PRE-WEEK MATERIALS – TORTS

1. Popoy and Basha’s wedding was set on April 30, and Popoy’s family will be coming from New Zealand. With this,
Popoy and Basha decided to renovate their house at Batangas to accommodate all Popoy’s relatives. On January
1, Popoy and Basha contracted an architect/engineer, Carlo, for the construction of the house for Php500,000.00.
The contract stated that the house will be completed as agreed on March 30, a month before the wedding. Popoy
and Basha fully paid the contract price with Php50,000.00 allowance. Unfortunately, the construction has not been
finished as of the wedding date, forcing Popoy’s relatives to stay in a 3-star hotel.

Popoy and Basha filed a complaint alleging that Carlo started the project without securing the necessary permits
from the city engineer’s office, which mainly caused the delay, with prayer for the return of Php50,000.00 over
payment, Php100,000.00 for repairing, and Php200,000.00 to complete the project. Carlo, in turn, countered that
over payment was for an additional work, and that the delay is due to circumstances beyond control of the
petitioner.

Is Popoy and Basha entitled to the actual damages prayed for?

No. Article 2199 of the New Civil Code provides that “one is entitled to an adequate compensation only for such
pecuniary loss suffered by him as he has duly proved.” In Ong v. CA, the Court held that “actual damages are
such compensation or damages for an injury that will put the injured party in the position in which he had been
before he was injured. They pertain to such injuries or losses that are actually sustained and susceptible of
measurement.” To be recoverable, actual damages must not only be capable of proof, but must actually be proved
with reasonable degree of certainty. We cannot simply rely on speculation, conjecture or guesswork in
determining the amount of damages. Thus, it was held that before actual damages can be awarded, there must be
competent proof of the actual amount of loss, and credence can be given only to claims which are duly supported
by receipts. (Engr. Apolinario Dueñas v. Alice Guce-Africa, GR No. 165679, October 5,2009 – DEL CASTILLO)

2. Explain the principle of Emergency Rule.

In Gan v. CA, the Supreme Court defined the Principle of Emergency Rule as “that when one who suddenly finds
himself in a place of danger, and is required to act without time to consider the best means that may be adopted to
avoid the impending danger, is not guilty of negligence, if he fails to adopt what subsequently and upon reflections
may appear to have been a better method, unless the emergency in which he finds himself is brought about by his
own negligence.” (Orix Metro Leasing and Finance Corporation v. Mangalinao y Dizon, GR No. 174089, 174266,
January 25, 2012 – DEL CASTILLO)

3. Joan, seller, and Angela, buyer, entered into a Conditional Deed of Sale for a parcel of land for Php1,000,000.00.
After three years and despite the payment of Php500,000.00, Joan was not able to transfer the said land. Hence,
Angela demanded the return of the amount paid. In reply, Joan promised to return the same within 120 days.
Angela agreed but imposed an interest of 12% annually. A still failed despite demands.

Angela filed a complaint with the RTC against Joan. In her answer, Joan averred that they she is willing to pay the
principal amount but without the interest as it was not agreed upon the Conditional Deed of Sale, which provides
only for the return of the down payment in case of breach. RTC ruled that Angela is entitled to the interest but only
at the rate of 6% per annum.

Is the imposition of 6% interest, even not stipulated in the Conditional Dees of Sale, proper?

Yes. The interest may be imposed even in the absence of stipulation in the contract. Article 2210 of the Civil Code
expressly provides that “interest may, in the discretion of the court, be allowed upon damages awarded for breach
of contract.” In this case, there is no question that Joan is legally obligated to return the Php1,000,000.00 because
of her failure to fulfill the obligation under the Conditional Deed of Sale, despite demand. Joan enjoyed the use of
 the money from the time it was given to her until now. Thus, Joan is already in default of her obligation from the
date of demand. (Hermojina Estores v. Spouses Arturo and Laura Supangan, GR No. 175139, April 18, 2012)

Is the RTC correct in ruling that Angela is entitled for 6% interest? Explain your answer.

Under Central Bank Circular 416, 12% interest shall be applied, not 6% (Article 2209 of the New Civil Code).

As a general rule, the applicable interest rate shall be computed in accordance with the stipulation of the parties.
When obligation arises out of a loan or forbearance of money, goods or credits and there is no stipulation, the
applicable rate of interest shall be 12%. The contract involved in this case is not a loan but a Conditional Deed of
Sale. There is no question that the obligations were not met and the return of money was not made. Even if the
transaction was a Conditional Deed of Sale, the stipulation governing the return of the money can be considered
as a forbearance of money which requires interest of 12%.

In Crismina Garments, Inc. v. CA, forbearance was defined as a “contractual obligation of lender or creditor to
refrain during a given period of time, from requiring the borrower or debtor to repay a loan or debt then due and
payable.” In such case, “forbearance of money, goods or credits” will have no distinct definition from a loan.
However, the phrase “forbearance of money, goods or credits” is meant to have a separate meaning from a loan;
otherwise there would have been no need to add that phrase as a loan is already sufficiently defined in the Civil
Code. Forbearance of money, goods or credits should therefore refer to arrangements other than loan
agreements, where a person acquiesces to the temporary use of his money, goods or credits pending happening
of certain events or fulfillment of certain conditions. Joan’s unwarranted withholding of the money amounts to
forbearance of money which can be considered as an involuntary loan so rate is 12% starting in Sept. 2000.
(Hermojina Estores v. Spouses Arturo and Laura Supangan, GR No. 175139, April 18, 2012)

4. Karmelle and her friend Janine were having a conversation when Janine’s friend, Finela, approached her to ask if
she could have Finela’s check cleared and encashed for a service fee of 2.5%. The check is under the account of
another person and drawn by a certain John against Bank of America Alhambra Branch in USA, payable to cash.
Because Janine does not have a dollar account in which to deposit the check, she asked Karmelle if she could
accommodate Finela’s request since she has a dollar savings account. Karmelle agreed. She deposited the check
and was informed of the 15-day clearing period. Five days later, the proceeds of the subject check had been
temporarily credited to PNB’s account. After informing Karmelle that the check had already been cleared and that
the amount had been credited to her account, she personally withdrew the proceeds and gave them to Finela.

PNB learned about the bounced check when it received a debit advice and a letter from Philadelphia National
Bank demanding the return of the money. Karmelle contacted Finela to get the money back but the latter told her
that all the money had already been given to several people. Later on, PNB demanded the payment of the amount
withdrawn by Karmelle, while the latter, as her main defense, claimed that the proximate cause of PNB’s injury
was its own negligence of paying the amount without waiting for the 15-day clearing period

Is the act of PNB, releasing the proceeds of the check prior to the lapse of the 15-day clearing period the
proximate cause of the loss?

Yes. The payment of the amounts of checks without previously clearing them with the drawee bank, especially so
where the drawee bank is a foreign bank and the amounts involved were large, is contrary to normal or ordinary
banking practice. Clearly, PNB’s disregard of its preventive and protective measure against the possibility of being
victimized by bad checks had brought upon itself the injury of losing a significant amount of money. PNB
miserably failed to do its duty of exercising extraordinary diligence and reasonable business prudence. The
disregard of its own banking policy amounts to gross negligence, which the law defines as “negligence
characterized by the want of even slight care, acting or omitting to act in a situation where there is duty to act, not
inadvertently but willfully and intentionally with a conscious indifference to consequences in so far as other
persons may be affected.” (Philippine National Bank v. Spouses Cheah, GR No. 170865, April 25, 2002 – DEL
CASTILLO)

Is Karmelle guilty of contributory negligence?

 Yes. Karmelle is guilty of contributory negligence and is bound to share the loss with the bank. Karmelle failed to
observe caution in giving her full trust in accommodating a complete stranger and this led her to be swindled. The
fact that the check was cleared after only eight banking days from the time it was deposited or contrary to what
Janine told Karmelle that clearing takes 15 days should have already put Karmelle on guard. (Philippine National
Bank v. Spouses Cheah, GR No. 170865, April 25, 2002 – DEL CASTILLO)

5. Explain the doctrine of res ipsa loquitur and provide its requisites.

Under the doctrine of res ipsa loquitur, where the thing that caused the injury complained of is shown to be under
the management of the defendant or his servants; and the accident, in the ordinary course of things, would not
happen if those who had management or control used proper care.

The requisites of the doctrine of res ipsa loquitur as established by jurisprudence are as follows: 1) the accident is
of a kind which does not ordinarily occur unless someone is negligent; 2) the cause of the injury was under the
exclusive control of the person in charge and 3) the injury suffered must not have been due to any voluntary action
or contribution on the part of the person injured.

6. Joshua, registered owner of a motor vehicle, allowed Julia to use his car and drive it to school. On its way to
school, Julia accidentally bumped an old man and caused his death.

Is Joshua, the registered owner of the vehicle, liable?

Yes. Joshua is the registered owner of the motor vehicle, hence primarily liable. In Aguilar, Sr. v. Commercial
Savings Bank, the car of therein respondent bank caused the death of Conrado while being driven by its assistant
vice president. Despite Article 2180, the Court still held the bank liable for damages for the accident as said
provision should defer to the settled doctrine concerning accidents involving registered motor vehicles, i.e., that
the registered owner of any vehicle, even if not used for public service, would primarily be responsible to the
public or to third persons for injuries caused the latter while the vehicle was being driven on highways and streets.

7. Juan executed a Special Power of Attorney in favor or Pedro authorizing Pedro to obtain a Php5,000,000.00 loan
using Juan’s properties as collateral. Pedro processed the loan and advanced Php500,000.00 to Juan in
exchange of the certificate of titles. However, the loan processed amounted only to Php2,000,000.00. Unsatisfied,
Juan revoked the SPA. Pedro contended that the SPA cannot be revoked solely by Juan.

Is Pedro’s contention tenable? Is Pedro entitled to actual damages or exemplary damages?

There is no question that the SPA executed by respondents in favor of petitioners is a contract of agency coupled
with interest. This is because their bilateral contract depends upon the agency. Hence, it “cannot be revoked at
the sole will of the principal.”

Pedro is entitled to actual damages. In exchange for his possession of the titles, Pedro advanced the amount of
P500,000.00 to Juan. Considering that the loan application did not push through, Juanis liable to return the said
amount to Pedro.

On the other hand, Pedro is not entitled to exemplary damages. Article 2229 of the Civil Code provides that
exemplary damages may be imposed “by way of example or correction for the public good, in addition to the
moral, temperate, liquidated or compensatory damages.” They are, however, not recoverable as a matter of right.
They are awarded only if the guilty party acted in a wanton, fraudulent, reckless, oppressive or malevolent
manner. In this case, although the revocation was done bad faith, Juan did not act in a wanton, fraudulent,
reckless, oppressive or malevolent manner. Juan revoked the SPA because he was not satisfied with the amount
of the loan approved. Thus, petitioners are not entitled to exemplary damages. (Albert M. Ching and Romeo J.
Bautista v. Felix M. Bantolo, GR No. 177086, December 5, 2012 – DEL CASTILLO)

8. What is malicious prosecution?

The term ‘malicious prosecution’ has been defined as ‘an action for damages brought by one against whom a
criminal prosecution, civil suit, or other legal proceeding has been instituted maliciously and without probable
 cause, after the termination of such prosecution, suit, or other proceeding in favor of the defendant therein.’ While
generally associated with unfounded criminal actions, the term has been expanded to include unfounded civil suits
instituted just to vex and humiliate the defendant despite the absence of a cause of action or probable cause.
(Meyr Enterprises Corp. v. Cordero, GR No. 197336, September 3, 2014 – DEL CASTILLO)

Note: The recovery of moral damages for malicious prosecution is allowed under Article 2219 of the Civil Code,
while attorney’s fees and expenses of litigation may be adjudged in malicious prosecution cases pursuant to
Article 2208 of the same Code.

9. Distinguish monetary interest from compensatory interest.

Monetary interest refers to the compensation set by the parties for the use or forbearance of money. No such
interest shall be due unless it has been expressly stipulated in writing. On the other hand, compensatory interest
refers to the penalty or indemnity for damages imposed by law or by the courts. The interest mentioned in Articles
2209 and 2212 of the Civil Code applies to compensatory interest. (Sun Life of Canada (Phils.), Inc. v. Tan Kit, GR
No. 183272, October 15, 2014 – DEL CASTILLO)

10. Discuss the two concepts of attorney’s fees—ordinary and extraordinary.

In its ordinary sense, it is the reasonable compensation paid to a lawyer by his client for legal services rendered.
In its extraordinary concept, it is awarded by the court to the successful litigant to be paid by the losing party as
indemnity for damages. Although both concepts are similar in some respects, they differ from each other. The
attorney’s fees which a court may, in proper cases, award to a winning litigant is, strictly speaking, an item of
damages. It differs from that which a client pays his counsel for the latter’s professional services.

11. In criminal cases involving death, can the Court award damages when no documentary evidence is provided?

Yes. The table of damages provides that in all criminal cases involving death, wherein no documentary evidence
of burial or funeral expenses is presented in court, the amount of Php50,000.00 as temperate damages shall be
awarded. (People v. Ireneo Jugueta, GR No. 202124, April 5, 2016)

12. Company A engaged the services of Contractor B for the construction of its watch assembly plant. Specifically,
one of the agreed services was construction administration, which includes guarding Company A from defects and
deficiencies during the construction phase by determining the progress and quality of the work of the general
contractor.

However, after five years from the year the construction began, Company A noticed roof defects. The major
construction work was done in December 2008, wherein Company A was forced to stop its operations from
December 1-18, 2008, putting its employees on forced leave with pay. Company A spent Php1,000,000.00 for
shoring expenses and wages of its employees for the period December 1-18, 2008. Company A has no receiving
copy of the payments, only the master list of the daily and monthly paid employees.

Laying the blame on Contractor B for the roof defects, Company A sought reimbursement of everything it had
spent for the corrective work by suing Contractor B for damages. One of which is the reimbursement of the
Php1,000,000.00.

Is the action for reimbursement of Company A tenable? If you are the judge, how will you resolve this case?

No. Article 2199 of the New Civil Code provides that “one is entitled to an adequate compensation only for such
pecuniary loss suffered by him as he has duly proved.” A claimant is entitled to be compensated reasonably and
commensurately for what he or she has lost as a result of another’s act or omission, and the amount of damages
to be awarded shall be equivalent to what have been pleaded and adequately proven. To prove that salaries have
been paid, Company A has the burden to show that payments have actually been made to its employees. The
master list of daily and monthly paid employees does not substantiate such plea for the full reimbursement of the
salaries.

Should the claimant fail to prove with exactitude the extent of injury he or she sustained, the court will still allow
redress if it finds that the claimant has suffered due to another’s fault. While Company A failed to prove the exact
amount of the salaries it had paid, the Court, however, acknowledged that Company A had to pay its employees
 during the shutdown and had suffered pecuniary loss for the structural problem. As a matter of equity, therefore, a
relief to Company A in the form of temperate damages is warranted. (Adrian Wilson International Associates Inc.
v. TMX Philippines, GR No. 162608, July 26, 2010)

13. Tender Juicy Hotdog, Inc. (TJH) and Mang Kanor entered into a Trucking Agreement, whereby Mang Kanor’s
trucks will haul TJH’s feeds from its central office to its various warehouses in Mindanao. Under this agreement,
Mang Kanor will deposit cash bonds of Php100,000.00 per truck.

In June 2008, Mang Kanor agreed with TJH’s Feeds Sales Supervisor, Kuya Jobert, regarding the lease of Mang
Kanor’s warehouse for the storage of the feeds products. In the Warehousing Agreement, it has been agreed that
it shall remain in force for a two-year period.

To properly document the movement of the stocks, TJH gives respondents two kinds of warehouse documents:
the Daily Warehouse Stock Report (DWSR), which is the inventory of incoming stocks, and the Warehouse Issue
Slip (WIS), which is a receipt for released stocks. According to TJH, the WIS should contain the signature of the
sales personnel as proof that the latter received the released stocks, in accordance with Paragraph V of the
agreement.

On May 20, 2009, however, TJH informed Mang Kanor that it is terminating the contract due to violations of the
Warehousing Agreement. TJH explained that, under Paragraph V of the Warehousing Agreement, the warehouse
operator should only release stocks to sales personnel after the latter presents a clearance to withdraw stocks.
The violations were evident from the WIS which did not contain the signatures of the sales personnel. These
unauthorized releases caused TJH an estimate cash shortage of Php2,000,000.00.

Mang Kanor denied violating the terms of the warehousing agreement. He explained that his actions is mere
obeisance to the instructions of Kuya Jobert to release the stocks directly to customers. As proof of these
instructions, Mang Kanor presented the handwritten letter he received from Kuya Jobert, authorizing him to
release the stocks directly to customers.

Consequently, TJH retained Mang Kanor’s three land titles and be given back on the day Mang Kanor will fully
comply with his obligation. It cited as its basis Paragraph XII of the Warehousing Agreement, which states that the
"bond shall answer for whatever obligation the warehouse operator may have with [TJH]."

Is there a breach of contract? If yes, is TJH entitled to damages as a result of such breach?

Yes. The provision of the Warehousing Agreement states that the warehouseman should only release stocks to
Swifts sales personnel who present a clearance to withdraw stocks. Breach of Paragraph V of the Warehousing
Agreement is clear. In this case, only an estimate was provided for the damages suffered, and based on
jurisprudence, where there has been a breach of contract but actual damages have not been established, nominal
damages may be awarded to vindicate the injured party’s rights. Considering that the Mang Kanor did not perform
or even take effort to fully comply with his duties and obligations under the warehousing agreement, it is only just
that he be ordered to return nominal damages, which is an approximation of whatever benefit they received from
such agreement. (Swift Foods, Inc. v. Spouses Jose Mate, Jr. and Irene Mateo, GR No. 170486, September
12,2011)

14. On September 8, 2011, an multiple-vehicle collision happened in North Luzon Expressway (NLEX), resulting in
the death of all the passengers in one vehicle, which includes the Osorio spouses and a sibling of the surviving
orphan minor heirs.

An action for damages based on quasi-delict was filed by the minor children of the Osorio spouses through their
legal guardian against the drivers A and B, as well as the operators and registered owners of the subject trucks,
namely Y and Z.

Y interposed that it is not the actual owner of the truck and contended that the children had no cause of action
against it because on September 7, 2011, it sold the truck to MMO Trucking owned by C. The latter being the
alleged owner at the time of the collision, Y filed a Third Party Complaint against C.

Is the contention of Y tenable?

No. Y as the operator on record of the truck is liable to the heirs of the victims of the mishap. Y cannot point
fingers at the alleged real owner to exculpate itself from vicarious liability under Article 2180 of the Civil Code,
which states that 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. 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. Regardless of whoever Y claims to be the actual owner of the truck
by reason of a contract of sale, it is nevertheless primarily liable for the damages or injury caused by the truck
registered under his name. (Orix Metro Leasing and Finance Corporation v. Minors: Dennis, Mylene, Melanie and
Marikris, all surnamed Mangalinao y Dizon, Manuel M. Ong, Loreto Lucilo, Sonny Li, and Antonio De Lo Santos,
GR No. 174089, January 25, 2012)

15. Marielle own several fishponds in Bulacan and through their duly appointed attorney-in-fact and co-respondent
Nerie, leased out these fishponds to Spouses Reyes. The lease was to be for five years, or from March 1, 2008 up
to June 30, 2013, as provided under the Contract of Lease. The lease expired on June 30, 2013, but Spouses
Reyes did not vacate and continued to occupy and operate the fishponds until August 11, 2013, or an additional
41 days beyond the contract expiration date.

Previously, or on July 22, 2013, Marielle and Nerie sent a letter to the spouses declaring the latter as trespassers
and demanding the settlement of the latter’s outstanding obligations, including rent for continued stay within the
premises, in the amount of Php378,451.00.

On June 8, 2014, respondents instituted Civil Case for collection of a sum of money with damages, claiming that
Spouses Reyes committed violations of their lease agreement – non-payment of rents as stipulated, subletting the
fishponds, failure to maintain the warehouses, and refusal to vacate the premises on expiration of the lease –
which caused Marielle and Nerie to incur actual and liquidated damages and other expenses in the respective
amounts of Php570,101.00 for unpaid rent, Php275,430.00 for unpaid additional rent for petitioners’ one-month
extended stay beyond the contract date, and Php2,000,000.00 for expenses incurred in restoring and repairing
their damaged warehouses. In addition, Marielle and Nerie prayed to be awarded moral and exemplary damages.

If you are the judge, will you award Marielle and Nerie moral and exemplary damages?

Yes. By refusing to honor their solemn obligations under the lease, and instead unduly profiting from these
violations, the spouses were guilty of bad faith. Under the law, moral damages may be awarded when the breach
of contract is attended with bad faith. Also, exemplary damages may be awarded when a wrongful act is
accompanied by bad faith or when the defendant acted in a wanton, fraudulent, reckless, oppressive, or
malevolent manner. (Spouses Alberto and Susan Castro v. Amparo Palenzuela, GR No. 184698, January 21,
2013)

16. ABC Inc. filed a Complaint for Damages and Attorney’s Fees against Juan. ABC Inc. claims to be the registered
owner of a 4,887-square meter parcel of land and alleged that sometime in July 2002, Juan constructed a dike in
front of his land. The dike disrupted the flow of the waves of the sea causing damages to his land. RTC dismissed
the case and became final and executory.

Juan argued that plaintiff-appellant has no personality to sue as the area in controversy is a foreshore land, owned
by the State and under no circumstances will plaintiff suffer any damage or injury therefrom. Juan further averred
that in order to "restore mother nature" without engaging plaintiff in actual court battle, Juan sought assistance
from the local government in constructing a dike/sea wall. He contended that the construction thereof should be
charged to the ABC Inc., as it is the proximate cause of the damage. He postulated that plaintiff filed the baseless
suit against him because Meyr wanted to acquire his land. He prayed for moral damages, attorney’s fees, litigation
expenses and exemplary damages.

Will you decide in favor of Juan?

Yes. Malicious prosecution is apparent in this case. A finding of malicious prosecution requires the following
elements: that the fact of the prosecution and the further fact that the defendant was himself the prosecutor, and
thatthe action was finally terminated with an acquittal; that in bringing the action, the prosecutor acted without
probable cause; and that the prosecutor was actuated or impelled by legal malice. In this case, it is evident that
ABC Inc. was the one who initiated the present case for damages against Juan. It is also crystal clear that the
dismissal of the original case has long become final and executory. Likewise, the second and third elements for
malicious prosecution have been evidently established. The subject in litigation which is the beach is undoubtedly
a foreshore land and incapable of private ownership. As such, the only entity that could suffer any damage
thereon is the State. Juan was also forced to litigate in court in his defense, thereby incurring attorney’s fees.
Thus, it is the conscientious posture of the Court that not only did ABC Inc. deliberately brought the case without
probable cause but also filed the same with legal malice as well. (Meyr Enterprises Corporation v. Rolando
Cordero, GR No. 197336, September 3, 2014)
17. The Republic filed a verified complaint for the expropriation of a parcel of land belonging to Anna. Anna received
two checks from DPWH representing 100% of the zonal value of the subject property. Anna signified in open court
that she is interposing no objection, and that she has received the total sum of Php683,349.22 and no longer
intending to claim any just compensation. The RTC directed the Republic to pay consequential damages
equivalent to the value of the capital gains tax and other taxes necessary for the transfer.

Should the awarded consequential damage be granted?

No. Consequential damages are only awarded if, as a result of the expropriation, the remaining property of the
owner suffers from impairment or decrease in value. In this case, given that the payment of capital gains tax on
the transfer of the subject property has no effect on the increase or decrease in value of the remaining property, it
can hardly be considered as consequential damages that may be awarded to respondents. (Republic of the
Philippines v. Spouses Senado F. Salvador and Josefina R. Salvador, GR No. 205428, June 7, 2017)

From Uribe Notes:

18. A passenger of the bus operated by Times Transit Company suffered serious physical injuries as a result of
vehicular accident. Information was filed against the driver of the bus for serious physical injuries through reckless
imprudence. He was however acquitted on the merits of the case because according to the judgment of acquittal
he was not negligent. Subsequently, the passenger instituted an action against the bus company to recover
damages.

Would it prosper?

It may prosper despite the fact the accused was acquitted and ruled not negligent. This determination of the court
in the criminal case is not binding on the court where the action under quasi delict was filed. It was because of the
fact of the quantum of evidence required is different. When the criminal court stated that the accused was not
negligent he was thinking of a quantum of evidence much higher than what is required in a civil action.

Note: On the requisites in order for a defendant be liable of quasi delict: Despite the provision under Art. 2176 that
“No pre-existing contractual relation” the Supreme Court would tell us that even if there is pre-existing contractual
relation a claim under quasi delict may prosper because the same act which breaches the contract may by itself a
tortious act. However it does not follow automatically that if there is a breach its tortious.

19. Despite a warning from the police that an attempt to hijack a PAL plane will be made in the following week, the
airline did not take extra precautions, such as frisking of passengers, for fear of being accused of violating human
rights. Two days later, an armed hijacker did attempt to hijack a PAL flight to Cebu. Although he was subdued by
the other passengers, he managed to fire a shot which hit and killed a female passenger. The victim’s parents
sued the airline for breach of contract, and the airline raised the defense of force majeure.

Considering the fact that there was a warning, is it PAL’s obligation to do extra measures?

No. First, it is not the obligation of the airline company to frisk passenger. By express provisions of the law this
scenario does not require the airline company to exercise extra ordinary diligence because this is an incident
involving both of them as passengers. If only a passenger would cause injury to another passenger the common
carrier is required only to exercise ordinary diligence under Art. 1763.

20. Armando operated a school bus to ferry his two sons and five of their schoolmates from their houses to their
school, and back. The parents of the five schoolmates paid for the service. One morning, Basilio, the driver, took a
short cut on the way to school because he was running late, and drove across an unmanned railway crossing. At
the time, Basilio was wearing earphones because he loved to hear loud music while driving. As he crossed the
railway tracks, a speeding PNR train loudly blared its horn to warn Basilio, but the latter did not hear the horn
because of the loud music. The train inevitably rammed into the school bus. The strong impact of the collision
between the school bus and the train resulted in the instant death of one of the classmates of Armando’s younger
son.

The parents of the fatality sued Armando for damages based on culpa contractual alleging that Armando was a
common carrier; Basilio for being negligent; and the PNR for damages based on culpa acquiliana.

Armando denied being a common carrier. He insisted that he had exercised the diligence of a good father of a
family in supervising Basilio, claiming that the latter had had no history of negligence or recklessness before the
fatal accident.
 Did Armando’s operation of the school bus service for a limited clientele render Armando a common carrier?
Explain your answer.

Yes, because a common carrier is one who is engaged in the business of carrying or transporting passengers or
goods, or both, or one who holds himself or itself out to the public as being engaged in the said business.

In Perena v. Zarate, the Court definitively ruled that the operators of a school bus service are common carriers
even if they are catering to a limited clientele because of the following reasons: (1) they are engaged in
transporting passengers generally as a business, not just as a casual occupation; (2) they are undertaking to carry
passengers over established roads by the method by which the business was conducted; and (3) they are
transporting students for a fee.

The Court additionally explained that despite catering to a limited clientele, they operate as common carriers
because they held themselves out as a ready transportation indiscriminately to the students of a particular school
living within or near where they operated the service and for a fee.

In accordance with your answer to the preceding question, state the degree of diligence to be observed by
Armando, and the consequences thereof. Explain your answer.

Being a common carrier, Armando is required to observe extraordinary diligence, and is presumed to be at fault or
to have acted negligently in case of the loss of the effects of passengers, or the death or injuries to passengers.

In this case, Armando is liable for the death of the student because, acting as a common carrier, he is already
presumed to be negligent at the time of the accident because death had occurred to the passenger. Here,
Armando failed to fend off liability because he failed to prove that he observed extraordinary diligence in ensuring
the safety of the passengers.

Assuming that the fatality was a minor of only 15 years of age who had no earning capacity at the time of his
death because he was still a student in high school, and the trial court is minded to award indemnity, what may
possibly be the legal and factual justifications for the award of loss of earning capacity? Explain your answer.

The basis for the computation of the deceased’s earning capacity should be the minimum wage in effect at the
time of his death, pursuant to the ruling of the Court in Perena v. Zarate. In the same case, the Court also ruled
that the computation of the victim’s life expectancy rate should not be reckoned from his age of 15 years at the
time of his death, but on 21 years, his age when he would have graduated from college.

In the same case, the Court justified the indemnification of the victim’s loss of earning capacity despite him having
been unemployed because compensation of this nature is awarded not for loss of time or earnings but for loss of
the deceased’s power or ability to earn money.

21. A driver of a bus owned by company Z ran over a boy who died instantly. A criminal case for reckless imprudence
resulting in homicide was filed against the driver. He was convicted and was ordered to pay P2 Million in actual
and moral damages to the parents of the boy who was an honor student and had a bright future. Without even
trying to find out if the driver had assets or means to pay the award of damages, the parents of the boy filed a civil
action against the bus company to make it directly liable for the damages.

Will their action prosper? If the parents of the boy do not wish to file a separate civil action against the bus
company, can they still make the bus company liable if the driver cannot' pay the award for damages?
If so, what is the nature of the employer's liability and how may civil damages be satisfied?

It may prosper, because if the action is under delict, then the conviction of the criminal case with higher quantum
of evidence required was satisfied more so in a civil case. However, if the civil action was under quasi delict, the
employer may raise the defence of diligence in selection and supervision making the employer not liable. They
can still make the bus company subsidiary liable. They have to prove first that the driver cannot pay the awards
before they can make the employer held liable.

22. Under Article 2180 of the New Civil Code, can the school be held vicariously liable?

Under Article 2180 of the NCC, the answer is no because the one liable is the teachers of the school, not the
school itself. However, in 1980s, the Justices of the Supreme Court can no longer subscribe to that interpretation.
Now, the prevailing rule is that under the Family Code the school can be held vicariously liable.*nothing follows*