CALIFORNIA CLOTHING, INC.

& YBAÑEZ v QUIÑONES

Peralta, J.
G.R. No. 175822. – October 23, 2013.
FACTS:
 July 25, 2001: Shirley Quiñones, a Reservation Ticketing Agent of Cebu Pacific, went inside the Guess USA Botique
at the 2nd floor of Robinson’s Department Store in Cebu City
 She fitted four items, then decided to purchase the black jeans worth P2,098
 She paid to the cashier, as evidence by a receipt issued by the store
 As she was leaving to go to Mercury Drug, a Guess employee approached her and informed her that she
failed to pay for the item she got
 Shirley insisted that she paid, and even showed the receipt
 Shirely suggested that they talk about it at the Cebu Pacific Office, located at the basement of the
mall
 When Shirley arrived at the Cebu Pacific Office, the Guess employees allegedly subjected her to humiliation
in front of Cebu Pacific
 They repeatedly demanded payment for the black jeans and searched her wallet to check how much
money she had
 On the same day, the Guess employees allegedly gave a letter to the Director of Cebu Pacific narrating the
incident
 The Director refused to receive it as it did not concern the office
 The Human Resource Department of Robisnon’s likewise refused to receive when it was furnished
the same letter
 Shirley filed a Complaint for Damages before RTC against California Clothing, Villagonzalo, Hawayon and Ybañez
 Demanded the payment of moral, nominal, and exemplary damages, plus attorney’s fees and litigation
expenses
 Alleged that she was not given a copy of the damaging letter penned by the Guess employees
 Claimed that she suffered physical anxiety, sleepless nights, mental anguish, fright, serious apprehension,
besmirched reputation, moral shock and social humiliation
 California Clothing et al.’s Defense
 Admitted issuance of the receipt of payment but claimed that instead of the cashier (Hawayon) issuing the
OR, it was the invoicer (Villagonzalo) who did it manually
 There was miscommunication between the employees at that time
 Prior to the issuance of the receipt, Villagonzalo asked Hawayon, “Ok na?”, to which the latter
replied “Ok na”
 The former took this to mean that the item had already been paid
 Realizing his mistake, Villagonzalo rushed outside to look for Shirley, who he invited back to the
store to clarify whether or not payment was made
 Upon meeting Shirley at the Cebu Pacific office to discuss the matter, they emphasized that they were
gentle and polite
 Alleged that Shirley was the one who was arrogant
 Filed a counterclaim, seeking payment of moral and exemplary damages, plus attorney’s fees
 June 20, 2003: RTC dismissed both the complaint of Shirley and the counterclaim of California Clothing
 Concluded that the petitioners and the other defendants believed in good faith that respondent failed to
make payment
 Did not find it damaging for respondent when the confrontation took place in front of Cebu Pacifc clients
 It was respondent herself who put herself in that situation by choosing the venue for discussion
 Did not take the letter against the Guess employees
 They merely asked for assistance and not to embarrass or humiliate respondent
 Aug. 3, 2006: On appeal, CA reversed and set aside the RTC decision
 Ordered California Clothing and Ybañez to pay Shirley jointly and solidarily moral damages
 Held that petitioners are guilty of abuse of right, entitling respondent to collect moral damages and
attorney's fees
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  California Clothing, Inc. was made liable for its failure to exercise extraordinary diligence in the
hiring and selection of its employees
 Ybañez's liability stemmed from her act of signing the demand letter sent to respondent's employer
 In view of Hawayon and Villagonzalo's good faith, however, they were exonerated from
liability
 Found preponderance of evidence showing that the Guess employees acted in bad faith in sending the
demand letter to respondent's employee
 The letter addressed to Cebu Pacific's director was sent to respondent's employer to subject her to
ridicule, humiliation and similar injury such that she would be pressured to pay
 There was a taint of bad faith and malice when it dragged respondent's employer who was not privy
to the transaction when Guess already started its investigation on the incident
 The purported letter contained accusations as to the alleged acts of respondent in trying to evade
payment
 Found that Shirley’s possession of both the official receipt and the subject black jeans as evidence of
payment.
 Petitioners filed a petition for review on certiorari under Rule 45
ISSUE/HELD/RATIO:
1. W/N California Clothing is guilty of abuse of its right to verify from respondent whether she indeed paid or not –
YES
 The elements of abuse of rights are as follows:
a) There is a legal right or duty
b) Which is exercised in bad faith
c) For the sole intent of prejudicing or injuring another
 California Clothing had the right to verify from Shirley whether she indeed made payment if they had reason to
believe that she did not
 However, the exercise of this right is not without limitations
 Art. 19: Every person must, in the exercise of his rights and in the performance of his duties, act with
justice, give everyone his due and observe honesty and good faith
o A person is liable if he acted in bad faith with intent to prejudice another
o Good faith consists of the intention to abstain from taking an unconscionable and unscrupulous
advantage of another
o Bad faith implies a conscious and intentional design to do a wrongful act for a dishonest purpose
or moral obliquity
 In the case at bar, California Clothing claims that it is within their right to verify from respondent whether she
indeed paid or not and collect from her if she did not
 Initially, there was nothing wrong with petitioners asking respondent whether she paid or not
 The confrontation at the Cebu Pacific Officce started well, but it eventually turned sour when voices were
raised by both parties
o Such was the natural consequence of two parties with con icting views insisting on their respective
beliefs
 Since respondent was in possession of the item purchased as well as the official receipt issued by
petitioners, the latter cannot insist that no such payment was made on the basis of a mere speculation
o Petitioners’ claim should have been proven by substantial evidence in the proper forum.
 It is evident from the circumstances of the case that petitioners went overboard and tried to force respondent to
pay the amount they were demanding
 Obviously imputed bad acts on the part of respondent when petitioners sent a demand letter to her
employer
o She allegedly left the store in a hurry after receiving the receipt, and refused to go back inside
o Accused her of not being honest about the circumstances of payment
 Accusations were made despite the issuance of the receipt of payment and the release of the item
purchased
o No showing that respondent had the intention to evade payment

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 o Contrary to petitioners' claim, respondent was not in a rush in leaving the shop or the mall
 This is evidenced by the fact that the Guess employees did not have a hard time looking
for her when they realized the supposed non-payment
 CONCLUSION: In sending the demand letter to respondent's employer, petitioners intended not to malign
respondent without substantial evidence and despite the latter's possession of enough evidence in her favor, is
clearly impermissible
 A person should not use his right unjustly or contrary to honesty and good faith, otherwise, he opens
himself to liability
 The exercise of a right must be in accordance with the purpose for which it was established and must
not be excessive or unduly harsh
 In this case, petitioners obviously abused their rights.

DISPOSITIVE PORTION:
WHEREFORE, premises considered, the petition is DENIED for lack of merit. The Court of Appeals Decision dated August
3, 2006 and Resolution dated November 14, 2006 in CA-G.R. CV No. 80309, are AFFIRMED.