannot prevail over written evidence, and
plaintiff's Exhibits 'A', 'A1', 'B', 'B-1', 'C' and 'C- 1' belie the testimony of said witnesses,
and clearly show that the plaintiff was issued, and paid for, a first class ticket without
any reservation whatever.
Furthermore, as hereinabove shown, defendant's own witness Rafael Altonaga
testified that the reservation for a 'first class' accommodation for the plaintiff was
confirmed. The court cannot believe that after such confirmation ,defendant had a
verbal understanding with plaintiff that the 'first class' ticket issued to him by defendant
would be subject to confirmation in Hongkong." 23
We have heretofore adverted to the fact that except for a slight difference of a few
pesos in the amount refunded on Carrascoso's ticket, the decision of the Court of First
Instance was affirmed by the Court of Appeals in all other respects. We hold the view
that such a judgment of affirmance has merged the judgment of the lower court. 24

Implicit in that affirmance is a determination by the Court of Appeals that the

proceeding in the Court of First Instance was free from prejudicial error and that 'all
questions raised by the assignments of error and all questions that might have been
so raised are to be regarded as finally adjudicated against the appellant". So also, the
judgment affirmed "must be regarded as free from all error" 25 We reached this policy
construction because nothing in the decision of the Court of Appeals on this point
would suggest that its findings of fact are in any way at war with those of the trial
court. Nor was said affirmance by the Court of Appeals upon a ground or grounds
different from those which were made the basis of the conclusions of the trial court. 26
If, as petitioner underscores, a first-class-ticket holder is not entitled to a first class
seat, notwithstanding the fact that seat availability in specific flights is therein
confirmed, then an air passenger is placed in the hollow of the hands of an airline.
What security then can a passenger have? It will always be an easy matter for an
airline aided by its employees, to strike out the very stipulations in the ticket, and say
that there was a verbal agreement to the contrary. What if the passenger had a
schedule to fulfill? We have long learned that, as a rule, a written document speaks a
uniform language; that spoken word could be notoriously unreliable. If only to achieve
stability in the relations between passenger and air carrier, adherence to the ticket so
issued is desirable. Such is the case here. The lower courts refused to believe the oral
evidence intended to defeat the covenants in the ticket.
The foregoing are the considerations which point to the conclusion that there are facts
upon which the Court of Appeals predicated the finding that respondent Carrascoso
had a first class ticket and was entitled to a first class seat at Bangkok, which is a
stopover in the Saigon to Beirut leg of the flight, 27 We perceive no "welter of
distortions by the Court of Appeals of petitioner's statement of its position", as charged
by petitioner. 28 Nor do we subscribe to petitioners accusation that respondent
Carrascoso "surreptitiously took a first class seat to provoke an issue". 29 And this
because, as petitioner states, Carrascoso went to see the Manager at his office in
Bangkok "to confirm my seat and because from Saigon I was told again to see the
Manager. 30 Why, then, was he allowed to take a first class seat in the plane at
Bangkok, if he had no seat? Or, if another had a better right to the seat?
4.
Petitioner assails respondent court's award of moral damages. Petitioner's
trenchant claim is that Carrascoso's action is planted upon breach of contract; that to
authorize an award for moral damages there must be an averment of fraud or bad
faith; 31 and that the decision of the Court of Appeals fails to make a finding of bad
faith. The pivotal allegations in the complaint bearing on this issue are:
"3.
That . . . plaintiff entered into a contract of air carriage with the Philippine Air
Lines for a valuable consideration, the latter acting as general agents for and in behalf
of the defendant, under which aid contract, plaintiff was entitled to, as defendant
agreed to furnish plaintiff, First Class passage on defendant's plane during the entire
duration of plaintiff's tour of Europe with Hongkong as starting point up to and until
plaintiff's return trip to Manila, . . .

4.
That during the first two legs of the trip from Hongkong to Saigon and from
Saigon to Bangkok, defendant furnished to the plaintiff First Class accommodation but
only after protestations, arguments and/or insistence were made by the plaintiff with
defendant's employees.
5.
That finally, defendant failed to provide First Class passage, but instead
furnished plaintiff only Tourist Class accommodations from Bangkok to Teheran
and/or Casablanca, . . . the plaintiff has been compelled by defendant's employees to
leave the First Class accommodation berths at Bangkok after he was already seated.
6.
That consequently, the plaintiff, desiring no repetition of the inconvenience
and embarrassments brought by defendant's breach of contract was forced to take a
Pan American World Airways plane on his return trip from Madrid to Manila. 32
xxx

xxx

xxx

2.
That likewise, as a result of defendant's failure to furnish First Class
accommodations aforesaid, plaintiff suffered inconveniences, embarrassments, and
humiliations, thereby causing plaintiff mental anguish, serious anxiety, wounded
feelings, social humiliation, and the like injury, resulting in moral damages in the
amount of P30,000.00." 33
xxx

xxx

xxx

The foregoing, in our opinion, substantially aver: First, That there was a contract to
furnish plaintiff a first class passage covering, amongst others, the Bangkok-Teheran
leg; Second, That said contract was breached when petitioner failed to furnish first
class transportation at Bangkok; and Third, That there was bad faith when petitioner's
employee compelled Carrascoso to leave his first class accommodation berth "after
he was already seated" and to take a seat in the tourist class, by reason of which he
suffered inconvenience, embarrassments and humiliations, thereby causing him
mental anguish, serious anxiety, wounded feelings and social humiliation, resulting in
moral damages. It is true that there is no specific mention of the term bad faith in the
complaint. But, the inference of bad faith is there; it may be drawn from the facts and
circumstances set forth therein. 34 The contract was averred to establish the relation
between the parties. But the stress of the action is put on wrongful expulsion.
Quite apart from the foregoing is that (a) right at the start of the trial, respondent's
counsel placed petitioner on guard on what Carrascoso intended to prove: That while
sitting in the plane in Bangkok, Carrascoso was ousted by petitioner's manager who
gave his seat to a white man; 35 and (b) evidence of bad faith in the fulfillment of the
contract was presented without objection on the part of the petitioner. It is, therefore,
unnecessary to inquire as to whether or not there is sufficient averment in the
complaint to justify an award for moral damages. Deficiency in the complaint, if any,
was cured by the evidence. An amendment thereof to conform to the evidence is not
even required. 36 On the question of bad faith, the Court of Appeals declared:

"That the plaintiff was forced out of his seat in the first class compartment of the plane
belonging to the defendant Air France while at Bangkok, and was transferred to the
tourist class not only without his consent but against his will, has been sufficiently
established by plaintiff in his testimony before the court, corroborated by the
corresponding entry made by the purser of the plane in his notebook which notation
reads as follows:
'First-class passenger was forced to go to the tourist class against his will and that the
captain refused to intervene',
and by the testimony of an eye-witness Ernesto G. Cuento, who was a co-passenger.
The captain of the plane who was asked by the manager of defendant company at
Bangkok to intervene even refused to do so. It is noteworthy that no one on behalf of
defendant ever contradicted or denied this evidence for the plaintiff. It could have been
easy for defendant to present its manager at Bangkok to testify at the trial of the case,
or yet to secure his deposition; but defendant did neither. 37
The Court of Appeals further stated
"Neither is there evidence as to whether or ,not a prior reservation was made by the
white man. Hence, if the employees of the defendant at Bangkok sold a first-class
ticket to him when all the seats had already been taken, surely the plaintiff should not
have been picked out as the one to suffer the consequences and to be subjected to
the humiliation and indignity of being ejected from his seat in the presence of others.
Instead of explaining to the white man the improvidence committed by defendant's
employees, the manager adopted the more drastic step of ousting the plaintiff who
was then safely ensconced in his rightful seat. We are strengthened in our belief that
this probably was what happened there, by the testimony of defendant's witness
Rafael Altonaga who, when asked to explain the meaning of the letters 'O.K.,
appearing on the tickets of plaintiff, said that 'the space is confirmed' for first class.
Likewise, Zenaida Faustino, another witness for defendant, who was the chief of the
Reservation Office of defendant, testified as follows:
'Q.
How does the person in the ticket-issuing office know what reservation the
passenger has arranged with you?
A.
They call us up by phone and ask for the confirmation.' (t.s.n., p. 247, June
19, 1959)
In this connection, we quote with approval what the trial Judge has said on this point:
'Why did the, using the words of witness Ernesto G. Cuento, 'white man' have a 'better
right' to the seat occupied by Mr. Carrascoso? The record is silent. The defendant
airline did not prove 'any better', nay, any right on the part of the 'white man' to the
'First class' seat that the plaintiff was occupying and for which he paid and was issued
a corresponding 'first class' ticket.

'If there was a justified reason for the action of the defendant's Manager in Bangkok,
the defendant could have easily proven it by having taken the testimony of the said
Manager by deposition, but defendant did not do so; the presumption is that evidence
willfully suppressed would be adverse if produced [Sec. 69, par. (e) Rules of Court];
and, under the circumstances, the Court is constrained to find, as it does find, that the
Manager of the defendant airline in Bangkok not merely asked but threatened the
plaintiff to throw him out of the plane if he did not give up his 'first class' seat because
the said Manager wanted to accommodate using the words of the witness Ernesto G.
Cuento, the 'white man'." 38
It is really correct to say that the Court of Appeals in the quoted portion first
transcribed did not use the term "bad faith". But can it be doubted that the recital of
facts therein points to bad faith? The manager not only prevented Carrascoso from
enjoying his right to a first class seat; worse, he imposed his arbitrary will; he forcibly
ejected him from his seat, made him suffer the humiliation of having to go to the tourist
class compartment just to give way to another passenger whose right thereto has
not been established. Certainly, this is bad faith. Unless, of course, bad faith has
assumed a meaning different from what is understood in law. For, "bad faith"
contemplates a "state of mind affirmatively operating with furtive design or with some
motive of self-interest or ill will or for ulterior purposes." 39
And if the foregoing were not yet sufficient, there is the express finding of bad faith in
the judgment of the Court of First Instance, thus:
"The evidence shows that defendant violated its contract of transportation with plaintiff
in bad faith, with the aggravating circumstances that defendant's Manager in Bangkok
went to the extent of threatening the plaintiff in the presence of many passengers to
have him thrown out of the airplane to give the 'first class' seat that he was occupying
to, again using the words of witness Ernesto G. Cuento, a 'white man' whom he
(defendant's Manager) wished to accommodate, and the defendant has not proven
that this 'white man' had any 'better right' to occupy the 'first class' seat that the
plaintiff was occupying, duly paid for, and for which the corresponding 'first class' ticket
was issued by the defendant to him." 40
5.
The responsibility of an employer for the tortuous act of its employees-need
not be essayed. It is well settled in law. 41 For the willful malevolent act of petitioner's
manager, his employer, must answer. Article 21 of the Civil Code says:
"Art. 21. Any person who willfully causes loss or injury to another in a manner that is
contrary to morals, good customs or public policy shall compensate the latter for the
damage."

sustains with the public. Its business is mainly with the travelling public. It invites
people to avail of the comforts and advantages it offers. The contract of air carriage,
therefore, generates a relation attended with a public duty. Neglect or malfeasance of
the carrier's employees, naturally, could give ground for an action for damages.
Passengers do not contract merely for transportation. They have a light to be treated
by the carrier's employees with kindness, respect, courtesy and due consideration.
They are entitled to be protected against personal misconduct, injurious language,
indignities and abuses from such employees. So it is, that any rude or discourteous
conduct on the part of employees towards a passenger gives the latter an action for
damages against the carrier. 44
Thus, "Where a steamship company 45 had accepted a passenger's check, it was a
breach of contract and a tort, giving a right of action for its agent in the presence of
third persons to falsely notify her that the check was worthless and demand payment
under threat of ejection, though the language used was not insulting and she was not
ejected. 46 And this, because, altho the relation of passenger and carrier is
"contractual both in origin and nature" nevertheless "the act that breaks the contract
may be also a tort". 47 And in another case, "Where a passenger on a railroad train,
when the conductor came to collect his fare, tendered him the cash fare to a point
where the train was scheduled not to stop, and told him that as soon as the train
reached such point he would pay the cash fare from that point to destination, there
was nothing in the conduct of the passenger which justified the conductor in using
insulting language to him, as by calling him a lunatic," 48 and the Supreme Court of
South Carolina there held the carrier liable for the mental suffering of said passenger.
Petitioner's contract with Carrascoso is one attended with public duty. The stress of
Carrascoso's action as we have said, is placed upon his wrongful expulsion. This is a
violation of public duty by the petitioner-air carrier a case of quasi-delict. Damages
are proper.
7.

Petitioner draws our attention to respondent Carrascoso's testimony, thus

"Q.

You mentioned about an attendant. Who is that attendant and purser?

A.
When we left already that was already in the trip I could not help it. So
one of the flight attendants approached me and requested from me my ticket and I
said, What for? and she said, 'We will note that you were transferred to the tourist
class'. I said, 'Nothing of that kind. That is tantamount to accepting my transfer.' And I
also said, You are not going to note anything there because I am protesting to this
transfer.

In parallel circumstances, we applied the foregoing legal precept; and, we held that
upon the provisions of Article 2219 (10), Civil Code, moral damages are recoverable.
42

Q.

Was she able to note it?

A.

No, because I did not give my ticket.

6.
A contract to transport passengers is quite different in kind and degree from
any other contractual relation. 43 And this, because of the relation which an air-carrier

Q.

About that purser?

A.
Well, the seats there are so close that you feel uncomfortable and you don't
have enough leg room, I stood up and I went to the pantry that was next to me and the
purser was there. He told me, 'I have recorded the incident in my notebook.' He read it
and translated it to me because it was recorded in French 'First class passenger
was forced to go to the tourist class against his will, and that the captain refused to
intervene.'
MR. VALTE
I move to strike out the last part of the testimony of the witness because the
best evidence would be the notes. Your Honor.
COURT
I will allow that as part of his testimony." 49
Petitioner charges that the finding of the Court of Appeals that the purser made an
entry in his notebooks reading "First class passenger was forced to go to the tourist
class against his will, and that the captain refused to intervene" is predicated upon
evidence [Carrascoso's testimony above] which is incompetent. We do not think so.
The subject of inquiry is not the entry, but the ouster incident. Testimony of the entry
does not come within the proscription of the best evidence rule. Such testimony is
admissible. 49
Besides, from a reading of the transcript just quoted, when the dialogue happened, the
impact of the startling occurrence was still fresh and continued to be felt. The
excitement had not as yet died down. Statements then, in this environment, are
admissible as part of the res gestae. 50 For, they grow "out of the nervous excitement
and mental and physical condition of the declarant". 51 The utterance of the purser
regarding his entry in the notebook was spontaneous, and related to the
circumstances of the ouster incident. Its trustworthiness has been guaranteed. 52 It
thus escapes the operation of the hearsay rule. It forms part of the res gestae.
At all events, the entry was made outside the Philippines. And, by an employee of
petitioner. It would have been an easy matter for petitioner to have contradicted
Carrascoso's testimony. If it were really true that no such entry was made, the
deposition of the purser could have cleared up the matter.
We, therefore, hold that the transcribed testimony of Carrascoso is admissible in
evidence.
8.
Exemplary damages are well awarded. The Civil Code gives the Court
ample power to grant exemplary damages in contracts and quasi-contracts. The
only condition is that defendant should have "acted in a wanton, fraudulent, reckless,
oppressive, or malevolent manner". 53 The manner of ejectment of respondent
Carrascoso from his first class seat fits into this legal precept. And this, in addition to
moral damages. 54

9.
The right to attorneys' fees is fully established. The grant of exemplary
damages justifies a similar judgment for attorneys' fees. The least that can be said is
that the courts below felt that it is but just and equitable that attorneys' fees be given.
55 We do not intend to break faith with the tradition that discretion well exercised as
it was here should not be disturbed.
10.
Questioned as excessive are the amounts decreed by both the trial court
and the Court of Appeals, thus: P25,000.00 as moral damages; P10,000.00, by way of
exemplary damages, and P3,000.00 as attorney's fees. The task of fixing these
amounts is primarily with the trial-court. 56 The Court of Appeals did not interfere with
the same. The dictates of good sense suggest that we give our imprimatur thereto.
Because, the facts and circumstances point to the reasonableness thereof. 57
On balance, we say that the judgment of the Court of Appeals does not suffer from
reversible error. We accordingly vote to affirm the same. Costs against petitioner. So
ordered.
VILORIA V CONTINENTAL AIRLINES; (G.R. No. 188288 January 16, 2012)
REYES, J.:
This is a petition for review under Rule 45 of the Rules of Court from the January 30,
2009 Decision1 of the Special Thirteenth Division of the Court of Appeals (CA) in CAG.R. CV No. 88586 entitled "Spouses Fernando and Lourdes Viloria v. Continental
Airlines, Inc.," the dispositive portion of which states:
WHEREFORE, the Decision of the Regional Trial Court, Branch 74, dated 03 April
2006, awarding US$800.00 or its peso equivalent at the time of payment, plus legal
rate of interest from 21 July 1997 until fully paid, [P]100,000.00 as moral damages,
[P]50,000.00 as exemplary damages, [P]40,000.00 as attorneys fees and costs of suit
to plaintiffs-appellees is hereby REVERSED and SET ASIDE.
Defendant-appellants counterclaim is DENIED.
Costs against plaintiffs-appellees.
SO ORDERED.2
On April 3, 2006, the Regional Trial Court of Antipolo City, Branch 74 (RTC) rendered
a Decision, giving due course to the complaint for sum of money and damages filed by
petitioners Fernando Viloria (Fernando) and Lourdes Viloria (Lourdes), collectively
called Spouses Viloria, against respondent Continental Airlines, Inc. (CAI). As culled
from the records, below are the facts giving rise to such complaint.
On or about July 21, 1997 and while in the United States, Fernando purchased for
himself and his wife, Lourdes, two (2) round trip airline tickets from San Diego,
California to Newark, New Jersey on board Continental Airlines. Fernando purchased
the tickets at US$400.00 each from a travel agency called "Holiday Travel" and was
attended to by a certain Margaret Mager (Mager). According to Spouses Viloria,

Fernando agreed to buy the said tickets after Mager informed them that there were no
available seats at Amtrak, an intercity passenger train service provider in the United
States. Per the tickets, Spouses Viloria were scheduled to leave for Newark on August
13, 1997 and return to San Diego on August 21, 1997.
Subsequently, Fernando requested Mager to reschedule their flight to Newark to an
earlier date or August 6, 1997. Mager informed him that flights to Newark via
Continental Airlines were already fully booked and offered the alternative of a round
trip flight via Frontier Air. Since flying with Frontier Air called for a higher fare of
US$526.00 per passenger and would mean traveling by night, Fernando opted to
request for a refund. Mager, however, denied his request as the subject tickets are
non-refundable and the only option that Continental Airlines can offer is the reissuance of new tickets within one (1) year from the date the subject tickets were
issued. Fernando decided to reserve two (2) seats with Frontier Air.
As he was having second thoughts on traveling via Frontier Air, Fernando went to the
Greyhound Station where he saw an Amtrak station nearby. Fernando made inquiries
and was told that there are seats available and he can travel on Amtrak anytime and
any day he pleased. Fernando then purchased two (2) tickets for Washington, D.C.
From Amtrak, Fernando went to Holiday Travel and confronted Mager with the Amtrak
tickets, telling her that she had misled them into buying the Continental Airlines tickets
by misrepresenting that Amtrak was already fully booked. Fernando reiterated his
demand for a refund but Mager was firm in her position that the subject tickets are
non-refundable.
Upon returning to the Philippines, Fernando sent a letter to CAI on February 11, 1998,
demanding a refund and alleging that Mager had deluded them into purchasing the
subject tickets.3
In a letter dated February 24, 1998, Continental Micronesia informed Fernando that
his complaint had been referred to the Customer Refund Services of Continental
Airlines at Houston, Texas.4
In a letter dated March 24, 1998, Continental Micronesia denied Fernandos request
for a refund and advised him that he may take the subject tickets to any Continental
ticketing location for the re-issuance of new tickets within two (2) years from the date
they were issued. Continental Micronesia informed Fernando that the subject tickets
may be used as a form of payment for the purchase of another Continental ticket,
albeit with a re-issuance fee.5
On June 17, 1999, Fernando went to Continentals ticketing office at Ayala Avenue,
Makati City to have the subject tickets replaced by a single round trip ticket to Los
Angeles, California under his name. Therein, Fernando was informed that Lourdes
ticket was non-transferable, thus, cannot be used for the purchase of a ticket in his
favor. He was also informed that a round trip ticket to Los Angeles was US$1,867.40
so he would have to pay what will not be covered by the value of his San Diego to
Newark round trip ticket.

In a letter dated June 21, 1999, Fernando demanded for the refund of the subject
tickets as he no longer wished to have them replaced. In addition to the dubious
circumstances under which the subject tickets were issued, Fernando claimed that
CAIs act of charging him with US$1,867.40 for a round trip ticket to Los Angeles,
which other airlines priced at US$856.00, and refusal to allow him to use Lourdes
ticket, breached its undertaking under its March 24, 1998 letter. 6
On September 8, 2000, Spouses Viloria filed a complaint against CAI, praying that
CAI be ordered to refund the money they used in the purchase of the subject tickets
with legal interest from July 21, 1997 and to payP1,000,000.00 as moral
damages, P500,000.00 as exemplary damages and P250,000.00 as attorneys fees.7
CAI interposed the following defenses: (a) Spouses Viloria have no right to ask for a
refund as the subject tickets are non-refundable; (b) Fernando cannot insist on using
the ticket in Lourdes name for the purchase of a round trip ticket to Los Angeles since
the same is non-transferable; (c) as Mager is not a CAI employee, CAI is not liable for
any of her acts; (d) CAI, its employees and agents did not act in bad faith as to entitle
Spouses Viloria to moral and exemplary damages and attorneys fees. CAI also
invoked the following clause printed on the subject tickets:
3. To the extent not in conflict with the foregoing carriage and other services
performed by each carrier are subject to: (i) provisions contained in this ticket, (ii)
applicable tariffs, (iii) carriers conditions of carriage and related regulations which are
made part hereof (and are available on application at the offices of carrier), except in
transportation between a place in the United States or Canada and any place outside
thereof to which tariffs in force in those countries apply.8
According to CAI, one of the conditions attached to their contract of carriage is the
non-transferability and non-refundability of the subject tickets.
The RTCs Ruling
Following a full-blown trial, the RTC rendered its April 3, 2006 Decision, holding that
Spouses Viloria are entitled to a refund in view of Magers misrepresentation in
obtaining their consent in the purchase of the subject tickets. 9The relevant portion of
the April 3, 2006 Decision states:
Continental Airlines agent Ms. Mager was in bad faith when she was less candid and
diligent in presenting to plaintiffs spouses their booking options. Plaintiff Fernando
clearly wanted to travel via AMTRAK, but defendants agent misled him into
purchasing Continental Airlines tickets instead on the fraudulent misrepresentation
that Amtrak was fully booked. In fact, defendant Airline did not specifically denied (sic)
this allegation.
Plainly, plaintiffs spouses, particularly plaintiff Fernando, were tricked into buying
Continental Airline tickets on Ms. Magers misleading misrepresentations. Continental
Airlines agent Ms. Mager further relied on and exploited plaintiff Fernandos need and
told him that they must book a flight immediately or risk not being able to travel at all

on the couples preferred date. Unfortunately, plaintiffs spouses fell prey to the airlines
and its agents unethical tactics for baiting trusting customers." 10
Citing Articles 1868 and 1869 of the Civil Code, the RTC ruled that Mager is CAIs
agent, hence, bound by her bad faith and misrepresentation. As far as the RTC is
concerned, there is no issue as to whether Mager was CAIs agent in view of CAIs
implied recognition of her status as such in its March 24, 1998 letter.
The act of a travel agent or agency being involved here, the following are the pertinent
New Civil Code provisions on agency:
Art. 1868. By the contract of agency a person binds himself to render some service or
to do something in representation or on behalf of another, with the consent or authority
of the latter.

relationship existed between CAI and Holiday Travel. According to the CA, Spouses
Viloria, who have the burden of proof to establish the fact of agency, failed to present
evidence demonstrating that Holiday Travel is CAIs agent. Furthermore, contrary to
Spouses Vilorias claim, the contractual relationship between Holiday Travel and CAI
is not an agency but that of a sale.
Plaintiffs-appellees assert that Mager was a sub-agent of Holiday Travel who was in
turn a ticketing agent of Holiday Travel who was in turn a ticketing agent of
Continental Airlines. Proceeding from this premise, they contend that Continental
Airlines should be held liable for the acts of Mager. The trial court held the same view.

The services rendered by Ms. Mager of Holiday Travel agency to the plaintiff spouses
on July 21, 1997 were no different from those offered in any other travel agency.
Defendant airline impliedly if not expressly acknowledged its principal-agent
relationship with Ms. Mager by its offer in the letter dated March 24, 1998 an obvious
attempt to assuage plaintiffs spouses hurt feelings. 11

We do not agree. By the contract of agency, a person binds him/herself to render

some service or to do something in representation or on behalf of another, with the
consent or authority of the latter. The elements of agency are: (1) consent, express or
implied, of the parties to establish the relationship; (2) the object is the execution of a
juridical act in relation to a third person; (3) the agent acts as a representative and not
for him/herself; and (4) the agent acts within the scope of his/her authority. As the
basis of agency is representation, there must be, on the part of the principal, an actual
intention to appoint, an intention naturally inferable from the principals words or
actions. In the same manner, there must be an intention on the part of the agent to
accept the appointment and act upon it. Absent such mutual intent, there is generally
no agency. It is likewise a settled rule that persons dealing with an assumed agent are
bound at their peril, if they would hold the principal liable, to ascertain not only the fact
of agency but also the nature and extent of authority, and in case either is
controverted, the burden of proof is upon them to establish it. Agency is never
presumed, neither is it created by the mere use of the word in a trade or business
name. We have perused the evidence and documents so far presented. We find
nothing except bare allegations of plaintiffs-appellees that Mager/Holiday Travel was
acting in behalf of Continental Airlines. From all sides of legal prism, the transaction in
issue was simply a contract of sale, wherein Holiday Travel buys airline tickets from
Continental Airlines and then, through its employees, Mager included, sells it at a
premium to clients.13

Furthermore, the RTC ruled that CAI acted in bad faith in reneging on its undertaking
to replace the subject tickets within two (2) years from their date of issue when it
charged Fernando with the amount of US$1,867.40 for a round trip ticket to Los
Angeles and when it refused to allow Fernando to use Lourdes ticket. Specifically:

The CA also ruled that refund is not available to Spouses Viloria as the word "nonrefundable" was clearly printed on the face of the subject tickets, which constitute their
contract with CAI. Therefore, the grant of their prayer for a refund would violate the
proscription against impairment of contracts.

Tickets may be reissued for up to two years from the original date of issue. When
defendant airline still charged plaintiffs spouses US$1,867.40 or more than double the
then going rate of US$856.00 for the unused tickets when the same were presented
within two (2) years from date of issue, defendant airline exhibited callous treatment of
passengers.12

Finally, the CA held that CAI did not act in bad faith when they charged Spouses
Viloria with the higher amount of US$1,867.40 for a round trip ticket to Los Angeles.
According to the CA, there is no compulsion for CAI to charge the lower amount of
US$856.00, which Spouses Viloria claim to be the fee charged by other airlines. The
matter of fixing the prices for its services is CAIs prerogative, which Spouses Viloria
cannot intervene. In particular:

Art. 1869. Agency may be express, or implied from the acts of the principal, from his
silence or lack of action, or his failure to repudiate the agency, knowing that another
person is acting on his behalf without authority.
Agency may be oral, unless the law requires a specific form.
As its very name implies, a travel agency binds itself to render some service or to do
something in representation or on behalf of another, with the consent or authority of
the latter. This court takes judicial notice of the common services rendered by travel
agencies that represent themselves as such, specifically the reservation and booking
of local and foreign tours as well as the issuance of airline tickets for a commission or
fee.

The Appellate Courts Ruling

On appeal, the CA reversed the RTCs April 3, 2006 Decision, holding that CAI cannot
be held liable for Magers act in the absence of any proof that a principal-agent

It is within the respective rights of persons owning and/or operating business entities
to peg the premium of the services and items which they provide at a price which they
deem fit, no matter how expensive or exhorbitant said price may seem vis--vis those

of the competing companies. The Spouses Viloria may not intervene with the business
judgment of Continental Airlines.14
The Petitioners Case

To determine the propriety of disturbing the CAs January 30, 2009 Decision and
whether Spouses Viloria have the right to the reliefs they prayed for, this Court deems
it necessary to resolve the following issues:
a. Does a principal-agent relationship exist between CAI and Holiday Travel?

In this Petition, this Court is being asked to review the findings and conclusions of the
CA, as the latters reversal of the RTCs April 3, 2006 Decision allegedly lacks factual
and legal bases. Spouses Viloria claim that CAI acted in bad faith when it required
them to pay a higher amount for a round trip ticket to Los Angeles considering CAIs
undertaking to re-issue new tickets to them within the period stated in their March 24,
1998 letter. CAI likewise acted in bad faith when it disallowed Fernando to use
Lourdes ticket to purchase a round trip to Los Angeles given that there is nothing in
Lourdes ticket indicating that it is non-transferable. As a common carrier, it is CAIs
duty to inform its passengers of the terms and conditions of their contract and
passengers cannot be bound by such terms and conditions which they are not made
aware of. Also, the subject contract of carriage is a contract of adhesion; therefore,
any ambiguities should be construed against CAI. Notably, the petitioners are no
longer questioning the validity of the subject contracts and limited its claim for a refund
on CAIs alleged breach of its undertaking in its March 24, 1998 letter.
The Respondents Case
In its Comment, CAI claimed that Spouses Vilorias allegation of bad faith is negated
by its willingness to issue new tickets to them and to credit the value of the subject
tickets against the value of the new ticket Fernando requested. CAI argued that
Spouses Vilorias sole basis to claim that the price at which CAI was willing to issue
the new tickets is unconscionable is a piece of hearsay evidence an advertisement
appearing on a newspaper stating that airfares from Manila to Los Angeles or San
Francisco cost US$818.00.15 Also, the advertisement pertains to airfares in September
2000 and not to airfares prevailing in June 1999, the time when Fernando asked CAI
to apply the value of the subject tickets for the purchase of a new one. 16 CAI likewise
argued that it did not undertake to protect Spouses Viloria from any changes or
fluctuations in the prices of airline tickets and its only obligation was to apply the value
of the subject tickets to the purchase of the newly issued tickets.
With respect to Spouses Vilorias claim that they are not aware of CAIs restrictions on
the subject tickets and that the terms and conditions that are printed on them are
ambiguous, CAI denies any ambiguity and alleged that its representative informed
Fernando that the subject tickets are non-transferable when he applied for the
issuance of a new ticket. On the other hand, the word "non-refundable" clearly
appears on the face of the subject tickets.
CAI also denies that it is bound by the acts of Holiday Travel and Mager and that no
principal-agency relationship exists between them. As an independent contractor,
Holiday Travel was without capacity to bind CAI.
Issues

b. Assuming that an agency relationship exists between CAI and Holiday Travel, is
CAI bound by the acts of Holiday Travels agents and employees such as Mager?
c. Assuming that CAI is bound by the acts of Holiday Travels agents and employees,
can the representation of Mager as to unavailability of seats at Amtrak be considered
fraudulent as to vitiate the consent of Spouse Viloria in the purchase of the subject
tickets?
d. Is CAI justified in insisting that the subject tickets are non-transferable and nonrefundable?
e. Is CAI justified in pegging a different price for the round trip ticket to Los Angeles
requested by Fernando?
f. Alternatively, did CAI act in bad faith or renege its obligation to Spouses Viloria to
apply the value of the subject tickets in the purchase of new ones when it refused to
allow Fernando to use Lourdes ticket and in charging a higher price for a round trip
ticket to Los Angeles?
This Courts Ruling
I. A principal-agent relationship exists between CAI and Holiday Travel.
With respect to the first issue, which is a question of fact that would require this Court
to review and re-examine the evidence presented by the parties below, this Court
takes exception to the general rule that the CAs findings of fact are conclusive upon
Us and our jurisdiction is limited to the review of questions of law. It is well-settled to
the point of being axiomatic that this Court is authorized to resolve questions of fact if
confronted with contrasting factual findings of the trial court and appellate court and if
the findings of the CA are contradicted by the evidence on record. 17
According to the CA, agency is never presumed and that he who alleges that it exists
has the burden of proof. Spouses Viloria, on whose shoulders such burden rests,
presented evidence that fell short of indubitably demonstrating the existence of such
agency.
We disagree. The CA failed to consider undisputed facts, discrediting CAIs denial that
Holiday Travel is one of its agents. Furthermore, in erroneously characterizing the
contractual relationship between CAI and Holiday Travel as a contract of sale, the CA
failed to apply the fundamental civil law principles governing agency and differentiating
it from sale.

In Rallos v. Felix Go Chan & Sons Realty Corporation, 18 this Court explained the
nature of an agency and spelled out the essential elements thereof:
Out of the above given principles, sprung the creation and acceptance of
the relationship of agencywhereby one party, called the principal (mandante),
authorizes another, called the agent (mandatario), to act for and in his behalf in
transactions with third persons. The essential elements of agency are: (1) there is
consent, express or implied of the parties to establish the relationship; (2) the object is
the execution of a juridical act in relation to a third person; (3) the agent acts as a
representative and not for himself, and (4) the agent acts within the scope of his
authority.1avvphi1
Agency is basically personal, representative, and derivative in nature. The authority of
the agent to act emanates from the powers granted to him by his principal; his act is
the act of the principal if done within the scope of the authority. Qui facit per alium facit
se. "He who acts through another acts himself."19
Contrary to the findings of the CA, all the elements of an agency exist in this case. The
first and second elements are present as CAI does not deny that it concluded an
agreement with Holiday Travel, whereby Holiday Travel would enter into contracts of
carriage with third persons on CAIs behalf. The third element is also present as it is
undisputed that Holiday Travel merely acted in a representative capacity and it is CAI
and not Holiday Travel who is bound by the contracts of carriage entered into by
Holiday Travel on its behalf. The fourth element is also present considering that CAI
has not made any allegation that Holiday Travel exceeded the authority that was
granted to it. In fact, CAI consistently maintains the validity of the contracts of carriage
that Holiday Travel executed with Spouses Viloria and that Mager was not guilty of
any fraudulent misrepresentation. That CAI admits the authority of Holiday Travel to
enter into contracts of carriage on its behalf is easily discernible from its February 24,
1998 and March 24, 1998 letters, where it impliedly recognized the validity of the
contracts entered into by Holiday Travel with Spouses Viloria. When Fernando
informed CAI that it was Holiday Travel who issued to them the subject tickets, CAI did
not deny that Holiday Travel is its authorized agent.
Prior to Spouses Vilorias filing of a complaint against it, CAI never refuted that it gave
Holiday Travel the power and authority to conclude contracts of carriage on its behalf.
As clearly extant from the records, CAI recognized the validity of the contracts of
carriage that Holiday Travel entered into with Spouses Viloria and considered itself
bound with Spouses Viloria by the terms and conditions thereof; and this constitutes
an unequivocal testament to Holiday Travels authority to act as its agent. This Court
cannot therefore allow CAI to take an altogether different position and deny that
Holiday Travel is its agent without condoning or giving imprimatur to whatever damage
or prejudice that may result from such denial or retraction to Spouses Viloria, who
relied on good faith on CAIs acts in recognition of Holiday Travels authority. Estoppel
is primarily based on the doctrine of good faith and the avoidance of harm that will
befall an innocent party due to its injurious reliance, the failure to apply it in this case
would result in gross travesty of justice.20 Estoppel bars CAI from making such denial.

As categorically provided under Article 1869 of the Civil Code, "[a]gency may be
express, or implied from the acts of the principal, from his silence or lack of action, or
his failure to repudiate the agency, knowing that another person is acting on his behalf
without authority."
Considering that the fundamental hallmarks of an agency are present, this Court finds
it rather peculiar that the CA had branded the contractual relationship between CAI
and Holiday Travel as one of sale. The distinctions between a sale and an agency are
not difficult to discern and this Court, as early as 1970, had already formulated the
guidelines that would aid in differentiating the two (2) contracts. In Commissioner of
Internal Revenue v. Constantino,21 this Court extrapolated that the primordial
differentiating consideration between the two (2) contracts is the transfer of ownership
or title over the property subject of the contract. In an agency, the principal retains
ownership and control over the property and the agent merely acts on the principals
behalf and under his instructions in furtherance of the objectives for which the agency
was established. On the other hand, the contract is clearly a sale if the parties
intended that the delivery of the property will effect a relinquishment of title, control
and ownership in such a way that the recipient may do with the property as he
pleases.
Since the company retained ownership of the goods, even as it delivered possession
unto the dealer for resale to customers, the price and terms of which were subject to
the company's control, the relationship between the company and the dealer is one of
agency, tested under the following criterion:
"The difficulty in distinguishing between contracts of sale and the creation of an
agency to sell has led to the establishment of rules by the application of which this
difficulty may be solved. The decisions say the transfer of title or agreement to transfer
it for a price paid or promised is the essence of sale. If such transfer puts the
transferee in the attitude or position of an owner and makes him liable to the transferor
as a debtor for the agreed price, and not merely as an agent who must account for the
proceeds of a resale, the transaction is a sale; while the essence of an agency to sell
is the delivery to an agent, not as his property, but as the property of the principal, who
remains the owner and has the right to control sales, fix the price, and terms, demand
and receive the proceeds less the agent's commission upon sales made. 1 Mechem
on Sales, Sec. 43; 1 Mechem on Agency, Sec. 48; Williston on Sales, 1; Tiedeman on
Sales, 1." (Salisbury v. Brooks, 94 SE 117, 118-119)22
As to how the CA have arrived at the conclusion that the contract between CAI and
Holiday Travel is a sale is certainly confounding, considering that CAI is the one
bound by the contracts of carriage embodied by the tickets being sold by Holiday
Travel on its behalf. It is undisputed that CAI and not Holiday Travel who is the party
to the contracts of carriage executed by Holiday Travel with third persons who desire
to travel via Continental Airlines, and this conclusively indicates the existence of a
principal-agent relationship. That the principal is bound by all the obligations
contracted by the agent within the scope of the authority granted to him is clearly

provided under Article 1910 of the Civil Code and this constitutes the very notion of
agency.

either by instructing or authorizing Holiday Travel and Mager to issue the said
misrepresentation.

II. In actions based on quasi-delict, a principal can only be held liable for the tort
committed by its agents employees if it has been established by
preponderance of evidence that the principal was also at fault or negligent or
that the principal exercise control and supervision over them.

It may seem unjust at first glance that CAI would consider Spouses Viloria bound by
the terms and conditions of the subject contracts, which Mager entered into with them
on CAIs behalf, in order to deny Spouses Vilorias request for a refund or Fernandos
use of Lourdes ticket for the re-issuance of a new one, and simultaneously claim that
they are not bound by Magers supposed misrepresentation for purposes of avoiding
Spouses Vilorias claim for damages and maintaining the validity of the subject
contracts. It may likewise be argued that CAI cannot deny liability as it benefited from
Magers acts, which were performed in compliance with Holiday Travels obligations
as CAIs agent.

Considering that Holiday Travel is CAIs agent, does it necessarily follow that CAI is
liable for the fault or negligence of Holiday Travels employees? Citing China Air Lines,
Ltd. v. Court of Appeals, et al.,23 CAI argues that it cannot be held liable for the actions
of the employee of its ticketing agent in the absence of an employer-employee
relationship.
An examination of this Courts pronouncements in China Air Lines will reveal that an
airline company is not completely exonerated from any liability for the tort committed
by its agents employees. A prior determination of the nature of the passengers cause
of action is necessary. If the passengers cause of action against the airline company
is premised on culpa aquiliana or quasi-delict for a tort committed by the employee of
the airline companys agent, there must be an independent showing that the airline
company was at fault or negligent or has contributed to the negligence or tortuous
conduct committed by the employee of its agent. The mere fact that the employee of
the airline companys agent has committed a tort is not sufficient to hold the airline
company liable. There is novinculum juris between the airline company and its agents
employees and the contractual relationship between the airline company and its agent
does not operate to create a juridical tie between the airline company and its agents
employees. Article 2180 of the Civil Code does not make the principal vicariously
liable for the tort committed by its agents employees and the principal-agency
relationship per se does not make the principal a party to such tort; hence, the need to
prove the principals own fault or negligence.
On the other hand, if the passengers cause of action for damages against the airline
company is based on contractual breach or culpa contractual, it is not necessary that
there be evidence of the airline companys fault or negligence. As this Court previously
stated in China Air Lines and reiterated in Air France vs. Gillego,24 "in an action based
on a breach of contract of carriage, the aggrieved party does not have to prove that
the common carrier was at fault or was negligent. All that he has to prove is the
existence of the contract and the fact of its non-performance by the carrier."
Spouses Vilorias cause of action on the basis of Magers alleged fraudulent
misrepresentation is clearly one of tort or quasi-delict, there being no pre-existing
contractual relationship between them. Therefore, it was incumbent upon Spouses
Viloria to prove that CAI was equally at fault.
However, the records are devoid of any evidence by which CAIs alleged liability can
be substantiated. Apart from their claim that CAI must be held liable for Magers
supposed fraud because Holiday Travel is CAIs agent, Spouses Viloria did not
present evidence that CAI was a party or had contributed to Magers complained act

However, a persons vicarious liability is anchored on his possession of control,

whether absolute or limited, on the tortfeasor. Without such control, there is nothing
which could justify extending the liability to a person other than the one who
committed the tort. As this Court explained in Cangco v. Manila Railroad Co.:25
With respect to extra-contractual obligation arising from negligence, whether of
act or omission, it is competent for the legislature to elect and our Legislature has
so elected to limit such liability to cases in which the person upon whom such an
obligation is imposed is morally culpable or, on the contrary, for reasons of public
policy, to extend that liability, without regard to the lack of moral culpability, so
as to include responsibility for the negligence of those persons whose acts or
omissions are imputable, by a legal fiction, to others who are in a position to
exercise an absolute or limited control over them. The legislature which adopted
our Civil Code has elected to limit extra-contractual liability with certain well-defined
exceptions to cases in which moral culpability can be directly imputed to the
persons to be charged. This moral responsibility may consist in having failed to
exercise due care in one's own acts, or in having failed to exercise due care in the
selection and control of one's agent or servants, or in the control of persons who, by
reasons of their status, occupy a position of dependency with respect to the person
made liable for their conduct.26 (emphasis supplied)
It is incumbent upon Spouses Viloria to prove that CAI exercised control or
supervision over Mager by preponderant evidence. The existence of control or
supervision cannot be presumed and CAI is under no obligation to prove its denial or
nugatory assertion. Citing Belen v. Belen,27 this Court ruled in Jayme v. Apostol,28 that:
In Belen v. Belen, this Court ruled that it was enough for defendant to deny an alleged
employment relationship. The defendant is under no obligation to prove the negative
averment. This Court said:
"It is an old and well-settled rule of the courts that the burden of proving the action is
upon the plaintiff, and that if he fails satisfactorily to show the facts upon which he
bases his claim, the defendant is under no obligation to prove his exceptions. This
[rule] is in harmony with the provisions of Section 297 of the Code of Civil Procedure

holding that each party must prove his own affirmative allegations, etc." 29 (citations
omitted)
Therefore, without a modicum of evidence that CAI exercised control over Holiday
Travels employees or that CAI was equally at fault, no liability can be imposed on CAI
for Magers supposed misrepresentation.
III. Even on the assumption that CAI may be held liable for the acts of Mager,
still, Spouses Viloria are not entitled to a refund. Magers statement cannot be
considered a causal fraud that would justify the annulment of the subject
contracts that would oblige CAI to indemnify Spouses Viloria and return the
money they paid for the subject tickets.
Article 1390, in relation to Article 1391 of the Civil Code, provides that if the consent of
the contracting parties was obtained through fraud, the contract is considered voidable
and may be annulled within four (4) years from the time of the discovery of the fraud.
Once a contract is annulled, the parties are obliged under Article 1398 of the same
Code to restore to each other the things subject matter of the contract, including their
fruits and interest.
On the basis of the foregoing and given the allegation of Spouses Viloria that
Fernandos consent to the subject contracts was supposedly secured by Mager
through fraudulent means, it is plainly apparent that their demand for a refund is
tantamount to seeking for an annulment of the subject contracts on the ground of
vitiated consent.
Whether the subject contracts are annullable, this Court is required to determine
whether Magers alleged misrepresentation constitutes causal fraud. Similar to the
dispute on the existence of an agency, whether fraud attended the execution of a
contract is factual in nature and this Court, as discussed above, may scrutinize the
records if the findings of the CA are contrary to those of the RTC.
Under Article 1338 of the Civil Code, there is fraud when, through insidious words or
machinations of one of the contracting parties, the other is induced to enter into a
contract which, without them, he would not have agreed to. In order that fraud may
vitiate consent, it must be the causal (dolo causante), not merely the incidental (dolo
incidente), inducement to the making of the contract. 30 InSamson v. Court of
Appeals,31 causal fraud was defined as "a deception employed by one party prior to or
simultaneous to the contract in order to secure the consent of the other."32
Also, fraud must be serious and its existence must be established by clear and
convincing evidence. As ruled by this Court in Sierra v. Hon. Court of Appeals, et
al.,33 mere preponderance of evidence is not adequate:
Fraud must also be discounted, for according to the Civil Code:

Art. 1338. There is fraud when, through insidious words or machinations of one of the
contracting parties, the other is induced to enter into a contract which without them, he
would not have agreed to.
Art. 1344. In order that fraud may make a contract voidable, it should be serious and
should not have been employed by both contracting parties.
To quote Tolentino again, the "misrepresentation constituting the fraud must be
established by full, clear, and convincing evidence, and not merely by a
preponderance thereof. The deceit must be serious. The fraud is serious when it is
sufficient to impress, or to lead an ordinarily prudent person into error; that which
cannot deceive a prudent person cannot be a ground for nullity. The circumstances of
each case should be considered, taking into account the personal conditions of the
victim."34
After meticulously poring over the records, this Court finds that the fraud alleged by
Spouses Viloria has not been satisfactorily established as causal in nature to warrant
the annulment of the subject contracts. In fact, Spouses Viloria failed to prove by clear
and convincing evidence that Magers statement was fraudulent. Specifically, Spouses
Viloria failed to prove that (a) there were indeed available seats at Amtrak for a trip to
New Jersey on August 13, 1997 at the time they spoke with Mager on July 21, 1997;
(b) Mager knew about this; and (c) that she purposely informed them otherwise.
This Court finds the only proof of Magers alleged fraud, which is Fernandos
testimony that an Amtrak had assured him of the perennial availability of seats at
Amtrak, to be wanting. As CAI correctly pointed out and as Fernando admitted, it was
possible that during the intervening period of three (3) weeks from the time Fernando
purchased the subject tickets to the time he talked to said Amtrak employee, other
passengers may have cancelled their bookings and reservations with Amtrak, making
it possible for Amtrak to accommodate them. Indeed, the existence of fraud cannot be
proved by mere speculations and conjectures. Fraud is never lightly inferred; it is good
faith that is. Under the Rules of Court, it is presumed that "a person is innocent of
crime or wrong" and that "private transactions have been fair and regular."35 Spouses
Viloria failed to overcome this presumption.
IV. Assuming the contrary, Spouses Viloria are nevertheless deemed to have
ratified the subject contracts.
Even assuming that Magers representation is causal fraud, the subject contracts have
been impliedly ratified when Spouses Viloria decided to exercise their right to use the
subject tickets for the purchase of new ones. Under Article 1392 of the Civil Code,
"ratification extinguishes the action to annul a voidable contract."
Ratification of a voidable contract is defined under Article 1393 of the Civil Code as
follows:
Art. 1393. Ratification may be effected expressly or tacitly. It is understood that there
is a tacit ratification if, with knowledge of the reason which renders the contract

voidable and such reason having ceased, the person who has a right to invoke it
should execute an act which necessarily implies an intention to waive his right.
Implied ratification may take diverse forms, such as by silence or acquiescence; by
acts showing approval or adoption of the contract; or by acceptance and retention of
benefits flowing therefrom.36
Simultaneous with their demand for a refund on the ground of Fernandos vitiated
consent, Spouses Viloria likewise asked for a refund based on CAIs supposed bad
faith in reneging on its undertaking to replace the subject tickets with a round trip ticket
from Manila to Los Angeles.
In doing so, Spouses Viloria are actually asking for a rescission of the subject
contracts based on contractual breach. Resolution, the action referred to in Article
1191, is based on the defendants breach of faith, a violation of the reciprocity
between the parties37 and in Solar Harvest, Inc. v. Davao Corrugated Carton
Corporation,38 this Court ruled that a claim for a reimbursement in view of the other
partys failure to comply with his obligations under the contract is one for rescission or
resolution.
However, annulment under Article 1390 of the Civil Code and rescission under Article
1191 are two (2) inconsistent remedies. In resolution, all the elements to make the
contract valid are present; in annulment, one of the essential elements to a formation
of a contract, which is consent, is absent. In resolution, the defect is in the
consummation stage of the contract when the parties are in the process of performing
their respective obligations; in annulment, the defect is already present at the time of
the negotiation and perfection stages of the contract. Accordingly, by pursuing the
remedy of rescission under Article 1191, the Vilorias had impliedly admitted the
validity of the subject contracts, forfeiting their right to demand their annulment. A
party cannot rely on the contract and claim rights or obligations under it and at the
same time impugn its existence or validity. Indeed, litigants are enjoined from taking
inconsistent positions.39
V. Contracts cannot be rescinded for a slight or casual breach.
CAI cannot insist on the non-transferability of the subject tickets.
Considering that the subject contracts are not annullable on the ground of vitiated
consent, the next question is: "Do Spouses Viloria have the right to rescind the
contract on the ground of CAIs supposed breach of its undertaking to issue new
tickets upon surrender of the subject tickets?"
Article 1191, as presently worded, states:
The power to rescind obligations is implied in reciprocal ones, in case one of the
obligors should not comply with what is incumbent upon him.

The injured party may choose between the fulfilment and the rescission of the
obligation, with the payment of damages in either case. He may also seek rescission,
even after he has chosen fulfillment, if the latter should become impossible.
The court shall decree the rescission claimed, unless there be just cause authorizing
the fixing of a period.
This is understood to be without prejudice to the rights of third persons who have
acquired the thing, in accordance with articles 1385 and 1388 and the Mortgage Law.
According to Spouses Viloria, CAI acted in bad faith and breached the subject
contracts when it refused to apply the value of Lourdes ticket for Fernandos purchase
of a round trip ticket to Los Angeles and in requiring him to pay an amount higher than
the price fixed by other airline companies.
In its March 24, 1998 letter, CAI stated that "non-refundable tickets may be used as a
form of payment toward the purchase of another Continental ticket for $75.00, per
ticket, reissue fee ($50.00, per ticket, for tickets purchased prior to October 30, 1997)."
Clearly, there is nothing in the above-quoted section of CAIs letter from which the
restriction on the non-transferability of the subject tickets can be inferred. In fact, the
words used by CAI in its letter supports the position of Spouses Viloria, that each of
them can use the ticket under their name for the purchase of new tickets whether for
themselves or for some other person.
Moreover, as CAI admitted, it was only when Fernando had expressed his interest to
use the subject tickets for the purchase of a round trip ticket between Manila and Los
Angeles that he was informed that he cannot use the ticket in Lourdes name as
payment.
Contrary to CAIs claim, that the subject tickets are non-transferable cannot be implied
from a plain reading of the provision printed on the subject tickets stating that "[t]o the
extent not in conflict with the foregoing carriage and other services performed by each
carrier are subject to: (a) provisions contained in this ticket, x x x (iii) carriers
conditions of carriage and related regulations which are made part hereof (and are
available on application at the offices of carrier) x x x." As a common carrier whose
business is imbued with public interest, the exercise of extraordinary diligence
requires CAI to inform Spouses Viloria, or all of its passengers for that matter, of all
the terms and conditions governing their contract of carriage. CAI is proscribed from
taking advantage of any ambiguity in the contract of carriage to impute knowledge on
its passengers of and demand compliance with a certain condition or undertaking that
is not clearly stipulated. Since the prohibition on transferability is not written on the
face of the subject tickets and CAI failed to inform Spouses Viloria thereof, CAI cannot
refuse to apply the value of Lourdes ticket as payment for Fernandos purchase of a
new ticket.
CAIs refusal to accept Lourdes ticket for the purchase of a new ticket for
Fernando is only a casual breach.

Nonetheless, the right to rescind a contract for non-performance of its stipulations is

not absolute. The general rule is that rescission of a contract will not be permitted for a
slight or casual breach, but only for such substantial and fundamental violations as
would defeat the very object of the parties in making the agreement. 40 Whether a
breach is substantial is largely determined by the attendant circumstances.41

prove that the price of a round trip ticket between Manila and Los Angeles at that time
was only $856.00 is a newspaper advertisement for another airline company, which is
inadmissible for being "hearsay evidence, twice removed." Newspaper clippings are
hearsay if they were offered for the purpose of proving the truth of the matter alleged.
As ruled in Feria v. Court of Appeals,:44

While CAIs refusal to allow Fernando to use the value of Lourdes ticket as payment
for the purchase of a new ticket is unjustified as the non-transferability of the subject
tickets was not clearly stipulated, it cannot, however be considered substantial. The
endorsability of the subject tickets is not an essential part of the underlying contracts
and CAIs failure to comply is not essential to its fulfillment of its undertaking to issue
new tickets upon Spouses Vilorias surrender of the subject tickets. This Court takes
note of CAIs willingness to perform its principal obligation and this is to apply the price
of the ticket in Fernandos name to the price of the round trip ticket between Manila
and Los Angeles. CAI was likewise willing to accept the ticket in Lourdes name as full
or partial payment as the case may be for the purchase of any ticket, albeit under her
name and for her exclusive use. In other words, CAIs willingness to comply with its
undertaking under its March 24, 1998 cannot be doubted, albeit tainted with its
erroneous insistence that Lourdes ticket is non-transferable.

[N]ewspaper articles amount to "hearsay evidence, twice removed" and are therefore
not only inadmissible but without any probative value at all whether objected to or
not, unless offered for a purpose other than proving the truth of the matter asserted. In
this case, the news article is admissible only as evidence that such publication does
exist with the tenor of the news therein stated.45 (citations omitted)

Moreover, Spouses Vilorias demand for rescission cannot prosper as CAI cannot be
solely faulted for the fact that their agreement failed to consummate and no new ticket
was issued to Fernando. Spouses Viloria have no right to insist that a single round trip
ticket between Manila and Los Angeles should be priced at around $856.00 and
refuse to pay the difference between the price of the subject tickets and the amount
fixed by CAI. The petitioners failed to allege, much less prove, that CAI had obliged
itself to issue to them tickets for any flight anywhere in the world upon their surrender
of the subject tickets. In its March 24, 1998 letter, it was clearly stated that "[n]onrefundable tickets may be used as a form of payment toward the purchase of another
Continental ticket"42 and there is nothing in it suggesting that CAI had obliged itself to
protect Spouses Viloria from any fluctuation in the prices of tickets or that the
surrender of the subject tickets will be considered as full payment for any ticket that
the petitioners intend to buy regardless of actual price and destination. The CA was
correct in holding that it is CAIs right and exclusive prerogative to fix the prices for its
services and it may not be compelled to observe and maintain the prices of other
airline companies.43

The records of this case demonstrate that both parties were equally in default; hence,
none of them can seek judicial redress for the cancellation or resolution of the subject
contracts and they are therefore bound to their respective obligations thereunder. As
the 1st sentence of Article 1192 provides:
Art. 1192. In case both parties have committed a breach of the obligation, the
liability of the first infractor shall be equitably tempered by the courts. If it cannot
be determined which of the parties first violated the contract, the same shall be
deemed extinguished, and each shall bear his own damages. (emphasis supplied)
Therefore, CAIs liability for damages for its refusal to accept Lourdes ticket for the
purchase of Fernandos round trip ticket is offset by Spouses Vilorias liability for their
refusal to pay the amount, which is not covered by the subject tickets. Moreover, the
contract between them remains, hence, CAI is duty bound to issue new tickets for a
destination chosen by Spouses Viloria upon their surrender of the subject tickets and
Spouses Viloria are obliged to pay whatever amount is not covered by the value of the
subject tickets.
This Court made a similar ruling in Central Bank of the Philippines v. Court of
Appeals.46 Thus:
Since both parties were in default in the performance of their respective reciprocal
obligations, that is, Island Savings Bank failed to comply with its obligation to furnish
the entire loan and Sulpicio M. Tolentino failed to comply with his obligation to pay
his P17,000.00 debt within 3 years as stipulated, they are both liable for damages.

The conflict as to the endorsability of the subject tickets is an altogether different

matter, which does not preclude CAI from fixing the price of a round trip ticket between
Manila and Los Angeles in an amount it deems proper and which does not provide
Spouses Viloria an excuse not to pay such price, albeit subject to a reduction coming
from the value of the subject tickets. It cannot be denied that Spouses Viloria had the
concomitant obligation to pay whatever is not covered by the value of the subject
tickets whether or not the subject tickets are transferable or not.1avvphi1

Article 1192 of the Civil Code provides that in case both parties have committed a
breach of their reciprocal obligations, the liability of the first infractor shall be equitably
tempered by the courts. WE rule that the liability of Island Savings Bank for damages
in not furnishing the entire loan is offset by the liability of Sulpicio M. Tolentino for
damages, in the form of penalties and surcharges, for not paying his
overdue P17,000.00 debt. x x x.47

There is also no showing that Spouses Viloria were discriminated against in bad faith
by being charged with a higher rate. The only evidence the petitioners presented to

Another consideration that militates against the propriety of holding CAI liable for
moral damages is the absence of a showing that the latter acted fraudulently and in
bad faith. Article 2220 of the Civil Code requires evidence of bad faith and fraud and

moral damages are generally not recoverable in culpa contractual except when bad
faith had been proven.48 The award of exemplary damages is likewise not warranted.
Apart from the requirement that the defendant acted in a wanton, oppressive and
malevolent manner, the claimant must prove his entitlement to moral damages.49
WHEREFORE, premises considered, the instant Petition is DENIED.
SO ORDERED.

Taylor vs. Manila Electric, Railroad and Light Co.; G.R. No. L-4977 March 22,
1910
CARSON, J.:
An action to recover damages for the loss of an eye and other injuries, instituted by
David Taylor, a minor, by his father, his nearest relative.
The defendant is a foreign corporation engaged in the operation of a street railway
and an electric light system in the city of Manila. Its power plant is situated at the
eastern end of a small island in the Pasig River within the city of Manila, known as the
Isla del Provisor. The power plant may be reached by boat or by crossing a footbridge,
impassable for vehicles, at the westerly end of the island.
The plaintiff, David Taylor, was at the time when he received the injuries complained
of, 15 years of age, the son of a mechanical engineer, more mature than the average
boy of his age, and having considerable aptitude and training in mechanics.
On the 30th of September, 1905, plaintiff, with a boy named Manuel Claparols, about
12 years of age, crossed the footbridge to the Isla del Provisor, for the purpose of
visiting one Murphy, an employee of the defendant, who and promised to make them
a cylinder for a miniature engine. Finding on inquiry that Mr. Murphy was not in his
quarters, the boys, impelled apparently by youthful curiosity and perhaps by the
unusual interest which both seem to have taken in machinery, spent some time in
wandering about the company's premises. The visit was made on a Sunday afternoon,
and it does not appear that they saw or spoke to anyone after leaving the power
house where they had asked for Mr. Murphy.
After watching the operation of the travelling crane used in handling the defendant's
coal, they walked across the open space in the neighborhood of the place where the
company dumped in the cinders and ashes from its furnaces. Here they found some
twenty or thirty brass fulminating caps scattered on the ground. These caps are
approximately of the size and appearance of small pistol cartridges and each has
attached to it two long thin wires by means of which it may be discharged by the use
of electricity. They are intended for use in the explosion of blasting charges of
dynamite, and have in themselves a considerable explosive power. After some
discussion as to the ownership of the caps, and their right to take them, the boys
picked up all they could find, hung them on stick, of which each took end, and carried

them home. After crossing the footbridge, they met a little girl named Jessie Adrian,
less than 9 years old, and all three went to the home of the boy Manuel. The boys
then made a series of experiments with the caps. They trust the ends of the wires into
an electric light socket and obtained no result. They next tried to break the cap with a
stone and failed. Manuel looked for a hammer, but could not find one. Then they
opened one of the caps with a knife, and finding that it was filled with a yellowish
substance they got matches, and David held the cap while Manuel applied a lighted
match to the contents. An explosion followed, causing more or less serious injuries to
all three. Jessie, who when the boys proposed putting a match to the contents of the
cap, became frightened and started to run away, received a slight cut in the neck.
Manuel had his hand burned and wounded, and David was struck in the face by
several particles of the metal capsule, one of which injured his right eye to such an
extent as to the necessitate its removal by the surgeons who were called in to care for
his wounds.
The evidence does definitely and conclusively disclose how the caps came to be on
the defendant's premises, nor how long they had been there when the boys found
them. It appears, however, that some months before the accident, during the
construction of the defendant's plant, detonating caps of the same size and kind as
those found by the boys were used in sinking a well at the power plant near the place
where the caps were found; and it also appears that at or about the time when these
caps were found, similarly caps were in use in the construction of an extension of
defendant's street car line to Fort William McKinley. The caps when found appeared to
the boys who picked them up to have been lying for a considerable time, and from the
place where they were found would seem to have been discarded as detective or
worthless and fit only to be thrown upon the rubbish heap.
No measures seems to have been adopted by the defendant company to prohibit or
prevent visitors from entering and walking about its premises unattended, when they
felt disposed so to do. As admitted in defendant counsel's brief, "it is undoubtedly true
that children in their play sometimes crossed the foot bridge to the islands;" and, we
may add, roamed about at will on the uninclosed premises of the defendant, in the
neighborhood of the place where the caps were found. There is evidence that any
effort ever was made to forbid these children from visiting the defendant company's
premises, although it must be assumed that the company or its employees were
aware of the fact that they not infrequently did so.
Two years before the accident, plaintiff spent four months at sea, as a cabin boy on
one of the interisland transports. Later he took up work in his father's office, learning
mechanical drawing and mechanical engineering. About a month after his accident he
obtained employment as a mechanical draftsman and continued in that employment
for six months at a salary of P2.50 a day; and it appears that he was a boy of more
than average intelligence, taller and more mature both mentally and physically than
most boys of fifteen.
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, that 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 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
sort 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 think 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 the 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 expectation
that they would be buried out of the 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 sustain a finding that the
company or some of its employees either willfully or through an oversight left them
exposed at a point on its premises which the general public, including children at play,
where not prohibited from visiting, and over which the company knew or ought to have
known that young boys were likely to roam about 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 intimidating or rather assuming that the
blasting work 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 and 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 or 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 illicit
acts and omissions or by those in which any kind of fault or negligence occurs.
ART. 1902 A 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 omissions, 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 live with them.
xxx

xxx

xxx

Owners or directors of an establishment or enterprise are equally liable for 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 also be liable for the damage caused
1 By the explosion of machines which may not have been cared for with due diligence,
and for kindling of explosive substances which may not have been placed in a safe
and proper place.

Counsel for the defendant and appellant rests his appeal strictly upon his contention
that the facts proven at the trial do not established 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 form and
the right of action (analogous to those raised in the case of Rakes vs. Atlantic, Gulf
and 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.
These proposition are, of 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 and not the fulminating caps
been left exposed at the point where they were found, or if their owner had exercised
due care in keeping them in an appropriate place; but it is equally clear that plaintiff
would not have been injured had he not, for his own pleasure and convenience,
entered upon the defendant's premises, and strolled around thereon without the
express permission of the defendant, and had he not picked up and carried away the
property of the defendant which he found on its premises, and had he not thereafter
deliberately cut open one of the caps and applied a match to its contents.
But counsel for plaintiff contends that because of plaintiff's youth and inexperience, his
entry upon defendant company's premises, and the intervention of his action between
the negligent act of defendant in leaving the caps exposed on its premises and the
accident which resulted in his injury should not be held to have contributed in any wise
to the accident, which should be deemed to be the direct result of defendant's
negligence in leaving the caps exposed at the place where they were found by the
plaintiff, and this latter the proximate cause of the accident which occasioned the
injuries sustained by him.
In support of his contention, counsel for plaintiff relies on the doctrine laid down in
many of the courts of last resort in the United States in the cases known as the
"Torpedo" and "Turntable" cases, and the cases based thereon.
In a 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

the purposes of amusement, enters upon the railroad company's premises, at a place
where the railroad company knew, or had good reason to suppose, children would be
likely to come, and there found explosive signal torpedoes left unexposed 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 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 in injury received by an infant
while upon its premises, from idle curiosity, or for purposes of amusement, if such
injury was, under circumstances, attributable to the negligence of the company), the
principles on which these cases turn are that "while a 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 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 each case by the
circumstances of the case."
The doctrine of the case of Railroad Company vs. Stout was vigorously controverted
and sharply criticized in several 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 cases, 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 the 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 or license to cross the premises of
another can not 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
as to the circumstances that will warrant the inference 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 the 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. McDonal 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 American, 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. MacDonald (supra) the facts were as
follows: The plaintiff, a boy 12 years of age, out 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 accident injured by falling into a
burning slack pile of whose existence he had no 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 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 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 principles 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 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 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 dogs be so attracted and thereby injured, an action on the
case would lie. "What difference," said Lord Ellenborough, C.J., "is there in reason
between drawing the animal into the trap by means of his instinct which he can not
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 it the case of
Townsend vs. Wathen, Judge Thompson, in his work on the Law of Negligence,
volume 1, page 305, note, well says: "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 instinct, might run into it and be killed,
and which would exempt him from liability for the consequence 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 or maimed for life."
Chief Justice Cooley, voicing the opinion of the supreme court of Michigan, in the case
of Powers vs. Harlow (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 treatise or torts, alluding to the doctrine of implied
invitation 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 conclusion 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
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 whenever the public is 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 expressly or impliedly permitted to
enter 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 can not 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 from entering his premises
at a place where he knows or ought to know that children are accustomed to roam
about of 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 enter under
such conditions the owner's failure to take reasonable precautions to guard the child
against injury from unknown or unseen dangers, placed upon such premises by the
owner, is clearly a breach of duty, 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 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 necessity, and neither is contention
that a man has a right to do what will with his own property or that children should be
kept under the care of their parents or guardians, so as to prevent their entering on the
premises of others is of sufficient weight to put 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 and interests of the community
(see U. S. vs. Toribio,1No. 5060, decided January 26, 1910), and except as to infants
of very tender years it would be absurd and unreasonable in a community organized
as is that in which we lived to hold that parents or guardian 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 parent could in any event be imputed to the child so as to deprive it a right to
recover in such cases a point which we neither discuss nor 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 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 plaintiffs action in
cutting open the detonating cap and putting 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 in 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 can not agree with this proposition, although we accept
the doctrine of the Turntable and Torpedo cases, that we have thought 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 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 each case by the
circumstances 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 its 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 wholly different question whether such youth can be said to have been free from
fault when he willfully and deliberately cut open 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 which our attention has been directed, the record
discloses that the plaintiffs, in 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 a 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 of himself. The evidence of record leaves
no room for doubt that, despite his denials on the witness stand, 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 application of a
match to the contents of the caps, 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
within 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 and "care and caution"
as might reasonably be required of him, or that defendant or anyone else should be
held civilly responsible for injuries incurred by him under such circumstances.
The law fixes 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 due care and 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 depends of his own acts and their consequences; and at 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 of exercising certain
rights and incurring certain responsibilities, though it can not 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 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 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 a 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 of 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 negligence 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 sentire. (Digest, book 50, tit. 17 rule 203.)

The Patidas 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 can not demand reparation therefor from another. (Law 25, tit.
5, Partida 3.)
And they even said that 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.)
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
Jurisprudencia 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 omission 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 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 the 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 of 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 duty of him who shall claim damages to establish

their existence. The decisions of April 9, 1896, and March 18, July, and September 27,
1898, have especially supported the principle, the first 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 omission and the damage; the latter must be the direct result of one of the
first two. As the decision of March 22, 1881, said, it is necessary that the damages
result immediately and directly from an act performed culpably and wrongfully;
"necessarily presupposing a legal ground for imputability." (Decision of October 29,
1887.)
Negligence is not presumed, but must be proven by him who alleges it. (Scavoela,
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 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 Pacific Co. (supra), wherein we held that while "There are many cases
(personal injury cases) was exonerated," on the ground that "the negligence of the
plaintiff was the 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 "define the effect to
be given the negligence of its causes, though not the principal one, and we are left to
seek the theory of the civil law in the practice of other countries;" and in such cases
we declared that 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 is 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,
independent 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 produces the event giving occasion for damagesthat is, the 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 his 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 can not
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 in his own act in
putting a match to the contents of the cap, and that having "contributed to the principal
occurrence, as one of its determining factors, he can not 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 defendant, and
carrying 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 fact
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 nor
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 the
judgment will be entered in favor of the defendant for the costs in first instance and the
complaint dismissed without day. So ordered.
Jarco Marketing vs. CA
SYNOPSIS
Petitioner Jarco Marketing Corporation is the owner of Syvel's Department Store,
Makati City (Syvel's), while the private respondents are spouses and the parents of
Zhieneth Aguilar. While Criselda and her child Zhieneth were at the 2nd floor of
Syvel's, a terrible accident happened, which caused the life of the six-year old
Zhieneth. She was pinned by the bulk of the store's gift-wrapping counter structure
which collapsed. Fourteen days later, Zhieneth died at the hospital, which was
attributed to the injuries she sustained. Private respondents filed a complaint for
damages wherein they sought the payment of P157,522.86 for actual damages,
P300,000.00 for moral damages, P20,000.00 for attorney's fees and an unspecified
amount for loss income and exemplary damages. Petitioners, however, denied any
liability for the injuries and consequent death of Zhieneth. They sought the dismissal of
the complaint and an award of moral and exemplary damages and attorney's fees in
their favor. The trial court dismissed the complaint, finding that the preponderance of
the evidence favored petitioners. The Court of Appeals decided in favor of private
respondents and reversed the appealed judgment. It found that petitioners were
negligent in maintaining a structurally dangerous counter. It also declared Zhieneth,
who was below seven at the time, was absolutely incapable of negligence or other
tort. The appellate court then awarded private respondents P99,420.86 as actual

damages, representing hospitalization expenses. It denied the award for funeral

expenses for lack of proof. Instead, compensatory damages were awarded for the
death of Zhieneth. Petitioners sought the reversal of the Court of Appeals' decision
and the reinstatement of the judgment of the trial court. EHTSCD
The Supreme Court ruled that the tragedy which befell Zhieneth was no accident and
her death could only be attributed to negligence. The physical analysis of the counter
by both the trial court and the Court of Appeals and a scrutiny of the evidence on
record revealed that it was not durable. Criselda should be absolved from any
contributory negligence. The petition was denied and the decision of the Court of
Appeals was affirmed.
SYLLABUS
1.
CIVIL
LAW;
DAMAGES.
ACCIDENT
AND
NEGLIGENCE;
DISTINGUISHED. An accident pertains to an unforeseen event in which no fault or
negligence attaches to the defendant. It is "a fortuitous circumstance, event or
happening; an event happening without any human agency, or if happening wholly or
partly through human agency, an event which under the circumstances is unusual or
unexpected by the person to whom it happens." On the other hand, negligence is the
omission to do something which a reasonable man, guided by those considerations
which ordinarily regulate the conduct of human affairs, would do, or the doing of
something which a prudent and reasonable man would not do. Negligence is "the
failure to observe, for the protection of the interest of another person, that degree of
care, precaution and vigilance which the circumstances justly demand, whereby such
other person suffers injury."
2.
ID.; ID.; ID.; TEST TO DETERMINE NEGLIGENCE. The test in
determining the existence of negligence is enunciated in the landmark case of Picart
v. Smith, (37 Phil. 809 [1918]) thus: 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.
3.
REMEDIAL LAW; EVIDENCE; TESTIMONY; EXCEPTION TO HEARSAY
RULE; PART OF RES GESTAE, DEFINED. The testimony of witness Gonzales
pertaining to ZHIENETH's statement formed (and should be admitted as) part of the
res gestae under Section 42, Rule 130 of the Rules of Court, thus: Part of res gestae.
Statements made by a person while a startling occurrence is taking place or
immediately prior or subsequent thereto with respect to the circumstances thereof,
may be given in evidence as part of the res gestae. So, also, statements
accompanying an equivocal act material to the issue, and giving it a legal significance,
may be received as part of the res gestae. It is axiomatic that matters relating to
declarations of pain or suffering and statements made to a physician are generally
considered declarations and admissions.
4.
ID.; ID.; ID.; ID.; REQUIREMENTS FOR ADMISSIBILITY; PRESENT IN
CASE AT BAR. All that is required for their admissibility as part of the res gestae is
that they be made or uttered under the influence of a startling event before the

declarant had the time to think and concoct a falsehood as witnessed by the person
who testified in court. Under the circumstances, it is unthinkable for ZHIENETH, a
child of such tender age and in extreme pain, to have lied to a doctor whom she
trusted with her life. We accord credence to Gonzales' testimony on the matter, i.e.,
ZHIENETH performed no act that facilitated her tragic death.
5.
ID.; ID.; ID.; CREDIBILITY OF WITNESSES; FINDINGS OF THE TRIAL
COURT GENERALLY NOT DISTURBED ON APPEAL; EXCEPTIONS; NOT
PRESENT IN CASE AT BAR. It is settled that when the issue concerns the
credibility of witnesses, the appellate courts will not as a general rule disturb the
findings of the trial court, which is in a better position to determine the same. The trial
court has the distinct advantage of actually hearing the testimony of and observing the
deportment of the witnesses. However, the rule admits of exceptions such as when its
evaluation was reached arbitrarily or it overlooked or failed to appreciate some facts or
circumstances of weight and substance which could affect the result of the case. In
the instant case, petitioners failed to bring their claim within the exception.
6.
ID.; ID.; PRESUMPTION; CHILDREN BELOW NINE YEARS OLD,
CONCLUSIVELY PRESUMED TO BE INCAPABLE OF CONTRIBUTORY
NEGLIGENCE; CASE AT BAR. Anent the negligence imputed to ZHIENETH, we
apply the conclusive presumption that favors children below nine (9) years old
incapable of contributory negligence. In his book, (I Philippine Law on Torts and
Damages, 70-71 [1993]), former Judge Cezar S. Sangco stated: In our jurisdiction, a
person under nine years of age is conclusively presumed to have acted without
discernment, and is, on that account, exempt from criminal liability. The same
presumption and a like exemption from criminal liability obtains in a case of a person
over nine and under fifteen years of age, unless it is shown that he has acted with
discernment. Since negligence may be a felony and a quasi-delict and required
discernment as a condition of liability, either criminal or civil, a child under nine years
of age is, by analogy, conclusively presumed to be incapable of negligence; and that
the presumption of lack of discernment or incapacity for negligence in the case of a
child over nine but under fifteen years of age is a rebuttable one, under our law. The
rule, therefore, is that a child under nine years of age must be conclusively presumed
incapable of contributory negligence as a matter of law. SDIACc
DECISION
DAVIDE, JR., C.J p:
In this petition for review on certiorari under Rule 45 of the Rules of Court, petitioners
seek the reversal of the 17 June 1996 decision 1 of the Court of Appeals in C.A. G.R.
No. CV 37937 and the resolution 2 denying their motion for reconsideration. The
assailed decision set aside the 15 January 1992 judgment of the Regional Trial Court
(RTC), Makati City, Branch 60 in Civil Case No. 7119 and ordered petitioners to pay
damages and attorney's fees to private respondents Conrado and Criselda
(CRISELDA) Aguilar. cdasia

Petitioner Jarco Marketing Corporation is the owner of Syvel's Department Store,

Makati City. Petitioners Leonardo Kong, Jose Tiope and Elisa Panelo are the store's
branch manager, operations manager, and supervisor, respectively. Private
respondents are spouses and the parents of Zhieneth Aguilar (ZHIENETH).
In the afternoon of 9 May 1983, CRISELDA and ZHIENETH were at the 2nd floor of
Syvel's Department Store, Makati City. CRISELDA was signing her credit card slip at
the payment and verification counter when she felt a sudden gust of wind and heard a
loud thud. She looked behind her. She then beheld her daughter ZHIENETH on the
floor, her young body pinned by the bulk of the store's gift-wrapping counter/structure.
ZHIENETH was crying and screaming for help. Although shocked, CRISELDA was
quick to ask the assistance of the people around in lifting the counter and retrieving
ZHIENETH from the floor. 3
ZHIENETH was quickly rushed to the Makati Medical Center where she was operated
on. The next day ZHIENETH lost her speech and thereafter communicated with
CRISELDA by writing on a magic slate. The injuries she sustained took their toil on
her young body. She died fourteen (14) days after the accident or on 22 May 1983, on
the hospital bed. She was six years old. 4
The cause of her death was attributed to the injuries she sustained. The provisional
medical certificate 5 issued by ZHIENETH's attending doctor described the extent of
her injuries:
Diagnoses:
1.

Shock, severe, sec. to intra-abdominal injuries due to blunt injury

2.

Hemorrhage, massive, intraperitoneal sec. to laceration, (L) lobe liver

3.

Rupture, stomach, anterior & posterior walls

4.

Complete transection, 4th position, duodenum

5.

Hematoma, extensive, retroperitoneal

6.

Contusion, lungs, severe

CRITICAL
After the burial of their daughter, private respondents demanded upon petitioners the
reimbursement of the hospitalization, medical bills and wake and funeral expenses 6
which they had incurred. Petitioners refused to pay. Consequently, private
respondents filed a complaint for damages, docketed as Civil Case No. 7119 wherein
they sought the payment of P157,522.86 for actual damages, P300,000 for moral
damages, P20,000 for attorney's fees and an unspecified amount for loss of income
and exemplary damages.

In their answer with counterclaim, petitioners denied any liability for the injuries and
consequent death of ZHIENETH. They claimed that CRISELDA was negligent in
exercising care and diligence over her daughter by allowing her to freely roam around
in a store filled with glassware and appliances. ZHIENETH too, was guilty of
contributory negligence since she climbed the counter, triggering its eventual collapse
on her. Petitioners also emphasized that the counter was made of sturdy wood with a
strong support; it never fell nor collapsed for the past fifteen years since its
construction.
Additionally, petitioner Jarco Marketing Corporation maintained that it observed the
diligence of a good father of a family in the selection, supervision and control of its
employees. The other petitioners likewise raised due care and diligence in the
performance of their duties and countered that the complaint was malicious for which
they suffered besmirched reputation and mental anguish. They sought the dismissal of
the complaint and an award of moral and exemplary damages and attorney's fees in
their favor. Cdpr
In its decision 7 the trial court dismissed the complaint and counterclaim after finding
that the preponderance of the evidence favored petitioners. It ruled that the proximate
cause of the fall of the counter on ZHIENETH was her act of clinging to it. It believed
petitioners' witnesses who testified that ZHIENETH clung to the counter, afterwhich
the structure and the girl fell with the structure falling on top of her, pinning her
stomach. In contrast, none of private respondents' witnesses testified on how the
counter fell. The trial court also held that CRISELDA's negligence contributed to
ZHIENETH's accident.
In absolving petitioners from any liability, the trial court reasoned that the counter was
situated at the end or corner of the 2nd floor as a precautionary measure hence, it
could not be considered as an attractive nuisance. 8 The counter was higher than
ZHIENETH. It has been in existence for fifteen years. Its structure was safe and wellbalanced. ZHIENETH, therefore, had no business climbing on and clinging to it.
Private respondents appealed the decision, attributing as errors of the trial court its
findings that: (1) the proximate cause of the fall of the counter was ZHIENETH's
misbehavior; (2) CRISELDA was negligent in her care of ZHIENETH; (3) petitioners
were not negligent in the maintenance of the counter; and (4) petitioners were not
liable for the death of ZHIENETH.
Further, private respondents asserted that ZHIENETH should be entitled to the
conclusive presumption that a child below nine (9) years is incapable of contributory
negligence. And even if ZHIENETH, at six (6) years old, was already capable of
contributory negligence, still it was physically impossible for her to have propped
herself on the counter. She had a small frame (four feet high and seventy pounds) and
the counter was much higher and heavier than she was. Also, the testimony of one of
the store's former employees, Gerardo Gonzales, who accompanied ZHIENETH when
she was brought to the emergency room of the Makati Medical Center belied
petitioners' theory that ZHIENETH climbed the counter. Gonzales claimed that when
ZHIENETH was asked by the doctor what she did, ZHIENETH replied, "[N]othing, I did

not come near the counter and the counter just fell on me." 9 Accordingly, Gonzales'
testimony on ZHIENETH's spontaneous declaration should not only be considered as
part of res gestae but also accorded credit.
Moreover, negligence could not be imputed to CRISELDA for it was reasonable for her
to have let go of ZHIENETH at the precise moment that she was signing the credit
card slip.
Finally, private respondents vigorously maintained that the proximate cause of
ZHIENETH's death, was petitioners' negligence in failing to institute measures to have
the counter permanently nailed.
On the other hand, petitioners argued that private respondents raised purely factual
issues which could no longer be disturbed. They explained that ZHIENETH's death
while unfortunate and tragic, was an accident for which neither CRISELDA nor even
ZHIENETH could entirely be held faultless and blameless. Further, petitioners
adverted to the trial court's rejection of Gonzales' testimony as unworthy of credence.
As to private respondent's claim that the counter should have been nailed to the
ground, petitioners justified that it was not necessary. The counter had been in
existence for several years without any prior accident and was deliberately placed at a
corner to avoid such accidents. Truth to tell, they acted without fault or negligence for
they had exercised due diligence on the matter. In fact, the criminal case 10 for
homicide through simple negligence filed by private respondents against the individual
petitioners was dismissed; a verdict of acquittal was rendered in their favor.
The Court of Appeals, however, decided in favor of private respondents and reversed
the appealed judgment. It found that petitioners were negligent in maintaining a
structurally dangerous counter. The counter was shaped like an inverted "L" 11 with a
top wider than the base. It was top heavy and the weight of the upper portion was
neither evenly distributed nor supported by its narrow base. Thus, the counter was
defective, unstable and dangerous; a downward pressure on the overhanging portion
or a push from the front could cause the counter to fall. Two former employees of
petitioners had already previously brought to the attention of the management the
danger the counter could cause. But the latter ignored their concern. The Court of
Appeals faulted the petitioners for this omission, and concluded that the incident that
befell ZHIENETH could have been avoided had petitioners repaired the defective
counter. It was inconsequential that the counter had been in use for some time without
a prior incident.
The Court of Appeals declared that ZHIENETH, who was below seven (7) years old at
the time of the incident, was absolutely incapable of negligence or other tort. It
reasoned that since a child under nine (9) years could not be held liable even for an
intentional wrong, then the six-year old ZHIENETH could not be made to account for a
mere mischief or reckless act. It also absolved CRISELDA of any negligence, finding
nothing wrong or out of the ordinary in momentarily allowing ZHIENETH to walk while
she signed the document at the nearby counter. LLjur

The Court of Appeals also rejected the testimonies of the witnesses of petitioners. It
found them biased and prejudiced. It instead gave credit to the testimony of
disinterested witness Gonzales. The Court of Appeals then awarded P99,420.86 as
actual damages, the amount representing the hospitalization expenses incurred by
private respondents as evidenced by the hospital's statement of account. 12 It denied
an award for funeral expenses for lack of proof to substantiate the same. Instead, a
compensatory damage of P50,000 was awarded for the death of ZHIENETH.
We quote the dispositive portion of the assailed decision, 13 thus:
WHEREFORE, premises considered, the judgment of the lower court is SET ASIDE
and another one is entered against [petitioners], ordering them to pay jointly and
severally unto [private respondents] the following:
1.
P50,000.00 by way of compensatory damages for the death of Zhieneth
Aguilar, with legal interest (6% p.a.) from 27 April 1984;
2.
P99,420.86 as reimbursement for hospitalization expenses incurred; with
legal interest (6% p.a.) from 27 April 1984;
3.

P100,000.00 as moral and exemplary damages;

4.

P20,000.00 in the concept of attorney's fees; and

5.

Costs.

Private respondents sought a reconsideration of the decision but the same was denied
in the Court of Appeals' resolution 14 of 16 July 1997.
Petitioners now seek the reversal of the Court of Appeals' decision and the
reinstatement of the judgment of the trial court. Petitioners primarily argue that the
Court of Appeals erred in disregarding the factual findings and conclusions of the trial
court. They stress that since the action was based on tort, any finding of negligence
on the part of the private respondents would necessarily negate their claim for
damages, where said negligence was the proximate cause of the injury sustained. The
injury in the instant case was the death of ZHIENETH. The proximate cause was
ZHIENETH's act of clinging to the counter. This act in turn caused the counter to fall
on her. This and CRISELDA's contributory negligence, through her failure to provide
the proper care and attention to her child while inside the store, nullified private
respondents' claim for damages. It is also for these reasons that parents are made
accountable for the damage or injury inflicted on others by their minor children. Under
these circumstances, petitioners could not be held responsible for the accident that
befell ZHIENETH.
Petitioners also assail the credibility of Gonzales who was already separated from
Syvel's at the time he testified; hence, his testimony might have been tarnished by illfeelings against them.

For their part, private respondents principally reiterated their arguments that neither
ZHIENETH nor CRISELDA was negligent at any time while inside the store; the
findings and conclusions of the Court of Appeals are substantiated by the evidence on
record; the testimony of Gonzales, who heard ZHIENETH comment on the incident
while she was in the hospital's emergency room should receive credence; and finally,
ZHIENETH's part of the res gestae declaration "that she did nothing to cause the
heavy structure to fall on her" should be considered as the correct version of the
gruesome events.

A
At the emergency room we were all surrounding the child. And when the
doctor asked the child "what did you do," the child said "nothing, I did not come near
the counter and the counter just fell on me."
Q

You want the words in Tagalog to be translated?

ATTY. BELTRAN

We deny the petition.

The two issues to be resolved are: (1) whether the death of ZHIENETH was accidental
or attributable to negligence; and (2) in case of a finding of negligence, whether the
same was attributable to private respondents for maintaining a defective counter or to
CRISELDA and ZHIENETH for failing to exercise due and reasonable care while
inside the store premises.
An accident pertains to an unforeseen event in which no fault or negligence attaches
to the defendant. 15 It is "a fortuitous circumstance, event or happening; an event
happening without any human agency, or if happening wholly or partly through human
agency, an event which under the circumstances is unusual or unexpected by the
person to whom it happens." 16
On the other hand, negligence is the omission to do something which a reasonable
man, guided by those considerations which ordinarily regulate the conduct of human
affairs, would do, or the doing of something which a prudent and reasonable man
would not do. 17 Negligence is "the failure to observe, for the protection of the interest
of another person, that degree of care, precaution and vigilance which the
circumstances justly demand, whereby such other person suffers injury." 18
Accident and negligence are intrinsically contradictory; one cannot exist with the other.
Accident occurs when the person concerned is exercising ordinary care, which is not
caused by fault of any person and which could not have been prevented by any
means suggested by common prudence. 19
The test in determining the existence of negligence is enunciated in the landmark case
of Picart v. Smith, 20 thus: 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. 21

(COURT TO ATTY. BELTRAN)

Yes, your Honor.

COURT
Granted. Intercalate "wala po, hindi po ako lumapit doon. Basta bumagsak."
22
This testimony of Gonzales pertaining to ZHIENETH's statement formed (and should
be admitted as) part of the res gestae under Section 42, Rule 130 of the Rules of
Court, thus:
Part of res gestae. Statements made by a person while a startling occurrence is taking
place or immediately prior or subsequent thereto with respect to the circumstances
thereof, may be given in evidence as part of the res gestae. So, also, statements
accompanying an equivocal act material to the issue, and giving it a legal significance,
may be received as part of the res gestae.
It is axiomatic that matters relating to declarations of pain or suffering and statements
made to a physician are generally considered declarations and admissions. 23 All that
is required for their admissibility as part of the res gestae is that they be made or
uttered under the influence of a startling event before the declarant had the time to
think and concoct a falsehood as witnessed by the person who testified in court.
Under the circumstances thus described, it is unthinkable for ZHIENETH, a child of
such tender age and in extreme pain, to have lied to a doctor whom she trusted with
her life. We therefore accord credence to Gonzales' testimony on the matter, i.e.,
ZHIENETH performed no act that facilitated her tragic death. Sadly, petitioners did,
through their negligence or omission to secure or make stable the counter's base.
Gonzales' earlier testimony on petitioners' insistence to keep and maintain the
structurally unstable gift-wrapping counter proved their negligence, thus:

We rule that the tragedy which befell ZHIENETH was no accident and that
ZHIENETH's death could only be attributable to negligence. LLjur

Q
When you assumed the position as gift wrapper at the second floor, will you
please describe the gift wrapping counter, were you able to examine?

We quote the testimony of Gerardo Gonzales who was at the scene of the incident
and accompanied CRISELDA and ZHIENETH to the hospital:

A
Because every morning before I start working I used to clean that counter
and since it is not nailed and it was only standing on the floor, it was shaky.

Q
While at the Makati Medical Center, did you hear or notice anything while
the child was being treated?

xxx

xxx

xxx

Q
Will you please describe the counter at 5:00 o'clock [sic] in the afternoon on
[sic] May 9, 1983?

xxx

xxx

xxx

Witness:
A
At that hour on May 9, 1983, that counter was standing beside the
verification counter. And since the top of it was heavy and considering that it was not
nailed, it can collapsed at anytime, since the top is heavy.
xxx
Q

xxx

xxx

And what did you do?

A
I informed Mr. Maat about that counter which is [sic] shaky and since Mr.
Maat is fond of putting display decorations on tables, he even told me that I would put
some decorations. But since I told him that it not [sic] nailed and it is shaky he told me
"better inform also the company about it." And since the company did not do anything
about the counter, so I also did not do anything about the counter. 24 [Emphasis
supplied]
Ramon Guevarra, another former employee, corroborated the testimony of Gonzales,
thus:
Q
Will you please described [sic] to the Honorable Court the counter where
you were assigned in January 1983?
xxx

xxx

xxx

A
That counter assigned to me was when my supervisor ordered me to carry
that counter to another place. I told him that the counter needs nailing and it has to be
nailed because it might cause injury or accident to another since it was shaky. LibLex
Q
When that gift wrapping counter was transferred at the second floor on
February 12, 1983, will you please describe that to the honorable Court?
A
I told her that the counter wrapper [sic] is really in good [sic] condition; it was
shaky. I told her that we had to nail it.
Q

When you said she, to whom are you referring to [sic]?

I am referring to Ms. Panelo, sir.

Q
And what was the answer of Ms. Panelo when you told her that the counter
was shaky?
A
She told me "Why do you have to teach me. You are only my subordinate
and you are to teach me? And she even got angry at me when I told her that.
xxx

xxx

xxx

Q
From February 12, 1983 up to May 9, 1983, what if any, did Ms. Panelo or
any employee of the management do to that [sic]

None, sir. They never nailed the counter. They only nailed the counter after
the accident happened. 25 [Emphasis supplied]
Without doubt, petitioner Panelo and another store supervisor were personally
informed of the danger posed by the unstable counter. Yet, neither initiated any
concrete action to remedy the situation nor ensure the safety of the store's employees
and patrons as a reasonable and ordinary prudent man would have done. Thus, as
confronted by the situation petitioners miserably failed to discharge the due diligence
required of a good father of a family.
On the issue of the credibility of Gonzales and Guevarra, petitioners failed to establish
that the former's testimonies were biased and tainted with partiality. Therefore, the
allegation that Gonzales and Guevarra's testimonies were blemished by "ill feelings"
against petitioners since they (Gonzales and Guevarra) were already separated
from the Company at the time their testimonies were offered in court was but mere
speculation and deserved scant consideration.
It is settled that when the issue concerns the credibility of witnesses, the appellate
courts will not as a general rule disturb the findings of the trial court, which is in a
better position to determine the same. The trial court has the distinct advantage of
actually hearing the testimony of and observing the deportment of the witnesses. 26
However, the rule admits of exceptions such as when its evaluation was reached
arbitrarily or it overlooked or failed to appreciate some facts or circumstances of
weight and substance which could affect the result of the case. 27 In the instant case,
petitioners failed to bring their claim within the exception.
Anent the negligence ZHIENETH, we apply the conclusive presumption that favors
children below nine (9) years old in that they are incapable of contributory negligence.
In his book, 28 former Judge Cezar S. Sangco stated:
In our jurisdiction, a person under nine years of age is conclusively presumed to have
acted without discernment, and is, on that account, exempt from criminal liability. The
same presumption and a like exemption from criminal liability obtains in a case of a
person over nine and under fifteen years of age, unless it is shown that he has acted
with discernment. Since negligence may be a felony and a quasi-delict and required
discernment as a condition of liability, either criminal or civil, a child under nine years
of age is, by analogy, conclusively presumed to be incapable of negligence; and that
the presumption of lack of discernment or incapacity for negligence in the case of a
child over nine but under fifteen years of age is a rebuttable one, under our law. The
rule, therefore, is that a child under nine years of age must be conclusively presumed
incapable of contributory negligence as a matter of law. [Emphasis supplied]
Even if we attribute contributory negligence to ZHIENETH and assume that she
climbed over the counter, no injury should have occurred if we accept petitioners'

theory that the counter was stable and sturdy. For if that was the truth, a frail six-year
old could not have caused the counter to collapse. The physical analysis of the
counter by both the trial court and Court of Appeals and a scrutiny of the evidence 29
on record reveal otherwise, i.e., it was not durable after all. Shaped like an inverted
"L," the counter was heavy, huge, and its top laden with formica. It protruded towards
the customer waiting area and its base was not secured. 30

consequences to claimant notwithstanding his negligence. Or "As the doctrine usually

is stated, a person who has the last clear chance or opportunity of avoiding an
accident, notwithstanding the negligent acts of his opponent or the negligence of a
third person which is imputed to his opponent, is considered in law solely responsible
for the consequences of the accident." (38 Am. Jur. pp. 900-902.)
DECISION

CRISELDA too, should be absolved from any contributory negligence. Initially,

ZHIENETH held on to CRISELDA's waist, later to the latter's hand. 31 CRISELDA
momentarily released the child's hand from her clutch when she signed her credit card
slip. At this precise moment, it was reasonable and usual for CRISELDA to let go of
her child. Further, at the time ZHIENETH was pinned down by the counter, she was
just a foot away from her mother; and the gift-wrapping counter was just four meters
away from CRISELDA. 32 The time and distance were both significant. ZHIENETH
was near her mother and did not loiter as petitioners would want to impress upon us.
She even admitted to the doctor who treated her at the hospital that she did not do
anything; the counter just fell on her.
WHEREFORE, in view of all the foregoing, the instant petition is DENIED and the
challenged decision of the Court of Appeals of 17 June 1996 in C.A. G.R. No. CV
37937 is hereby AFFIRMED.
Costs against petitioners.
SO ORDERED
Ong vs. Metropolitan Water District; [G.R. No. L-7664. August 29, 1958.]
SYLLABUS
1.
DAMAGES; FAULT OR NEGLIGENCE; CLAIMANT HAS BURDEN TO
PROVE. The person claiming damages has the burden of proving that the
damages is caused by the fault or negligence of the person from whom the damage is
claimed, or of one of his employees (Walter A. Smith & Co. vs. Cadwallader Gibson
Lumber Co., 55 Phil., 517).
2.
ID.; ABSENCE OF NEGLIGENCE OF OPERATOR OF SWIMMING
POOLS; DROWNING OR DEATH OF PATRON. The operator of swimming pools
will not be held liable for the drowning or death of 3 patron, if said operator had
exercised due diligence in the election of, and supervision over, its employees and
that it had observed the diligence required by law under the circumstances in that it
has taken all necessary precautions to avoid danger to the lives of its patrons or
prevent accident. which may cause their death.
3.
WORDS AND PHRASES; "DOCTRINE OF LAST CLEAR CHANCE."
The doctrine of last clear chance simply means that the negligence of a claimant does
not preclude a recovery for the negligence of defendant where it appears that the
latter, by exercising reasonable care and prudence, might have avoided injurious

BAUTISTA ANGELO, J p:
Plaintiffs spouses seek to recover from defendant, a government-owned corporation,
the sum of P50,000 as damages, P5,000 as funeral expenses, and P11,000 as
attorneys' fees, for the death of their son Dominador Ong in one of the swimming
pools operated by defendant.
Defendant admits the fact that plaintiffs' son was drowned in one of its swimming
pools but avers that his death was caused by his own negligence or by unavoidable
accident. Defendant also avers that it had exercised due diligence in the selection of,
and supervision over, its employees and that it had observed the diligence required by
law under the circumstances.
After trial, the lower court found that the action of plaintiffs is untenable and dismissed
the complaint without pronouncement as to costs. Plaintiffs took the case on appeal
directly to this Court because the amount involved exceeds the sum of P50,000.
Defendant owns and operates three recreational swimming pools at its Balara filters,
Diliman, Quezon City, to which people are invited and for which a nominal fee of
P0.50 for adults and P0.20 for children is charged. The main pool is between two
small pools of oval shape known as the "Wading pool" and the "Beginners Pool."
There are diving boards in the big pools and the depths of the water at different parts
are indicated by appropriate marks on the wall. The care and supervision of the pools
and the users thereof is entrusted to a recreational section composed of Simeon
Chongco as chief, Armando Rule, a male nurse, and six lifeguards who had taken the
life-saving course given by the Philippine Red Cross at the YMCA in Manila. For the
safety of its patrons, defendant has provided the pools with a ring buoy, toy roof,
towing line, saving kit and a resuscitator. There is also a sanitary inspector who is in
charge of a clinic established for the benefit of the patrons. Defendant has also on
display in a conspicuous place certain rules and regulations governing the use of the
pools, one of which prohibits the swimming in the pool alone or without any attendant.
Although defendant does not maintain a full- time physician in the swimming pool
compound, it has however a nurse and a sanitary inspector ready to administer
injections or operate the oxygen resuscitator if the need should arise.
In the afternoon of July 5, 1952, at about 1:00 o'clock, Dominador Ong, a 14-year old
high school student and a boy scout, and his brothers Ruben and Eusebio, went to
defendant's swimming pools. This was not the first time that the three brothers had
gone to said natatorium for they had already been there four or five times before. They
arrived at the natatorium at about 1:45 p.m. After paying the requisite admission fee,

they immediately went to one of the small pools where the water was shallow. At
about 4:35 p.m., Dominador Ong told his brothers that he was going to the locker
room in an adjoining building to drink a bottle of coke. Upon hearing this, Ruben and
Eusebio went to the bigger pool leaving Dominador in the small pool and so they did
not see the latter when he left the pool to get a bottle of coke. In that afternoon, there
were two lifeguards on duty in the pool compound, namely, Manuel Abao and Mario
Villanueva. The tour of duty of Abao was from 8:00 to 12:00 in the morning and from
2:00 to 6:00 in the afternoon, and of Villanueva from 7:30 to 11:30 a.m. and from
12:30 to 4:30 p.m. Between 4:00 to 5:00 that afternoon, there were about twenty
bathers inside the pool area and Manuel Abao was going around the pools to
observe the bathers in compliance with the instructions of his chief.

to another, there being fault or negligence, is obliged to pay for the damages done."
Such fault or negligence is called quasi-delict. Under the second article, this obligation
is demandable not only for one's own acts or omissions but also for those of persons
for whom one is responsible. In addition, we may quote the following authorities cited
in the decision of the trial court:

Between 4:40 to 4:45 p.m., some boys who were in the pool area informed a bather by
the name of Andres Hagad, Jr., that somebody was swimming under water for quite a
long time. Another boy informed lifeguard Manuel Abao of the same happening and
Abao immediately jumped into the big swimming pool and retrieved the apparently
lifeless body of Dominador Ong from the bottom. The body was placed at the edge of
the pool and Abao immediately applied manual artificial respiration. Soon after, male
nurse Armando Rule came to render assistance, followed by sanitary inspector
Iluminado Vicente who, after being called by phone from the clinic by one of the
security guards, boarded a jeep carrying with him the resuscitator and a medicine kit,
and upon arriving he injected the boy with camphorated oil. After the injection, Vicente
left on a jeep in order to fetch Dr. Ayuyao from the University of the Philippines.
Meanwhile, Abao continued the artificial manual respiration, and when this failed to
revive him, they applied the resuscitator until the two oxygen tanks were exhausted.
Not long thereafter, Dr. Ayuyao arrived with another resuscitator, but the same
became of no use because he found the boy already dead. The doctor ordered that
the body be taken to the clinic.

"'Although the proprietor of a natatorium is liable for injuries to a patron, resulting from
lack of ordinary care in providing for his safety, without the fault of the patron, he is
not, however, in any sense deemed to be the insurer of the safety of patrons. And the
death of a patron within his premises does not cast upon him the burden of excusing
himself from any presumption of negligence' (Bertalot vs. Kinnare. 72 Ill. App. 52, 22
A. L. R. 635; Flora vs. Bimini Water Co., 161 Cal. 495, 119 Pac. 661). Thus in Bertalot
vs. Kinnare, supra, it was held that there could be no recovery for the death by
drowning of a fifteen-year boy in defendant's natatorium, where it appeared merely
that he was lastly seen alive in water at the shallow end of the pool, and some ten or
fifteen minutes later was discovered unconscious, and perhaps lifeless, at the bottom
of the pool, all efforts to resuscitate him being without avail."

In the evening of the same day, July 5, 1952, the incident was investigated by the
Police Department of Quezon City and in the investigation boys Ruben Ong and
Andres Hagad, Jr. gave written statements. On the following day, July 6, 1952, an
autopsy was performed by Dr. Enrique V. de los Santos, Chief, Medico Legal Division,
National Bureau of Investigation, who found in the body of the deceased the following:
an abrasion on the right elbow lateral aspect; contusion on the right forehead;
hematoma on the scalp, frontal region, right side; a congestion in the brain with
petechial subcortical hemorrhage, frontal lobe; cyanosis on the face and on the nails;
the lung was soggy with fine froth in the bronchioles; dark fluid blood in the heart;
congestion in the visceral organs, and brownish fluid in the stomach. The death was
due to asphyxia by submersion in water.
The issue posed in this appeal is whether the death of minor Dominador Ong can be
attributed to the negligence of defendant and/or its employees so as to entitle plaintiffs
to recover damages.
The present action is governed by Article 2176 in relation to Article 2080 of the new
Civil Code. The first article provides that "whoever by act or omission causes damage

"'The rule is well settled that the owners of resorts to which people generally are
expressly or by implication invited are legally bound to exercise ordinary care and
prudence in the management and maintenance of such resorts, to the end of making
them reasonably safe for visitors' (Larkin vs. Saltair Beach Co., 30 Utah 86, 83 Pac.
688).

Since the present action is one for damages founded on culpable negligence, the
principle to be observed is that the person claiming damages has the burden of
proving that the damage is caused by the fault or negligence of the person from whom
the damage is claimed, or of one of his employees (Walter A. Smith & Co. vs.
Cadwallader Gibson Lumber Co., 55 Phil., 517). The question then that arises is:
Have appellants established by sufficient evidence the existence of fault or negligence
on the part of appellee so as to render it liable for damages for the death of
Dominador Ong?
There is no question that appellants had striven to prove that appellee failed to take
the necessary precaution to protect the lives of its patrons by not placing at the
swimming pools efficient and competent employees who may render help at a
moment's notice, and they ascribed such negligence to appellee because the lifeguard
it had on the occasion minor Ong was drowning was not available or was attending to
something else with the result that his help came late. Thus, appellants tried to prove
through the testimony of Andres Hagad, Jr. and Ruben Ong that when Eusebio Ong
and Hagad, Jr. detected that there was a drowning person in the bottom of the big
swimming pool and shouted to the lifeguard for help, lifeguard Manuel Abao did not
immediately respond to the alarm and it was only upon the third call that he threw
away the magazine he was reading and allowed three or four minutes to elapse before
retrieving the body from the water. This negligence of Abao, they contend, is
attributable to appellee.

But the claim of these two witnesses not only was vehemently denied by lifeguard
Abao, but is belied by the written statements given by them in the investigation
conducted by the Police Department of Quezon City approximately three hours after
the happening of the accident. Thus, these two boys admitted in the investigation that
they narrated in their statements everything they knew of the accident, but, as found
by the trial nowhere in said statements do they state that the lifeguard was chatting
with the security guard at the gate of the swimming pool or was reading a comic
magazine when the alarm was given for which reason he failed to immediately
respond to the alarm. On the contrary, what Ruben Ong particularly emphasized
therein was that after the lifeguard heard the shouts for help, the latter immediately
dived into the pool to retrieve the person under water who turned out to be his brother.
For this reason, the trial court made this conclusion: "The testimony of Ruben Ong
and Andres Hagad, Jr. as to the alleged failure of the lifeguard Abao to immediately
respond to their call may therefore be disregarded because they are belied by their
written statements." (Emphasis supplied.).
On the other hand, there is sufficient evidence to show that appellee has taken all
necessary precautions to avoid danger to the lives of its patrons or prevent accident
which may cause their death. Thus, it has been shown that the swimming pools of
appellee are provided with a ring buoy, toy roof, towing line, oxygen resuscitator and a
first aid medicine kit. The bottom of the pools is painted with black colors so as to
insure clear visibility. There is on display in a conspicuous place within the area
certain rules and regulations governing the use of the pools. Appellee employs six
lifeguards who are all trained as they had taken a course for that purpose and were
issued certificates of proficiency. These lifeguards work on schedule prepared by their
chief and arranged in such a way as to have two guards at a time on duty to look after
the safety of the bathers. There is a male nurse and a sanitary inspector with a clinic
provided with oxygen resuscitator. And there are security guards who are available
always in case of emergency. .
The record also shows that when the body of minor Ong was retrieved from the
bottom of the pool, the employees of appellee did everything possible to bring him
back to life. Thus, after he was placed at the edge of the pool, lifeguard Abao
immediately gave him manual artificial respiration. Soon thereafter, nurse Armando
Rule arrived, followed by sanitary inspector Iluminado Vicente who brought with him
an oxygen resuscitator. When they found that the pulse of the boy was abnormal, the
inspector immediately injected him with camphorated oil. When the manual artificial
respiration proved ineffective they applied the oxygen resuscitator until its contents
were exhausted. And while all these efforts were being made, they sent for Dr. Ayuyao
from the University of the Philippines who however came late because upon
examining the body found him to be already dead. All of the foregoing shows that
appellee has done what is humanly possible under the circumstances to restore life to
minor Ong and for that reason it is unfair to hold it liable for his death.
Sensing that their former theory as regards the liability of appellee may not be of much
help, appellants now switch to the theory that even if it be assumed that the deceased
is partly to be blamed for the unfortunate incident, still appellee may be held liable

under the doctrine of "last clear chance" for the reason that, having the last
opportunity to save the victim, it failed to do so.
We do not see how this doctrine may apply, considering that the record does not show
how minor Ong came into the big swimming pool. The only thing the record discloses
is that minor Ong informed his elder brothers that he was going to the locker room to
drink a bottle of coke but that from that time on nobody knew what happened to him
until his lifeless body was retrieved. The doctrine of last clear chance simply means
that the negligence of a claimant does not preclude a recovery for the negligence of
defendant where it appears that the latter, by exercising reasonable care and
prudence, might have avoided injurious consequences to claimant notwithstanding his
negligence. Or, "As the doctrine usually is stated, a person who has the last clear
chance or opportunity of avoiding an accident, notwithstanding the negligent acts of
his opponent or the negligence of a third person which is imputed to his opponent, is
considered in law solely responsible for the consequences of the accident." (38 Am.
Jur. pp. 900-902)
"It goes without saying that the plaintiff himself was not free from fault, for he was
guilty of antecedent negligence in planting himself in 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 a person who has the
last clear 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." (Picart vs.
Smith, 37 Phil., 809)
Since it is not known how minor Ong came into the big swimming pool and it being
apparent that he went there without any companion in violation of one of the
regulations of appellee as regards the use of the pools, and it appearing that lifeguard
Abao responded to the call for help as soon as his attention was called to it and
immediately after retrieving the body all efforts at the disposal of appellee had been
put into play in order to bring him back to life, it is clear that there is no room for the
application of the doctrine now invoked by appellants to impute liability to appellee.
"The last clear chance doctrine can never apply where the party charged is required to
act instantaneously, and if the injury cannot be avoided by the application of all means
at hand after the peril is or should have been discovered; at least in cases in which
any previous negligence of the party charged cannot be said to have contributed to
the injury. O'Mally vs. Eagan, 77 ALR 582, 43 Wyo. 233, 350, 2, P2d 1063." (A.L.R.
Digest, Vol. 8, pp. 955-956)
Before closing, we wish to quote the following observation of the trial court, which we
find supported by the evidence: "There is (also) a strong suggestion coming from the
expert evidence presented by both parties that Dominador Ong might have dived
where the water was only 5.5 feet deep, and in so doing he might have hit or bumped
his forehead against the bottom of the pool, as a consequence of which he was

stunned, and which eventually led to his drowning. As a boy scout he must have
received instructions in swimming. He knew, or must have known, that it was
dangerous for him to dive in that part of the pool."

publication of notices announcing the postponement of private respondent's

daughter's wedding which had to be cancelled because of his accident [Record on
Appeal, p. 5].

Wherefore, the decision appealed from being in accordance with law and the
evidence, we hereby affirm the same, without pronouncement as to costs.

Judgment was rendered in private respondent's favor prompting petitioner to appeal to

the Court of Appeals. The latter affirmed the trial court's decision. Petitioner then filed
with the same court a Motion for Reconsideration but this was denied.

Civil Aeronautics Administration vs. CA [G.R. No. 51806. November 8, 1988.]

Petitioner now comes before this Court raising the following assignment of errors:
DECISION
CORTES, J p:
Assailed in this petition for review on certiorari is the decision of the Court of Appeals
affirming the trial court decision which reads as follows:
WHEREFORE, judgment is hereby rendered ordering defendant to pay plaintiff the
amount of P15,589.55 as full reimbursement of his actual medical and hospital
expenses, with interest at the legal rate from the commencement of the suit; the
amount of P20,200.00 as consequential damages; the amount of P30,000.00 as moral
damages; the amount of P40,000.00 as exemplary damages; the further amount of
P20,000.00 as attorney's fees and the costs [Rollo, p. 24].
The facts of the case are as follows:
Private respondent is a naturalized Filipino citizen and at the time of the incident was
the Honorary Consul General of Israel in the Philippines.
In the afternoon of December 13, 1968, private respondent with several other persons
went to the Manila International Airport to meet his future son-in-law. In order to get a
better view of the incoming passengers, he and his group proceeded to the viewing
deck or terrace of the airport.
While walking on the terrace, then filled with other people, private respondent slipped
over an elevation about four (4) inches high at the far end of the terrace. As a result,
private respondent fell on his back and broke his thigh bone.
The next day, December 14, 1963, private respondent was operated on for about
three hours.
Private respondent then filed an action for damages based on quasi-delict with the
Court of First Instance of Rizal, Branch VII against petitioner Civil Aeronautics
Administration or CAA as the entity empowered "to administer, operate, manage,
control, maintain and develop the Manila International Airport . . ." [Sec. 32 (24), R.A.
776].
Said claim for damages included, aside from the medical and hospital bills,
consequential damages for the expenses of two lawyers who had to go abroad in
private respondent's stead to finalize certain business transactions and for the

1.
The Court of Appeals gravely erred in not holding that the present suit
against the CAA is really a suit against the Republic of the Philippines which cannot
be sued without its consent, which was not given in this case.
2.
The Court of Appeals gravely erred in finding that the injuries of respondent
Ernest E. Simke were due to petitioner's negligence although there was no
substantial evidence to support such finding; and that the inference that the hump or
elevation in the surface of the floor area of the terrace of the (old) MIA building is
dangerous just because said respondent tripped over it is manifestly mistaken
circumstances that justify a review by this Honorable Court of the said finding of fact of
respondent appellate court (Garcia v. Court of Appeals, 33 SCRA 622; Ramos v. CA,
63 SCRA 331.)
3.
The Court of Appeals gravely erred in ordering petitioner to pay actual,
consequential, moral and exemplary damages, as well as attorney's fees to
respondent Simke although there was no substantial and competent proof to
support said awards [Rollo, pp. 93-94].
I
Invoking the rule that the State cannot be sued without its consent, petitioner contends
that being an agency of the government, it cannot be made a party-defendant in this
case.
This Court has already held otherwise in the case of National Airports Corporation v.
Teodoro, Sr. [91 Phil. 203 (1952)].
Petitioner contends that the said ruling does not apply in this case because: First, in
the Teodoro case, the CAA was sued only in a substituted capacity, the National
Airports Corporation being the original party. Second, in the Teodoro case, the cause
of action was contractual in nature while here, the cause of action is based on a quasidelict. Third, there is no specific provision in Republic Act No. 776, the law governing
the CAA, which would justify the conclusion that petitioner was organized for business
and not for governmental purposes. [Rollo, pp. 94-97].
Such arguments are untenable.

First, the Teodoro case, far from stressing the point that the CAA was only substituted
for the National Airports Corporation, in fact treated the CAA as the real party in
interest when it stated that:
xxx

xxx

xxx

. . . To all legal intents and practical purposes the National Airports Corporation is
dead and the Civil Aeronautics Administration is its heir or legal representative, acting
by the law of its creation upon its own lights and in its own name. The better practice
then should have been to make the Civil Aeronautics Administration the third party
defendant instead of the National Airports Corporation.[National Airports Corp. v.
Teodoro, supra, p. 208.]
xxx

xxx

xxx

Second, the Teodoro case did not make any qualification or limitation as to whether or
not the CAA's power to sue and be sued applies only to contractual obligations. The
Court in the Teodoro case ruled that Sections 3 and 4 of Executive Order 365 confer
upon the CAA, without any qualification, the power to sue and be sued, albeit only by
implication. Accordingly, this Court's pronouncement that where such power to sue
and be sued has been granted without any qualification, it can include a claim based
on tort or quasi-delict [Rayo v. Court of First Instance of Bulacan, G.R. Nos. 55273-83,
December 19, 1981, 110 SCRA 456] finds relevance and applicability to the present
case.
Third, it has already been settled in the Teodoro case that the CAA as an agency is
not immune from suit, it being engaged in functions pertaining to a private entity.
xxx

xxx

the CAA in the category of a private entity were retained substantially in Republic Act
776, Sec. 32 (24) and (25). Said Act provides:
Sec. 32. Powers and Duties of the Administrator. Subject to the general control
and supervision of the Department Head, the Administrator shall have among others,
the following powers and duties:
xxx

(24)
To administer, operate, manage, control, maintain and develop the Manila
International Airport and all government-owned aerodromes except those controlled or
operated by the Armed Forces of the Philippines including such powers and duties as:
(a) to plan, design, construct, equip, expand, improve, repair or alter aerodromes or
such structures, improvement or air navigation facilities; (b) to enter into, make and
execute contracts of any kind with any person, firm, or public or private corporation or
entity;. . . .
(25)
To determine, fix, impose, collect and receive landing fees, parking space
fees, royalties on sales or deliveries, direct or indirect, to any aircraft for its use of
aviation gasoline, oil and lubricants, spare parts, accessories and supplies, tools,
other royalties, fees or rentals for the use of any of the property under its management
and control.
xxx

xxx

xxx

From the foregoing, It can be seen that the CAA is tasked with private or nongovernmental functions which operate to remove it from the purview of the rule on
State immunity from suit. For the correct rule as set forth in the Teodoro case states:
xxx

xxx

xxx

xxx

The Civil Aeronautics Administration comes under the category of a private entity.
Although not a body corporate it was created, like the National Airports Corporation,
not to maintain a necessary function of government, but to run what is essentially a
business, even if revenues be not its prime objective but rather the promotion of travel
and the convenience of the travelling public. It is engaged in an enterprise which, far
from being the exclusive prerogative of state, may, more than the construction of
public roads, be undertaken by private concerns. [National Airports Corp. v. Teodoro,
supra, p. 207.]
xxx

xxx

xxx

True, the law prevailing in 1952 when the Teodoro case was promulgated was Exec.
Order 365 (Reorganizing the Civil Aeronautics Administration and Abolishing the
National Airports Corporation). Republic Act No. 776 (Civil Aeronautics Act of the
Philippines), subsequently enacted on June 20, 1952, did not alter the character of the
CAA's objectives under Exec. Order 365. The pertinent provisions cited in the Teodoro
case, particularly Secs. 3 and 4 of Exec. Order 365, which led the Court to consider

xxx

xxx

Not all government entities, whether corporate or non-corporate, are immune from
suits. Immunity from suits is determined by the character of the objects for which the
entity was organized. The rule is thus stated in Corpus Juris:
Suits against State agencies with relation to matters in which they have assumed to
act in private or non-governmental capacity, and various suits against certain
corporations created by the state for public purposes, but to engage in matters
partaking more of the nature of ordinary business rather than functions of a
governmental or political character, are not regarded as suits against the state. The
latter is true, although the state may own stock or property of such a corporation for by
engaging in business operations through a corporation, the state divests itself so fan
of its sovereign character, and by implication consents to suits against the corporation.
(59 C.J., 313) [National Airports Corporation v. Teodoro, supra, pp. 206-207;
Emphasis supplied.]
This doctrine has been reaffirmed in the recent case of Malong v. Philippine National
Railways [G.R. No. L-49930, August 7, 1985, 138 SCRA 63], where it was held that
the Philippine National Railways, although owned and operated by the government,

was not immune from suit as it does not exercise sovereign but purely proprietary and
business functions. Accordingly, as the CAA was created to undertake the
management of airport operations which primarily involve proprietary functions, it
cannot avail of the immunity from suit accorded to government agencies performing
strictly governmental functions.
II
Petitioner tries to escape liability on the ground that there was no basis for a finding of
negligence. There can be no negligence on its part, it alleged, because the elevation
in question "had a legitimate purpose for being on the terrace and was never intended
to trip down people and injure them. It was there for no other purpose but to drain
water on the floor area of the terrace" [Rollo, p. 99].
To determine whether or not the construction of the elevation was done in a negligent
manner, the trial court conducted an ocular inspection of the premises.
xxx

xxx

xxx

. . . This Court after its ocular inspection found the elevation shown in Exhs. A or 6-A
where plaintiff slipped to be a step, a dangerous sliding step, and the proximate cause
of plaintiffs injury . . .
xxx

xxx

xxx

This Court during its ocular inspection also observed the dangerous and defective
condition of the open terrace which has remained unrepaired through the years. It has
observed the lack of maintenance and upkeep of the MIA terrace, typical of many
government buildings and offices. Aside from the litter allowed to accumulate in the
terrace, pot holes cause by missing tiles remained unrepaired and unattented. The
several elevations shown in the exhibits presented were verified by this Court during
the ocular inspection it undertook. Among these elevations is the one (Exh. A) where
plaintiff slipped. This Court also observed the other hazard, the slanting or sliding step
(Exh. B) as one passes the entrance door leading to the terrace [Record on Appeal,
U.S., pp. 56 and 59; Italics supplied.]
The Court of Appeals further noted that:
The inclination itself is an architectural anomaly for as stated by the said witness, it is
neither a ramp because a ramp is an inclined surface in such a way that it will prevent
people or pedestrians from sliding. But if, it is a step then it will not serve its purpose,
for pedestrian purposes. (tsn, p. 35, id.) [Rollo. p. 29.]
These factual findings are binding and conclusive upon this Court. Hence, the CAA
cannot disclaim its liability for the negligent construction of the elevation since under
Republic Act No. 776, it was charged with the duty of planning, designing,
constructing, equipping, expanding, improving, repairing or altering aerodromes or
such structures, improvements or air navigation facilities [Section 32, supra, R.A. 776].
In the discharge of this obligation, the CAA is duty-bound to exercise due diligence in

overseeing the construction and maintenance of the viewing deck or terrace of the
airport.
It must be borne in mind that pursuant to Article 1173 of the Civil Code, "(t)he fault or
negligence of the obligor consists in the omission of that diligence which is required by
the nature of the obligation and corresponds with the circumstances of the person, of
the time and of the place." Here, the obligation of the CAA in maintaining the viewing
deck, a facility open to the public, requires that CAA insure the safety of the viewers
using it. As these people come to the viewing deck to watch the planes and
passengers, their tendency would be to look to where the planes and the incoming
passengers are and not to look down on the floor or pavement of the viewing deck.
The CAA should have thus made sure that no dangerous obstructions or elevations
exist on the floor of the deck to prevent any undue harm to the public.
The legal foundation of CAA's liability for quasi-delict can be found in Article 2176 of
the Civil Code which provides that "(w)hoever by act or omission causes damage to
another, there being fault or negligence, is obliged to pay for the damage done. . . ."
As the CAA knew of the existence of the dangerous elevation which it claims though,
was made precisely in accordance with the plans and specifications of the building for
proper drainage of the open terrace [See Record on Appeal, pp. 13 and 57; Rollo, p.
39], its failure to have it repaired or altered in order to eliminate the existing hazard
constitutes such negligence as to warrant a finding of liability based on quasi-delict
upon CAA.
The Court finds the contention that private respondent was, at the very least, guilty of
contributory negligence, thus reducing the damages that plaintiff may recover,
unmeritorious. Contributory negligence under Article 2179 of the Civil Code
contemplates a negligent act or omission on the part of the plaintiff, which although
not the proximate cause of his injury, contributed to his own damage, the proximate
cause of the plaintiffs own injury being the defendant's lack of due care. In the instant
case, no contributory negligence can be imputed to the private respondent,
considering the following test formulated in the early case of Picart v. Smith, 37 Phil.
809 (1918):
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 man 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 the 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 speculations cannot be here
of much value but this 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 . . . [Picart v. Smith, supra, p. 813; emphasis supplied.]
The private respondent, who was the plaintiff in the case before the lower court, could
not have reasonably foreseen the harm that would befall him, considering the
attendant factual circumstances. Even if the private respondent had been looking
where he was going, the step in question could not easily be noticed because of its
construction. As the trial court found:
In connection with the incident testified to, a sketch, Exhibit O, shows a section of the
floorings on which plaintiff had tripped. This sketch reveals two pavements adjoining
each other, one being elevated by four and one-fourth inches than the other. From the
architectural standpoint the higher pavement is a step. However, unlike a step
commonly seen around, the edge of the elevated pavement slanted outward as one
walks to the interior of the terrace. The length of the inclination between the edges of
the two pavements is three inches. Obviously, plaintiff had stepped on the inclination
because had his foot landed on the lower pavement he would not have lost his
balance. The same sketch shows that both pavements including the inclined portion
are tiled in red cement, and as shown by the photograph Exhibit A, the lines of the
tilings are continuous. It would therefore be difficult for a pedestrian to see the
inclination especially where there are plenty of persons in the terrace as was the
situation when plaintiff fell down. There was no warning sign to direct one's attention
to the change in the elevation of the floorings. [Rollo, pp. 28-29.]
III
Finally, petitioner appeals to this Court the award of damages to private respondent.
The liability of CAA to answer for damages, whether actual, moral or exemplary,
cannot be seriously doubted in view of the conferment of the power to sue and be
sued upon it, which, as held in the case of Rayo v. Court of First Instance, supra,
includes liability on a claim for quasi-delict. In the aforestated case, the liability of the
National Power Corporation to answer for damages resulting from its act of sudden,
precipitate and simultaneous opening of the Angat Dam, which caused the death of
several residents of the area and the destruction of properties, was upheld since the
grant of the power to sue and be sued upon it necessarily implies that it can be held
answerable for its tortious acts or any wrongful act for that matter.
With respect to actual or compensatory damages, the law mandates that the same be
proven.
Art. 2199. Except as provided by law or by stipulation, one is entitled to an adequate
compensation only for such pecuniary loss suffered by him as he has duly proved.

Such compensation is referred to as actual or compensatory damages [New Civil

Code].
Private respondent claims P15,589.55 representing medical and hospitalization bills.
This Court finds the same to have been duly proven through the testimony of Dr.
Ambrosio Tangco, the physician who attended to private respondent (Rollo, p. 26 )
and who identified Exh. "H" which was his bill for professional services [Rollo, p. 31].
Concerning the P20,200.00 alleged to have been spent for other expenses such as
the transportation of the two lawyers who had to represent private respondent abroad
and the publication of the postponement notices of the wedding, the Court holds that
the same had also been duly proven. Private respondent had adequately shown the
existence of such losses and the amount thereof in the testimonies before the trial
court [CA decision, p. 8]. At any rate, the findings of the Court of Appeals with respect
to this are findings of facts [One Heart Sporting Club, Inc. v. Court of Appeals, G.R.
Nos. 53790-53972, Oct. 23, 1981 , 108 SCRA 416] which, as had been held time and
again, are, as a general rule, conclusive before this Court [Sese v. Intermediate
Appellate Court, G.R. No. 66186, July 31, 1987, 152 SCRA 585].
With respect to the P30,000.00 awarded as moral damages, the Court holds private
respondent entitled thereto because of the physical suffering and physical injuries
caused by the negligence of the CAA [Arts. 2217 and 2219 (2), New Civil Code].
With respect to the award of exemplary damages, the Civil Code explicitly states:
Art. 2229. Exemplary or corrective damages are imposed, by way of example or
correction for the public good, in addition to the moral, temperate, liquidated or
compensatory damages.
Art. 2231. In quasi-delicts, exemplary damages may be granted if the defendant acted
with gross negligence.
Gross negligence which, according to the Court, is equivalent to the term "notorious
negligence" and consists in the failure to exercise even slight care [Caunan v.
Compania General de Tabacos, 56 Phil. 542 (1932)] can be attributed to the CAA for
its failure to remedy the dangerous condition of the questioned elevation or to even
post a warning sign directing the attention of the viewers to the change in the elevation
of the floorings notwithstanding its knowledge of the hazard posed by such elevation
[Rollo, pp. 28-29; Record on Appeal, p. 57]. The wanton disregard by the CAA of the
safety of the people using the viewing deck, who are charged an admission fee,
including the petitioner who paid the entrance fees to get inside the vantage place [CA
decision, p. 2; Rollo, p. 25] and are, therefore, entitled to expect a facility that is
properly and safely maintained justifies the award of exemplary damages against
the CAA as a deterrent and by way of example or correction for the public good. The
award of P40,000.00 by the trial court as exemplary damages appropriately
underscores the point that as an entity charged with providing service to the public,
the CAA, like all other entities serving the public, has the obligation to provide the
public with reasonably safe service.

Finally, the award of attorney's fees is also upheld considering that under Art. 2208 (1
) of the Civil Code, the same may be awarded whenever exemplary damages are
awarded, as in this case, and, at any rate, under Art. 2208 (11), the Court has the
discretion to grant the same when it is just and equitable.
However, since the Manila International Airport Authority (MIAA) has taken over the
management and operations of the Manila International Airport [renamed Ninoy
Aquino International Airport under Republic Act No. 6639] pursuant to Executive Order
No. 778 as amended by executive Orders Nos. 903 (1983), 909 (1983) and 298
(1987) and under Section 24 of the said Exec. Order 778, the MIAA has assumed all
the debts, liabilities and obligations of the now defunct Civil Aeronautics Administration
(CAA), the liabilities of the CAA have now been transferred to the MIAA.
WHEREFORE, finding no reversible error, the Petition for review on Certiorari is
DENIED and the decision of the Court of Appeals in CA-G.R. No. 51172-R is
AFFIRMED. SO ORDERED.