CASE 12: F.F. CRUZ and CO., INC., petitioner, vs.
THE COURT OF APPEALS, insurance company is subrogated to the rights of the insured against
GREGORIO MABLE as substituted by his wife LUZ ALMONTE MABLE and
children DOMING, LEONIDAS, LIGAYA, ELENA, GREGORIO, JR., SALOME,
ANTONIO, and BERNARDO all surnamed MABLE, respondents.
(WENCESLAO)
DOCTRINE
Upon payment of the loss incurred by the insured, the insurer is entitled
to be subrogated pro tanto to any right of action which the insured may
have against the third person whose negligence or wrongful act
caused the loss. Under Art. 2207, the real party in interest with regard to
the indemnity received by the insured is the insurer.
FACTS
FF Cruzs furniture manufacturing shop in Caloocan was situated
adjacent to private respondent Gregorio Mables residence.
Mable first approached Eric Cruz (plant manager of petitioner)
to request that a firewall be construcred between the shop and
Mable residence. This request was repeated several times but
Cruz fell on deaf ears.
Sept 6 1974a fire broke out in FF Cruzs shop. Petitioners private respondents insurer has to claim his right to reimbursement of
employees, who slept in the shop premises tried to put out the
fire but their efforts proved futile. The fire spread to Mables
house. Both the shop and the house was razed to the ground.
The cause of the conflagration was never discovered.
Subsequently, Mable filed an action for damages against Cruz.
RCFI held for the Mables ordering Cruz to pay for damages.
CA affirmed CFI decision. MR was filed by Cruz but was denied.
Hence, this petition for review on certiorari and eventually
submitted for decision on Jan 1981.
Petitioner argues that the sum of P35,000 which Mable
recovered on the insurance of their house must be deducted
from the award of damages. Also, they argue that the doctrine
of res ipsa loquitur must apply in the case,
ISSUE/S
W/N private respondents may still recover from petitioner
notwithstanding the indemnity paid by their insurer?
HELD/RATIO
YES!
Art. 2207. If the plaintiffs property has been insured, and he has
received indemnity from the insurance company for the injury or loss
arising out of the wrong or breach of contract complained of, the
the wrongdoer or the person who violated the contract. If the amount
paid by the insurance company does not fully cover the injury or loss,
the aggrieved party shall be entitled to recover the deficiency from the
person causing the loss or injury.
The law is clear and needs no interpretation. On the other hand, the
insurer may seek reimbursement of the amount it indemnified private
respondents from petitioner. This is the essence of the right to
subrogation under Art. 2207. Upon payment of the loss incurred by the
insured, the insurer is entitled to be subrogated to any right of action
which the insurer may have against the third person whise negligence
or wrongful act caused the loss. (Firemans Fund Insurance Co. v. Jamila
& Co.)
Under Art. 2207, the real party in interest with regard to the indemnity
received is the insurer. Whether or not the insurer should exercise the
rights of the insured to which it had been subrogated lies solely within
the formers sound discretion. Since the insurer is not a party to this case,
its identity is not of record, and no claim is made on its behalf, the
the P35,000 paid to the insured.
RULING: CA AFFIRMED. P35000 is reduced rom the damages and the
right of the insurer to subrogation and thus seek reimbursement from
petitioner for P35000 is recognized.
NOTES:
Doctrine of Res Ipsa Loquitur (found to be applicable in this case)
Concept: where the thing which caused the injury complained of is
shown to be under the management of the defendant or his servants
and the accident is such as in the ordinary course of things does not
happen if those who have its management or control use the proper
case, it affords reasonable evidence, in the absence of explanation by
the defendant, that the accident arose from want of care.
Applicability: petitioner failed to construct a firewall between its shop
and the residence of private respondents as required by the city
ordinance. Thus, the accident arose from want of care.