NO.

1
SERGIO F. NAGUIAT, doing business under the
name and style SERGIO F. NAGUIAT ENT., INC., &
CLARK FIELD TAXI, INC., petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION
(THIRD DIVISION), NATIONAL ORGANIZATION OF
WORKINGMEN and its members, LEONARDO T.
GALANG, et al., respondents.

FACTS:
Petitioner CLARK FIELD TAXI, INC. (CFTI) held a
concessionaire's contract with the Army Air Force
Exchange Services ("AAFES") for the operation of taxi
services within Clark Air Base. Sergio F. Naguiat was
CFTI's president, while Antolin T. Naguiat was its vicepresident.

Essentially, "tort" consists in the violation of a

right given or the omission of a duty imposed by
law. 35 Simply stated, tort is a breach of a legal
duty. 36 Article 283 of the Labor Code mandates
the employer to grant separation pay to
employees in case of closure or cessation of
operations of establishment or undertaking not
due to serious business losses or financial
reverses, which is the condition obtaining at bar.
CFTI failed to comply with this law-imposed duty
or obligation. Consequently, its stockholder who
was actively engaged in the management or
operation of the business should be held
personally liable.
Moreover, the fifth paragraph of Section 100 of the
Corporation Code specifically imposes personal liability
upon the stockholder actively managing or operating
the business and affairs of the close corporation.
(5) To the extent that the stockholders
are actively engage(d) in the
management or operation of the
business and affairs of a close
corporation, the stockholders shall be
held to strict fiduciary duties to each
other and among themselves. Said
stockholders shall be personally liable
for corporate torts unless the
corporation has obtained reasonably
adequate liability insurance. (emphasis
supplied)

CFTI was a family-owned corporation which is like

Sergio F. Naguiat Enterprises, Incorporated ("Naguiat
Enterprises"), a trading firm.
Individual respondents were previously employed by
CFTI as taxicab drivers.
Due to the phase-out of the US military bases in the
Philippines, from which Clark Air Base was not spared,
the AAFES was dissolved, and the services of individual
respondents were officially terminated.
AAFES Taxi Drivers Association ("drivers' union") and
the company arrived at an agreement that the
separated drivers will be given P500.00 for every year
of service as severance pay.
However, after disaffiliating themselves from the
drivers' union, individual respondents, through the
National Organization of Workingmen ("NOWM"), a
labor organization which they subsequently joined,
filed a complaint 5against "Sergio F. Naguiat doing
business under the name and style Sergio F. Naguiat
Enterprises, Inc., for payment of separation pay.
They claimed to have been assigned to Naguiat
Enterprises after having been hired by CFTI, and that
the former thence managed, controlled and supervised
their employment. They averred further that they were
entitled to separation pay based on their latest daily
earnings of US$15.00 for working sixteen (16) days a
month.

ISSUE:
WON the president of CFTI jointly and severally liable
for the obligations of the corporation to its dismissed
employees particularly on the separation pay?
WON there was corporate tort?
RULING:
Yes.
According to the Labor Code, "Employer" includes any
person acting in the interest of an employer, directly or
indirectly.
Sergio F. Naguiat admittedly, was the president of CFTI
who actively managed the business. Thus, he falls
within the meaning of an "employer" as contemplated
by the Labor Code, who may be held jointly and
severally liable for the obligations of the corporation to
its dismissed employees.

NO. 2
LIWAYWAY VINZONS-CHATO, petitioner,
vs.
FORTUNE TOBACCO CORPORATION, respondent.
FACTS:
Petitioner Liwayway Vinzons-Chato was then the
Commissioner of Internal Revenue while respondent
Fortune Tobacco Corporation is an entity engaged in
the manufacture of different brands of cigarettes,
among which are "Champion," "Hope," and "More"
cigarettes.
On June 10, 1993, the legislature enacted Republic Act
No. 7654 (RA 7654), which took effect on July 3, 1993.
Prior to its effectivity, cigarette brands Champion,"
"Hope," and "More" were considered local brands
subjected to an ad valorem tax at the rate of 20-45%.
However, on July 1, 1993, or two days before RA 7654
took effect, petitioner issued RMC 37-93 reclassifying
"Champion," "Hope," and "More" as locally
manufactured cigarettes bearing a foreign
brand subject to the 55% ad valorem tax.4 RMC 3793 in effect subjected "Hope," "More," and "Champion"
cigarettes to the provisions of RA 7654, specifically, to
Sec. 142,5 (c)(1) on locally manufactured cigarettes
which are currently classified and taxed at 55%,
and which imposes an ad valorem tax of "55%
provided that the minimum tax shall not be less than
Five Pesos (P5.00) per pack."6
The CTA ruled that RMC 37-93 is defective, invalid, and
unenforceable and further enjoined petitioner from
collecting the deficiency tax assessment issued
pursuant to RMC No. 37-93. This ruling was affirmed by
the Court of Appeals, and finally by the SC.
Respondent filed before the RTC a complaint11 for
damages against petitioner in her private capacity.
Respondent contended that the latter should be held
liable for damages under Article 32 of the Civil Code

considering that the issuance of RMC 37-93 violated its

constitutional right against deprivation of property
without due process of law and the right to equal
protection of the laws.
Article 32 of the Civil Code provides:
ART. 32. Any public officer or employee, or any
private individual, who directly or indirectly
obstructs, defeats, violates, or in any manner
impedes or impairs any of the following rights
and liberties of another person shall be liable
to the latter for damages:
xxxx
(6) The right against deprivation of property
without due process of law;

instant case precisely filed to seek damages for

violation of constitutional rights.
Considering that bad faith and malice are not
necessary in an action based on Article 32 of the Civil
Code, the failure to specifically allege the same will not
amount to failure to state a cause of action. The courts
below therefore correctly denied the motion to dismiss
on the ground of failure to state a cause of action,
since it is enough that the complaint avers a violation
of a constitutional right of the plaintiff.
NO. 3
ORLANDO D. GARCIA, JR., doing business under
the name and style COMMUNITY DIAGNOSTIC
CENTER and BU CASTRO,1 Petitioners,
vs.
RANIDA D. SALVADOR and RAMON
SALVADOR, Respondents.

xxxx
FACTS:
(8) The right to the equal protection of the laws;
Petitioner averred that the Civil Code, specifically,
Article 32 which allows recovery of damages for
violation of constitutional rights, is a general law on the
liability of public officers; while Section 38, Book I of
the Administrative Code is a special law on the superior
public officers liability, such that, if the complaint, as
in the instant case, does not allege bad faith, malice, or
gross negligence, the same is dismissible for failure to
state a cause of action.
ISSUE:
WON the complaint filed by respondent stated a cause
of action? Which law should be applied?
RULING:
The complaint filed by respondent stated a cause of
action and that the decisive provision thereon is Article
32 of the Civil Code.
The rule is that where there are two acts, one of which
is special and particular and the other general which, if
standing alone, would include the same matter and
thus conflict with the special act, the special law must
prevail since it evinces the legislative intent more
clearly than that of a general statute and must not be
taken as intended to affect the more particular and
specific provisions of the earlier act, unless it is
absolutely necessary so to construe it in order to give
its words any meaning at all.
Article 32 was patterned after the "tort" in
American law.27 A tort is a wrong, a tortious act
which has been defined as the commission or
omission of an act by one, without right,
whereby another receives some injury, directly
or indirectly, in person, property, or reputation.
While the Civil Code, specifically, the Chapter on
Human Relations is a general law, Article 32 of the
same Chapter is a special and specific provision that
holds a public officer liable for and allows redress from
a particular class of wrongful acts that may be
committed by public officers. Compared thus with
Section 38 of the Administrative Code, which broadly
deals with civil liability arising from errors in the
performance of duties, Article 32 of the Civil Code is
the specific provision which must be applied in the

Respondent Ranida D. Salvador started working as a

trainee in the Accounting Department of Limay Bulk
Handling Terminal, Inc. (the Company).
As a prerequisite for regular employment, she
underwent a medical examination at the Community
Diagnostic Center (CDC).
Garcia who is a medical technologist, conducted the
HBs Ag (Hepatitis B Surface Antigen) test and on
October 22, 1993, CDC issued the test
result5 indicating that Ranida was "HBs Ag: Reactive."
The result bore the name and signature of Garcia as
examiner and the rubber stamp signature of Castro as
pathologist.
The findings indicated that she is suffering from
Hepatitis B, a liver disease. Thus, based on the medical
report6submitted by Sto. Domingo, the Company
terminated Ranidas employment for failing the
physical examination
However, after consulting several professionals, it
turned out that Salvador has a "Negative" result.9
Thereafter, the Company rehired Ranida.
Ranida and Ramon filed a complaint13 for damages
against petitioner Garcia and a purportedly unknown
pathologist of CDC, claiming that, by reason of the
erroneous interpretation of the results of Ranidas
examination, she lost her job and suffered serious
mental anxiety, trauma and sleepless nights, while
Ramon was hospitalized and lost business
opportunities.
ISSUE:
WON petitioner Garcia is liable for damages to the
respondents for issuing an incorrect HBsAG test result?
RULING:
Yes.
Negligence is the failure to observe for the
protection of the interest of another person that
degree of care, precaution and vigilance which
the circumstances justly demand,20 whereby
such other person suffers injury. For health care
providers, the test of the existence of negligence is: did
the health care provider either fail to do something
which a reasonably prudent health care provider would

have done, or that he or she did something that a

reasonably prudent health care provider would not
have done; and that failure or action caused injury to
the patient;21 if yes, then he is guilty of negligence.
Thus, the elements of an actionable conduct are: 1)
duty, 2) breach, 3) injury, and 4) proximate causation.
All the elements are present in the case at bar.
From the rules, it is clear that a clinical laboratory must
be administered, directed and supervised by a licensed
physician authorized by the Secretary of Health, like a
pathologist who is specially trained in methods of
laboratory medicine; that the medical technologist
must be under the supervision of the pathologist or a
licensed physician; and that the results of any
examination may be released only to the requesting
physician or his authorized representative upon the
direction of the laboratory pathologist.

Here, Garcia conducted the HBsAG test of respondent

Ranida without the supervision of defendant-appellee
Castro. Hence, he is liable for damages.
Also, Article 20 of the New Civil Code provides:
Art. 20. Every person who, contrary to law, willfully or
negligently causes damage to another, shall indemnify
the latter for the same.
The foregoing provision provides the legal basis for the
award of damages to a party who suffers damage
whenever one commits an act in violation of some
legal provision.