passengers.

The decision of the Court of Appeals was, affirmed, with the

modification that the award of moral damages was deleted.
SECOND DIVISION

SYLLABUS
[G.R. No. 122039. May 31, 2000.]

1. CIVIL LAW; TORTS AND DAMAGES; QUASI-DELICT AND BREACH OF

VICENTE CALALAS, petitioner, vs. COURT OF CONTRACT; DISTINGUISHED; CASE AT BAR. — The issue in Civil Case No.
APPEALS, ELIZA JUJEURCHE SUNGA and 3490 was whether Salva and his driver Verena were liable for quasi-delict for the
FRANCISCO SALVA, respondents.
damage caused to petitioner's jeepney. On the other hand, the issue in this case is
whether petitioner is liable on his contract of carriage. The first, quasi-delict, also
known as culpa aquiliana or culpa extra contractual, has as its source the negligence
Leo B. Diocos for petitioner. of the tortfeasor. The second, breach of contract or culpa contractual, is premised
Enrique S. Empleo for E.J. Sunga. upon the negligence in the performance of a contractual obligation. Consequently,
in quasi-delict, the negligence or fault should be clearly established because it is the
Eduardo T. Sedillo for F. Salva. basis of the action, whereas in breach of contract, the action can be prosecuted
merely by proving the existence of the contract and the fact that the obligor, in this
case the common carrier, failed to transport his passenger safely to his destination. In
SYNOPSIS case of death or injuries to passengers, Art. 1756 of the Civil Code provides that
common carriers are presumed to have been at fault or to have acted negligently
unless they prove that they observed extraordinary diligence as defined in Arts. 1733
Sunga filed a complaint for damages against Calalas, alleging violation of the
contract of carriage by the former in failing to exercise the diligence required of him and 1755 of the Code. This provision necessarily shifts to the common carrier the
as a common carrier. Calalas, on the other hand, filed a third-party complaint against burden of proof.
Francisco Salva, the owner of the Isuzu truck that bumped their passenger jeepney. 2. ID.; ID.; ID.; DOCTRINE OF PROXIMATE CAUSE; NOT APPLICABLE IN
The lower court rendered judgment against Salva as third-party defendant and ACTIONS INVOLVING BREACH OF CONTRACT; RATIONALE. — The
absolved Calalas of liability, holding that it was the driver of the Isuzu truck who doctrine of proximate cause is applicable only in actions for quasi-delict, not in
was responsible for the accident. It took cognizance of another case (Civil Case No. actions involving breach of contract. The doctrine is a device for imputing liability to
3490), filed by Calalas against Salva and Verena for quasi-delict, in which Branch 37 a person where there is no relation between him and another party. In such a case,
of the same court held Salva and his driver Verena jointly liable to Calalas for the the obligation is created by law itself. But, where there is a pre-existing contractual
damage to his jeepney. On appeal, the Court of Appeals reversed the ruling of the relation between the parties, it is the parties themselves who create the obligation,
lower court on the ground that Sunga's cause of action was based on a contract of and the function of the law is merely to regulate the relation thus created. Insofar as
carriage, not quasi-delict, and that the common carrier failed to exercise the diligence contracts of carriage are concerned, some aspects regulated by the Civil Code are
required under the Civil Code. The appellate court dismissed the third-party those respecting the diligence required of common carriers with regard to the safety
complaint against Salva and adjudged Calalas liable for damages to Sunga. Hence, of passengers as well as the presumption of negligence in cases of death or injury to
this petition. passengers.
It is immaterial that the proximate cause of the collision between the jeepney and the 3. ID.; ID.; ID.; CASO FORTUITO; DEFINED; REQUIREMENTS THEREOF. —
truck was the negligence of the truck driver. The doctrine of proximate cause is A caso fortuito is an event which could not be foreseen, or which, though foreseen,
applicable only in actions for quasi-delict, not in actions involving breach of was inevitable. This requires that the following requirements be present: (a) the
contract. In the case at bar, upon the happening of the accident, the presumption of cause of the breach is independent of the debtor's will; (b) the event is unforeseeable
negligence at once arose, and it became the duty of petitioner to prove that he had or unavoidable; (c) the event is such as to render it impossible for the debtor to fulfill
observed extraordinary diligence in the care of his passengers. The fact that Sunga his obligation in a normal manner, and (d) the debtor did not take part in causing the
was seated in an "extension seat" placed her in a peril greater than that to which the injury to the creditor. Petitioner should have foreseen the danger of parking his
other passengers were exposed. Therefore, not only was petitioner unable to jeepney with its body protruding two meters into the highway.
overcome the presumption of negligence imposed on him for the injury sustained by
Sunga, but also, the evidence showed he was actually negligent in transporting
4. ID.; DAMAGES; MORAL DAMAGES; WHEN IT MAY BE RECOVERED. — The lower court rendered judgment, against Salva as third-party defendant and
As a general rule, moral damages are not recoverable in actions for damages absolved Calalas of liability, holding that it was the driver of the Isuzu truck who
predicated on a breach of contract for it is not one of the items enumerated under Art. was responsible for the accident. It took cognizance of another case (Civil Case No.
2219 of the Civil Code. As an exception, such damages are recoverable: (1) in cases 3490), filed by Calalas against Salva and Verena, for quasi-delict, in which Branch
in which the mishap results in the death of a passenger, as provided in Art. 1764, in 37 of the same court held Salva and his driver Verena jointly liable to Calalas for the
relation to Art. 2206 (3) of the Civil Code; and (2) in the cases in which the carrier is damage to his jeepney.
guilty of fraud or bad faith, as provided in Art. 2220. SCDaET
On appeal to the Court of Appeals, the ruling of the lower court was reversed on the
ground that Sunga's cause of action was based on a contract of carriage, not quasi-
delict, and that the common carrier failed to exercise the diligence required under the
DECISION Civil Code. The appellate court dismissed the third-party complaint against Salva
and adjudged Calalas liable for damages to Sunga. The dispositive portion of its
decision reads:

MENDOZA, J p: WHEREFORE, the decision appealed from is hereby

REVERSED and SET ASIDE, and another one is entered
This is a petition for review on certiorari of the decision 1 of the Court of Appeals, ordering defendant-appellee Vicente Calalas to pay plaintiff-
dated March 31, 1991, reversing the contrary decision of the Regional Trial Court, appellant:
Branch 36, Dumaguete City, and awarding damages instead to private respondent (1) P50,000.00 as actual and compensatory damages;
Eliza Jujeurche Sunga as plaintiff in an action for breach of contract of
carriage. prLL (2) P50,000.00 as moral damages;
The facts, as found by the Court of Appeals, are as follows: (3) P10,000.00 as attorney's fees; and
At 10 o'clock in the morning of August 23, 1989, private respondent Eliza Jujeurche (4) P1,000.00 as expenses of litigation; and
G. Sunga, then a college freshman majoring in Physical Education at the Siliman
University, took a passenger jeepney owned and operated by petitioner Vicente (5) to pay the costs.
Calalas. As the jeepney was filled to capacity of about 24 passengers, Sunga was SO ORDERED.
given by the conductor an "extension seat," a wooden stool at the back of the door at
the rear end of the vehicle. Hence, this petition. Petitioner contends that the ruling in Civil Case No. 3490 that
the negligence of Verena was the proximate cause of the accident negates his
On the way to Poblacion Sibulan, Negros Occidental, the jeepney stopped to let a liability and that to rule otherwise would be to make the common carrier an insurer
passenger off. As she was seated at the rear of the vehicle, Sunga gave way to the of the safety of its passengers. He contends that the bumping of the jeepney by the
outgoing passenger. Just as she was doing so, an Isuzu truck driven by Iglecerio truck owned by Salva was a caso fortuito. Petitioner further assails the award of
Verena and owned by Francisco Salva bumped the left rear portion of the jeepney. moral damages to Sunga on the ground that it is not supported by evidence. prLL
As a result, Sunga was injured. She sustained a fracture of the "distal third of the left
tibia-fibula with severe necrosis of the underlying skin." Closed reduction of the The petition has no merit.
fracture, long leg circular casting, and case wedging were done under sedation. Her
confinement in the hospital lasted from August 23 to September 7, 1989. Her The argument that Sunga is bound by the ruling in Civil Case No. 3490 finding the
attending physician, Dr. Danilo V. Oligario, an orthopedic surgeon, certified she driver and the owner of the truck liable for quasi-delict ignores the fact that she was
would remain on a cast for a period of three months and would have to ambulate in never a party to that case and, therefore, the principle of res judicata does not apply.
crutches during said period. dctai Nor are the issues in Civil Case No. 3490 and in the present case the same. The issue
On October 9, 1989, Sunga filed a complaint for damages against Calalas, alleging in Civil Case No. 3490 was whether Salva and his driver Verena were liable
violation of the contract of carriage by the former in failing to exercise the diligence forquasi-delict for the damage caused to petitioner's jeepney. On the other hand, the
required of him as a common carrier. Calalas, on the other hand, filed a third-party issue in this case is whether petitioner is liable on his contract of carriage. The
complaint against Francisco Salva, the owner of the Isuzu truck. first,quasi-delict, also known as culpa aquiliana or culpa extra contractual, has as its
source the negligence of the tortfeasor. The second, breach of contract or culpa
contractual, is premised upon the negligence in the performance of a contractual acted negligently, unless they prove that they observed
obligation. extraordinary diligence as prescribed by Articles 1733 and 1755.
In the case at bar, upon the happening of the accident, the presumption of negligence
at once arose, and it became the duty of petitioner to prove that he had to observe
Consequently, in quasi-delict, the negligence or fault should be clearly established extraordinary diligence in the care of his passengers.
because it is the basis of the action, whereas in breach of contract, the action can be
prosecuted merely by proving the existence of the contract and the fact that the Now, did the driver of jeepney carry Sunga "safely as far as human care and
obligor, in this case the common carrier, failed to transport his passenger safely to foresight could provide, using the utmost diligence of very cautious persons, with
his destination. 2 In case of death or injuries to passengers, Art. 1756 of the Civil due regard for all the circumstances" as required by Art. 1755? We do not think so.
Code provides that common carriers are presumed to have been at fault or to have Several factors militate against petitioner's contention.
acted negligently unless they prove that they observed extraordinary diligence as
defined in Arts. 1733 and 1755 of the Code. This provision necessarily shifts to the First, as found by the Court of Appeals, the jeepney was not properly parked, its rear
common carrier the burden of proof. portion being exposed about two meters from the broad shoulders of the highway,
and facing the middle of the highway in a diagonal angle. This is a violation of
There is, thus, no basis for the contention that the ruling in Civil Case No. 3490, the R.A. No. 4136, as amended, or the Land Transportation and Traffic Code, which
finding Salva and his driver Verena liable for the damage to petitioner's jeepney, provides:
should be binding on Sunga. It is immaterial that the proximate cause of the collision
between the jeepney and the truck was the negligence of the truck driver. The SECTION 54. Obstruction of Traffic. — No person shall drive
doctrine of proximate cause is applicable only in actions for quasi-delict, not in his motor vehicle in such a manner as to obstruct or impede the
actions involving breach of contract. The doctrine is a device for imputing liability to passage of any vehicle, nor, while discharging or taking on
a person where there is no relation between him and another party. In such a case, passengers or loading or unloading freight, obstruct the free
the obligation is created by law itself. But, where there is a pre-existing contractual passage of other vehicles on the highway. LLpr
relation between the parties, it is the parties themselves who create the obligation, Second, it is undisputed that petitioner's driver took in more passengers than the
and the function of the law is merely to regulate the relation thus created. Insofar as allowed seating capacity of the jeepney, a violation of §32(a) of the same law. It
contracts of carriage are concerned, some aspects regulated by the Civil Code are provides:
those respecting the diligence required of common carriers with regard to the safety
of passengers as well as the presumption of negligence in cases of death or injury to Exceeding registered capacity. — No person operating any
passengers. It provides: llcd motor vehicle shall allow more passengers or more freight or
cargo in his vehicle than its registered capacity.
ARTICLE 1733. Common carriers, from the nature of their
business and for reasons of public policy, are bound to observe The fact that Sunga was seated in an "extension seat" placed her in a peril greater
extraordinary diligence in the vigilance over the goods and for than that to which the other passengers were exposed. Therefore, not only was
the safety of the passengers transported by them, according to all petitioner unable to overcome the presumption of negligence imposed on him for the
the circumstances of each case. injury sustained by Sunga, but also, the evidence shows he was actually negligent in
transporting passengers.
Such extraordinary diligence in the vigilance over the goods is
further expressed in Articles 1734, 1735, and 1746, Nos. 5, 6, We find it hard to give serious thought to petitioner's contention that Sunga's taking
and 7, while the extraordinary diligence for the safety of the an "extension seat" amounted to an implied assumption of risk. It is akin to arguing
passengers is further set forth in Articles 1755 and 1756. LLjur that the injuries to the many victims of the tragedies in our seas should not be
compensated merely because those passengers assumed a greater risk of drowning by
ARTICLE 1755. A common carrier is bound to carry the boarding an overloaded ferry. This is also true of petitioner's contention that the
passengers safely as far as human care and foresight can provide, jeepney being bumped while it was improperly parked constitutes caso
using the utmost diligence of very cautious persons, with due fortuito. A caso fortuito is an event which could not be foreseen, or which, though
regard for all the circumstances. foreseen, was inevitable. 3 This requires that the following requirements be present:
ARTICLE 1756. In case of death of or injuries to passengers, (a) the cause of the breach is independent of the debtor's will; (b) the event is
common carriers are presumed to have been at fault or to have unforeseeable or unavoidable; (c) the event is such as to render it impossible for the
debtor to fulfill his obligation in a normal manner, and (d) the debtor did not take
part in causing the injury to the creditor. 4 Petitioner should have foreseen the danger WHEREFORE, the decision of the Court of Appeals, dated March 31, 1995, and its
of parking his jeepney with its body protruding two meters into the highway. dctai resolution, dated September 11, 1995, are AFFIRMED, with the MODIFICATION
that the award of moral damages is DELETED.
Finally, petitioner challenges the award of moral damages alleging that it is
excessive and without basis in law. We find this contention well taken. SO ORDERED.
In awarding moral damages, the Court of Appeals stated: Bellosillo and Buena, JJ., concur.
Plaintiff-appellant at the time of the accident was a first-year Quisumbing and De Leon, Jr., JJ., are on leave.
college student in that school year 1989-1990 at the Siliman
University, majoring in Physical Education. Because of the ||| (Calalas v. Court of Appeals, G.R. No. 122039, [May 31, 2000], 388 PHIL 146-
injury, she was not able to enroll in the second semester of that 155)
school year. She testified that she had no more intention of
continuing with her schooling, because she could not walk and
decided not to pursue her degree, major in Physical Education
"because of my leg which has a defect already."
Plaintiff-appellant likewise testified that even while she was
under confinement, she cried in pain because of her injured left
foot. As a result of her injury, the Orthopedic Surgeon also
certified that she has "residual bowing of the fracture side." She
likewise decided not to further pursue Physical Education as her
major subject, because "my left leg . . . has a defect
already." LLphil
Those are her physical pains and moral sufferings, the inevitable
bedfellows of the injuries that she suffered. Under Article 2219
of the Civil Code, she is entitled to recover moral damages in the
sum of P50,000.00, which is fair, just and reasonable.
As a general rule, moral damages are not recoverable in actions for damages
predicated on a breach of contract for it is not one of the items enumerated under Art.
2219 of the Civil Code. 5 As an exception, such damages are recoverable: (1) in
cases in which the mishap results in the death of a passenger, as provided in Art.
1764, in relation to Art. 2206(3) of the Civil Code; and (2) in the cases in which the
carrier is guilty of fraud or bad faith, as provided in Art. 2220. 6
In this case, there is no legal basis for awarding moral damages since there was no
factual finding by the appellate court that petitioner acted in bad faith in the
performance of the contract of carriage. Sunga's contention that petitioner's
admission in open court that the driver of the jeepney failed to assist her in going to a
nearby hospital cannot be construed as an admission of bad faith. The fact that it was
the driver of the Isuzu truck who took her to the hospital does not imply that
petitioner was utterly indifferent to the plight of his injured passenger. If at all, it is
merely implied recognition by Verena that he was the one at fault for the
accident. LLpr
 1. CIVIL LAW; OBLIGATIONS AND CONTRACTS; COMMON CARRIERS;
THIRD DIVISION NOT LIABLE TO INJURIES OR DAMAGES CAUSED BY FORTUITOUS
EVENT. — A contract to transport passengers is quite different in kind and degree
from any other contractual relation. It is safe to conclude that it is a relationship
[G.R. No. 118664. August 7, 1998.] imbued with public interest. Failure on the part of the common carrier to live up to
the exacting standards of care and diligence renders it liable for any damages that
JAPAN AIRLINES, petitioner, vs. THE COURT OF may be sustained by its passengers. However, this is not to say that common carriers
APPEALS, ENRIQUE AGANA, MARIA ANGELA NINA are absolutely responsible for all injuries or damages even if the same were caused
AGANA, ADALIA B. FRANCISCO and JOSE by a fortuitous event. To rule otherwise would render the defense of "force majeure,"
MIRANDA, respondents. as an exception from any liability, illusory and ineffective. AECIaD
2. ID.; ID.; ID.; ID.; DISRUPTION OF FLIGHT DUE TO ERUPTION OF MT.
PINATUBO, A "FORCE MAJEURE". — Accordingly, there is no question that
SYNOPSIS when a party is unable to fulfill his obligation because of "force majeure," the
general rule is that he cannot be held liable for damages for non-performance.
Private respondents boarded a Japan Airlines (JAL) flight in San Francisco, Corollarily, when JAL was prevented from resuming its flight to Manila due to the
California bound for Manila with an overnight stopover at Narita, Japan at JAL's effects of Mt. Pinatubo eruption, whatever losses or damages in the form of hotel and
expense. Due to the Mt. Pinatubo eruption, private respondents' trip to Manila was meal expenses the stranded passengers incurred, cannot be charged to JAL. Yet it is
cancelled. JAL rebooked all the Manila-bound passengers and paid for the hotel undeniable that JAL assumed the hotel expenses of respondents for their unexpected
expenses for their unexpected overnight stay. The flight of private respondents was overnight stay on June 15, 1991. Admittedly, to be stranded for almost a week in a
again cancelled due to NAIA's indefinite closure. Since JAL did not defray their foreign land was an exasperating experience for the private respondents. To be sure,
hotel accommodation expenses during their stay in Narita, Japan, private respondents they underwent distress and anxiety during their unanticipated stay in Narita, but
were forced to pay for their accommodations and meal expenses from their personal their predicament was not due to the fault or negligence of JAL but the closure of
funds. NAIA to international flights. Indeed, to hold JAL, in the absence of bad faith or
negligence, liable for the amenities of its stranded passengers by reason of a
The private respondents then filed an action for damages against JAL before the fortuitous event is too much of a burden to assume.
Regional Trial Court of Quezon City. The trial court rendered judgment in favor of
private respondent holding JAL liable for damages. The Court of Appeals affirmed 3. ID.; ID.; ID.; ID.; AIRLINE PASSENGERS MUST TAKE RISKS INCIDENT
the decision but lowered the amount of the damages. Hence, this petition. TO MODE OF TRAVEL. — It has been held that airline passengers must take such
risks incident to the mode of travel. In this regard, adverse weather conditions or
The Supreme Court held that when JAL was prevented from resuming its flight to extreme climatic changes are some of the perils involved in air travel, the
Manila due to the effects of Mt. Pinatubo eruption, whatever losses or damages in consequences of which the passengers must assume or expect. After all, common
the form of hotel and meal expenses the stranded passengers incurred, cannot be carriers are not the insurer of all risks.
charged to JAL. The Court, however, did not completely absolved JAL from any
liability. While JAL was no longer required to defray private respondents' living 4. ID.; ID.; ID.; ID.; PAL CASE (226 SCRA 423) NOT APPLICABLE TO CASE
expenses during their stay in Narita, Japan on account of fortuitous event, JAL had AT BAR. — The factual background of the PAL case is different from the instant
the duty to make the necessary arrangements to transport private respondents on the petition. In that case there was indeed a fortuitous event resulting in the diversion of
first available connecting flight to Manila. Petitioner JAL reneged on its obligation to the PAL flight. However, the unforeseen diversion was worsened when "private
look after the comfort and convenience of its passengers when it declassified private respondents (passenger) was left at the airport and could not even hitch a ride in a
respondents from "transit passengers" to "new passengers" Ford Fiera loaded with PAL personnel," not to mention the apparent apathy of the
PAL station manager as to the predicament of the stranded passengers. In light of
The decision is affirmed with modification as to the damages. these circumstances, we held that if the fortuitous event was accompanied by neglect
and malfeasance by the carrier's employees, an action for damages against the carrier
is permissible. Unfortunately, for private respondents, none of these conditions are
SYLLABUS present in the instant petition. SDAcaT
5. ID.; ID.; ID.; LIABLE FOR PAYMENT OF NOMINAL DAMAGES FOR
FAILURE TO MAKE ARRANGEMENTS ON THE FIRST AVAILABLE
CONNECTING FLIGHT FOR THE PASSENGERS' FINAL DESTINATION; To accommodate the needs of its stranded passengers, JAL rebooked all the Manila-
CASE AT BAR. — We are not prepared, however, to completely absolve petitioner bound passengers on flight No. 741 due to depart on June 16, 1991 and also paid for
JAL from any liability. It must be noted that private respondents bought tickets from the hotel expenses for their unexpected overnight stay. On June 16, 1991, much to
the United States with Manila as their final destination. While JAL was no longer the dismay of the private respondents, their long anticipated flight to Manila was
required to defray private respondents' living expenses during their stay in Narita on again cancelled due to NAIA's indefinite closure. At this point, JAL informed the
account of the fortuitous event, JAL had the duty to make the necessary private respondents that it would no longer defray their hotel and accommodation
arrangements to transport private respondents on the first available connecting flight expense during their stay in Narita.
to Manila. Petitioner JAL reneged on its obligation to look after the comfort and
convenience of its passengers when it declassified private respondents from "transit Since NAIA was only reopened to airline traffic on June 22, 1991, private
passengers" to "new passengers" as a result of which private respondents were respondents were forced to pay for their accommodations and meal expenses from
obliged to make the necessary arrangements themselves for the next flight to Manila. their personal funds from June 16 to June 21, 1991. Their unexpected stay in Narita
Consequently, the award of nominal damages is in order. Nominal damages are ended on June 22, 1991 when they arrived in Manila on board JL flight No. 741.
adjudicated in order that a right of a plaintiff, which has been violated or invaded by Obviously, still reeling from the experience, private respondents, on July 25, 1991,
the defendant, may be vindicated or recognized and for the purpose of indemnifying commenced an action for damages against JAL before the Regional Trial Court of
any loss suffered by him. The court may award nominal damages in every obligation Quezon City, Branch 104. 2 To support their claim, private respondents asserted that
arising from any source enumerated in Article 1157, or in every case where any JAL failed to live up to its duty to provide care and comfort to its stranded
property right has been invaded. Petitioner JAL is ordered to pay each of the private passengers when it refused to pay for their hotel and accommodation expenses from
respondents nominal damages in the sum of P100,000.00 each including attorney's June 16 to 21, 1991 at Narita, Japan. In other words, they insisted that JAL was
fees of P50,000.00 plus costs. TICDSc obligated to shoulder their expenses as long as they were still stranded in Narita. On
the other hand, JAL denied this allegation and averred that airline passengers have
no vested right to these amenities in case a flight is cancelled due to " force
majeure."
DECISION
On June 18, 1992, the trial court rendered its judgment in favor of private
respondents holding JAL liable for damages, viz.:
ROMERO, J p: "WHEREFORE, judgment is rendered in favor of plaintiffs
ordering the defendant Japan Airlines to pay the plaintiffs
Before us is an appeal by certiorari filed by petitioner Japan Airlines, Inc. (JAL) Enrique Agana, Adalia B. Francisco and Maria Angela Nina
seeking the reversal of the decision of the Court of Appeals, 1 which affirmed with Agana the sum of One million Two Hundred forty-six Thousand
modification the award of damages made by the trial court in favor of herein private Nine Hundred Thirty-Six Pesos (P1,246,936.00) and Jose
respondents Enrique Agana, Maria Angela Nina Agana, Adelia Francisco and Jose Miranda the sum of Three Hundred Twenty Thousand Six
Miranda. dctai Hundred sixteen and 31/100 (P320,616.31) as actual, moral and
exemplary damages and pay attorney's fees in the amount of
On June 13, 1991, private respondent Jose Miranda boarded JAL flight No. JL 001 in Two Hundred Thousand Pesos (P200,000.00), and to pay the
San Francisco, California bound for Manila. Likewise, on the same day private costs of suit."
respondents Enrique Agana, Maria Angela Nina Agana and Adelia Francisco left
Los Angeles, California for Manila via JAL flight No. JL 061. As an incentive for
traveling on the said airline, both flights were to make an overnight stopover at
Narita, Japan, at the airlines' expense, thereafter proceeding to Manila the following Undaunted, JAL appealed the decision before the Court of Appeals, which, however,
day. with the exception of lowering the damages awarded affirmed the trial court's
finding, 3 thus:
Upon arrival at Narita, Japan on June 14, 1991, private respondents were billeted at
Hotel Nikko Narita for the night. The next day, private respondents, on the final leg ''Thus, the award or moral damages should be as it is hereby
of their journey, went to the airport to take their flight to Manila However, due to the reduced to P200,000.00 for each of the plaintiffs, the exemplary
Mt. Pinatubo eruption, unrelenting ashfall blanketed Ninoy Aquino International damages to P300,000.00 and the attorney's fees to P100,000.00
Airport (NAIA), rendering it inaccessible to airline traffic. Hence, private plus the costs.
respondents' trip to Manila was cancelled indefinitely.
 WHEREFORE, with the foregoing Modification, the judgment Furthermore, it has been held that airline passengers must take such risks incident to
appealed from is hereby AFFIRMED in all other the mode of travel. 7 In this regard, adverse weather conditions or extreme climatic
respects." LLphil changes are some of the perils involved in air travel, the consequences of which the
passenger must assume or expect. After all, common carriers are not the insurer of
JAL filed a motion for reconsideration which proved futile and unavailing. 4 all risks. 8
Failing in its bid to reconsider the decision, JAL has now filed this instant petition. Paradoxically, the Court of Appeals, despite the presence of "force majeure," still
The issue to be resolved is whether JAL, as a common carrier has the obligation to ruled against JAL relying in our decision in PAL v. Court of Appeals, 9 thus:
shoulder the hotel and meal expenses of its stranded passengers until they have "The position taken by PAL in this case clearly illustrates its
reached their final destination, even if the delay were caused by " force majeure." failure to grasp the exacting standard required by law.
To begin with, there is no dispute that the Mt. Pinatubo eruption prevented JAL from Undisputably, PAL's diversion of its flight due to inclement
proceeding to Manila on schedule. Likewise, private respondents concede that such weather was a fortuitous event. Nonetheless, such occurrence
event can be considered as " force majeure" since their delayed arrival in Manila was did not terminate PAL's contract with its passengers. Being in
not imputable to JAL. 5 the business of air carriage and the sole one to operate in the
country, PAL is deemed equipped to deal with situations as in
However, private respondents contend that while JAL cannot be held responsible for the case at bar. What we said in one case once again must be
the delayed arrival in Manila, it was nevertheless liable for their living expenses stressed, i.e., the relation of carrier and passenger continues until
during their unexpected stay in Narita since airlines have the obligation to ensure the the latter has been landed at the port of destination and has left
comfort and convenience of its passengers. While we sympathize with the private the carrier's premises. Hence, PAL necessarily would still have
respondents' plight, we are unable to accept this contention. to exercise extraordinary diligence in safeguarding the comfort,
convenience and safety of its stranded passengers until they have
We are not unmindful of the fact that in a plethora of cases we have consistently reached their final destination. On this score, PAL grossly failed
ruled that a contract to transport passengers is quite different in kind and degree from considering the then ongoing battle between government forces
any other contractual relation. It is safe to conclude that it is a relationship imbued and Muslim rebels in Cotabato City and the fact that the private
with public interest. Failure on the part of the common carrier to live up to the respondent was a stranger to the place."
exacting standards of care and diligence renders it liable for any damages that may
be sustained by its passengers. However, this is not to say that common carriers are The reliance is misplaced. The factual background of the PAL case is different from
absolutely responsible for all injuries or damages even if the same were caused by a the instant petition. In that case there was indeed a fortuitous event resulting in the
fortuitous event. To rule otherwise would render the defense or " force majeure" as diversion of the PAL flight. However, the unforeseen diversion was worsened when
an exception from any liability, illusory and ineffective. "private respondents (passenger) was left at the airport and could not even hitch a
ride in a Ford Fiera loaded with PAL personnel," 10 not to mention the apparent
Accordingly, there is no question that when a party is unable to fulfill his obligation apathy of the PAL station manager as to the predicament of the stranded
because of "force majeure," the general rule is that he cannot be held liable for passengers. 11In light of these circumstances, we held that if the fortuitous event was
damages for non-performance. 6 Corollarily, when JAL was prevented from accompanied by neglect and malfeasance by the carrier's employees, an action for
resuming its flight to Manila due to the effects of Mt. Pinatubo eruption, whatever damages against the carrier is permissible. Unfortunately, for private respondents,
losses or damages in the form of hotel and meal expenses the stranded passengers none of these conditions are present in the instant petition. cdasia
incurred, cannot be charged to JAL. Yet it is undeniable that JAL assumed the hotel
expenses of respondents for their unexpected overnight stay on June 15, 1991. We are not prepared, however, to completely absolve petitioner JAL from any
liability. It must be noted that private respondents bought tickets from the United
Admittedly, to be stranded for almost a week in a foreign land was an exasperating States with Manila as their final destination. While JAL was no longer required to
experience for the private respondents. To be sure, they underwent distress and defray private respondents' living expenses during their stay in Narita on account of
anxiety during their unanticipated stay in Narita, but their predicament was not due the fortuitous event, JAL had the duty to make the necessary arrangements to
to the fault or negligence of JAL but the closure of NAIA to international flights. transport private respondents on the first available connecting flight to Manila.
Indeed, to hold JAL, in the absence of bad faith or negligence, liable for the Petitioner JAL reneged on its obligation to look after the comfort and convenience of
amenities of its stranded passengers by reason of a fortuitous event is too much of a its passengers when it declassified private respondents from "transit passengers" to
burden to assume. "new passengers" as a result of which private respondents were obliged to make the
necessary arrangements themselves for the next flight to Manila. Private respondents
were placed on the waiting list from June 20 to June 24. To assure themselves of a
seat on an available flight, they were compelled to stay in the airport the whole day
of June 22, 1991 and it was only at 8:00 p.m. of the aforesaid date that they were
advised that they could be accommodated in said flight which flew at about 9:00
a.m. the next day.
We are not oblivious to the fact that the cancellation of JAL flights to Manila from
June 15 to June 21, 1991 caused considerable disruption in passenger booking and
reservation. In fact, it would be unreasonable to expect, considering NAIA's closure,
that JAL flight operations would be normal on the days affected. Nevertheless, this
does not excuse JAL from its obligation to make the necessary arrangements to
transport private respondents on its first available flight to Manila. After all, it had a
contract to transport private respondents from the United States to Manila as their
final destination.
Consequently, the award of nominal damages is in order. Nominal damages are
adjudicated in order that a right of a plaintiff, which has been violated or invaded by
the defendant, may be vindicated or recognized and not for the purpose of
indemnifying any loss suffered by him. 12 The court may award nominal damages in
every obligation arising from any source enumerated in Article 1157, or in every
case where any property right has been invaded. 13
WHEREFORE, in view of the foregoing, the decision of the Court of Appeals dated
December 22, 1993 is hereby MODIFIED. The award of actual moral and exemplary
damages is hereby DELETED. Petitioner JAL is ordered to pay each of the private
respondents nominal damages in the sum of P100,000.00 each including attorney's
fees of P50,000.00 plus costs. LLpr
SO ORDERED.
Narvasa, C .J ., Kapunan and Purisima, JJ ., concur.
||| (Japan Airlines v. Court of Appeals, G.R. No. 118664, [August 7, 1998], 355 PHIL
444-454)
 carrier's premises whereas in the case at bar, an interval of one (1) hour had elapsed
SECOND DIVISION before the victim met the accident. The primary factor to be considered is the existence
of a reasonable cause as will justify the presence of the victim on or near the
petitioner's vessel. We believe there exists such a justifiable cause.
[G.R. No. 84458. November 6, 1989.]
3. ID.; ID.; ID.; PASSENGERS OF VESSELS ARE AUDITED A LONGER
PERIOD OF TIME TO DISEMBARK FROM SHIP THAN OTHER COMMON
ABOITIZ SHIPPING CORPORATION, petitioner, vs. HON. CARRIERS; REASON. — It is of common knowledge that, by the very nature of
COURT OF APPEALS, ELEVENTH DIVISION, LUCILA C. petitioner's business as a shipper, the passengers of vessels are allotted a longer period
VIANA, SPS. ANTONIO VIANA and GORGONIA VIANA, of time to disembark from the ship than other common carriers such as a passenger
and PIONEER STEVEDORING bus. With respect to the bulk of cargoes and the number of passengers it can load, such
CORPORATION, respondents. vessels are capable of accommodating a bigger volume of both as compared to the
capacity of a regular commuter bus. Consequently, a ship passenger will need at least
an hour as is the usual practice, to disembark from the vessel and claim his baggage
Herenio E. Martinez for petitioner. whereas a bus passenger can easily get off the bus and retrieve his luggage in a very
M.R. Villaluz Law Office for private respondent. short period of time. Verily, petitioner cannot categorically claim, through the bare
expedient of comparing the period of time entailed in getting the passenger's cargoes,
that the ruling in La Mallorca is inapplicable to the case at bar. On the contrary, if we
SYLLABUS are to apply the doctrine enunciated therein to the instant petition, we cannot in reason
doubt that the victim Anacleto Viana was still a passenger at the time of the incident.
When the accident occurred, the victim was in the act of unloading his cargoes, which
1. COMMERCIAL LAW; COMMON CARRIERS; CARRIER-PASSENGER he had every right to do, from petitioner's vessel. As earlier stated, a carrier is duty
RELATIONSHIP; CONTINUES UNTIL PASSENGER HAS BEEN LANDED AT bound not only to bring its passengers safely to their destination but also to afford them
THE PORT OF DESTINATION AND HAS LEFT VESSEL OWNER'S DOCK OR a reasonable time to claim their baggage.
PREMISES. — The rule is that the relation of carrier and passenger continues until
the passenger has been landed at the port of destination and has left the vessel owner's 4. ID.; ID.; ID.; VICTIM RETRIEVING HIS BAGGAGE, DEEMED A
dock or premises. Once created, the relationship will not ordinarily terminate until the PASSENGER OF CARRIER. — It is not definitely shown that one (1) hour prior to
passenger has, after reaching his destination, safely alighted from the carrier's the incident, the victim had already disembarked from the vessel. Petitioner failed to
conveyance or had a reasonable opportunity to leave the carrier's premises. All persons prove this. What is clear to us is that at the time the victim was taking his cargoes, the
who remain on the premises a reasonable time after leaving the conveyance are to be vessel had already docked an hour earlier. In consonance with common shipping
deemed passengers, and what is a reasonable time or a reasonable delay within this procedure as to the minimum time of one (1) hour allowed for the passengers to
rule is to be determined from all the circumstances, and includes a reasonable time to disembark, it may be presumed that the victim had just gotten off the vessel when he
see after his baggage and prepare for his departure. The carrier-passenger relationship went to retrieve his baggage. Yet, even if he had already disembarked an hour earlier,
is not terminated merely by the fact that the person transported has been carried to his his presence in petitioner's premises was not without cause. The victim had to claim
destination if, for example, such person remains in the carrier's premises to claim his his baggage which was possible only one (1) hour after the vessel arrived since it was
baggage. admittedly standard procedure in the case of petitioner's vessels that the unloading
operations shall start only after that time. Consequently, under the foregoing
2. ID.; ID.; ID.; EXISTENCE OF A REASONABLE CAUSE AS WILL JUSTIFY circumstances, the victim Anacleto Viana is still deemed a passenger of said carrier at
PRESENCE OF VICTIM ON OR NEAR PETITIONER'S VESSEL, A PRIMARY the time of his tragic death.
FACTOR. — It is apparent from the case of La Mallorca vs. Court of Appeals, et. al.
that what prompted the Court to rule as it did in said case is the fact of the passenger's 5. ID.; ID.; DUTIES THEREOF, CITED. — Common carriers are, from the nature of
reasonable presence within the carrier's premises. That reasonableness of time should their business and for reasons of public policy, bound to observe extraordinary
be made to depend on the attending circumstances of the case, such as the kind of diligence in the vigilance over the goods and for the safety of the passengers
common carrier, the nature of its business, the customs of the place, and so forth, and transported by them, according to all the circumstances of each case. More particularly,
therefore precludes a consideration of the time element per se without taking into a common carrier is bound to carry the passengers safely as far as human care and
account such other factors. It is thus of no moment whether in the cited case of La foresight can provide, using the utmost diligence of very cautious persons, with a due
Mallorca there was no appreciable interregnum for the passenger therein to leave the regard for all the circumstances.
6. ID.; ID.; CONTRACT OF CARRIAGE; DEATH OR INJURY OF PASSENGER definitely have prevented, the former's death. Moreover, in paragraph 5.6 of its petition,
GIVES RISE TO AN ACTION FOR BREACH, PROOF REQUIRED TO PROVE at bar, petitioner has expressly conceded the factual finding of respondent Court of
BREACH. — Where a passenger dies or is injured, the common carrier is presumed Appeals that petitioner did not present sufficient evidence in support of its submission
to have been at fault or to have acted negligently. This gives rise to an action for breach that the deceased Anacleto Viana was guilty of gross negligence. Petitioner cannot
of contract of carriage where all that is required of plaintiff is to prove the existence now be heard to claim otherwise.
of the contract of carriage and its non-performance by the carrier, that is, the failure of
the carrier to carry the passenger safely to his destination, which, in the instant case, 10. ID.; ID.; NEGLIGENCE; IMPUTATION THEREOF ON PRIVATE
necessarily includes its failure to safeguard its passenger with extraordinary diligence RESPONDENT CORPORATION, NOT PROPER; RATIONALE. — Aboitiz joined
while such relation subsists. Pioneer in proving the alleged gross negligence of the victim, hence its present
contention that the death of the passenger was due to the negligence of the crane
7. ID.; ID.; ID.; PRESUMPTION OF VESSEL'S NEGLIGENCE; HIGHEST operator cannot be sustained both on grounds of estoppel and for lack of evidence on
DEGREE OF CARE AND DILIGENCE REQUIRED. — The presumption is, its present theory. Even in its answer filed in the court below it readily alleged that
therefore, established by law that in case of a passenger's death or injury the operator Pioneer had taken the necessary safeguards insofar as its unloading operations were
of the vessel was at fault or negligent, having failed to exercise extraordinary diligence, concerned, a fact which appears to have been accepted by the plaintiff therein by not
and it is incumbent upon it to rebut the same. This is in consonance with the avowed impleading Pioneer as a defendant, and likewise inceptively by Aboitiz by filing its
policy of the State to afford full protection to the passengers of common carriers which third-party complaint only after ten (10) months from the institution of the suit against
can be carried out only by imposing a stringent statutory obligation upon the latter. it. Parenthetically, Pioneer is not within the ambit of the rule on extraordinary
Concomitantly, this Court has likewise adopted a rigid posture in the application of diligence required of, and the corresponding presumption of negligence foisted on,
the law by exacting the highest degree of care and diligence from common carriers, common carriers like Aboitiz. This, of course, does not detract from what we have said
bearing utmost in mind the welfare of the passengers who often become hapless that no negligence can be imputed to Pioneer but, that on the contrary, the failure of
victims of indifferent and profit-oriented carriers. We cannot in reason deny that Aboitiz to exercise extraordinary diligence for the safety of its passenger is the
petitioner failed to rebut the presumption against it. Under the facts obtaining in the rationale for our finding on its liability.
present case, it cannot be gainsaid that petitioner had inadequately complied with the
required degree of diligence to prevent the accident from happening.
8. ID.; ID.; ID.; EXTRAORDINARY DILIGENCE NOT SHOWN BY
PRECAUTIONARY MEASURES OF PETITIONER. — The evidence does not show
that there was a cordon of drums around the perimeter of the crane, as claimed by DECISION
petitioner. It also adverted to the fact that the alleged presence of visible warning signs
in the vicinity was disputable and not indubitably established. Thus, we are not
inclined to accept petitioner's explanation that the victim and other passengers were
sufficiently warned that merely venturing into the area in question was fraught with REGALADO, J p:
serious peril. Definitely, even assuming the existence of the supposed cordon of drums
loosely placed around the unloading area and the guard's admonitions against entry In this appeal by certiorari, petitioner Aboitiz Shipping Corporation seeks a review of
therein, these were at most insufficient precautions which pale into insignificance if the decision 1 of respondent Court of Appeals, dated July 29, 1988, the decretal
considered vis-a-vis the gravity of the danger to which the deceased was exposed. portion of which reads:
There is no showing that petitioner was extraordinarily diligent in requiring or seeing "WHEREFORE, the judgment appealed from as modified by the
to it that said precautionary measures were strictly and actually enforced to subserve order of October 27, 1982, is hereby affirmed with the
their purpose of preventing entry into the forbidden area. By no stretch of liberal modification that appellant Aboitiz Shipping is hereby ordered to
evaluation can such perfunctory acts approximate the "utmost diligence of very pay plaintiff-appellees the amount of P30,000.00 for the death of
cautious persons" to be exercised "as far as human care and foresight can provide" Anacleto Viana; actual damages of P9,800.00; P160,000.00 for
which is required by law of common carriers with respect to their passengers. unearned income; P7,200.00 as support for deceased's parents;-
9. ID.; ID.; ID.; EVEN IF VICTIM IS CONTRIBUTORILY NEGLIGENT, P20,000.00 as moral damages; P10,000.00 as attorney's fees; and
PROXIMATE AND DIRECT CAUSE OF VICTIM'S DEATH IS PETITIONER'S to pay the costs."
FAILURE TO OBSERVE EXTRAORDINARY DILIGENCE. — While the victim The undisputed facts of the case, as found by the court a quo and adopted by
was admittedly contributorily negligent, still petitioner's aforesaid failure to exercise respondent court, are as follows: cdrep
extraordinary diligence was the proximate and direct cause of, because it could
 "The evidence disclosed that on May 11, 1975, Anacleto Viana Stevedoring Corporation (Pioneer, for short) as the exclusive stevedoring contractor
boarded the vessel M/V Antonia, owned by defendant, at the port of Aboitiz, which handled the unloading of cargoes from the vessel of Aboitiz. It is
at San Jose, Occidental Mindoro, bound for Manila, having also averred that since the crane operator was not an employee of Aboitiz, the latter
purchased a ticket (No. 117392) in the sum of P23.10 (Exh. 'B'). cannot be held liable under the fellow-servant rule. prcd
On May 12, 1975, said vessel arrived at Pier 4, North Harbor,
Manila, and the passengers therein disembarked, a gangplank Thereafter, Aboitiz, as third-party plaintiff, filed a third-party complaint 5 against
having been provided connecting the side of the vessel to the pier. Pioneer imputing liability thereto for Anacleto Viana's death as having been allegedly
Instead of using said gangplank, Anacleto Viana disembarked on caused by the negligence of the crane operator who was an employee of Pioneer under
the third deck which was on the level with the pier. After said its exclusive control and supervision.
vessel had landed, the Pioneer Stevedoring Corporation took over Pioneer, in its answer to the third-party complaint, 6 raised the defenses that Aboitiz
the exclusive control of the cargoes loaded on said vessel pursuant had no cause of action against Pioneer considering that Aboitiz is being sued by the
to the Memorandum of Agreement dated July 26, 1975 (Exh. '2') Vianas for breach of contract of carriage to which Pioneer is not a party; that Pioneer
between the third party defendant Pioneer Stevedoring had observed the diligence of a good father of a family both in the selection and
Corporation and defendant Aboitiz Shipping Corporation. supervision of its employees as well as in the prevention of damage or injury to anyone
"The crane owned by the third party defendant and operated by its including the victim Anacleto Viana; that Anacleto Viana's gross negligence was the
crane operator Alejo Figueroa was placed alongside the vessel and direct and proximate cause of his death; and that the filing of the third-party complaint
one (1) hour after the passengers of said vessel had disembarked, was premature by reason of the pendency of the criminal case for homicide through
it started operation by unloading the cargoes from said vessel. reckless imprudence filed against the crane operator, Alejo Figueroa.
While the crane was being operated, Anacleto Viana who had In a decision rendered on April 17, 1980 by the trial court, 7 Aboitiz was ordered to
already disembarked from said vessel obviously remembering pay the Vianas for damages incurred, and Pioneer was ordered to reimburse Aboitiz
that some of his cargoes were still loaded in the vessel, went back for whatever amount the latter paid the Vianas. The dispositive portion of said decision
to the vessel, and it was while he was pointing to the crew of the provides:
said vessel to the place where his cargoes were loaded that the
crane hit him, pinning him between the side of the vessel and the "WHEREFORE, judgment is hereby rendered in favor of the
crane. He was thereafter brought to the hospital where he later plaintiffs:
expired three (3) days thereafter, on May 15, 1975, the cause of
his death according to the Death Certificate (Exh. 'C') being "(1) ordering defendant Aboitiz Shipping Corporation to pay to
"hypostatic pneumonia secondary to traumatic fracture of the plaintiffs the sum of P12,000.00 for the death of Anacleto Viana;
pubic bone lacerating the urinary bladder" (See also Exh. 'B'). For P9,800.00 as actual damages; P533,200.00 value of the 10,664
his hospitalization, medical, burial and other miscellaneous cavans of palay computed at P50.00 per cavan; P10,000.00 as
expenses, Anacleto's wife, herein plaintiff, spent a total of attorney's fees; P5,000.00, value of the 100 cavans of palay as
P9,800.00 (Exhibits 'E', 'E-1', to 'E-5'). Anacleto Viana who was support for five (5) years for deceased (sic) parents, herein
only forty (40) years old when he met said fateful accident (Exh. plaintiffs Antonio and Gorgonia Viana computed at P50.00 per
'E') was in good health. His average annual income as a farmer or cavan; P7,200.00 as support for deceased's parents computed at
a farm supervisor was 400 cavans of palay annually. His parents, P120.00 a month for five years pursuant to Art. 2206, Par. 2, of
herein plaintiffs Antonio and Gorgonia Viana, prior to his death the Civil Code; P20,000.00 as moral damages, and costs; and
had been recipient of twenty (20) cavans of palay as support or "(2) ordering the third party defendant Pioneer Stevedoring
P120.00 monthly. Because of Anacleto's death, plaintiffs suffered Corporation to reimburse defendant and third party plaintiff-
mental anguish and extreme worry or moral damages. For the Aboitiz Shipping Corporation the said amounts that it is ordered
filing of the instant case, they had to hire a lawyer for an agreed to pay to herein plaintiffs."
fee of ten thousand (P10,000.00) pesos." 2
Both Aboitiz and Pioneer filed separate motions for reconsideration wherein they
Private respondents Vianas filed a complaint 3 for damages against petitioner similarly raised the trial court's failure to declare that Anacleto Viana acted with gross
corporation (Aboitiz, for brevity) for breach of contract of carriage. negligence despite the overwhelming evidence presented in support thereof. In
In its answer, 4 Aboitiz denied responsibility contending that at the time of the addition, Aboitiz alleged, in opposition to Pioneer's motion, that under the
accident, the vessel was completely under the control of respondent Pioneer memorandum of agreement the liability of Pioneer as contractor is automatic for any
damages or losses whatsoever occasioned by and arising from the operation of its submit, contributory negligence was the proximate cause of his
arrastre and stevedoring service. LLjur death; specifically the Honorable respondent Court of Appeals
failed to apply Art. 1762 of the New Civil Code;"
In an order dated October 27, 1982, 8 the trial court absolved Pioneer from liability
for failure of the Vianas and Aboitiz to preponderantly establish a case of negligence (C) In the alternative assuming the holding of the Honorable
against the crane operator which the court a quo ruled is never presumed, aside from respondent Court of Appeals that petitioner may be legally
the fact that the memorandum of agreement supposedly refers only to Pioneer's condemned to pay damages to the private respondents we
liability in case of loss or damage to goods handled by it but not in the case of personal respectfully submit that it committed a reversible error when it
injuries, and, finally, that Aboitiz cannot properly invoke the fellow-servant rule dismissed petitioner's third party complaint against private
simply because its liability stems from a breach of contract of carriage. The dispositive respondent Pioneer Stevedoring Corporation instead of
portion of said order reads: compelling the latter to reimburse the petitioner for whatever
damages it may be compelled to pay to the private respondents
"WHEREFORE, judgment is hereby modified insofar as third Vianas." 9
party defendant Pioneer Stevedoring Corporation is concerned
rendered in favor of the plaintiffs:
"(1) Ordering defendant Aboitiz Shipping Corporation to pay the At threshold, it is to be observed that both the trial court and respondent Court of
plaintiffs the sum of P12,000.00 for the death of Anacleto Viana; Appeals found the victim Anacleto Viana guilty of contributory negligence, but
P9,000.00 (sic) as actual damages; P533,200.00 value of the holding that it was the negligence of Aboitiz in prematurely turning over the vessel to
10,664 cavans of palay computed at P50.00 per cavan; P10,000.00 the arrastre operator for the unloading of cargoes which was the direct, immediate and
as attorney's fees; P5,000.00 value of the 100 cavans of palay as proximate cause of the victim's death.
support for five (5) years for deceased's parents, herein plaintiffs
Antonio and Gorgonia Viana, computed at P50.00 per cavan; I. Petitioner contends that since one (1) hour had already elapsed from the time
P7,200.00 as support for deceased's parents computed at P120.00 Anacleto Viana disembarked from the vessel and that he was given more than ample
a month for five years pursuant to Art. 2206, Par. 2, of the Civil opportunity to unload his cargoes prior to the operation of the crane, his presence on
Code; P20,000.00 as moral damages, and costs; and" the vessel was no longer reasonable and he consequently ceased to be a passenger.
Corollarily, it insists that the doctrine in La Mallorca vs. Court of Appeals, et al. 10 is
(2) Absolving third-party defendant Pioneer Stevedoring not applicable to the case at bar.
Corporation for (sic) any liability for the death of Anacleto Viana,
the passenger of M/V Antonia owned by defendant third party The rule is that the relation of carrier and passenger continues until the passenger has
plaintiff Aboitiz Shipping Corporation it appearing that the been landed at the port of destination and has left the vessel owner's dock or
negligence of its crane operator has not been established therein." premises. 11 Once created, the relationship will not ordinarily terminate until the
passenger has, after reaching his destination, safely alighted from the carrier's
Not satisfied with the modified judgment of the trial court, Aboitiz appealed the same conveyance or had a reasonable opportunity to leave the carrier's premises. All persons
to respondent Court of Appeals which affirmed the findings of the trial court except who remain on the premises a reasonable time after leaving the conveyance are to be
as to the amount of damages awarded to the Vianas. llcd deemed passengers, and what is a reasonable time or a reasonable delay within this
rule is to be determined from all the circumstances, and includes a reasonable time to
Hence, this petition wherein petitioner Aboitiz postulates that respondent court erred: see after his baggage and prepare for his departure. 12 The carrier-passenger
"(A) In holding that the doctrine laid down by this Honorable relationship is not terminated merely by the fact that the person transported has been
Court in La Mallorca vs. Court of Appeals, et al. (17 SCRA 739, carried to his destination if, for example, such person remains in the carrier's premises
July 27, 1966) is applicable to the case in the face of the to claim his baggage. 13
undisputable fact that the factual situation under the La Mallorca It was in accordance with this rationale that the doctrine in the aforesaid case of La
case is radically different from the facts obtaining in this case; Mallorca was enunciated, to wit:
"(B) In holding petitioner liable for damages in the face of the "It has been recognized as a rule that the relation of carrier and
finding of the court a quo and confirmed by the Honorable passenger does not cease at the moment the passenger alights from
respondent Court of Appeals that the deceased, Anacleto Viana the carrier's vehicle at a place selected by the carrier at the point
was guilty of contributory negligence, which, we respectfully of destination, but continues until the passenger has had a
 reasonable time or a reasonable opportunity to leave the carrier's commuter bus. Consequently, a ship passenger will need at least an hour as is the usual
premises. And, what is a reasonable time or a reasonable delay practice, to disembark from the vessel and claim his baggage whereas a bus passenger
within this rule is to be determined from all the circumstances. can easily get off the bus and retrieve his luggage in a very short period of time. Verily,
Thus, a person who, after alighting from a train, walks along the petitioner cannot categorically claim, through the bare expedient of comparing the
station platform is considered still a passenger. So also, where a period of time entailed in getting the passenger's cargoes, that the ruling in La
passenger has alighted at his destination and is proceeding by the Mallorca is inapplicable to the case at bar. On the contrary, if we are to apply the
usual way to leave the company's premises, but before actually doctrine enunciated therein to the instant petition, we cannot in reason doubt that the
doing so is halted by the report that his brother, a fellow passenger, victim Anacleto Viana was still a passenger at the time of the incident. When the
has been shot, and he in good faith and without intent of engaging accident occurred, the victim was in the act of unloading his cargoes, which he had
in the difficulty, returns to relieve his brother, he is deemed every right to do, from petitioner's vessel. As earlier stated, a carrier is duty bound not
reasonably and necessarily delayed and thus continues to be a only to bring its passengers safely to their destination but also to afford them a
passenger entitled as such to the protection of the railroad reasonable time to claim their baggage.
company and its agents. llcd
It is not definitely shown that one (1) hour prior to the incident, the victim had already
"In the present case, the father returned to the bus to get one of his disembarked from the vessel. Petitioner failed to prove this. What is clear to us is that
baggages which was not unloaded when they alighted from the at the time the victim was taking his cargoes, the vessel had already docked an hour
bus. Racquel, the child that she was, must have followed the father. earlier. In consonance with common shipping procedure as to the minimum time of
However, although the father was still on the running board of the one (1) hour allowed for the passengers to disembark, it may be presumed that the
bus waiting for the conductor to hand him the bag or bayong, the victim had just gotten off the vessel when he went to retrieve his baggage. Yet, even
bus started to run, so that even he (the father) had to jump down if he had already disembarked an hour earlier, his presence in petitioner's premises was
from the moving vehicle. It was at this instance that the child, who not without cause. The victim had to claim his baggage which was possible only one
must be near the bus, was run over and killed. In the circumstances, (1) hour after the vessel arrived since it was admittedly standard procedure in the case
it cannot be claimed that the carrier's agent had exercised the of petitioner's vessels that the unloading operations shall start only after that time.
'utmost diligence' of a 'very cautious person' required by Article Consequently, under the foregoing circumstances, the victim Anacleto Viana is still
1755 of the Civil Code to be observed by a common carrier in the deemed a passenger of said carrier at the time of his tragic death. prcd
discharge of its obligation to transport safely its passengers . . .
The presence of said passengers near the bus was not II. Under the law, common carriers are, from the nature of their business and for
unreasonable and they are, therefore, to be considered still as reasons of public policy, bound to observe extraordinary diligence in the vigilance
passengers of the carrier, entitled to the protection under their over the goods and for the safety of the passengers transported by them, according to
contract of carriage." 14 all the circumstances of each case. 15 More particularly, a common carrier is bound to
carry the passengers safely as far as human care and foresight can provide, using the
It is apparent from the foregoing that what prompted the Court to rule as it did in said utmost diligence of very cautious persons, with a due regard for all the
case is the fact of the passenger's reasonable presence within the carrier's premises. circumstances. 16 Thus, where a passenger dies or is injured, the common carrier is
That reasonableness of time should be made to depend on the attending circumstances presumed to have been at fault or to have acted negligently. 17 This gives rise to an
of the case, such as the kind of common carrier, the nature of its business, the customs action for breach of contract of carriage where all that is required of plaintiff is to
of the place, and so forth, and therefore precludes a consideration of the time prove the existence of the contract of carriage and its non-performance by the carrier,
element per se without taking into account such other factors. It is thus of no moment that is, the failure of the carrier to carry the passenger safely to his
whether in the cited case of La Mallorca there was no appreciable interregnum for the destination, 18 which, in the instant case, necessarily includes its failure to safeguard
passenger therein to leave the carrier's premises whereas in the case at bar, an interval its passenger with extraordinary diligence while such relation subsists.
of one (1) hour had elapsed before the victim met the accident. The primary factor to
be considered is the existence of a reasonable cause as will justify the presence of the The presumption is, therefore, established by law that in case of a passenger's death or
victim on or near the petitioner's vessel. We believe there exists such a justifiable cause. injury the operator of the vessel was at fault or negligent, having failed to exercise
extraordinary diligence, and it is incumbent upon it to rebut the same. This is in
It is of common knowledge that, by the very nature of petitioner's business as a shipper, consonance with the avowed policy of the State to afford full protection to the
the passengers of vessels are allotted a longer period of time to disembark from the passengers of common carriers which can be carried out only by imposing a stringent
ship than other common carriers such as a passenger bus. With respect to the bulk of statutory obligation upon the latter. Concomitantly, this Court has likewise adopted a
cargoes and the number of passengers it can load, such vessels are capable of rigid posture in the application of the law by exacting the highest degree of care and
accommodating a bigger volume of both as compared to the capacity of a regular diligence from common carriers, bearing utmost in mind the welfare of the passengers
who often become hapless victims of indifferent and profit-oriented carriers. We corresponding presumption of negligence foisted on, common carriers like Aboitiz.
cannot in reason deny that petitioner failed to rebut the presumption against it. Under This, of course, does not detract from what we have said that no negligence can be
the facts obtaining in the present case, it cannot be gainsaid that petitioner had imputed to Pioneer but, that on the contrary, the failure of Aboitiz to exercise
inadequately complied with the required degree of diligence to prevent the accident extraordinary diligence for the safety of its passenger is the rationale for our finding
from happening. on its liability.
As found by the Court of Appeals, the evidence does not show that there was a cordon WHEREFORE, the petition is DENIED and the judgment appealed from is hereby
of drums around the perimeter of the crane, as claimed by petitioner. It also adverted AFFIRMED in toto.
to the fact that the alleged presence of visible warning signs in the vicinity was
disputable and not indubitably established. Thus, we are not inclined to accept SO ORDERED.
petitioner's explanation that the victim and other passengers were sufficiently warned Melencio-Herrera (Chairman), Paras, Padilla and Sarmiento, JJ., concur.
that merely venturing into the area in question was fraught with serious peril.
Definitely, even assuming the existence of the supposed cordon of drums loosely ||| (Aboitiz Shipping Corp. v. Court of Appeals, G.R. No. 84458, [November 6, 1989],
placed around the unloading area and the guard's admonitions against entry therein, 258-A PHIL 665-680)
these were at most insufficient precautions which pale into insignificance if considered
vis-a-vis the gravity of the danger to which the deceased was exposed. There is no
showing that petitioner was extraordinarily diligent in requiring or seeing to it that said
precautionary measures were strictly and actually enforced to subserve their purpose
of preventing entry into the forbidden area. By no stretch of liberal evaluation can such
perfunctory acts approximate the "utmost diligence of very cautious persons" to be
exercised "as far as human care and foresight can provide" which is required by law
of common carriers with respect to their passengers.

While the victim was admittedly contributorily negligent, still petitioner's aforesaid
failure to exercise extraordinary diligence was the proximate and direct cause of,
because it could definitely have prevented, the former's death. Moreover, in paragraph
5.6 of its petition, at bar, 19 petitioner has expressly conceded the factual finding of
respondent Court of Appeals that petitioner did not present sufficient evidence in
support of its submission that the deceased Anacleto Viana was guilty of gross
negligence. Petitioner cannot now be heard to claim otherwise. LLpr
No excepting circumstance being present, we are likewise bound by respondent court's
declaration that there was no negligence on the part of Pioneer Stevedoring
Corporation, a confirmation of the trial court's finding to that effect, hence our
conformity to Pioneer's being absolved of any liability.
As correctly observed by both courts, Aboitiz joined Pioneer in proving the alleged
gross negligence of the victim, hence its present contention that the death of the
passenger was due to the negligence of the crane operator cannot be sustained both on
grounds of estoppel and for lack of evidence on its present theory. Even in its answer
filed in the court below it readily alleged that Pioneer had taken the necessary
safeguards insofar as its unloading operations were concerned, a fact which appears to
have been accepted by the plaintiff therein by not impleading Pioneer as a defendant,
and likewise inceptively by Aboitiz by filing its third-party complaint only after ten
(10) months from the institution of the suit against it. Parenthetically, Pioneer is not
within the ambit of the rule on extraordinary diligence required of, and the
 When an injury is caused by the negligence of a servant or an employee, the master or
THIRD DIVISION employer is presumed to be negligent either in the selection or in the supervision of
that employee. This presumption may be overcome only by satisfactorily showing that
the employer exercised the care and the diligence of a good father of a family in the
[G.R. No. 139875. December 4, 2000.] selection and the supervision of its employee. The negligence alluded to here is in its
supervision over its driver, not in that which directly caused the accident. The fact that
GREGORIO PESTAÑO and METRO CEBU AUTOBUS Pestaño was able to use a bus with a faulty speedometer shows that Metro Cebu was
CORPORATION, petitioners, vs. Spouses TEOTIMO remiss in the supervision of its employees and in the proper care of its vehicles. It had
SUMAYANG and PAZ C. SUMAYANG,respondents. thus failed to conduct its business with the diligence required by law. The Court,
therefore, affirmed the decision of the appellate court.

Bugarin & Bugarin Law Office for petitioners.

SYLLABUS
Atty. Paterno S. Compra for private respondents.
1. REMEDIAL LAW; EVIDENCE; FACTUAL FINDINGS OF COURT OF
SYNOPSIS APPEALS, AFFIRMING THOSE OF TRIAL COURT, ARE CONCLUSIVE AND
BINDING ON SUPREME COURT. — Factual findings of the CA affirming those of
the trial court are conclusive and binding on this Court. Petitioners failed to
On August 9, 1986, at around 2:00 o'clock P.M., Ananias Sumayang was riding a demonstrate that this case falls under any of the recognized exceptions to this rule.
motorcycle along the national highway in Ilihan, Tabagon, Cebu. Riding with him was Indeed, the issue of negligence is basically factual and, in quasi-delicts, crucial in the
his friend Manuel Romagos. As they came upon a junction, a passenger bus driven by award of damages. EHcaDT
petitioner Gregorio Pestaño and owned by Petitioner Metro Cebu Autobus
Corporation hit them. The bus had tried to overtake them sending the motorcycle and 2. CIVIL LAW; QUASI-DELICT; PRESUMPTION OF EMPLOYER'S
its passengers hurtling upon the pavement. Both Ananias Sumayang and Manuel NEGLIGENCE IN SELECTION OR SUPERVISION OF EMPLOYEE, WHEN
Romagos died. ARISES; HOW MAY BE OVERCOME. — Under Articles 2180 and 2176 of the
Civil Code, owners and managers are responsible for damages caused by their
The Regional Trial Court found petitioners liable for death indemnity, loss of earning employees. When an injury is caused by the negligence of a servant or an employee,
capacity of the deceased Ananias Sumayang, and for necessary interment expenses. the master or employer is presumed to be negligent either in the selection or in the
The Court of Appeals affirmed petitioners' liability for the accident and for supervision of that employee. This presumption may be overcome only by
Sumayang's death. It agreed with the trial court that the vehicular collision was caused satisfactorily showing that the employer exercised the care and the diligence of a good
by Pestaño's negligence when he attempted to overtake the motorcycle. The appellate father of a family in the selection and the supervision of its employee.
court opined that petitioner Metro Bus had shown laxity in the conduct of its operations
and in the supervision of its employees when it allowed petitioner Pestaño to ply his 3. ID.; DAMAGES; INDEMNITY FOR DEATH CAUSED BY A QUASI-DELICT
route despite the defective speedometer. Having failed to observe the extraordinary FIXED AT P50,000.00. — The indemnity for death caused by a quasi-delict used to
diligence required of public transportation companies, it was held vicariously liable to be pegged at P3,000, based on Article 2206 of the Civil Code. However, the amount
the victims of the vehicular accident. The appellate court, however, raised to P50,000 has been gradually increased through the years because of the declining value of our
the granted indemnity for the death of the victim in accordance with prevailing currency. At present, prevailing jurisprudence fixes the amount at P50,000.
jurisprudence. It also affirmed the award of loss of earning capacity based on his life 4. ID.; ID.; LOSS OF EARNING CAPACITY; COMPUTATION THEREOF IS
expectancy. BASED ON LIFE EXPECTANCY OF DECEASED. — The Court has consistently
Hence, this petition. computed the loss of earning capacity based on the life expectancy of the deceased,
and not on that of the heir. Even Villa Rey Transit did likewise. HAaDcS
The Supreme Court finds no cogent reason to reverse or modify the Court of Appeals'
factual findings. Factual findings of the CA affirming those of the trial court are 5. ID.; ID.; ID.; FACTORS IN THE AWARD THEREOF. — The award for loss of
conclusive and binding on this Court. In quasi-delicts, such findings are crucial earning capacity is based on two factors: (1) the number of years on which the
because negligence is largely a matter of evidence. computation of damages is based and (2) the rate at which the loss sustained by the
heirs is fixed. The first factor refers to the life expectancy, which takes into
consideration the nature of the victim's work, lifestyle, age and state of health prior to hurtling upon the pavement. Both Ananias Sumayang and Manuel
the accident. The second refers to the victim's earning capacity minus the necessary Romagos were rushed to the hospital in Sogod, where Sumayang
living expenses. Stated otherwise, the amount recoverable is that portion of the was pronounced dead on arrival. Romagos was transferred to the
earnings of the deceased which the beneficiary would have received — the net Cebu Doctors' Hospital, but he succumbed to his injuries the day
earnings of the deceased. after. STHAID
"Apart from the institution of criminal charges against Gregorio
Pestaño, [Respondents] Teotimo and Paz Sumayang, as heirs of
DECISION Ananias Sumayang, filed this civil action for damages against
Gregorio Pestaño, as driver of the passenger bus that rammed the
deceased's motorcycle, Metro Cebu, as owner and operator of the
said bus, and Perla Compania de Seguros, as insurer of Metro
PANGANIBAN, J p: Cebu. The case was docketed as Civil Case No. CEB-6108.

Factual findings of the Court of Appeals, affirming those of the trial judge, are binding "On November 9, 1987, upon motion of [Petitioner] Pestaño,
on this Court. In quasi-delicts, such findings are crucial because negligence is largely Judge Pedro C. Son ordered the consolidation of the said case with
a matter of evidence. In computing an award for lost earning capacity, the life Criminal Case No. 10624, pending in Branch 16 of the same Court,
expectancy of the deceased, not that of the heir, is used as basis. involving the criminal prosecution of Gregorio Pestaño for
[d]ouble [h]omicide thru [r]eckless [i]mprudence. Joint trial of the
two cases thereafter ensued, where the following assertions were
The Case made:

Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, '[Respondents] rely mainly on the testimonies of Ignacio
assailing the April 21, 1999 Decision and the August 6, 1999 Resolution of the Court Neis, Pat. Aquilino Dinoy and Teotimo Sumayang,
of Appeals 1 (CA) in CA-GR CV No. 30289. The questioned Decision disposed as father of the deceased. Neis declared that he saw the
follows: incident while he was sitting on a bench beside the
highway; that both vehicles c[a]me from the North; that
"WHEREFORE, premises considered, the instant appeal is as the motorcycle approached the junction to Tab[a]gon,
hereby DENIED. The assailed Decision of the lower court is the driver Ananias Sumayang signalled with his left arm
hereby AFFIRMED with the aforesaid modification regarding the to indicate that he was taking the Tab[a]gon Road; that
award of death penalty." the motorcycle did turn left but as it did so, it was
bumped by an overspeeding bus; that the force of the
The Resolution of August 6, 1999 denied reconsideration. 2
impact threw Ananias Sumayang and his companion
Manuel Romagos about 14 meters away. The motorcycle,
The Facts Neis continued, was badly damaged as it was dragged by
the bus.
The events leading to this Petition were summarized by the Court of Appeals as
'On the other hand, Pat. Dinoy testified that he was in the
follows:
nearby house of Ruben Tiu [when] he heard the sound or
"It appears from the records that at around 2:00 o'clock [o]n the noise caused by the collision; that he immediately went
afternoon of August 9, 1986, Ananias Sumayang was riding a to the scene where he found Ananias Sumayang and
motorcycle along the national highway in Ilihan, Tabagon, Cebu. Manuel Romagos lying on the road bleeding and badly
Riding with him was his friend Manuel Romagos. As they came injured; that he requested the driver of a PU vehicle to
upon a junction where the highway connected with the road take them to a hospital; that he took note of the various
leading to Tabagon, they were hit by a passenger bus driven by distances which he included in his sketch (Exh. J) that
[Petitioner] Gregorio Pestaño and owned by [Petitioner] Metro the probable point of impact was at the left lane of the
Cebu Autobus Corporation (Metro Cebu, for brevity), which had highway and right at the junction to Tab[a]gon (Exh J-
tried to overtake them, sending the motorcycle and its passengers 11); that he based his conclusion on the 'scratches' caused
by the motorcycle's footrest on the asphalt pavement; several inspectors posted at random places along the
that he described the damage caused to the motorcycle in route.'
his sketch (Exh J); that on the part of the bus, the right
end of its front bumper was bent and the right portion of "In judgment, the lower court found [petitioners] liable to the
the radiator grill was dented. Pat. Dinoy acknowledged [respondents], in the amounts of P30,000.00 for death indemnity,
that he met at the scene Ignacio Neis who informed him P829,079 for loss of earning capacity of the deceased Ananias
that he saw the incident. Sumayang, and P36,000.00 for necessary interment expenses. The
liability of defendant Perla Compania de Seguros, Inc., however,
'On the contrary, Pestaño blamed Sumayang for the was limited only to the amount stipulated in the insurance policy,
accident. He testified that when he first blew the horn the which [was] P12,000 for death indemnity and P4,500.00 for burial
motorcycle which was about 15 or 20 meters ahead went expenses.
to the right side of the highway that he again blew the
horn and accelerated in order to overtake the motorcycle; "In so ruling, the lower court found [Petitioner] Pestaño to have
that when he was just one meter behind, the motorcycle been negligent in driving the passenger bus that hit the deceased.
suddenly turned left towards the Tab[a]gon [R]oad and It was shown that Pestaño negligently attempted to overtake the
was bumped by his bus; that he was able to apply his motorcycle at a dangerous speed as they were coming upon a
break only after the impact. Pestaño's testimony was junction in the road, and as the motorcycle was about to turn left
corroborated by Ireneo Casilia who declared that he was towards Tabagon. The court likewise found Metro Cebu directly
one of the passengers of the bus; that the motorcycle and primarily liable, along with Pestaño, the latter's employer
suddenly turned left towards Tab[a]gon [R]oad without under Article 2180 of the Civil Code, as [Petitioner] Metro Cebu
giving any signal to indicate its maneuver; that the bus failed to present evidence to prove that it had observed . . . [the]
was going at 40 kph when the accident occurred. diligence of a good father of a family to prevent damage. Nor has
Metro Cebu proven that it had exercised due diligence in the
supervision of its employees and in the maintenance of
vehicles." 3
'To substantiate its defense of bonos pater
familias [petitioner] [c]orporation recalled to the witness
box Gregorio Pestaño who explained how his driving Ruling of the Court of Appeals
experience and ability were tested by the company
before he was hired. He further declared that the The CA affirmed respondent's liability for the accident and for Sumayang's death.
management gave regular lectures to drivers and Pestaño was negligent when he tried to overtake the victim's motorcycle at the
conductors touching on various topics like speeding, Tabagon junction. As a professional driver operating a public transport vehicle, he
parking, loading and treatment of passengers, and that should have taken extra precaution to avoid accidents, knowing that it was perilous to
before he took to the road at 2:30 AM of that day he overtake at a junction, where adjoining roads had brought about merging and diverging
checked together with the mechanic the tires, brake, traffic.
signal lights as well as the tools to be brought along. He
did the same thing before commencing his return trip The appellate court opined that Metro Cebu had shown laxity in the conduct of its
from Hagnaya, San Remegio later in the day. operations and in the supervision of its employees. By allowing the bus to ply its route
despite the defective speedometer, said petitioner showed its indifference towards the
'The corporation also presented its maintenance proper maintenance of its vehicles. Having failed to observe the extraordinary
supervisor, Agustin Pugeda, Jr., and its manager, diligence required of public transportation companies, it was held vicariously liable to
Alfonso Corominas, Jr. who corroborated Pestaño's the victims of the vehicular accident.
testimony that his driving ability was thoroughly tested,
and that all drivers underwent periodic lecture on various In accordance with prevailing jurisprudence, the CA raised to P50,000 the granted
aspects of safety driving including pertinent traffic indemnity for the death of the victim. It also affirmed the award of loss of earning
regulations. They also confirmed the thorough checkup capacity based on his life expectancy. Such liability was assessed, not as a pension for
of every vehicle before it would depart and that the the claiming heirs, but as a penalty and an indemnity for the driver's negligent act.
performance of the drivers was being monitored by Hence, this Petition. 4
 Issues the victim raised his left arm to signal that he was turning left to Tabagon, but that the
Petitioners submit the following issues 5 for our consideration: latter and his companion were thrown off the motorcycle after it was bumped by the
overspeeding bus.
"1. The Court of Appeals misapplied facts of weight and
substance affecting the result of the case. These contentions have already been passed upon by the trial and the appellate courts.
We find no cogent reason to reverse or modify their factual findings. The CA agreed
"2. The Court of Appeals misapplied R.A. 4136 as regards the with the trial court that the vehicular collision was caused by Pestaño's negligence
behavior of the deceased at the time of the accident. when he attempted to overtake the motorcycle. As a professional driver operating a
public transport bus, he should have anticipated that overtaking at a junction was a
"3. The Court of Appeals erred in ruling that the award of perilous maneuver and should thus have exercised extreme caution.
damages representing income that deceased could have earned be
considered a penalty. Factual findings of the CA affirming those of the trial court are conclusive and binding
on this Court. Petitioners failed to demonstrate that this case falls under any of the
"4. The Court of Appeals, contrary to Article 2204, Civil Code, recognized exceptions to this rule. 7 Indeed, the issue of negligence is basically factual
raised the award of P30,000.00 damages representing indemnity and, in quasi-delicts, crucial in the award of damages.
for death to P50,000.00.
Petitioners aver that the CA was wrong in attributing the accident to a faulty
"5. The Court of Appeals used as basis for the loss of earning speedometer and in implying that the accident could have been avoided had this
capacity, the life expectancy of the [d]eceased instead of that of instrument been properly functioning. EcHIDT
the respondents which was shorter." 6
This contention has no factual basis. Under Articles 2180 and 2176 of the Civil Code,
In short, they raise these questions: whether the CA erred (1) in applying Section 45 owners and managers are responsible for damages caused by their employees. When
of RA 4136 when it ruled that negligence in driving was the proximate cause of the an injury is caused by the negligence of a servant or an employee, the master or
accident; (2) in increasing the civil indemnity from P30,000 to P50,000; and (3) in employer is presumed to be negligent either in the selection or in the supervision of
using the life expectancy of the deceased instead of the life expectancies of that employee. This presumption may be overcome only by satisfactorily showing that
respondents. the employer exercised the care and the diligence of a good father of a family in the
selection and the supervision of its employee. 8
The Court's Ruling The CA said that allowing Pestaño to ply his route with a defective speedometer
showed laxity on the part of Metro Cebu in the operation of its business and in the
The Petition has no merit. supervision of its employees. The negligence alluded to here is in its supervision over
its driver, not in that which directly caused the accident. The fact that Pestaño was able
First Issue: Negligence to use a bus with a faulty speedometer shows that Metro Cebu was remiss in the
supervision of its employees and in the proper care of its vehicles. It had thus failed to
Petitioners contend that Pestaño was not under any obligation to slow down when he conduct its business with the diligence required by law.
overtook the motorcycle, because the deceased had given way to him upon hearing the
bus horn. Seeing that the left side of the road was clearly visible and free of oncoming Second Issue: Life Indemnity
traffic, Pestaño accelerated his speed to pass the motorcycle. Having given way to the
bus, the motorcycle driver should have slowed down until he had been overtaken. Petitioners aver that the CA erred in increasing the award for life indemnity from
They further contend that the motorcycle was not in the middle of the road nearest to P30,000 to P50,000, without specifying any aggravating circumstance to justify the
the junction as found by the trial and the appellate courts, but was on the inner lane. increment as provided in the Civil Code. 9
This explains why the damage on the bus were all on the right side — the right end of This contention is untenable. The indemnity for death caused by a quasi-delict used to
the bumper and the right portion of the radiator grill were bent and dented. Hence, they be pegged at P3,000, based on Article 2206 of the Civil Code. However, the amount
insist that it was the victim who was negligent. has been gradually increased through the years because of the declining value of our
We disagree. Petitioners are raising a question of fact based on Pestaño's testimony currency. At present, prevailing jurisprudence fixes the amount at P50,000. 10
contradicting that of Eyewitness Ignacio Neis and on the location of the dents on the
bumper and the grill. Neis testified that as the two vehicles approached the junction,
 Third Issue: Loss of Earning Capacity

Petitioners cite Villa Rey Transit, Inc. v. Court of Appeals, 11 which held:
"The determination of the indemnity to be awarded to the heirs of
a deceased person has therefore no fixed basis. . . . The life
expectancy of the deceased or of the beneficiary, whichever is
shorter, is an important factor. . . . ."
They contend that the CA used the wrong basis for its computation of earning
capacity.
We disagree. The Court has consistently computed the loss of earning capacity based
on the life expectancy of the deceased, 12 and not on that of the heir. 13 Even Villa
Rey Transit did likewise.
The award for loss of earning capacity is based on two factors: (1) the number of years
on which the computation of damages is based and (2) the rate at which the loss
sustained by the heirs is fixed. 14 The first factor refers to the life expectancy, which
takes into consideration the nature of the victim's work, lifestyle, age and state of
health prior to the accident. The second refers to the victim's earning capacity minus
the necessary living expenses. Stated otherwise, the amount recoverable is that portion
of the earnings of the deceased which the beneficiary would have received — the net
earnings of the deceased. 15

WHEREFORE, the Petition is DENIED and the assailed Decision and Resolution
AFFIRMED. Cost against petitioners.
SO ORDERED.
Melo, Vitug, and Gonzaga-Reyes, JJ ., concur.
||| (Pestaño v. Spouses Sumayang, G.R. No. 139875, [December 4, 2000], 400 PHIL
740-751)
 witnesses of the prosecution are credible is entitled to respect for it was the trial
SECOND DIVISION judge who had the chance to observe the witnesses below; and that applying the
doctrine of res ipsa loquitur, there exists a presumption of negligence against private
respondents which the latter failed to overcome.
[G.R. No. 125483. February 1, 2001.]

LUDO AND LUYM SYLLABUS

CORPORATION, petitioner, vs. COURT OF APPEALS,
GABISAN SHIPPING LINES, INC. and/or ANSELMO 1. REMEDIAL LAW; CIVIL PROCEDURE; PETITION FOR REVIEW
OLASIMAN, respondents. ON CERTIORARI; REVIEW IS LIMITED ONLY TO QUESTIONS OF LAW;
EXCEPTIONS. — While the rule is that this Court is limited only to questions of
law in a petition for review, there are exceptions, among which are when the factual
Baduel, Espina & Associates for petitioner. findings of the Court of Appeals and the trial court conflict, and when the appellate
Atty. Adelino B. Sitoy for private respondents. court based its conclusion entirely on speculations, surmises, or conjectures.
2. ID; EVIDENCE; CREDIBILITY OF WITNESSES; FINDINGS OF THE TRIAL
COURT THEREON ARE ENTITLED TO RESPECT ON APPEAL; CASE AT
SYNOPSIS BAR. — Our review of the records constrains us to conclude that indeed MV
Miguela rammed and damaged petitioner's fender pile cluster. Naval and Espina
When private respondents' vessel came to dock at petitioner's wharf, it rammed and witnessed the incident, saw the impact and heard cracking sounds thereafter. The
destroyed a fender pile cluster. Petitioner subsequently filed a damage suit for the trial court found them credible. We respect this observation of the trial court, for in
cost of repair. Eyewitness Naval, petitioner's employee, testified that he guided the the appreciation of testimonial evidence and attribution of values to the declaration
vessel to its docking place and shouted "Reverse" to the vessel's crew, but it was too of witnesses, it is the trial judge who had the chance to observe the witnesses and
late when the latter responded. was in a position to determine if the witnesses are telling the truth or not.

Petitioners' witnesses, marine surveyor Degamo and diver Alferez who dived two or 3. CIVIL LAW; DAMAGES; APPLICABILITY OF THE DOCTRINE OF RES
three times after the incident, confirmed the damage caused by private respondents' IPSA LOQUITUR IN CASE AT BAR. — The doctrine of res ipsa loquitur was
vessel. On the other hand, private respondents presented diver, Lazara, a explained in Batiquin vs. Court of Appeals, 258 SCRA 334 (1996), . . . The doctrine
mere bodegero, who stated that there was no damage, but later testified in court that recognizes that parties may establish prima facie negligence without direct proof and
he found a crack on one side of the pile cluster and saw seashells and seaweeds allows the principle to substitute for specific proof of negligence. This is invoked
underneath an uprooted post. when under the circumstances, direct evidence is absent and not readily available. In
our view, all the requisites for recourse to this doctrine exist. First, MV Miguela was
After trial, the trial court rendered judgment ordering private respondents to pay under the exclusive control of its officers and crew. Petitioner did not have direct
damages to petitioner. The Court of Appeals, however, reversed the decision, evidence on what transpired within as the officers and crew maneuvered the vessel to
finding: petitioner's eyewitness Naval as incompetent; there were other vessels which its berthing place. We note the Court of Appeals' finding that Naval and Espina were
also used the wharf for berthing; there was no positive proof to show that it was not knowledgeable on the vessel's maneuverings, and could not testify on the
private respondents' vessel which rammed the pile cluster; and the seashells and negligence of the officers and crew. Second, aside from the testimony that MV
seaweeds under the uprooted post indicated that the breaking happened a long time Miguelarammed the cluster pile, private respondent did not show persuasively other
ago. possible causes of the damage. Applying now the above, there exists a presumption
of negligence against private respondents which we opine the latter failed to
On appeal, petitioner argued; that private respondents did not assign as an error overcome. cCTaSH
Naval's incompetence to testify on the negligence of private respondents' officers and
crew; and maintained that they did not ram and damage the pile cluster.
The Supreme Court held: that the Court of Appeals can rule on the competency of
Naval to testify to determine the issue of negligence of private respondents' officers DECISION
and crew, which was a properly assigned error; that the trial court's finding that
QUISUMBING, J p: business in the vessels' maneuvering. When Naval informed the vessel's officers of
the incident, Olasiman sent their bodega man, Ronilo Lazara, to dive on the same
This petition for review 1 under Rule 45 of the Revised Rules of Court seeks to afternoon to check on the alleged damage. Lazara told Olasiman that there was no
annul and set aside the decision 2 dated January 10, 1996 of the Court of Appeals damage. However, during direct examination, Lazara testified that he found a crack
which reversed and set aside the decision of the Regional Trial Court of Cebu City, on the side of the pile cluster, one post detached from the seabed at a distance of
Branch IX, and the resolution 3 dated June 11, 1996, denying petitioner's motion for about 7 inches, and seashells and seaweeds directly underneath the uprooted post.
reconsideration. There were scattered pieces of copra at the place where MV Miguela docked, which
indicated the prior docking by other vessels. After MV Miguela left, another vessel
Petitioner Ludo & Luym Corporation is a domestic corporation engaged in copra docked in the same area. Petitioner did not prevent MV Miguela from departing.
processing with plant and business offices in Cebu City. Private Respondent Gabisan When chiefmate Gabisan went to Atty. Du, the latter told him not to mind the
Shipping Lines was the registered owner and operator of the motor vessel MV incident.
Miguela, while the other private respondent, Anselmo Olasiman, was its captain.
On rebuttal, petitioner presented Atty. Du who testified that Gabisan never went to
Petitioner owns and operates a private wharf used by vessels for loading and his office after receiving the letter-complaint; that petitioner never received any reply
unloading of copra and other processed products. Among its wharf's facilities are to its demand letters; and that the first time Atty. Du saw Gabisan was during the
fender pile clusters for docking and mooring. pre-trial.
On May 21, 1990, at around 1:30 P.M., while MV Miguela was docking at On May 14, 1993, the trial court disposed the case in favor of petitioner, thus:
petitioner's wharf, it rammed and destroyed a fender pile cluster. Petitioner
demanded damages from private respondents. The latter refused. Hence, petitioner WHEREFORE, premises considered, this court hereby renders
filed a complaint for damages before the Regional Trial Court of Cebu. judgment in favor of the plaintiff, ordering the defendants,
jointly and severally, to pay the plaintiff the following:
Petitioner's evidence during trial showed that on May 21, 1990, at 1:30 P.M., MV
Miguela came to dock at petitioner's wharf. Ireneo Naval, petitioner's employee, 1) Php 70,000.00 actual damages, plus interest at the rate of 12%
guided the vessel to its docking place. After the guide (small rope) was thrown from per annum from the time the decision is received by defendants
the vessel and while the petitioner's security guard was pulling the big rope to be tied until fully paid;
to the bolar, MV Miguela did not slow down. The crew did not release the vessel's
anchor. Naval shouted "Reverse" to the vessel's crew, but it was too late when the 2) Php 15,000.00 exemplary damages;
latter responded, for the vessel already rammed the pile cluster. The impact 3) Php 15,000.00 attorney's fees;
disinclined the pile cluster and deformed the cable wires wound around it. Naval
immediately informed the vessel's captain and its chiefmate of the incident, and 4) Php 10,000.00 litigation expenses.
instructed the guard-on-duty, Alfredo Espina, to make a spot report. The incident
was reported to Atty. Du, petitioner's vice-president for legal and corporate affairs. COSTS AGAINST THE DEFENDANTS.
Atty. Du in turn sent formal demand letters to private respondents. Marine surveyor SO ORDERED. 4
Carlos Degamo inspected the damage on the pile cluster and found that one post was
uprooted while two others were loosened and that the pile cluster was leaning In finding in favor of petitioner, the trial court found that it was able to prove by
shoreward. Degamo hired skin diver Marvin Alferez, who found that one post was preponderance of evidence that MV Miguela rammed and damaged the pile cluster;
broken at about 7 inches from the seabed and two other posts rose and cracked at the that petitioner's witnesses, Naval and Espina, actually saw the incident; that
bottom. Based on these findings, Degamo concluded that the two raised posts were respondents failed to refute the testimony of marine surveyor Degamo and skin diver
also broken under the seabed and estimated the cost of repair and replacement at Alferez on the damages; that the officers and crew of MV Miguela were negligent;
P95,000.00. and that respondents are solidarily liable for the damages.

Private respondents denied the incident and the damage. Their witnesses claimed that
the damage, if any, must have occurred prior to their arrival and caused by another
Upon private respondent's appeal, the Court of Appeals reversed the trial court on
vessel or by ordinary wear and tear. They averred that MV Miguela started to slow
January 10, 1996, in its decision that reads:
down at 100 meters and the crew stopped the engine at 50 meters from the pier; that
Capt. Anselmo Olasiman did not order the anchor's release and chief mate Manuel WHEREFORE, in view of the foregoing, judgment is rendered
Gabisan did not hear Naval shout "Reverse". Respondents claimed that Naval had no REVERSING and SETTING aside the decision of the Court a
 quo, hereby entering a new one DISMISSING the Complaint for issue of their negligence, which appeared in the second assigned error. In
lack of merit. reproducing the portion of the TSN consisting of Naval's cross examination, private
respondents' counsel was indirectly attacking Naval's competence and invoking it vis
No pronouncement as to costs. a vis the trial court's finding, based on Naval's testimony, that MV Miguela was
SO ORDERED. 5 sailing at a speed unusual for a docking vessel. 8 The CA did not err in addressing
the matter. An appellate court can consider an unassigned error on which depends
The CA found that petitioner's eyewitness Naval was incompetent to testify on the the determination of the question in the properly assigned error. 9 The issue of
negligence of the crew and officers of MV Miguela; that there were other vessels that negligence of MV Miguela's officers and crew depends significantly on the
used the wharf for berthing and petitioner's evidence did not positively prove that it determination of whether Naval is competent to testify on the maneuvering of a
was MV Miguela that rammed the pile cluster; that the photographs of the pile cluster docking vessel.
taken after the incident showed no visible damages; that, as shown by private
respondents' witness, there were seashells and seaweeds directly under the uprooted The second issue is whether or not we can review questions of fact. Petitioner, in its
post, which indicated that the breaking happened a long time ago. second and third assigned errors, claims that the appellate court relied on
speculations and conjectures when it ruled that MV Miguela could not have rammed
The CA denied the motion for reconsideration. Hence, this petition for review where the pile cluster because of the presence of other vessels; that petitioner's evidence,
petitioner assigns the following errors: corroborated by those of private respondents, is positive and sufficient to prove
respondents' liability; that evidence on record showed the negligence and
A. THE COURT OF APPEALS ACTED IN EXCESS OF ITS recklessness of MV Miguela's officers and crew; and that the crew were grossly
JURISDICTION WHEN IT WENT BEYOND THE incompetent and incapable to man the vessel.
ISSUES RAISED IN THE ASSIGNMENT OF
ERRORS OF PRIVATE RESPONDENT. Private respondents claim that the above are conclusions of fact which this Court
may not review.
B. THE DECISION OF THE COURT OF APPEALS IS
GROUNDED ON SPECULATION, SURMISES AND While the rule is that this Court is limited only to questions of law in a petition for
CONJECTURES AND HAS DEPARTED FROM THE review, there are exceptions, among which are when the factual findings of the Court
RULES ON EVIDENCE. of Appeals and the trial court conflict, and when the appellate court based its
conclusion entirely on speculations, surmises, or conjectures. 10
C. THE COURT OF APPEALS MISAPPREHENDED THE
FACTS AND ITS FINDINGS IS TOTALLY NOT IN Our review of the records constrains us to conclude that indeed MV Miguela rammed
ACCORD WITH THE EVIDENCE ON RECORD. and damaged petitioner's fender pile cluster. Naval and Espina witnessed the
incident, saw the impact and heard cracking sounds thereafter. The trial court found
D. THE COURT OF APPEALS DEPARTED FROM THE them credible. We respect this observation of the trial court, for in the appreciation
RULE OF RES IPSA LOQUITUR. 6 EcICSA of testimonial evidence and attribution of values to the declaration of witnesses, it is
The issues for resolution can be reduced into three: the trial judge who had the chance to observe the witnesses and was in a position to
determine if the witnesses are telling the truth or not. 11 Further, private respondents'
1. Did the CA go beyond the issues raised? witnesses, Olasiman and Gabisan, acknowledged that Naval was at the pier waving a
handkerchief to direct them to their berthing place. 12
2. Can this Court review factual questions in this case?
Private respondents' claim that they could not have rammed and damaged the pile
3. Is the doctrine of res ipsa loquitur applicable to this case? cluster because other vessels used the same area for berthing is a mere speculation
On the first issue, petitioner argues that private respondents did not assign as an error unworthy of credence.
eyewitness Ireneo Naval's incompetence to testify on the negligence of MV Petitioner's witnesses, marine surveyor Degamo and diver Alferez, confirmed the
Miguela's officers and crew. Private respondent's brief contained nothing but general damage. Degamo had eighteen years of experience as marine surveyor and belonged
statements and reproductions of excerpts of the transcript of stenographic notes
to an independent survey company. Alferez was hired and directly supervised by
(TSN) which could not pass for a valid assignment of errors.
Degamo for the task. 13 The latter testified during trial that he examined the pile
We note that Naval's incompetence was not one of the assigned errors in private cluster at the portion above the water line by going near it and found that one cluster
respondents' brief. 7 However, private respondents raised it in connection with the pile was moving, two were loose, and the whole pile cluster was leaning shoreward
and misaligned. 14 Alferez, under oath, testified that he dived two or three times and Olasiman can not estimate how long it takes before the engine goes to slow astern
saw one broken post and two slightly uprooted ones with a crack on each. 15 after the engine is restarted. From these declarations, the conclusion is that it was
already too late when the captain ordered reverse. By then, the vessel was only 4
On the other hand, private respondents' evidence on this matter was contradictory. meters from the pier, 20 and thus rammed it.
As testified by Olasiman, when he asked Lazara on the result of his diving, the latter
said that there was no damage. 16 However, when Lazara testified in court, he said Respondent company's negligence consists in allowing incompetent crew to man its
he found a crack on the side of the pile cluster, with one pile no longer touching the vessel. As shown also by petitioner, both Captain Olasiman and Chief Mate Gabisan
seabed and directly underneath it were seashells and seaweeds. Further, he said that did not have a formal training in marine navigation. The former was a mere
he informed the captain about this. 17 We find Lazara's testimony as an afterthought, elementary graduate 21 while the latter is a high school graduate. Their experience in
lacking credibility. In addition, Leonilo Lazara, was a mere bodegero of MV navigation 22 was only as a watchman and a quartermaster, respectively.
Miguela. He could not possibly be a competent witness on marine surveys. 18
WHEREFORE, the petition is GRANTED. The decision and resolution of the Court
Finally, is the doctrine of res ipsa loquitur applicable to this case? Petitioner argues of Appeals are ANNULLED AND SET ASIDE, and the decision of the Regional
that the Court of Appeals erred when it reversed the trial court for the latter's heavy Trial Court of Cebu City, Branch IX, is hereby REINSTATED.
reliance on Naval's testimony. The appellate court overlooked the fact that aside
from Naval's testimony, the trial court also relied on the principle of res ipsa Costs against private respondents.
loquitur to establish private respondents' negligence. SO ORDERED.
The doctrine of res ipsa loquitur was explained in Batiquin vs. Court of Appeals, 258 Bellosillo, Mendoza, Buena and De Leon, Jr., JJ., concur.
SCRA 334 (1996), thus:
||| (Ludo & Luym Corp. v. Court of Appeals, G.R. No. 125483, [February 1, 2001],
Where the thing which causes injury is shown to be under the
403 PHIL 749-759)
management of the defendant, and the accident is such as in the
ordinary course of things does not happen if those who have the
management use proper care, it affords reasonable evidence, in
the absence of an explanation by the defendant, that the accident
arose from want of care.
The doctrine recognizes that parties may establish prima facie negligence without
direct proof and allows the principle to substitute for specific proof of negligence.
This is invoked when under the circumstances, direct evidence is absent and not
readily available. 19
In our view, all the requisites for recourse to this doctrine exist. First, MV
Miguela was under the exclusive control of its officers and crew. Petitioner did not
have direct evidence on what transpired within as the officers and crew maneuvered
the vessel to its berthing place. We note the Court of Appeals' finding that Naval and
Espina were not knowledgeable on the vessel's maneuverings, and could not testify
on the negligence of the officers and crew. Second, aside from the testimony that MV
Miguela rammed the cluster pile, private respondent did not show persuasively other
possible causes of the damage. DTaSIc
Applying now the above, there exists a presumption of negligence against private
respondents which we opine the latter failed to overcome. Additionally, petitioner
presented tangible proof that demonstrated private respondents' negligence. As
testified by Capt. Olasiman, from command of "slow ahead" to "stop engine", the
vessel will still travel 100 meters before it finally stops. However, he ordered "stop
engine" when the vessel was only 50 meters from the pier. Further, he testified that
before the vessel is put to slow astern, the engine has to be restarted. However,
 1. CIVIL LAW; OBLIGATIONS AND CONTRACTS; FORTUITOUS EVENT;
THIRD DIVISION CHARACTERISTICS THEREOF. — A fortuitous event is possessed of the
following characteristics: (a) the cause of the unforeseen and unexpected occurrence,
or the failure of the debtor to comply with his obligations must be independent of
[G.R. No. 113003. October 17, 1997.] human will; (b) it must be impossible to foresee the event which constitutes the caso
fortuito, or if it can be foreseen, it must be impossible to avoid; (c) the occurrence
ALBERTA YOBIDO and CRESENCIO must be such as to render it impossible for the debtor to fulfill his obligation in a
YOBIDO, petitioners, vs. COURT OF APPEALS, LENY normal manner; and (d) the obligor must be free from any participation in the
TUMBOY, ARDEE TUMBOY and JASMIN aggravation of the injury resulting to the creditor. As Article 1174 provides, no
TUMBOY, respondents. person shall be responsible for a fortuitous event which could not be foreseen, or
which, though foreseen was inevitable. In other words, there must be an entire
exclusion of human agency from the cause of injury or loss.
Silvanio T. Liza for petitioners. 2. ID.; COMMON CARRIER; WHEN A PASSENGER IS INJURED OR DIES
Gershon A. Patalinghug, Jr. for private respondents. WHILE TRAVELLING, THE LAW PRESUMES THAT THE COMMON
CARRIER IS NEGLIGENT. — When a passenger boards a common carrier, he
takes the risks incidental to the mode of travel he has taken. After all, a carrier is not
SYNOPSIS an insurer of the safety of its passengers and is not bound absolutely and at all events
to carry them safely and without injury. However, when a passenger is injured or
dies while travelling, the law presumes that the common carrier is negligent. . . .
On April 26, 1988, spouses Tito and Leny Tumboy and their minor children, Ardee Article 1755 provides that "(a) common carrier is bound to carry the passengers
and Jasmin, boarded at Mangagoy, Surigao del Sur, a Yobido bus bound for Davao safely as far as human care and foresight can provide, using the utmost diligence of
City. Along Picop road in Km. 17, Sta. Maria, Agusan del Sur, the left front tire of very cautious persons, with a due regard for all the circumstances." Accordingly,
the bus suddenly exploded. The bus fell into a ravine around three (3) feet from the the culpa contractual, once a passenger dies or is injured the carrier is presumed to
road and struck a tree which resulted in the death of Tito Tumboy and physical have been at fault or to have acted negligently. This disputable presumption may
injuries to other passengers. Thereafter, a complaint for breach of contract of only be overcome by evidence that the carrier had observed extraordinary diligence
carriage, damages and attorney's fees was filed by Leny and her children against as prescribed by Articles 1733, 1755 and 1756 of the Civil Code or that the death or
Alberta Yobido, the owner of the bus, and Cresencio Yobido, its driver in the injury of the passenger was due to a fortuitous event. Consequently, the court need
Regional Trial Court of Davao City. After trial, the lower court rendered a decision not make an express finding of fault or negligence on the part of the carrier to hold it
dismissing the action for lack of merit. Respondents appealed to the Court of responsible for damages sought by the passenger.
Appeals. On August 23, 1993, respondent court rendered a decision reversing that of
the lower court. In this instant petition, petitioners assert that the tire blowout that 3. ID.; ID.; AN ACCIDENT CAUSED EITHER BY DEFECTS IN THE
caused the death of Tito Tumboy was a caso fortuito and herein respondent court AUTOMOBILE OR THROUGH THE NEGLIGENCE OF ITS DRIVER IS NOT
misapprehended the facts of the case, therefore, its findings cannot be considered A CASO FORTUITO THAT WOULD EXEMPT THE CARRIER FROM
final which shall bind the Court. aIHSEc LIABILITY FOR DAMAGES. — The explosion of the new tire may not be
considered a fortuitous event. There are human factors involved in the situation. The
The Supreme Court ruled that there is no reason to overturn the findings and fact that the tire was new did not imply that it was entirely free from manufacturing
conclusions of the Court of Appeals. Petitioners' contention that they are exempted defects or that it was properly mounted on the vehicle. Neither may the fact that the
from liability because the tire blowout was a fortuitous event that could not have tire bought and used in the vehicle is of a brand name noted for quality, resulting in
been foreseen, must fail. It is settled that an accident caused either by defects in the the conclusion that it could not explode within five days' use. Be that as it may, it is
automobile or through the negligence of its driver is not a caso fortuito that would settled that an accident caused either by defects in the automobile or through the
exempt the carrier from liability for damages. Accordingly, the challenged decision negligence of its driver is not a caso fortuito that would exempt the carrier from
is affirmed subject to modification that petitioners shall additionally pay herein, liability for damages.
respondents P20,000.00 as exemplary damages.
4. ID.; ID.; PROOF THAT THE TIRE WAS NEW AND OF GOOD QUALITY IS
NOT SUFFICIENT PROOF THAT PETITIONER IS NOT NEGLIGENT. — It was
SYLLABUS incumbent upon the defense to establish that it took precautionary measures
considering partially dangerous condition of the road. As stated above, proof that the
tire was new and of good quality is not sufficient proof that it was not negligent. DECISION
Petitioners should have shown that it undertook extraordinary diligence in the care of
its carrier such as conducting daily routinary check-ups of the vehicle's parts. As the
late Justice J.B.L. Reyes said: "It may be impracticable, as appellee argues, to require
of carriers to test the strength of each and every part of its vehicles before each trip, ROMERO, J p:
but we are of the opinion that a due regard for the carrier's obligations toward the
traveling public demands adequate periodical tests to determine the condition and In this petition for review on certiorari of the decision of the Court of Appeals, the
strength of those vehicle portions the failure of which may endanger the safety of the issue is whether or not the explosion of a newly installed tire of a passenger vehicle
passengers." is a fortuitous event that exempts the carrier from liability for the death of a
passenger.
5. ID.; ID.; PRESENCE OF CONTRADICTORY FACTS MUST BE RESOLVED
IN FAVOR OF LIABILITY IN VIEW OF THE PRESUMPTION OF On April 26, 1988, spouses Tito and Leny Tumboy and their minor children named
NEGLIGENCE OF THE CARRIER IN THE LAW; CASE AT BAR. — It is Ardee and Jasmin, boarded at Mangagoy, Surigao del Sur, a Yobido Liner bus bound
interesting to note that petitioners proved through the bus conductor, Salce, that the for Davao City. Along Picop Road in Km. 17, Sta. Maria, Agusan del Sur, the left
bus was running at "60-50" kilometers per hour only within the prescribed lawful front tire of the bus exploded. The bus fell into a ravine around three (3) feet from
speed limit. However, they failed to rebut the testimony of Leny Tumboy that the the road and struck a tree. The incident resulted in the death of 28-year-old Tito
bus was running so fast that she cautioned the driver to slow down. These Tumboy, and physical injuries to other passengers.
contradictory facts must, therefore, be resolved in favor of liability in view of the
On November 21, 1988, a complaint for breach of contract of carriage, damages and
presumption of negligence of the carrier in the law.
attorney's fees was filed by Leny and her children against Alberta Yobido, the owner
6. ID.; ID.; DAMAGES; FOR THE DEATH OF A PASSENGER, THE HEIRS of the bus, and Cresencio Yobido, its driver, before the Regional Trial Court of
ARE ENTITLED TO P50,000.00. — Having failed to discharge its duty to Davao City. When the defendants therein filed their answer to the complaint, they
overthrow the presumption of negligence with clear and convincing evidence, raised the affirmative defense of caso fortuito. They also filed a third-party
petitioners are hereby held liable for damages. Article 1764 in relation to Article complaint against Philippine Phoenix Surety and Insurance, Inc. This third-party
2206 of the Civil Code prescribes the amount of at least three thousand pesos as defendant filed an answer with compulsory counterclaim. At the pre-trial conference,
damages for the death of a passenger. Under prevailing jurisprudence, the award of the parties agreed to a stipulation of facts. 1
damages under Article 2206 has been increased to fifty thousand pesos (P50,000.00).
Upon a finding that the third party defendant was not liable under the insurance
7. ID.; ID.; ID.; MORAL DAMAGES; RECOVERABLE WHEN THERE IS A contract, the lower court dismissed the third party complaint. No amicable settlement
BREACH OF CONTRACT OF CARRIAGE RESULTING IN THE DEATH OF A having been arrived at by the parties, trial on the merits ensued. cdasia
PASSENGER. — Moral damages are generally not recoverable in culpa
contractual except when bad faith had been proven. However, the same damages
may be recovered when breach of contract of carriage results in the death of a The plaintiffs asserted that violation of the contract of carriage between them and the
passenger, as in this case. ISDCaT defendants was brought about by the driver's failure to exercise the diligence
required of the carrier in transporting passengers safely to their place of destination.
8. ID.; ID.; EXEMPLARY DAMAGES; RESPONDENTS ARE ENTITLED TO
According to Leny Tumboy, the bus left Mangagoy at 3:00 o'clock in the afternoon.
P20,000.00 AS EXEMPLARY DAMAGES BECAUSE PETITIONER IS DEEMED
The winding road it traversed was not cemented and was wet due to the rain; it was
TO HAVE ACTED RECKLESSLY. — Exemplary damages, awarded by way of
rough with crushed rocks. The bus which was full of passengers had cargoes on top.
example or correction for the public good when moral damages are awarded, may
Since it was "running fast," she cautioned the driver to slow down but he merely
likewise be recovered in contractual obligations if the defendant acted in wanton,
stared at her through the mirror. At around 3:30 p.m., in Trento, she heard something
fraudulent, reckless, oppressive, or malevolent manner. Because petitioners failed to
explode and immediately, the bus fell into a ravine.
exercise the extraordinary diligence required of a common carrier, which resulted in
the death of Tito Tumboy, it is deemed to have acted recklessly. As such, private For their part, the defendants tried to establish that the accident was due to a
respondents shall be entitled to exemplary damages in the amount of fortuitous event. Abundio Salce, who was the bus conductor when the incident
P20,000.00. CaDEAT happened, testified that the 42-seater bus was not full as there were only 32
passengers, such that he himself managed to get a seat. He added that the bus was
running at a speed of "60 to 50" and that it was going slow because of the zigzag
road. He affirmed that the left front tire that exploded was a "brand new tire" that he
mounted on the bus on April 21, 1988 or only five (5) days before the incident. The the plaintiff to prove that the cause of the blow-out is not caso
Yobido Liner secretary, Minerva Fernando, bought the new Goodyear tire from fortuito.
Davao Toyo Parts on April 20, 1988 and she was present when it was mounted on
the bus by Salce. She stated that all driver applicants in Yobido Liner underwent Proving that the tire that exploded is a new Goodyear tire is not sufficient to
actual driving tests. before they were employed. Defendant Cresencio Yobido discharge defendants' burden. As enunciated in Necesito vs. Paras, the passenger has
underwent such test and submitted his professional driver's license and clearances neither choice nor control over the carrier in the selection and use of its equipment
from the barangay, the fiscal and the police. and the good repute of the manufacturer will not necessarily, relieve the carrier from
liability.
On August 29, 1991, the lower court rendered a decision 2 dismissing the action for
lack of merit. On the issue of whether or not the tire blowout was a caso fortuito, it Moreover, there is evidence that the bus was moving
found that "the falling of the bus to the cliff was a result of no other outside factor fast, and the road was wet and rough. The driver could have
than the tire blow-out." It held that the ruling in the La Mallorca and Pampanga Bus explained that the blow out that precipitated the accident that
Co. v. De Jesus 3 that a tire blowout is "a mechanical defect of the conveyance or a caused the death of Tito Tumboy could not have been prevented
fault in its equipment which was easily discoverable if the bus had been subjected to even if he had exercised due care to avoid the same, but he was
a more thorough or rigid check-up before it took to the road that morning" is not presented as witness."
inapplicable to this case. It reasoned out that in said case, it was found that the The Court of Appeals thus disposed of the appeal as follows:
blowout was caused by the established fact that the inner tube of the left front tire
"was pressed between the inner circle of the left wheel and the rim which had slipped "WHEREFORE, the judgment of the court a quo is set aside and
out of the wheel." In this case, however, "the cause of the explosion remains a another one entered ordering defendants to pay plaintiffs the sum
mystery until at present." As such, the court added, the tire blowout was "a caso of P50,000.00 for the death of Tito Tumboy, P30,000.00 in
fortuito which is completely an extraordinary circumstance independent of the will" moral damages, and P7,000.00 for funeral and burial expenses.
of the defendants who should be relieved of "whatever liability the plaintiffs may SO ORDERED."
have suffered by reason of the explosion pursuant to Article 1174 4 of the Civil
Code." The defendants filed a motion for reconsideration of said decision which was denied
on November 4, 1993 by the Court of Appeals. Hence, the instant petition asserting
Dissatisfied, the plaintiffs appealed to the Court of Appeals. They ascribed to the the position that the tire blowout that caused the death of Tito Tumboy was a caso
lower court the following errors: (a) finding that the tire blowout was a caso fortuito; fortuito. Petitioners claim further that the Court of Appeals, in ruling contrary to that
(b) failing to hold that the defendants did not exercise utmost and/or extraordinary of the lower court, misapprehended facts and, therefore, its findings of fact cannot be
diligence required of carriers under Article 1755 of the Civil Code, and (c) deciding considered final which shall bind this Court. Hence, they pray that this Court review
the case contrary to the ruling in Juntilla v. Fontanar, 5 and Necesito v. Paras. 6 the facts of the case.
On August 23, 1993, the Court of Appeals rendered the Decision 7 reversing that of The Court did re-examine the facts and evidence in this case because of the
the lower court. It held that: inapplicability of the established principle that the factual findings of the Court of
"To Our mind, the explosion of the tire is not in itself a Appeals are final and may not be reviewed on appeal by this Court. This general
fortuitous event. The cause of the blow-out, if due to a factory principle is subject to exceptions such as the one present in this case, namely, that the
defect, improper mounting, excessive tire pressure, is not an lower court and the Court of Appeals arrived at diverse factual findings. 8 However,
unavoidable event. On the other hand, there may have been upon such re-examination, we found no reason to overturn the findings and
adverse conditions on the road that were unforeseeable and/or conclusions of the Court of Appeals.
inevitable, which could make the blow-out a caso fortuito. The As a rule, when a passenger boards a common carrier, he takes the risks incidental to
fact that the cause of the blow-out was not known does not the mode of travel he has taken. After all, a carrier is not an insurer of the safety of
relieve the carrier of liability. Owing to the statutory its passengers and is not bound absolutely and at all events to carry them safely and
presumption of negligence against the carrier and its obligation without injury. 9 However, when a passenger is injured or dies, while traveling, the
to exercise the utmost diligence of very cautious persons to carry law presumes that the common carrier is negligent. Thus, the Civil Code provides:
the passenger safely as far as human care and foresight can
provide, it is the burden of the defendants to prove that the cause "Art. 1756. In case of death or injuries to passengers, common
of the blow-out was a fortuitous event. It is not incumbent upon carriers are presumed to have been at fault or to have acted
 negligently, unless they prove that they observed extraordinary adverse road conditions or that precautions were taken by the
diligence as prescribed in articles 1733 and 1755." jeepney driver to compensate for any conditions liable to cause
accidents. The sudden blowing-up, therefore, could have been
Article 1755 provides that "(a) common carrier is bound to carry the passengers caused by too much air pressure injected into the tire coupled by
safely as far as human care and foresight can provide, using the utmost diligence of the fact that the jeepney was overloaded and speeding at the time
very cautious persons, with a due regard for all the circumstances." Accordingly, of the accident." 17
in culpa contractual, once a passenger dies or is injured, the carrier is presumed to
have been at fault or to have acted negligently. This disputable presumption may It is interesting to note that petitioners proved through the bus conductor, Salce, that
only be overcome by evidence that the carrier had observed extraordinary diligence the bus was running at "60-50" kilometers per hour only or within the prescribed
as prescribed by Articles 1733, 10 1755 and 1756 of the Civil Code or that the death lawful speed limit. However, they failed to rebut the testimony of Leny Tumboy that
or injury of the passenger was due to a fortuitous event. 11 Consequently, the court the bus was running so fast that she cautioned the driver to slow down. These
need not make an express finding of fault or negligence on the part of the carrier to contradictory facts must, therefore, be resolved in favor of liability in view of the
hold it responsible for damages sought by the passenger. 12 presumption of negligence of the carrier in the law. Coupled with this is the
established condition of the road — rough, winding and wet due to the rain. It was
In view of the foregoing, petitioners' contention that they should be exempt from incumbent upon the defense to establish that it took precautionary measures
liability because the tire blowout was no more than a fortuitous event that could not considering partially dangerous condition of the road. As stated above, proof that the
have been foreseen, must fail. A fortuitous event is possessed of the following tire was new and of good quality is not sufficient proof that it was not negligent.
characteristics: (a) the cause of the unforeseen and unexpected occurrence, or the Petitioners should have shown that it undertook extraordinary diligence in the care of
failure of the debtor to comply with his obligations, must be independent of human its carrier, such as conducting daily routinary check-ups of the vehicle's parts. As the
will; (b) it must be impossible to foresee the event which constitutes the caso late Justice J.B.L. Reyes said:
fortuito, or if it can be foreseen, it must be impossible to avoid; (c) the occurrence
must be such as to render it impossible for the debtor to fulfill his obligation in a "It may be impracticable, as appellee argues, to require of
normal manner; and (d) the obligor must be free from any participation in the carriers to test the strength of each and every part of its vehicles
aggravation of the injury resulting to the creditor. 13 As Article 1174 provides, no before each trip; but we are of the opinion that a due regard for
person shall be responsible for a fortuitous event which could not be foreseen, or the carrier's obligations toward the traveling public demands
which, though foreseen, was inevitable. In other words, there must be an entire adequate periodical tests to determine the condition and strength
exclusion of human agency from the cause of injury or loss. 14 aisadc of those vehicle portions the failure of which may endanger the
safety of the passengers." 18
Under the circumstances of this case, the explosion of the new tire may not be
considered a fortuitous event. There are human factors involved in the situation. The Having failed to discharge its duty to overthrow the presumption of negligence with
fact that the tire was new did not imply that it was entirely free from manufacturing clear and convincing evidence, petitioners are hereby held liable for damages.Article
defects or that it was properly mounted on the vehicle. Neither may the fact that the 1764 19 in relation to Article 2206 20 of the Civil Code prescribes the amount of at
tire bought and used in the vehicle is of a brand name noted for quality, resulting in least three thousand pesos as damages for the death of a passenger. Under prevailing
the conclusion that it could not explode within five days' use. Be that as it may, it is jurisprudence, the award of damages under Article 2206 has been increased to fifty
settled that an accident caused either by defects in the automobile or through the thousand pesos (P50,000.00). 21
negligence of its driver is not a caso fortuito that would exempt the carrier from
liability for damages. 15 Moral damages are generally not recoverable in culpa contractual except when bad
faith had been proven. However, the same damages may be recovered when breach
Moreover, a common carrier may not be absolved from liability in case of force of contract of carriage results in the death of a passenger, 22 as in this case.
majeure or fortuitous event alone. The common carrier must still prove that it was Exemplary damages, awarded by way of example or correction for the public good
not negligent in causing the death or injury resulting from an accident. 16 This Court when moral damages are awarded, 23 may likewise be recovered in contractual
has had occasion to state: obligations if the defendant acted in wanton, fraudulent, reckless, oppressive, or
malevolent manner. 24 Because petitioners failed to exercise the extraordinary
diligence required of a common carrier, which resulted in the death of Tito Tumboy,
"While it may be true that the tire that blew-up was still good it is deemed to have acted recklessly. 25 As such, private respondents shall be
because the grooves & the tire were still visible, this fact alone entitled to exemplary damages.
does not make the explosion of the tire a fortuitous event. No
evidence was presented to show that the accident was due to
WHEREFORE, the Decision of the Court of Appeals is hereby AFFIRMED subject
to the modification that petitioners shall, in addition to the monetary awards therein,
be liable for the award of exemplary damages in the amount of P20,000.00. Costs
against petitioners.
SO ORDERED.
Narvasa, C .J ., Melo, Francisco and Panganiban, JJ ., concur.
||| (Yobido v. Court of Appeals, G.R. No. 113003, [October 17, 1997], 346 PHIL 1-
13)
 petitioner did nothing to protect the safety of its passengers. Had petitioner and its
SECOND DIVISION employees been vigilant, they would not have failed to see that the malefactors had a
large quantity of gasoline with them. Under the circumstances, simple precautionary
measures to protect the safety of passengers, such as frisking passengers and
[G.R. No. 119756. March 18, 1999.] inspecting their baggages, preferably with non-intrusive gadgets such as metal
detectors, before allowing them on board could have been employed without
FORTUNE EXPRESS, INC., petitioner, vs. COURT OF violating the passenger's constitutional rights.
APPEALS, PAULIE U. CAORONG, and minor children The decision of the Court of Appeals was AFFIRMED.
YASSER KING CAORONG, ROSE HEINNI and PRINCE
ALEXANDER, all surnamed CAORONG, and represented
by their mother PAULIE U. CAORONG, respondents. SYLLABUS

Geocadin & Sabig Law Office for petitioner. 1. CIVIL LAW; OBLIGATIONS AND CONTRACTS; COMMON CARRIER;
RESPONSIBLE FOR INJURIES SUFFERED BY PASSENGER ON ACCOUNT
Alan L. Flores for private respondents. OF WILFUL ACTS OF OTHER PASSENGERS. — Art. 1763 of the Civil Code
provides that a common carrier is responsible for injuries suffered by a passenger on
account of the wilful acts of other passengers, if the employees of the common
SYNOPSIS carrier could have prevented the act through the exercise of the diligence of a good
father of a family. cdasia
Petitioner Fortune Express, Inc. is a bus company in Northern Mindanao. On 2. ID.; ID.; ID.; CASE AT BAR. — In the present case, it is clear that because of the
November 18, 1989, one of its buses collided with a jeepney owned by a Maranao negligence of petitioner's employees, the seizure of the bus by Mananggolo and his
which resulted in the death of several passengers of the jeepney including two men was made possible. Despite warning by the Philippine Constabulary at Cagayan
Maranaos. In relation thereto, the Philippine Constabulary of Cagayan de Oro de Oro that the Maranaos were planning to take revenge on the petitioner by burning
warned the petitioner, through its operations manager Diosdado Bravo, that the some of its buses and the assurance of petitioner's operation manager, Diosdado
Maranaos were planning to take revenge on the petitioner by burning some of its Bravo, that the necessary precautions would be taken, petitioner did nothing to
buses. Bravo assured them that the necessary precautions to ensure the safety of lives protect the safety of its passengers. Had petitioner and its employees been vigilant
and properties of the passengers would be taken. On November 22, 1989, three they would not have failed to see that the malefactors had a large quantity of gasoline
armed Maranaos who pretended to be passengers, seized and burned the bus of the with them. Under the circumstances, simple precautionary measures to protect the
petitioner at Linamon, Lanao del Norte while on its way to Iligan City which resulted safety of passengers, such as frisking passengers and inspecting their baggages,
in the death one of its passengers, Atty. Talib Caorong. Thus the heirs of Atty. preferably with non-intrusive gadgets such as metal detectors, before allowing them
Caorong filed before the Regional Trial Court, Branch VI, Iligan City a complaint on board could have been employed without violating the passenger's constitutional
for damages for breach of contract of carriage against the petitioner. The trial court rights.
dismissed the complaint. However, the Court of Appeals reversed the decision of the
trial court. 3. ID.; ID.; FORTUITOUS EVENT; DEFINED. — Art. 1174 of the Civil Code
defines a fortuitous event as an occurrence which could not be foreseen or which
Hence, this petition for review. though foreseen, is inevitable. In Yobido v. Court of Appeals, we held that to be
Article 1763 of the Civil Code provides that a common carrier is responsible for considered as force majeure, it is necessary that: (1) the cause of the breach of the
injuries suffered by a passenger on account of the wilful acts of other passengers, if obligation must be independent of the human will; (2) the event must be either
the employees of the common carrier could have prevented the act through the unforeseeable or unavoidable; (3) the occurrence must be such as to render it
exercise of the diligence of a good father of a family. In the present case, it is clear impossible for the debtor to fulfill the obligation in a normal manner; and (4) the
that because of the negligence of petitioner's employees, the seizure of the bus by obligor must be free of participation in, or aggravation of, the injury to the creditor.
Manggolo and his men was made possible. Despite warning by the Philippine The absence of any of the requisites mentioned above would prevent the obligor
Constabulary at Cagayan de Oro that the Maranaos were planning to take revenge on from being excused from liability.
the petitioner by burning some of its buses and the assurance of petitioner's
operations manager, Diosdado Bravo, that the necessary precautions would be taken,
4. ID.; ID.; ID.; NOT PRESENT IN CASE AT BAR. — Thus, in Vasquez v. Court respondents in the amount of P100,000.00 as moral damages for the death of Atty.
of Appeals, it was held that the common carrier was liable for its failure to take Caorong.
necessary precautions against an approaching typhoon, of which it was warned,
resulting in the loss of the lives of several passengers. The event was foreseeable, 9. ID.; ID.; ID.; EXEMPLARY DAMAGES. — Art. 2232 provides that "in contracts
and, thus, the second requisite mentioned above was not fulfilled. This ruling applies and quasi-contracts, the court may award exemplary damages if the defendant acted
by analogy to the present case. Despite the report of PC agent Generalao that the in a wanton, fraudulent, reckless, oppressive, or malevolent manner." In the present
Maranaos were going to attack its buses, petitioner took no steps to safeguard the case, the petitioner acted in a wanton and reckless manner. Despite warning that the
lives and properties of its passengers. The seizure of the bus of the petitioner was Maranaos were planning to take revenge against the petitioner by burning some of its
foreseeable and, therefore, was not a fortuitous event which would exempt petitioner buses, and contrary to the assurance made by its operations manager that the
from liability. necessary precautions would be taken, the petitioner and its employees did nothing to
protect the safety of passengers. Under the circumstances, we deem it reasonable to
5. ID.; ID.; DAMAGES; DECEASED NOT GUILTY OF CONTRIBUTORY award private respondents exemplary damages in the amount of P100,000.00.
NEGLIGENCE. — The petitioner contends that Atty. Caorong was guilty of
contributory negligence in returning to the bus to retrieve something. But Atty. 10. ID.; ID.; ID.; ATTORNEY'S FEES MAY BE RECOVERED WHEN
Caorong did not act recklessly. It should be pointed out that the intended targets of EXEMPLARY DAMAGES ARE AWARDED. — Pursuant to Art. 2208, attorney's
the violence were petitioner and its employee, not its passengers. The assailant's fees may be recovered when, as in the instant case, exemplary damages are awarded.
motive was to retaliate for the loss of life of two Maranaos as a result of the collision In the recent case of Sulpicio Lines, Inc. v. Court of Appeals, we held an award of
between petitioner's bus and the jeepney in which the two Maranaos were riding. P50,000.00 as attorney's fees to be reasonable. Hence, the private respondents are
Mananggolo, the leader of the group which had hijacked the bus, ordered the entitled to attorney's fees in that amount.
passengers to get off the bus as they intended to burn it and its driver. The armed 11. ID.; ID.; ID.; COMPENSATION FOR LOSS OF EARNING CAPACITY. —
men actually allowed Atty. Caorong to retrieve something from the bus. What Art. 1764 of the Civil Code, in relation to Art. 2206 thereof, provides that in addition
apparently angered them was his attempt to help the driver of the bus by pleading for to the indemnity for death arising from the breach of contract of carriage by a
his life. He was playing the role of the good Samaritan. Certainly, this act cannot be common carrier, the "defendant shall be liable for the loss of the earning capacity of
considered an act of negligence, let alone recklessness. the deceased, and the indemnity shall be paid to the heirs of the latter." The formula
6. ID.; ID.; ID.; INDEMNITY FOR DEATH. — Art. 1764 of the Civil Code, in established in decided cases for computing net earning capacity is as follows: Net
relation to Art. 2206 thereof, provides for the payment of indemnity for the death of Earning Capacity = Life Expectancy x [Gross Annual Income - Necessary Living
passengers caused by the breach of contract of carriage by a common carrier. Expenses]. Life expectancy is equivalent to two thirds (2/3) multiplied by the
Initially fixed in Art. 2206 at P3,000.00, the amount of the said indemnity for death difference of eighty (80) and the age of the deceased. IcESDA
has through the years been gradually increased in view of the declining value of the
peso. It is presently fixed at P50,000.00. Private respondents are entitled to this
amount.
7. ID.; ID.; ID.; ACTUAL DAMAGES. — Art. 2199 provides that "except as
DECISION
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." The trial court found
that the private respondents spent P30,000.00 for the wake and burial of Atty.
Caorong. Since petitioner does not question this finding of the trial court, it is liable MENDOZA, J p:
to private respondents in the said amount as actual damages.
8. ID.; ID.; ID.; MORAL DAMAGES. — Under Art. 2206, the "spouse, legitimate This is an appeal by petition for review on certiorari of the decision, dated July 29,
and illegitimate descendants and ascendants of the deceased may demand moral 1994, of the Court of Appeals, which reversed the decision of the Regional Trial
damages for mental anguish by reason of the death of the deceased." The trial court Court, Branch VI, Iligan City. The aforesaid decision of the trial court dismissed the
found that private respondent Paulie Caorong suffered pain from the death of her complaint of private respondents against petitioner for damages for breach of
husband and worry on how to provide support for their minor children, private contract of carriage filed on the ground that petitioner had not exercised the required
respondents Yasser King, Rose Heinni, and Prince Alexander. The petitioner degree of diligence in the operation of one of its buses. Atty. Talib Caorong, whose
likewise does not question this finding of the trial court. Thus, in accordance with heirs are private respondents herein, was a passenger of the bus and was killed in the
recent decisions of this Court, we hold that the petitioner is liable to the private ambush involving said bus.
The facts of the instant case are as follows: The fact that defendant, through Operations Manager Diosdado
Bravo, was informed of the "rumors" that the Moslems intended
Petitioner is a bus company in northern Mindanao. Private respondent Paulie to take revenge by burning five buses of defendant is established
Caorong is the widow of Atty. Caorong, while private respondents Yasser King, since the latter also utilized Crisanto Generalao as a witness. Yet
Rose Heinni, and Prince Alexander are their minor children. despite this information, the plaintiffs charge, defendant did not
On November 18, 1989, a bus of petitioner figured in an accident with a jeepney in take proper precautions . . . . Consequently, plaintiffs now fault
Kauswagan, Lanao del Norte, resulting in the death of several passengers of the the defendant for ignoring the report. Their position is that the
jeepney, including two Maranaos. Crisanto Generalao, a volunteer field agent of the defendant should have provided its buses with security guards.
Constabulary Regional Security Unit No. X, conducted an investigation of the Does the law require common carriers to install security guards
accident. He found that the owner of the jeepney was a Maranao residing in in its buses for the protection and safety of its passengers? Is the
Delabayan, Lanao del Norte and that certain Maranaos were planning to take revenge failure to post guards an omission of the duty to "exercise the
on the petitioner by burning some of its buses. Generalao rendered a report on his diligence of a good father of the family" which could have
findings to Sgt. Reynaldo Bastasa of the Philippine Constabulary Regional prevented the killing of Atty. Caorong? To our mind, the
Headquarters at Cagayan de Oro. Upon the instruction of Sgt. Bastasa he went to see diligence demanded by law does not include the posting of
Diosdado Bravo, operations manager of petitioner, at its main office in Cagayan de security guards in buses. It is an obligation that properly belongs
Oro City. Bravo assured him that the necessary precautions to insure the safety of to the State. Besides, will the presence of one or two security
lives and property would be taken. 1 guards suffice to deter a determined assault of the lawless and
thus prevent the injury complained of? Maybe so, but again,
At about 6:45 P.M. on November 22, 1989, three armed Maranaos who pretended to perhaps not. In other words, the presence of a security guard is
be passengers, seized a bus of petitioner at Linamon, Lanao del Norte while on its not a guarantee that the killing of Atty. Caorong would have
way to Iligan City. Among the passengers of the bus was Atty. Caorong. The leader been definitely avoided.
of the Maranaos, identified as one Bashier Mananggolo, ordered the driver,
Godofredo Cabatuan, to stop the bus on the side of the highway. Mananggolo then xxx xxx xxx
shot Cabatuan on the arm, which caused him to slump on the steering wheel. Then Accordingly, the failure of defendant to accord faith and credit
one of the companions of Mananggolo started pouring gasoline inside the bus, as the to the report of Mr. Generalao and the fact that it did not provide
other held the passengers at bay with a handgun. Mananggolo then ordered the security to its buses cannot, in the light of the circumstances, be
passengers to get off the bus. The passengers, including Atty. Caorong, stepped out characterized as negligence.
of the bus and went behind the bushes in a field some distance from the
highway. 2LibLex Finally, the evidence clearly shows that the assailants did not
have the least intention of harming any of the passengers. They
However, Atty. Caorong returned to the bus to retrieve something from the overhead ordered all the passengers to alight and set fire on the bus only
rack. At that time, one of the armed men was pouring gasoline on the head of the after all the passengers were out of danger. The death of Atty.
driver. Cabatuan, who had meantime regained consciousness, heard Atty. Caorong Caorong was an unexpected and unforeseen occurrence over
pleading with the armed men to spare the driver as he was innocent of any wrong which defendant had no control. Atty. Caorong performed an act
doing and was only trying to make a living. The armed men were, however, adamant of charity and heroism in coming to the succor of the driver even
as they repeated their warning that they were going to burn the bus along with its in the face of danger. He deserves the undying gratitude of the
driver. During this exchange between Atty. Caorong and the assailants, Cabatuan driver whose life he saved. No one should blame him for an act
climbed out of the left window of the bus and crawled to the canal on the opposite of extraordinary charity and altruism which cost his life. But
side of the highway. He heard shots from inside the bus. Larry de la Cruz, one of the neither should any blame be laid on the doorstep of defendant.
passengers, saw that Atty. Caorong was hit. Then the bus was set on fire. Some of His death was solely due to the willful acts of the lawless which
the passengers were able to pull Atty. Caorong out of the burning bus and rush him defendant could neither prevent nor stop. cdphil
to the Mercy Community Hospital in Iligan City, but he died while undergoing
operation. 3 xxx xxx xxx
The private respondents brought this suit for breach of contract of carriage in the WHEREFORE, in view of the foregoing, the complaint is
Regional Trial Court, Branch VI, Iligan City. In its decision, dated December 28, hereby dismissed. For lack of merit, the counter-claim is
1990, the trial court dismissed the complaint, holding as follows: likewise dismissed. No cost. 4
On appeal, however, the Court of Appeals reversed. It held: In view of the constitutional right to personal privacy, our
pronouncement in this decision should not be construed as an
In the case at bench, how did defendant-appellee react to the tip advocacy of mandatory frisking in all public conveyances. What
or information that certain Maranao hotheads were planning to we are saying is that given the circumstances obtaining in the
burn five of its buses out of revenge for the deaths of two case at bench that: (a) two Maranaos died because of a vehicular
Maranaos in an earlier collision involving appellee's bus? Except collision involving one of appellee's vehicles; (b) appellee
for the remarks of appellee's operations manager that "we will received a written report from a member of the Regional
have our action . . . and I'll be the one to settle it personally," Security Unit, Constabulary Security Group, that the
nothing concrete whatsoever was taken by appellee or its tribal/ethnic group of the two deceased were planning to burn
employees to prevent the execution of the threat. Defendant- five buses of appellee out of revenge; and (c) appellee did
appellee never adopted even a single safety measure for the nothing — absolutely nothing — for the safety of its passengers
protection of its paying passengers. Were there available travelling in the area of influence of the victims, appellee has
safeguards? Of course, there were: one was frisking passengers failed to exercise the degree of diligence required of common
particularly those en route to the area where the threats were carriers. Hence, appellee must be adjudged liable.
likely to be carried out such as where the earlier accident
occurred or the place of influence of the victims or their locality. xxx xxx xxx
If frisking was resorted to, even temporarily, . . . appellee might
be legally excused from liability. Frisking of passengers picked
up along the route could have been implemented by the bus WHEREFORE, the decision appealed from is hereby
conductor; for those boarding at the bus terminal, frisking could REVERSED and another rendered ordering defendant-appellee
have been conducted by him and perhaps by additional to pay plaintiffs-appellants the following:
personnel of defendant-appellee. On hindsight, the handguns and
especially the gallon of gasoline used by the felons all of which 1) P3,399,649.20 as death indemnity;
were brought inside the bus would have been discovered, thus
preventing the burning of the bus and the fatal shooting of the 2) P50,000.00 and P500.00 per appearance as attorney's fees;
victim. and

Appellee's argument that there is no law requiring it to provide Costs against defendant-appellee. 5
guards on its buses and that the safety of citizens is the duty of Hence, this appeal. Petitioner contends:
the government, is not well taken. To be sure, appellee is not
expected to assign security guards on all of its buses; if at all, it (A) THAT PUBLIC RESPONDENT ERRED IN REVERSING
has the duty to post guards only on its buses plying THE DECISION OF THE REGIONAL TRIAL
predominantly Maranao areas. As discussed in the next COURT DATED DECEMBER 28, 1990 DISMISSING
preceding paragraph, the least appellee could have done in THE COMPLAINT AS WELL AS THE
response to the report was to adopt a system of verification such COUNTERCLAIM, AND FINDING FOR PRIVATE
as the frisking of passengers boarding its buses. Nothing, and to RESPONDENTS BY ORDERING PETITIONER TO
repeat, nothing at all, was done by defendant-appellee to protect PAY THE GARGANTUAN SUM OF P3,449,649.20
its innocent passengers from the danger arising from the PLUS P500.00 PER APPEARANCE AS
"Maranao threats." It must be observed that frisking is not a ATTORNEY'S FEES, AS WELL AS DENYING
novelty as a safety measure in our society. Sensitive places — in PETITIONER'S MOTION FOR
fact, nearly all important places — have applied this method of RECONSIDERATION AND THE SUPPLEMENT TO
security enhancement. Gadgets and devices are available in the SAID MOTION, WHILE HOLDING, AMONG
market for this purpose. It would not have weighed much against OTHERS, THAT PETITIONER BREACHED THE
the budget of the bus company if such items were made CONTRACT OF CARRIAGE BY ITS FAILURE TO
available to its personnel to cope up with situations such as the EXERCISE THE REQUIRED DEGREE OF
"Maranao threats." prcd DILIGENCE;
 (B) THAT THE ACTS OF THE MARANAO OUTLAWS Art. 1174 of the Civil Code defines a fortuitous event as an occurrence which could
WERE SO GRAVE, IRRESISTIBLE, VIOLENT, not be foreseen or which though foreseen, is inevitable. In Yobido v. Court of
AND FORCEFUL, AS TO BE REGARDED AS CASO Appeals, 7 we held that to be considered as force majeure, it is necessary that: (1) the
FORTUITO; AND cause of the breach of the obligation must be independent of the human will; (2) the
event must be either unforeseeable or unavoidable; (3) the occurrence must be such
(C) THAT PUBLIC RESPONDENT COURT OF APPEALS as to render it impossible for the debtor to fulfill the obligation in a normal manner;
SERIOUSLY ERRED IN HOLDING THAT and (4) the obligor must be free of participation in, or aggravation of, the injury to
PETITIONER COULD HAVE PROVIDED the creditor. The absence of any of the requisites mentioned above would prevent the
ADEQUATE SECURITY IN PREDOMINANTLY obligor from being excused from liability.
MUSLIM AREAS AS PART OF ITS DUTY TO
OBSERVE EXTRA-ORDINARY DILIGENCE AS A Thus, in Vasquez v. Court of Appeals, 8 it was held that the common carrier was
COMMON CARRIER. dctai liable for its failure to take the necessary precautions against an approaching
typhoon, of which it was warned, resulting in the loss of the lives of several
The instant petition has no merit. passengers. The event was foreseeable, and, thus, the second requisite mentioned
First. Petitioner's Breach of the Contract of Carriage above was not fulfilled. This ruling applies by analogy to the present case. Despite
the report of PC agent Generalao that the Maranaos were going to attack its buses,
Art. 1763 of the Civil Code provides that a common carrier is responsible for injuries petitioner took no steps to safeguard the lives and properties of its passengers. The
suffered by a passenger on account of the wilful acts of other passengers, if the seizure of the bus of the petitioner was foreseeable and, therefore, was not a
employees of the common carrier could have prevented the act through the exercise fortuitous event which would exempt petitioner from liability.
of the diligence of a good father of a family. In the present case, it is clear that
because of the negligence of petitioner's employees, the seizure of the bus by Petitioner invokes the ruling in Pilapil v. Court of Appeals 9 and De Guzman
Mananggolo and his men was made possible. v. Court of Appeals 10 in support of its contention that the seizure of its bus by the
assailants constitutes force majeure. In Pilapil v. Court of Appeals, 11 it was held
Despite warning by the Philippine Constabulary at Cagayan de Oro that the that a common carrier is not liable for failing to install window grills on its buses to
Maranaos were planning to take revenge on the petitioner by burning some of its protect passengers from injuries caused by rocks hurled at the bus by lawless
buses and the assurance of petitioner's operation manager, Diosdado Bravo, that the elements. On the other hand, in De Guzman v. Court of Appeals, 12 it was ruled that
necessary precautions would be taken, petitioner did nothing to protect the safety of a common carrier is not responsible for goods lost as a result of a robbery which is
its passengers. attended by grave or irresistible threat, violence, or force.
Had petitioner and its employees been vigilant they would not have failed to see that It is clear that the cases of Pilapil and De Guzman do not apply to the present
the malefactors had a large quantity of gasoline with them. Under the circumstances, case. Art. 1755 of the Civil Code provides that "a common carrier is bound to carry
simple precautionary measures to protect the safety of passengers, such as frisking the passengers as far as human care and foresight can provide, using the utmost
passengers and inspecting their baggages, preferably with non-intrusive gadgets such diligence of very cautious persons, with due regard for all the circumstances." Thus,
as metal detectors, before allowing them on board could have been employed we held in Pilapil and De Guzman that the respondents therein were not negligent in
without violating the passenger's constitutional rights. As this Court intimated failing to take special precautions against threats to the safety of passengers which
in Gacal v. Philippine Air Lines, Inc., 6 a common carrier can be held liable for could not be foreseen, such as tortious or criminal acts of third persons. In the
failing to prevent a hijacking by frisking passengers and inspecting their baggages. present case, this factor of unforeseeability (the second requisite for an event to be
considered force majeure) is lacking. As already stated, despite the report of PC
From the foregoing, it is evident that petitioner's employees failed to prevent the agent Generalao that the Maranaos were planning to burn some of petitioner's buses
attack on one of petitioner's buses because they did not exercise the diligence of a and the assurance of petitioner's operations manager (Diosdado Bravo) that the
good father of a family. Hence, petitioner should be held liable for the death of Atty. necessary precautions would be taken, nothing was really done by petitioner to
Caorong. protect the safety of passengers. cda
Second. Seizure of Petitioner's Bus not a Case of Force Majeure Third. Deceased not Guilty of Contributory Negligence
The petitioner contends that the seizure of its bus by the armed assailants was a The petitioner contends that Atty. Caorong was guilty of contributory negligence in
fortuitous event for which it could not be held liable. cdasia returning to the bus to retrieve something. But Atty. Caorong did not act recklessly.
It should be pointed out that the intended targets of the violence were petitioner and
its employees, not its passengers. The assailant's motive was to retaliate for the loss
of life of two Maranaos as a result of the collision between petitioner's bus and the
jeepney in which the two Maranaos were riding. Mananggolo, the leader of the group Attorney's Fees. Pursuant to Art. 2208, attorney's fees may be recovered when, as in
which had hijacked the bus, ordered the passengers to get off the bus as they the instant case, exemplary damages are awarded. In the recent case of Sulpicio
intended to burn it and its driver. The armed men actually allowed Atty. Caorong to Lines, Inc. v. Court of Appeals, 18 we held an award of P50,000.00 as attorney's fees
retrieve something from the bus. What apparently angered them was his attempt to to be reasonable. Hence, the private respondents are entitled to attorney's fees in that
help the driver of the bus by pleading for his life. He was playing the role of the good amount.
Samaritan. Certainly, this act cannot be considered an act of negligence, let alone Compensation for Loss of Earning Capacity. Art. 1764 of the Civil Code, in relation
recklessness. to Art. 2206 thereof, provides that in addition to the indemnity for death arising from
Fourth. Petitioner Liable to Private Respondents for Damages the breach of contract of carriage by a common carrier, the "defendant shall be liable
for the loss of the earning capacity of the deceased, and the indemnity shall be paid
We now consider the question of damages that the heirs of Atty. Caorong, private to the heirs of the latter." The formula established in decided cases for computing net
respondents herein, are entitled to recover from the petitioner. earning capacity is as follows: 19
Indemnity for Death. Art. 1764 of the Civil Code, in relation to Art. 2206 thereof,
provides for the payment of indemnity for the death of passengers caused by the
breach of contract of carriage by a common carrier. Initially fixed in Art. 2206 at
P3,000.00, the amount of the said indemnity for death has through the years been
gradually increased in view of the declining value of the peso. It is presently fixed at
P50,000.00. 13 Private respondents are entitled to this amount.
Actual Damages. Art. 2199 provides that "except as provided by law or by
stipulation, one is entitled to an adequate compensation only for such pecuniary loss Life expectancy is equivalent to two thirds (2/3) multiplied by the difference of
suffered by him as he has duly proved." The trial court found that the private eighty (80) and the age of the deceased. 20 Since Atty. Caorong was 37 years old at
respondents spent P30,000.00 for the wake and burial of Atty. Caorong. 14 Since the time of his death, 21 he had a life expectancy of 28 2/3 more years. 22 His
petitioner does not question this finding of the trial court, it is liable to private projected gross annual income, computed based on his monthly salary of
respondents in the said amount as actual damages. P11,385.00 23 as a lawyer in the Department of Agrarian Reform at the time of his
death, was P148,005.00. 24 Allowing for necessary living expenses of fifty percent
Moral Damages. Under Art. 2206, the "spouse, legitimate and illegitimate
(50%) 25 of his projected gross annual income, his total earning capacity amounts to
descendants and ascendants of the deceased may demand moral damages for mental
P2,121,404.90. 26 Hence, the petitioner is liable to the private respondents in the
anguish by reason of the death of the deceased." The trial court found that private
said amount as compensation for loss of earning capacity. cdlex
respondent Paulie Caorong suffered pain from the death of her husband and worry on
how to provide support for their minor children, private respondents Yasser King, WHEREFORE, the decision, dated July 29, 1994, of the Court of Appeals is hereby
Rose Heinni, and Prince Alexander. 15 The petitioner likewise does not question this AFFIRMED with the MODIFICATION that petitioner Fortune Express, Inc. is
finding of the trial court. Thus, in accordance with recent decisions of this ordered to pay the following amounts to private respondents Paulie, Yasser King,
Court, 16 we hold that the petitioner is liable to the private respondents in the Rose Heinni, and Prince Alexander Caorong:
amount of P100,000.00 as moral damages for the death of Atty. Caorong.
1. death indemnity in the amount of fifty thousand pesos (P50,000.00);
Exemplary Damages. Art. 2232 provides that "in contracts and quasi-contracts, the
court may award exemplary damages if the defendant acted in a wanton, fraudulent, 2. actual damages in the amount of thirty thousand pesos (P30,000.00);
reckless, oppressive, or malevolent manner." In the present case, the petitioner acted
3. moral damages in the amount of one hundred thousand pesos (P100,000.00);
in a wanton and reckless manner. Despite warning that the Maranaos were planning
to take revenge against the petitioner by burning some of its buses, and contrary to 4. exemplary damages in the amount of one hundred thousand pesos (P100,000.00);
the assurance made by its operations manager that the necessary precautions would
be taken, the petitioner and its employees did nothing to protect the safety of 5. attorney's fees in the amount of fifty thousand pesos (P50,000.00);
passengers. Under the circumstances, we deem it reasonable to award private
respondents exemplary damages in the amount of P100,000.00. 17 cdll
6. compensation for loss of earning capacity in the amount of two million one
hundred twenty-one thousand four hundred four pesos and ninety centavos
(P2,121,404.90); and
7. costs of suits.
SO ORDERED.
||| (Fortune Express, Inc. v. Court of Appeals, G.R. No. 119756, [March 18, 1999],
364 PHIL 480-496)
 parents of Narcisa) filed a complaint for "sum of money" against Bachelor Express,
THIRD DIVISION Inc. its alleged owner Samson Yasay, and the driver Rivera.
In their answer, the petitioners denied liability for the death of Ornominio Beter and
[G.R. No. 85691. July 31, 1990.] Narcisa Rautraut. They alleged that ". . . the driver was able to transport his
passengers safely to their respective places of destination except Ornominio Beter
and Narcisa Rautraut who jumped off the bus without the knowledge and consent,
BACHELOR EXPRESS, INCORPORATED, and much less, the fault of the driver and conductor and the defendants in this case; the
CRESENCIO RIVERA, petitioners, vs. THE HONORABLE defendant corporation had exercised due diligence in the choice of its employees to
COURT OF APPEALS (Sixth Division), RICARDO avoid as much as possible accidents; the incident on August 1, 1980 was not a traffic
BETER, SERGIA BETER, TEOFILO RAUTRAUT and accident or vehicular accident, it was an incident or event very much beyond the
ZOETERA RAUTRAUT, respondents. control of the defendants; defendants were not parties to the incident complained of
as it was an act of a third party who is not in any way connected with the defendants
and of which the latter have no control and supervision; . . ." (Rollo, pp. 112-113).
Aquino W. Gambe for petitioners.
After due trial, the trial court issued an order dated August 8, 1985 dismissing the
Tranquilino O. Calo, Jr. for private respondents. complaint.LibLex
Upon appeal however, the trial court's decision was reversed and set aside. The
dispositive portion of the decision of the Court of Appeals states:
DECISION
"WHEREFORE, the Decision appealed from is REVERSED and
SET ASIDE and a new one entered finding the appellees jointly
and solidarily liable to pay the plaintiffs-appellants the following
GUTIERREZ, JR., J p: amounts:

This is a petition for review of the decision of the Court of Appeals which reversed 1) To the heirs of Ornominio Beter, the amount of Seventy Five
and set aside the order of the Regional Trial Court, Branch I, Butuan City dismissing Thousand Pesos (P75,000.00) in loss of earnings and support,
the private respondents' complaint for collection of "a sum of money" and finding the moral damages, straight death indemnity and attorney's fees;
petitioners solidarily liable for damages in the total amount of One Hundred Twenty and,
Thousand Pesos (P120,000.00). The petitioners also question the appellate court's 2) To the heirs of Narcisa Rautraut, the amount of Forty Five
resolution denying a motion for reconsideration. Thousand Pesos (P45,000.00) for straight death indemnity,
On August 1, 1980, Bus No. 800 owned by Bachelor Express, Inc. and driven by moral damages and attorney's fees. Costs against appellees."
Cresencio Rivera was the situs of a stampede which resulted in the death of (Rollo, pp. 71-72)
passengers Ornominio Beter and Narcisa Rautraut. The petitioners now pose the following questions:
The evidence shows that the bus came from Davao City on its way to Cagayan de "What was the proximate cause of the whole incident? Why
Oro City passing Butuan City; that while at Tabon-Tabon, Butuan City, the bus were the passengers on board the bus panicked (sic) and why
picked up a passenger; that about fifteen (15) minutes later, a passenger at the rear were they shoving one another? Why did Narcisa Rautraut and
portion suddenly stabbed a PC soldier which caused commotion and panic among Ornominio Beter jump off from the running bus?"
the passengers; that when the bus stopped, passengers Ornominio Beter and Narcisa
Rautraut were found lying down the road, the former already dead as a result of head The petitioners opine that answers to these questions are material to arrive at "a fair,
injuries and the latter also suffering from severe injuries which caused her death just and equitable judgment." (Rollo, p. 5) They claim that the assailed decision is
later. The passenger-assailant alighted from the bus and ran toward the bushes but based on a misapprehension of facts and its conclusion is grounded on speculation,
was killed by the police. Thereafter, the heirs of Ornomino Beter and Narcisa surmises or conjectures.
Rautraut, private respondents herein (Ricardo Beter and Sergia Beter are the parents
of Ornominio while Teofilo Rautraut and Zoetera [should be Zotera] Rautraut are the As regards the proximate cause of the death of Ornominio Beter and Narcisa
Rautraut, the petitioners maintain that it was the act of the passenger who ran amuck
and stabbed another passenger of the bus. They contend that the stabbing incident In the case at bar, Ornominio Beter and Narcisa Rautraut were passengers of a bus
triggered off the commotion and panic among the passengers who pushed one belonging to petitioner Bachelor Express, Inc. and, while passengers of the bus,
another and that "presumably out of fear and moved by that human instinct of self- suffered injuries which caused their death. Consequently, pursuant to Article 1756 of
preservation Beter and Rautraut jumped off the bus while the bus was still running the Civil Code, petitioner Bachelor Express, Inc. is presumed to have acted
resulting in their untimely death.' (Rollo, p. 6) Under these circumstances, the negligently unless it can prove that it had observed extraordinary diligence in
petitioners asseverate that they were not negligent in the performance of their duties accordance with Articles 1733 and 1755 of the New Civil Code.
and that the incident was completely and absolutely attributable to a third person, the
passenger who ran amuck, for without his criminal act, Beter and Rautraut could not Bachelor Express, Inc. denies liability for the death of Beter and Rautraut on its
have been subjected to fear and shock which compelled them to jump off the running posture that the death of the said passengers was caused by a third person who was
bus. They argue that they should not be made liable for damages arising from acts of beyond its control and supervision. In effect, the petitioner, in order to overcome the
third persons over whom they have no control or supervision. presumption of fault or negligence under the law, states that the vehicular incident
resulting in the death of passengers Beter and Rautraut was caused by force majeure
Furthermore, the petitioners maintain that the driver of the bus, before, during and or caso fortuito over which the common carrier did not have any control.
after the incident was driving cautiously giving due regard to traffic rules, laws and
regulations. The petitioners also argue that they are not insurers of their passengers Article 1174 of the present Civil Code states:
as ruled by the trial court. "Except in cases expressly specified by law, or when it is
The liability, if any, of the petitioners is anchored on culpa contractual or breach of otherwise declared by stipulations, or when the nature of the
contract of carriage. The applicable provisions of law under the New Civil Code are obligation requires the assumption of risk, no person shall be
as follows: responsible for those events which could not be foreseen, or
which though foreseen, were inevitable."
"ART. 1732. Common carriers are persons, corporations, firms
or associations engaged in the business of carrying or The above - mentioned provision was substantially copied from Article 1105 of the
transporting passengers or goods or both by land, water, or air, old Civil Code which states"
for compensation, offering their services to the public. "No one shall be liable for events which could not be foreseen or
"ART. 1733. Common carriers, from the nature of their business which, even if foreseen, were inevitable, with the exception of
and for reasons of public policy, are bound to observe the cases in which the law expressly provides otherwise and
extraordinary diligence in the vigilance over the goods and for those in which the obligation itself imposes liability."
the safety of the passengers transported by them, according to all In the case of Lasam v. Smith (45 Phil. 657 [1924]), we defined "events" which
the circumstances of each case. cannot be foreseen and which, having been foreseen, are inevitable in the following
xxx xxx xxx manner:

"ART. 1755. A common carrier is bound to carry the passengers ". . . The Spanish authorities regard the language employed as an
safely as far as human care and foresight can provide, using the effort to define the term 'caso fortuito' and hold that the two
utmost diligence of very cautious persons, with a due regard for expressions are synonymous. (Manresa Comentarios al Codigo
all the circumstances. Civil Español, vol. 8, pp. 88 et seq.; Scaevola, Codigo Civil, vol.
19, pp. 526 et seq.)
"ART. 1756. In case of death of or injuries to passengers,
common carriers are presumed to have been at fault or to have The antecedent to Article 1105 is found in Law II, Title 33,
acted negligently, unless they prove that they observed Partida 7, which defines caso fortuito as 'ocasion que acaese por
extraordinary diligence as prescribed in Articles 1733 and 1755." aventura de que non se puede ante ver. E son estos,
derrivamientos de casas e fuego que enciende a so ora, e
There is no question that Bachelor Express, Inc. is a common carrier. Hence, from quebrantamiento de navio, fuerca de ladrones.' (An event that
the nature of its business and for reasons of public policy Bachelor Express, Inc. is takes place by incident and could not have been foreseen.
bound to carry its passengers safely as far as human care and foresight can provide Examples of this are destruction of houses, unexpected fire,
using the utmost diligence of very cautious persons, with a due regard for all the shipwreck, violence of robbers. . . .)
circumstances.
 Escriche defines caso fortuito as an unexpected event or act of ". . . [F]or their defense of force majeure or act of God to prosper
God which could neither be foreseen nor resisted, such as floods, the accident must be due to natural causes and exclusively
torrents, shipwrecks, conflagrations, lightning, compulsion, without human intervention." (Emphasis supplied)
insurrections, destruction of buildings by unforeseen accidents
and other occurrences of a similar nature. Therefore, the next question to be determined is whether or not the petitioner's
common carrier observed extraordinary diligence to safeguard the lives of its
passengers.
In discussing and analyzing the term caso fortuito the In this regard the trial court and the appellate court arrived at conflicting factual
Enciclopedia Juridica Española says: 'In a legal sense and, findings.
consequently, also in relation to contracts, a caso fortuito
presents the following essential characteristics: (1 ) The cause of The trial court found the following facts:
the unforeseen and unexpected occurrence, or of the failure of "The parties presented conflicting evidence as to how the two
the debtor to comply with his obligation, must be independent of deceased Narcisa Rautruat and Ornominio Beter met their
the human will. (2) It must be impossible to foresee the event deaths.
which constitutes the caso fortuito, or if it can be foreseen, it
must be impossible to avoid. (3) The occurrence must be such as However, from the evidence adduced by the plaintiffs, the Court
to render it impossible for the debtor to fulfill his obligation in a could not see why the two deceased could have fallen off the bus
normal manner. And (4) the obligor (debtor) must be free from when their own witnesses testified that when the commotion
any participation in the aggravation of the injury resulting to the ensued inside the bus, the passengers pushed and shoved each
creditor. (5 Enciclopedia Juridica Española, 309) other towards the door apparently in order to get off from the
bus through the door. But the passengers also could not pass
As will be seen, these authorities agree that some extraordinary through the door because according to the evidence the door was
circumstance independent of the will of the obligor, or of his locked.
employees, is an essential element of a caso fortuito. . . ."
On the other hand, the Court is inclined to give credence to the
The running amuck of the passenger was the proximate cause of the incident as it evidence adduced by the defendants that when the commotion
triggered off a commotion and panic among the passengers such that the passengers ensued inside the bus, the two deceased panicked and, in state of
started running to the sole exit shoving each other resulting in the falling off the bus shock and fear, they jumped off from the bus by passing through
by passengers Beter and Rautraut causing them fatal injuries. The sudden act of the the window. prcd
passenger who stabbed another passenger in the bus is within the context of force
majeure. It is the prevailing rule and settled jurisprudence that
transportation companies are not insurers of their passengers.
However, in order that a common carrier may be absolved from liability in case The evidence on record does not show that defendants' personnel
of force majeure, it is not enough that the accident was caused by force majeure. The were negligent in their duties. The defendants' personnel have
common carrier must still prove that it was not negligent in causing the injuries every right to accept passengers absent any manifestation of
resulting from such accident. Thus, as early as 1912, we ruled: violence or drunkenness. If and when such passengers harm
"From all the foregoing, it is concluded that the defendant other passengers without the knowledge of the transportation
is not liable for the loss and damage of the goods shipped company's personnel, the latter should not be faulted." (Rollo,
on the lorcha Pilar by the Chinaman, Ong Bien Sip, pp. 46-47)
inasmuch as such loss and damage were the result of a A thorough examination of the records, however, show that there are material facts
fortuitous event or force majeure, and there was no ignored by the trial court which were discussed by the appellate court to arrive at a
negligence or lack of care and diligence on the part of the different conclusion. These circumstances show that the petitioner common carrier
defendant company or its agents." (Tan Chiong Sian v. was negligent in the provision of safety precautions so that its passengers may be
Inchausti & Co., 22 Phil. 152 [1912] Emphasis supplied). transported safely to their destinations. The appellate court states: LibLex
This principle was reiterated in a more recent case, Batangas Laguna Tayabas
"A critical eye must be accorded the lower court's conclusions of
Co. v. Intermediate Appellate Court (167 SCRA 379 [1988]), wherein we ruled:
fact in its tersely written ratio decidendi. The lower court
concluded that the door of the bus was closed; secondly, the Accordingly, there is no reason to believe that the deceased
passengers, specifically the two deceased, jumped out of the passengers jumped from the window when it was entirely
window. The lower court therefore concluded that the defendant possible for them to have alighted through the door. The lower
common carrier is not liable for the death of the said passengers court's reliance on the testimony of Pedro Collango, as the
which it implicitly attributed to the unforeseen acts of the conductor and employee of the common carrier, is unjustified, in
unidentified passenger who went amuck. the light of the clear testimony of Leonila Cullano as the sole
uninterested eyewitness of the entire episode. Instead we find
There is nothing in the record to support the conclusion that the Pedro Collango's testimony to be infused by bias and fraught
solitary door of the bus was locked as to prevent the passengers with inconsistencies, if not notably unreliable for lack of
from passing through. Leonila Cullano, testifying for the veracity. On direct examination, he testified:
defense, clearly stated that the conductor opened the door when
the passengers were shouting that the bus stop while they were xxx xxx xxx
in a state of panic. Sergia Beter categorically stated that she
actually saw her son fall from the bus as the door was forced Q So what happened to the passengers inside your bus?
open by the force of the onrushing passengers. A Some of the passengers jumped out of the window.
Pedro Collango, on the other hand, testified that he shut the door COURT:
after the last passenger had boarded the bus. But he had quite
conveniently neglected to say that when the passengers had Q While the bus was in motion?
panicked, he himself panicked and had gone to open the door.
Portions of the testimony of Leonila Cullano, quoted below, are A Yes, your Honor, but the speed was slow because we have just
illuminating: picked up a passenger.

'xxx xxx xxx Atty. Gambe:

Q When you said the conductor opened the door, the door at the Q You said that at the time of the incident the bus was running
front or rear portion of the bus? slow because you have just picked up a passenger. Can
you estimate what was your speed at that time?.
A Front door.
Atty. Calo:
Q And these two persons whom you said alighted, where did
they pass, the fron(t) door or rear door? No basis, your Honor, he is neither a driver nor a
conductor.
A Front door.
COURT:
xxx xxx xxx
Let the witness answer. Estimate only, the conductor
(Tsn., p. 4, Aug. 8, 1984) experienced.
xxx xxx xxx Witness:
Q What happened after there was a commotion at the rear Not less than 30 to 40 miles.
portion of the bus?
COURT:
A When the commotion occurred, I stood up and I noticed that
there was a passenger who was sounded (sic). The Kilometers or miles?
conductor panicked because the passengers were A Miles.
shouting 'stop, stop'. The conductor opened the bus.'"
Atty. Gambe:
(Tsn., p. 3, August 8, 1984).
Q That is only your estimate by your experience?
 A Yes, sir, estimate. and the trial court recognized them as such. The trial court dismissed the complaint
solely on the ground that the petitioners were not negligent.
(Tsn., pp. 4-5, Oct. 17, 1983).
Finally, the amount of damages awarded to the heirs of Beter and Rautraut by the
At such speed of not less than 30 to 40 miles . . ., or about 48 to appellate court is supported by the evidence. The appellate court stated: prLL
65 kilometers per hour, the speed of the bus could scarcely be
considered slow considering that according to Collango himself, "Ornominio Beter was 32 years of age at the time of his death,
the bus had just come from a full stop after picking a passenger single, in good health and rendering support and service to his
(Tsn, p. 4, id.) and that the bus was still on its second or third mother. As far as Narcisa Rautraut is concerned, the only
gear (Tsn., p. 12, id.). evidence adduced is to the effect that at her death, she was 23
years of age, in good health and without visible means of
In the light of the foregoing, the negligence of the common support.
carrier, through its employees, consisted of the lack of
extraordinary diligence required of common carriers, in In accordance with Art. 1764 in conjunction with Art. 2206 of
exercising vigilance and utmost care of the safety of its the Civil Code, and established jurisprudence, several factors
passengers, exemplified by the driver's belated stop and the may be considered in determining the award of damages,
reckless opening of the doors of the bus while the same was namely: 1) life expectancy (considering the state of health of the
travelling at an appreciably fast speed. At the same time, the deceased and the mortality tables are deemed conclusive) and
common carrier itself acknowledged, through its administrative loss of earning capacity; (2) pecuniary loss, loss of support and
officer, Benjamin Granada, that the bus was commissioned to service; and (3) moral and mental suffering (Alcantara, et el. v.
travel and take on passengers and the public at large, while Surro, et al., 93 Phil. 470).
equipped with only a solitary door for a bus its size and loading
capacity, in contravention of rules and regulations provided for In the case of People v. Daniel (No. L-66551, April 25, 1985,
under the Land Transportation and Traffic Code (RA 4136 as 136 SCRA 92, at page 104), the High Tribunal, reiterating the
amended.)" (Rollo, pp. 23-26) rule in Villa Rey Transit, Inc. v. Court of Appeals(31 SCRA
511), stated that the amount of loss of earning capacity is based
Considering the factual findings of the Court of Appeals — the bus driver did not mainly on two factors, namely, (1) the number of years on the
immediately stop the bus at the height of the commotion; the bus was speeding from basis of which the damages shall be computed; and (2) the rate
a full stop; the victims fell from the bus door when it was opened or gave way while at which the losses sustained by the heirs should be fixed.
the bus was still running; the conductor panicked and blew his whistle after people
had already fallen off the bus; and the bus was not properly equipped with doors in As the formula adopted in the case of Davila v. Philippine Air
accordance with law — it is clear that the petitioners have failed to overcome the Lines, 49 SCRA 497, at the age of 30 one's normal life
presumption of fault and negligence found in the law governing common carriers. expectancy is 33 1/3 years based on the American Expectancy
Table of Mortality (2/3 x 80-32). By taking into account the pace
The petitioners' argument that the petitioners "are not insurers of their passengers" and nature of the life of a carpenter, it is reasonable to make
deserves no merit in view of the failure of the petitioners to prove that the deaths of allowances for these circumstances and reduce the life
the two passengers were exclusively due to force majeure and not to the failure of expectancy of the deceased Ornominio Beter to 25 years (People
the petitioners to observe extraordinary diligence in transporting safely the v. Daniel, supra). To fix the rate of losses it must be noted that
passengers to their destinations as warranted by law. (See Batangas Laguna Tayabas Art. 2206 refers to gross earnings less necessary living expenses
Co. v. Intermediate Appellate Court, supra). of the deceased, in other words, only net earnings are to be
considered (People v. Daniel, supra; Villa Rey Transit, Inc. v.
Court of Appeals, supra).
The petitioners also contend that the private respondents failed to show to the court Applying the foregoing rules with respect to Ornominio Beter, it
that they are the parents of Ornominio Beter and Narcisa Rautraut respectively and is both just and reasonable, considering his social standing and
therefore have no legal personality to sue the petitioners. This argument deserves position, to fix the deductible, living and incidental expenses at
scant consideration. We find this argument a belated attempt on the part of the the sum of Four Hundred Pesos (P400.00) a month, or Four
petitioners to avoid liability for the deaths of Beter and Rautraut. The private Thousand Eight Hundred Pesos (P4,800.00) annually. As to his
respondents were identified as the parents of the victims by witnesses during the trial income, considering the irregular nature of the work of a daily
 wage carpenter which is seasonal, it is safe to assume that he
shall have worked for twenty (20) days a month at Twenty Five
Pesos (P25.00) a day or Five Hundred Pesos (P500.00) a month.
Annually, his income would amount to Six Thousand Pesos
(P6,000.00) or One Hundred Fifty Thousand Pesos
(P150,000.00) for twenty five years. Deducting therefrom his
necessary expenses, his heirs would be entitled to Thirty
Thousand Pesos (P30,000.00) representing loss of support and
service (P150,000.00 less P120,000.00). In addition, his heirs are
entitled to Thirty Thousand Pesos (P30,000.00) as straight death
indemnity pursuant to Article 2206 (People v. Daniel, supra).
For damages for their moral and mental anguish, his heirs are
entitled to the reasonable sum of P10,000.00 as an exception to
the general rule against moral damages in case of breach of
contract rule Art. 2200 (Necesito v. Paras, 104 Phil. 75). As
attorney's fees, Beter's heirs are entitled to P5,000.00. All in all,
the plaintiff-appellants Ricardo and Sergia Beter as heirs of their
son Ornominio are entitled to an indemnity of Seventy Five
Thousand Pesos (P75,000.00). cdphil
In the case of Narcisa Rautraut, her heirs are entitled to a straight
death indemnity of Thirty Thousand Pesos (P30,000.00), to
moral damages in the amount of Ten Thousand Pesos
(P10,000.00) and Five Thousand Pesos (P5,000.00) as attorneys
fees, or a total of Forty Five Thousand Pesos (P45,000.00) as
total indemnity for her death in the absence of any evidence that
she had visible means of support." (Rollo, pp. 30-31)
WHEREFORE, the instant petition is DISMISSED. The questioned decision dated
May 19, 1988 and the resolution dated August 1, 1988 of the Court of Appeals are
AFFIRMED.
SO ORDERED.
||| (Bachelor Express, Inc. v. Court of Appeals, G.R. No. 85691, [July 31, 1990], 266
PHIL 233-249)
 methacrylate monomer — its officers and crew failed to take all the necessary
THIRD DIVISION precautions to prevent an accident. The Court held that the owner or the person in
possession and control of a vessel and the vessel are liable for all natural and
proximate damage caused to persons and property by reason of negligent
[G.R. No. 143008. June 10, 2002.] management or navigation. Hence, the decision of the Court of Appeals was
affirmed by the Court, but with modification with respect to the amount of actual
SMITH BELL DODWELL SHIPPING AGENCY damages for loss of earning capacity.SEHACI
CORPORATION, petitioner, vs. CATALINO BORJA and
INTERNATIONAL TOWAGE AND TRANSPORT
CORPORATION, respondents. SYLLABUS

1. REMEDIAL LAW; EVIDENCE; FACTUAL FINDINGS OF COURT OF

Del Rosario and Del Rosario for petitioner. APPEALS; BINDING UPON THE SUPREME COURT WHEN SUPPORTED BY
Castillo and Poblador for respondent ITTC. SUBSTANTIAL EVIDENCE. — Both the RTC and the CA ruled that the fire and
the explosion had originated from petitioner's vessel. We find no cogent reason to
Manalo Puno Jocson & Placido Law Offices for respondent Borja. overturn these factual findings. Nothing is more settled in jurisprudence than that this
Court is bound by the factual findings of the Court of Appeals when these are
Amado D. Valdez & Associates for respondents. supported by substantial evidence and are not under any of the exceptions in Fuentes
v. Court of Appeals, more so, when such findings affirm those of the trial
court. cTAaDC
SYNOPSIS
2. CIVIL LAW; QUASI-DELICTS; NEGLIGENCE; EXPLAINED; CASE AT
BAR. — Negligence is conduct that creates undue risk of harm to another. It is the
Respondent Catalino Borja, customs inspector of the Bureau of Customs, was failure to observe that degree of care, precaution and vigilance that the circumstances
assigned to inspect petitioner's vessel, M/T King Family, which was due to arrive at justly demand, whereby that other person suffers injury. Petitioner's vessel was
the port of Manila on September 24, 1987. At about 11 o'clock in the morning on
carrying chemical cargo — alkyl benzene and methyl methacrylate monomer. While
September 24, 1987, while the vessel was unloading chemicals unto the two barges
knowing that their vessel was carrying dangerous inflammable chemicals, its officers
owned by respondent ITTC, a sudden explosion occurred setting the vessels afire. and crew failed to take all the necessary precautions to prevent an accident.
Respondent Borja was at that time inside the cabin preparing reports. As a result of Petitioner was, therefore, negligent. CHaDIT
the fire and explosion, respondent Borja suffered damages and injuries. His attending
physician diagnosed respondent Borja to be permanently disabled. Hence, for 3. ID.; ID.; ELEMENTS; ESTABLISHED IN CASE AT BAR. — The three
injuries suffered, respondent Borja asked for damages. However, both petitioner and elements of quasi delict are: (a) damages suffered by the plaintiff, (b) fault or
respondent ITTC denied liabilities and attributed to each other negligence. negligence of the defendant, and (c) the connection of cause and effect between the
Thereafter, the Regional Trial Court found that the fire and the explosion had fault or negligence of the defendant and the damages inflicted on the plaintiff. All
originated from petitioner's vessel. It, therefore, held petitioner liable for damages these elements were established in this case. Knowing fully well that it was carrying
and loss of income. The Court of Appeals affirmed in toto the decision of the trial dangerous chemicals, petitioner was negligent in not taking all the necessary
court. Petitioner elevated the matter before the Supreme Court via a petition for precautions in transporting the cargo. IcAaEH
review on certiorari. caEIDA
4. ID.; ID.; OWNER OR PERSON IN CONTROL OF A VESSEL AND THE
The Court found no cogent reason to overturn the factual findings of the lower VESSEL ARE LIABLE FOR ALL NATURAL AND PROXIMATE DAMAGE
courts. Nothing is more settled in jurisprudence than that the Court is bound by the CAUSED TO PERSONS AND PROPERTY BY REASON OF NEGLIGENT
factual findings of the Court of Appeals when these are supported by substantial MANAGEMENT OR NAVIGATION; CASE AT BAR. — As a result of the fire
evidence and are not under any of the exceptions, more so, when such findings and the explosion during the unloading of the chemicals from petitioner's vessel,
affirm those of the trial court. Hence, the Court reviews only issues of law. TSHIDa Respondent Borja suffered the following damage and injuries: "(1) chemical burns of
the face and arms; (2) inhalation of fumes from burning chemicals; (3) exposure to
The Court found the petitioner negligent. While knowing that their vessel was
the elements [while] floating in sea water for about three (3) hours; (4)
carrying dangerous inflammable chemicals — alkyl benzene and methyl
homonymous hemianopsia or blurring of the right eye [which was of] possible toxic
origin; and (5) [c]erebral infract with neo-vascularization, left occipital region with 8. ID.; ID.; ID.; ID.; ID.; PEGGED AT 80 YEARS EVEN IF PERSON LIVED
right sided headache and the blurring of vision of right eye." Hence, the owner or the BEYOND SAID AGE. — Petitioner avers that Respondent Borja died nine years
person in possession and control of a vessel and the vessel are liable for all natural after the incident and, hence, his life expectancy of 80 years should yield to the
and proximate damage caused to persons and property by reason of negligent reality that he was only 59 when he actually died. We disagree. The Court uses the
management or navigation. American Experience/Expectancy Table of Mortality or the Actuarial or Combined
Experience Table of Mortality, which consistently pegs the life span of the average
5. ID.; DAMAGES; REASONABLENESS OF DAMAGES AWARDED; Filipino at 80 years, from which it extrapolates the estimated income to be earned by
FACTORS. — In determining the reasonableness of the damages awarded under the deceased had he or she not been killed. Respondent Borja's demise earlier than
Article 1764 in conjunction with Article 2206 of the Civil Code, the factors to be the estimated life span is of no moment. For purposes of determining loss of earning
considered are: (1) life expectancy (considering the health of the victim and the capacity, life expectancy remains at 80. Otherwise, the computation of loss of
mortality table which is deemed conclusive) and loss of earning capacity; (b) earning capacity will never become final, being always subject to the eventuality of
pecuniary loss, loss of support and service; and (c) moral and mental sufferings. The the victim's death. The computation should not change even if Borja lived beyond 80
loss of earning capacity is based mainly on the number of years remaining in the years. Fair is fair.
person's expected life span. In turn, this number is the basis of the damages that shall
be computed and the rate at which the loss sustained by the heirs shall be 9. ID.; ID.; AWARD OF MORAL DAMAGES AND ATTORNEY'S FEES,
fixed. IEcaHS PROPER IN CASE AT BAR. — Having been duly proven, the moral damages and
attorney's fees awarded are justified under the Civil Code's Article 2219, paragraph
6. ID.; ID.; ACTUAL DAMAGES; LOSS OF EARNING CAPACITY; AMOUNT 2; and Article 2208, paragraph 11, respectively.
RECOVERABLE; FORMULA. — The formula for the computation of loss of
earning capacity is as follows: Net earning capacity = Life expectancy x [Gross
Annual Income — Living Expenses (50% of gross annual income)], where life
expectancy = 2/3 (80 – the age of the deceased). Petitioner is correct in arguing that DECISION
it is net income (or gross income less living expenses) which is to be used in the
computation of the award for loss of income. Villa Rey Transit v. Court of
Appeals explained that "the amount recoverable is not the loss of the entire earning,
but rather the loss of that portion of the earnings which the beneficiary would have PANGANIBAN, J p:
received." Hence, in fixing the amount of the said damages, the necessary expenses
of the deceased should be deducted from his earnings. In other words, only net The owner or the person in possession and control of a vessel is liable for all natural
earnings, not gross earnings, are to be considered; that is, the total of the earnings and proximate damages caused to persons and property by reason of negligence in its
less expenses necessary in the creation of such earnings or income, less living and management or navigation. The liability for the loss of the earning capacity of the
other incidental expenses. When there is no showing that the living expenses deceased is fixed by taking into account the net income of the victim at the time of
constituted a smaller percentage of the gross income, we fix the living expenses at death — of the incident in this case — and that person's probable life expectancy.
half of the gross income. To hold that one would have used only a small part of the
income, with the larger part going to the support of one's children, would be
conjectural and unreasonable. The Case
7. ID.; ID.; ID.; ID.; LIFE EXPECTANCY; NOT PEGGED AT 65 YEARS; CASE Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court,
AT BAR. — Counsel for Respondent Borja is also correct in saying that life challenging the March 6, 2000 Decision 1 and the April 25, 2000 Resolution 2 of the
expectancy should not be based on the retirement age of government employees, Court of Appeals 3 (CA) in CA-G.R. CV No. 57470. The assailed Decision disposed
which is pegged at 65. In Negros Navigation Co., Inc. v. CA, the Court resolved that as follows:
in calculating the life expectancy of an individual for the purpose of determining loss
of earning capacity under Article 2206(1) of the Civil Code, it is assumed that the "WHEREFORE, premises considered, the instant appeal is
deceased would have earned income even after retirement from a particular job. hereby DENIED. The questioned decision of the lower court is
Respondent Borja should not be situated differently just because he was a hereby AFFIRMED in toto. No pronouncement as to costs." 4
government employee. Private employees, given the retirement packages provided Reconsideration was denied in the assailed Resolution.
by their companies, usually retire earlier than government employees; yet, the life
expectancy of the former is not pegged at 65 years. The Facts
The facts of the case are set forth by the CA as follows: 3. The amount of P50,000.00 for and as reasonable
attorney's fees.
"It appears that on September 23, 1987, Smith Bell [herein
petitioner] filed a written request with the Bureau of Customs for "The cross-claim of [Petitioner] Smith Bell Dodwell Shipping
the attendance of the latter's inspection team on vessel M/T King Agency Corporation against co-defendant International Towage
Family which was due to arrive at the port of Manila on and Transport Corporation and the latter's counterclaim against
September 24, 1987. [Borja] and cross-claim with compulsory counterclaim
against Smith Bell are hereby ordered dismissed." 7
"Said vessel contained 750 metric tons of alkyl benzene and
methyl methacrylate monomer. Ruling of the Court of Appeals
"On the same day, Supervising Customs Inspector Manuel Ma. Affirming the trial court, the CA rejected the plea of petitioner that it be exonerated
D. Nalgan instructed [Respondent Catalino Borja] to board said from liability for Respondent Borja's injuries. Contrary to the claim of petitioner that
vessel and perform his duties as inspector upon the vessel's no physical evidence was shown to prove that the explosion had originated from its
arrival until its departure. At that time, [Borja] was a customs vessel, the CA held that the fire had originated from M/T King Family. This
inspector of the Bureau of Customs receiving a salary of conclusion was amply supported by the testimonies of Borja and Eulogio Laurente
P31,188.25 per annum. (the eyewitness of International Towage and Transport Corporation or ITTC) as well
as by the investigation conducted by the Special Board of Marine Inquiry and
"At about 11 o'clock in the morning on September 24, 1987, affirmed by the secretary of the Department of National Defense. On the other hand,
while M/T King Family was unloading chemicals unto two (2) the RTC, which the CA sustained, had not given probative value to the evidence of
barges [—] ITTC 101 and CLC-1002 [—] owned by petitioner, whose sole eyewitness had not shown up for cross-examination.
[Respondent] ITTC, a sudden explosion occurred setting the
vessels afire. Upon hearing the explosion, [Borja], who was at Hence, this Petition. 8
that time inside the cabin preparing reports, ran outside to check
The Issues
what happened. Again, another explosion was heard.
In its Memorandum, 9 petitioner raises the following issues:
"Seeing the fire and fearing for his life, [Borja] hurriedly jumped
over board to save himself. However, the [water] [was] likewise "1. Whether petitioner should be held liable for the injuries of
on fire due mainly to the spilled chemicals. Despite the Respondent Catalino Borja.
tremendous heat, [Borja] swam his way for one (1) hour until he
"2. Whether Respondent ITTC should be held liable for the
was rescued by the people living in the squatters' area and sent to
injuries of Respondent Catalino Borja.
San Juan De Dios Hospital.
"3. Assuming without admitting that Respondent
"After weeks of intensive care at the hospital, his attending
Catalino Borja is entitled to damages, whether
physician diagnosed [Borja] to be permanently disabled due to
Respondent Borja is entitled to the amount of damages awarded
the incident. [Borja] made demands againstSmith Bell and ITTC
to him by the trial court." 10
for the damages caused by the explosion. However, both denied
liabilities and attributed to each other negligence." 5 Simply put, these issues can be summed up in these two questions: (1) Who, if any,
is liable for Borja's injuries? (2) What is the proper amount of liability?
The trial court 6 (RTC) ruled in favor of Respondent Borja and held petitioner liable
for damages and loss of income. The RTC disposed as follows: This Court's Ruling
"WHEREFORE, premises considered, judgment is hereby The Petition is partly meritorious.
rendered ordering [Petitioner] Smith Bell Dodwell [S]hipping
Agency Corporation to pay [Borja]: First Issue:

1. The amount of P495,360.00 as actual damages for Responsibility for Injuries

loss of earning capacity: Petitioner avers that both lower courts labored under a misapprehension of the facts.
It claims that the documents adduced in the RTC conclusively revealed that the
2. The amount of P100,000.00 for moral damages; and explosion that caused the fire on M/T King Family had originated from the
barge ITTC-101, a conclusion based on three grounds. First, the Survey Report (Exh. The three elements of quasi delict are: (a) damages suffered by the plaintiff, (b) fault
"10") dated October 21, 1987 submitted by the Admiral Surveyors and Adjusters, or negligence of the defendant, and (c) the connection of cause and effect between
Inc., showed that no part of M/T King Family sustained any sharp or violent damage the fault or negligence of the defendant and the damages inflicted on the
that would otherwise be observed if indeed an explosion had occurred on it. On the plaintiff. 16 All these elements were established in this case. Knowing fully well that
other hand, the fact that the vessel sustained cracks on its shell plating was noted in it was carrying dangerous chemicals, petitioner was negligent in not taking all the
two Survey Reports from Greutzman Divers Underwater Specialist, dated October 6, necessary precautions in transporting the cargo.
1987 (Exh. "11"), and during the underwater inspection on the sunken barge ITTC-
101. As a result of the fire and the explosion during the unloading of the chemicals from
petitioner's vessel, Respondent Borja suffered the following damage and injuries:
Second, external fire damage on the hull of M/T King Family indicated that the fire "(1) chemical burns of the face and arms; (2) inhalation of fumes from burning
had started from outside the vessel and from ITTC-101. The port side of the vessel to chemicals; (3) exposure to the elements [while] floating in sea water for about three
which the ITTC barge was tied was completely gutted by fire, while the starboard (3) hours; (4) homonymous hemianopsia or blurring of the right eye [which was of]
side to which the barge CLC-1002 was tied sustained only slight fire damage. possible toxic origin; and (5) [c]erebral infract with neovascularization, left occipital
region with right sided headache and the blurring of vision of right eye." 17
Third, testimonial evidence proved that the explosion came from the barge of the
ITTC and not from its vessel. Security Guard Vivencio Estrella testified that he had Hence, the owner or the person in possession and control of a vessel and the vessel
seen the sudden explosion of monomer on the barge with fire that went up to about are liable for all natural and proximate damage caused to persons and property by
60 meters. Third Mate Choi Seong Hwan and Second Mate Nam Bang Choun ofM/T reason of negligent management or navigation. 18
King Family narrated that while they were discharging the chemicals, they saw and
heard an explosion from the barge ITTC-101. Chief Security Guard Reynaldo Patron, Second Issue:
in turn, testified that he was 7 to 10 meters away from the barge when he heard the Amount of Liability
explosion from the port side of M/T King Family and saw the barge already on fire.
Petitioner insists that Borja is not entitled to the full amount of damages awarded by
We are not persuaded. Both the RTC and the CA ruled that the fire and the explosion the lower courts. It disputes the use of his gross earning as basis for the computation
had originated from petitioner's vessel. Said the trial court: of the award for loss of earning capacity. Both courts, in computing the value of such
loss, used the remaining years of the victim as a government employee and the
"The attempts of [Petitioner] Smith Bell to shift the blame on . . .
amount he had been receiving per annum at the time of the incident.
ITTC were all for naught. First, the testimony of its alleged
eyewitness was stricken off the record for his failure to appear Counsel for Respondent Borja, on the other hand, claims that petitioner had no cause
for cross-examination (p. 361, Record). Second, the documents to complain, because the miscomputation had ironically been in its favor. The
offered to prove that the fire originated from barge ITTC-101 multiplier used in the computation was erroneously based on the remaining years in
were all denied admission by the [c]ourt for being, in effect, government service, instead of the life expectancy, of the victim. Borja's counsel also
hearsay (pp. 335 and 362). . . . Thus, there is nothing in the points out that the award was based on the former's meager salary in 1987, or about
record to support [petitioner's] contention that the fire and 23 years ago when the foreign exchange was still P14 to $1. Hence, the questioned
explosion originated from barge ITTC-101." 11 award is consistent with the primary purpose of giving what is just, moral and legally
due the victim as the aggrieved party.
We find no cogent reason to overturn these factual findings. Nothing is more settled
in jurisprudence than that this Court is bound by the factual findings of the Court of
Appeals when these are supported by substantial evidence and are not under any of
the exceptions in Fuentes v. Court of Appeals; 12 more so, when such findings Both parties have a point. In determining the reasonableness of the damages awarded
affirm those of the trial court. 13 Verily, this Court reviews only issues of law. under Article 1764 in conjunction with Article 2206 of the Civil Code, the factors to
be considered are: (1) life expectancy (considering the health of the victim and the
Negligence is conduct that creates undue risk of harm to another. It is the failure to mortality table which is deemed conclusive) and loss of earning capacity; (b)
observe that degree of care, precaution and vigilance that the circumstances justly pecuniary loss, loss of support and service; and (c) moral and mental
demand, whereby that other person suffers injury. 14 Petitioner's vessel was carrying sufferings. 19 The loss of earning capacity is based mainly on the number of years
chemical cargo — alkyl benzene and methyl methacrylate monomer. 15 While remaining in the person's expected life span. In turn, this number is the basis of the
knowing that their vessel was carrying dangerous inflammable chemicals, its officers damages that shall be computed and the rate at which the loss sustained by the heirs
and crew failed to take all the necessary precautions to prevent an accident. shall be fixed.20
Petitioner was, therefore, negligent.
The formula for the computation of loss of earning capacity is as follows: 21 being always subject to the eventuality of the victim's death. The computation should
not change even if Borja lived beyond 80 years. Fair is fair.
Net earning capacity = Life expectancy x [Gross Annual Income
- Living Expenses (50% of gross annual income)], Based on the foregoing discussion, the award for loss of earning capacity should be
where life expectancy = 2/3 (80 — the age of the computed as follows:
deceased ) 22
Loss of earning = [2 (80-50)] x [(P2,752 x 12)-16,512]
Petitioner is correct in arguing that it is net income (or gross income less living
expenses) which is to be used in the computation of the award for loss of capacity ————
income. Villa Rey Transit v. Court of Appeals 23 explained that "the amount 3
recoverable is not the loss of the entire earning, but rather the loss of that portion of
the earnings which the beneficiary would have received." Hence, in fixing the = P330,240
amount of the said damages, the necessary expenses of the deceased should be
deducted from his earnings. Having been duly proven, the moral damages and attorney's fees awarded are
justified under the Civil Code's Article 2219, paragraph 2; and Article 2208,
In other words, only net earnings, not gross earnings, are to be considered; that is, the paragraph 11, respectively.
total of the earnings less expenses necessary in the creation of such earnings or
income, less living and other incidental expenses. When there is no showing that the WHEREFORE, the Petition is PARTLY GRANTED. The assailed Decision is
living expenses constituted a smaller percentage of the gross income, we fix the AFFIRMED with the following MODIFICATIONS: petitioner is ordered to pay the
living expenses at half of the gross income. To hold that one would have used only a heirs of the victim damages in the amount of P320,240 as loss of earning capacity,
small part of the income, with the larger part going to the support of one's children, moral damages in the amount of P100,000, plus another P50,000 as attorney's fees.
would be conjectural and unreasonable. 24 Costs against petitioner. DSETac

Counsel for Respondent Borja is also correct in saying that life expectancy should SO ORDERED.
not be based on the retirement age of government employees, which is pegged at 65. ||| (Smith Bell Dodwell Shipping Agency Corp. v. Borja, G.R. No. 143008, [June 10,
In Negros Navigation Co., Inc. v. CA, 25 the Court resolved that in calculating the
2002], 432 PHIL 913-926)
life expectancy of an individual for the purpose of determining loss of earning
capacity under Article 2206(1) of the Civil Code, it is assumed that the deceased
would have earned income even after retirement from a particular job.
Respondent Borja should not be situated differently just because he was a
government employee. Private employees, given the retirement packages provided
by their companies, usually retire earlier than government employees; yet, the life
expectancy of the former is not pegged at 65 years.
Petitioner avers that Respondent Borja died nine years after the incident and, hence,
his life expectancy of 80 years should yield to the reality that he was only 59 when
he actually died.
We disagree. The Court uses the American Experience/Expectancy Table of
Mortality or the Actuarial or Combined Experience Table of Mortality, which
consistently pegs the life span of the average Filipino at 80 years, from which it
extrapolates the estimated income to be earned by the deceased had he or she not
been killed. 26
Respondent Borja's demise earlier than the estimated life span is of no moment. For
purposes of determining loss of earning capacity, life expectancy remains at 80.
Otherwise, the computation of loss of earning capacity will never become final,