THIRD DIVISION

[G.R. No. 144274. September 20, 2004.]

NOSTRADAMUS VILLANUEVA , petitioner, vs . PRISCILLA R. DOMINGO

and LEANDRO LUIS R. DOMINGO , respondents.

DECISION

CORONA , J : p

This is a petition to review the decision 1 of the Court of Appeals in CA-G.R. CV No.
52203 a rming in turn the decision of the trial court nding petitioner liable to respondent
for damages. The dispositive portion read:
WHEREFORE, the appealed decision is hereby AFFIRMED except the award
of attorney's fees including appearance fees which is DELETED.
SO ORDERED. 2

The facts of the case, as summarized by the Court of Appeals, are as follows:
[Respondent] Priscilla R. Domingo is the registered owner of a silver
Mitsubishi Lancer Car model 1980 bearing plate No. NDW 781 '91 with [co-
respondent] Leandro Luis R. Domingo as authorized driver. [Petitioner]
Nostradamus Villanueva was then the registered "owner" of a green Mitsubishi
Lancer bearing Plate No. PHK 201 '91.
On 22 October 1991 at about 9:45 in the evening, following a green tra c
light, [respondent] Priscilla Domingo's silver Lancer car with Plate No. NDW 781
'91 then driven by [co-respondent] Leandro Luis R. Domingo was cruising along
the middle lane of South Superhighway at moderate speed from north to south.
Suddenly, a green Mitsubishi Lancer with plate No. PHK 201 '91 driven by Renato
Dela Cruz Ocfemia darted from Vito Cruz Street towards the South Superhighway
directly into the path of NDW 781 '91 thereby hitting and bumping its left front
portion. As a result of the impact, NDW 781 '91 hit two (2) parked vehicles at the
roadside, the second hitting another parked car in front of it.
ATESCc

Per Tra c Accident Report prepared by Tra c Investigator Pfc. Patrocinio

N. Acido, Renato dela Cruz Ocfemia was driving with expired license and positive
for alcoholic breath. Hence, Manila Assistant City Prosecutor Oscar A. Pascua
recommended the ling of information for reckless imprudence resulting to (sic)
damage to property and physical injuries.

The original complaint was amended twice: rst, impleading Auto Palace
Car Exchange as commercial agent and/or buyer-seller and second, impleading
Albert Jaucian as principal defendant doing business under the name and style of
Auto Palace Car Exchange.

Except for Ocfemia, all the defendants led separate answers to the
complaint. [Petitioner] Nostradamus Villanueva claimed that he was no longer the
owner of the car at the time of the mishap because it was swapped with a Pajero
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 owned by Albert Jaucian/Auto Palace Car Exchange. For her part, Linda Gonzales
declared that her presence at the scene of the accident was upon the request of
the actual owner of the Mitsubishi Lancer (PHK 201 '91) [Albert Jaucian] for
whom she had been working as agent/seller. On the other hand, Auto Palace Car
Exchange represented by Albert Jaucian claimed that he was not the registered
owner of the car. Moreover, it could not be held subsidiary liable as employer of
Ocfemia because the latter was off-duty as utility employee at the time of the
incident. Neither was Ocfemia performing a duty related to his employment. 3

After trial, the trial court found petitioner liable and ordered him to pay respondent
actual, moral and exemplary damages plus appearance and attorney's fees:
WHEREFORE, judgment is hereby rendered for the plaintiffs, ordering
Nostradamus Villanueva to pay the amount of P99,580 as actual damages,
P25,000.00 as moral damages, P25,000.00 as exemplary damages and attorney's
fees in the amount of P10,000.00 plus appearance fees of P500.00 per hearing
with legal interest counted from the date of judgment. In conformity with the law
on equity and in accordance with the ruling in First Malayan Lending and Finance
Corporation vs. Court of Appeals (supra), Albert Jaucian is hereby ordered to
indemnify Nostradamus Villanueva for whatever amount the latter is hereby
ordered to pay under the judgment.

SO ORDERED. 4

The CA upheld the trial court's decision but deleted the award for appearance and
attorney's fees because the justi cation for the grant was not stated in the body of the
decision. Thus, this petition for review which raises a singular issue:
MAY THE REGISTERED OWNER OF A MOTOR VEHICLE BE HELD LIABLE FOR
DAMAGES ARISING FROM A VEHICULAR ACCIDENT INVOLVING HIS MOTOR
VEHICLE WHILE BEING OPERATED BY THE EMPLOYEE OF ITS BUYER WITHOUT
THE LATTER'S CONSENT AND KNOWLEDGE? 5

Yes.
We have consistently ruled that the registered owner of any vehicle is directly and
primarily responsible to the public and third persons while it is being operated. 6 The
rationale behind such doctrine was explained way back in 1957 in Erezo vs. Jepte 7 :
The principle upon which this doctrine is based is that in dealing with
vehicles registered under the Public Service Law, the public has the right to
assume or presume that the registered owner is the actual owner thereof, for it
would be di cult for the public to enforce the actions that they may have for
injuries caused to them by the vehicles being negligently operated if the public
should be required to prove who the actual owner is. How would the public or third
persons know against whom to enforce their rights in case of subsequent
transfers of the vehicles? We do not imply by his doctrine, however, that the
registered owner may not recover whatever amount he had paid by virtue of his
liability to third persons from the person to whom he had actually sold, assigned
or conveyed the vehicle. ESCcaT

Under the same principle the registered owner of any vehicle, even if not
used for a public service, should primarily be responsible to the public or to third
persons for injuries caused the latter while the vehicle is being driven on the
highways or streets. The members of the Court are in agreement that the
defendant-appellant should be held liable to plaintiff-appellee for the injuries
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 occasioned to the latter because of the negligence of the driver, even if the
defendant-appellant was no longer the owner of the vehicle at the time of the
damage because he had previously sold it to another. What is the legal basis for
his (defendant-appellant's) liability?

There is a presumption that the owner of the guilty vehicle is the

defendant-appellant as he is the registered owner in the Motor Vehicles O ce.
Should he not be allowed to prove the truth, that he had sold it to another and
thus shift the responsibility for the injury to the real and actual owner? The
defendant holds the a rmative of this proposition; the trial court held the
negative.
The Revised Motor Vehicle Law (Act No. 3992, as amended) provides that
no vehicle may be used or operated upon any public highway unless the same is
property registered. It has been stated that the system of licensing and the
requirement that each machine must carry a registration number, conspicuously
displayed, is one of the precautions taken to reduce the danger of injury to
pedestrians and other travelers from the careless management of automobiles.
And to furnish a means of ascertaining the identity of persons violating the laws
and ordinances, regulating the speed and operation of machines upon the
highways (2 R.C.L. 1176). Not only are vehicles to be registered and that no motor
vehicles are to be used or operated without being properly registered for the
current year, but that dealers in motor vehicles shall furnish the Motor Vehicles
O ce a report showing the name and address of each purchaser of motor vehicle
during the previous month and the manufacturer's serial number and motor
number. (Section 5(c), Act No. 3992, as amended.)

Registration is required not to make said registration the operative act by

which ownership in vehicles is transferred, as in land registration cases, because
the administrative proceeding of registration does not bear any essential relation
to the contract of sale between the parties (Chinchilla vs. Rafael and Verdaguer,
39 Phil. 888), but to permit the use and operation of the vehicle upon any public
highway (section 5[a], Act No. 3992, as amended). The main aim of motor vehicle
registration is to identify the owner so that if any accident happens, or that any
damage or injury is caused by the vehicle on the public highways, responsibility
therefore can be xed on a de nite individual, the registered owner. Instances are
numerous where vehicles running on public highways caused accidents or
injuries to pedestrians or other vehicles without positive identi cation of the
owner or drivers, or with very scant means of identi cation. It is to forestall these
circumstances, so inconvenient or prejudicial to the public, that the motor vehicle
registration is primarily ordained, in the interest of the determination of persons
responsible for damages or injuries caused on public highways:

One of the principal purposes of motor vehicles legislation is

identi cation of the vehicle and of the operator, in case of accident; and
another is that the knowledge that means of detection are always available
may act as a deterrent from lax observance of the law and of the rules of
conservative and safe operation. Whatever purpose there may be in these
statutes, it is subordinate at the last to the primary purpose of rendering it
certain that the violator of the law or of the rules of safety shall not escape
because of lack of means to discover him. The purpose of the statute is
thwarted, and the displayed number becomes a "share and delusion," if
courts would entertain such defenses as that put forward by appellee in
this case. No responsible person or corporation could be held liable for the
most outrageous acts of negligence, if they should be allowed to place a
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 "middleman" between them and the public, and escape liability by the
manner in which they recompense servants. (King vs. Brenham Automobile
Co., Inc. 145 S.W. 278, 279.)
With the above policy in mind, the question that defendant-appellant poses
is: should not the registered owner be allowed at the trial to prove who the actual
and real owner is, and in accordance with such proof escape or evade
responsibility by and lay the same on the person actually owning the vehicle? We
hold with the trial court that the law does not allow him to do so; the law, with its
aim and policy in mind, does not relieve him directly of the responsibility that the
law xes and places upon him as an incident or consequence of registration.
Were a registered owner allowed to evade responsibility by proving who the
supposed transferee or owner is, it would be easy for him, by collusion with others
or otherwise, to escape said responsibility and transfer the same to an inde nite
person, or to one who possesses no property with which to respond nancially for
the damage or injury done. A victim of recklessness on the public highways is
usually without means to discover or identify the person actually causing the
injury or damage. He has no means other than by a recourse to the registration in
the Motor Vehicles O ce to determine who is the owner. The protection that the
law aims to extend to him would become illusory were the registered owner given
the opportunity to escape liability by disproving his ownership. If the policy of the
law is to be enforced and carried out, the registered owner should not be allowed
to prove the contrary to the prejudice of the person injured, that is, to prove that a
third person or another has become the owner, so that he may thereby be relieved
of the responsibility to the injured person.

The above policy and application of the law may appear quite harsh and
would seem to con ict with truth and justice. We do not think it is so. A registered
owner who has already sold or transferred a vehicle has the recourse to a third-
party complaint, in the same action brought against him to recover for the
damage or injury done, against the vendee or transferee of the vehicle. The
inconvenience of the suit is no justi cation for relieving him of liability; said
inconvenience is the price he pays for failure to comply with the registration that
the law demands and requires.
In synthesis, we hold that the registered owner, the defendant-appellant
herein, is primarily responsible for the damage caused to the vehicle of the
plaintiff-appellee, but he (defendant-appellant) has a right to be indemni ed by
the real or actual owner of the amount that he may be required to pay as damage
for the injury caused to the plaintiff-appellant. 8

Petitioner insists that he is not liable for damages since the driver of the vehicle at
the time of the accident was not an authorized driver of the new (actual) owner of the
vehicle. He claims that the ruling in First Malayan Leasing and Finance Corporation vs. CA 9
implies that to hold the registered owner liable for damages, the driver of the vehicle must
have been authorized, allowed and permitted by its actual owner to operate and drive it.
Thus, if the vehicle is driven without the knowledge and consent of the actual owner, then
the registered owner cannot be held liable for damages.
He further argues that this was the underlying theory behind Duavit vs. CA 1 0 wherein
the court absolved the registered owner from liability after nding that the vehicle was
virtually stolen from the owner's garage by a person who was neither authorized nor
employed by the owner. Petitioner concludes that the ruling in Duavit and not the one in
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 First Malayan should be applicable to him.
Petitioner's argument lacks merit. Whether the driver is authorized or not by the
actual owner is irrelevant to determining the liability of the registered owner who the law
holds primarily and directly responsible for any accident, injury or death caused by the
operation of the vehicle in the streets and highways. To require the driver of the vehicle to
be authorized by the actual owner before the registered owner can be held accountable is
to defeat the very purpose why motor vehicle legislations are enacted in the first place.
Furthermore, there is nothing in First Malayan which even remotely suggests that the
driver must be authorized before the registered owner can be held accountable. In First
Malayan, the registered owner, First Malayan Corporation, was held liable for damages
arising from the accident even if the vehicle involved was already owned by another party:
This Court has consistently ruled that regardless of who the actual owner
is of a motor vehicle might be, the registered owner is the operator of the same
with respect to the public and third persons, and as such, directly and primarily
responsible for the consequences of its operation. In contemplation of law, the
owner/operator of record is the employer of the driver, the actual operator and
employer being considered merely as his agent (MYC-Agro-Industrial Corporation
vs. Vda. de Caldo, 132 SCRA 10, citing Vargas vs. Langcay, 6 SCRA 174; Tamayo
vs. Aquino, 105 Phil. 949). DCTHaS

'We believe that it is immaterial whether or not the driver was

actually employed by the operator of record. It is even not necessary to
prove who the actual owner of the vehicle and the employer of the driver is.
Granting that, in this case, the father of the driver is the actual owner and
that he is the actual employer, following the well-settled principle that the
operator of record continues to be the operator of the vehicle in
contemplation of law, as regards the public and third person, and as such
is responsible for the consequences incident to its operation, we must hold
and consider such owner-operator of record as the employer, in
contemplation of law, of the driver. And, to give effect to this policy of law
as enunciated in the above cited decisions of this Court, we must now
extend the same and consider the actual operator and employer as the
agent of the operator of record.' 1 1

Contrary to petitioner's position, the First Malayan ruling is applicable to him since
the case involves the same set of facts — the registered owner had previously sold the
vehicle to someone else and was being driven by an employee of the new (actual) owner.
Duavit is inapplicable since the vehicle there was not transferred to another; the registered
and the actual owner was one and the same person. Besides, in Duavit, the defense of the
registered owner, Gilberto Duavit, was that the vehicle was practically stolen from his
garage by Oscar Sabiano, as affirmed by the latter:
Defendant Sabiano, in his testimony, categorically admitted that he took
the jeep from the garage of defendant Duavit without the consent and authority
of the latter. He testi ed further that Duavit even led charges against him for the
theft of the jeep but which Duavit did not push through as his (Sabiano's) parents
apologized to Duavit on his behalf. 1 2

As correctly pointed out by the CA, the Duavit ruling is not applicable to petitioner's
case since the circumstance of unauthorized use was not present. He in fact voluntarily
delivered his car to Albert Jaucian as part of the downpayment for a vehicle he purchased
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 from Jaucian. Thus, he could not claim that the vehicle was stolen from him since he
voluntarily ceded possession thereof to Jaucian. It was the latter, as the new (actual)
owner, who could have raised the defense of theft to prove that he was not liable for the
acts of his employee Ocfemia. Thus, there is no reason to apply the Duavit ruling to this
case.
The ruling in First Malayan has been reiterated in BA Finance Corporation vs. CA 1 3
and more recently in Aguilar, Sr . vs. Commercial Savings Bank. 1 4 In BA Finance, we held
the registered owner liable even if, at the time of the accident, the vehicle was leased by
another party and was driven by the lessee's employee. In Aguilar, the registered owner-
bank answered for damages for the accident even if the vehicle was being driven by the
Vice-President of the Bank in his private capacity and not as an o cer of the Bank, as
claimed by the Bank. We find no reason to deviate from these decisions.
The main purpose of vehicle registration is the easy identi cation of the owner who
can be held responsible for any accident, damage or injury caused by the vehicle. Easy
identi cation prevents inconvenience and prejudice to a third party injured by one who is
unknown or unidenti ed. To allow a registered owner to escape liability by claiming that
the driver was not authorized by the new (actual) owner results in the public detriment the
law seeks to avoid.
Finally, the issue of whether or not the driver of the vehicle during the accident was
authorized is not at all relevant to determining the liability of the registered owner. This
must be so if we are to comply with the rationale and principle behind the registration
requirement under the motor vehicle law.
WHEREFORE, the petition is hereby DENIED. The January 26, 2000 decision of the
Court of Appeals is AFFIRMED.
SO ORDERED.
Panganiban and Sandoval-Gutierrez, JJ ., concur.
Carpio Morales, J ., is on leave.

Footnotes
1. Penned by Associate Justice Buenaventura J. Guerrero and concurred in by Associate
Justices Hilarion L. Aquino and Elvi John S. Asuncion of the Eighth Division.
2. Court of Appeals Decision, Rollo, p. 30.
3. Rollo, pp. 24–25.
4. Rollo, pp. 23–24.
5. Petition for Review, Rollo, p. 10.
6. St. Mary's Academy vs. Carpitanos, et al., 426 Phil 878 (2002); BA Finance Corporation
vs. CA, G.R. No. 98275, 13 November 1992, 215 SCRA 715, 720, citing Erezo vs. Jepte,
102 Phil 103 (1957).

7. 102 Phil 103 (1957).

8. Ibid at 106–110.
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 9. G.R. No. 91378, 9 June 1992, 209 SCRA 660.

10. G.R. No. 82318, 18 May 1989, 173 SCRA 490.

11. Supra note 9 at 663.
12. Supra note 10 at 493.
13. G.R. No. 98275, 13 November 1992, 215 SCRA 715.
14. 412 Phil 834 (2001).

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