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Picart v Smith (Torts)

PICART V SMITH G.R. No. L-12219 March 15, 1918 AMADO PICART, plaintiff-appellant, vs. FRANK SMITH,
JR., defendant- appellee.

FACTS:
The plaintiff was riding on his pony over the Carlatan bridge in La Union. Before he had gotten half way across, the
defendant approached from the opposite direction in an automobile, going at the rate of about ten or twelve miles per
hour. As the defendant neared the bridge he saw a horseman on it and blew his horn to give warning of his approach.
He continued his course and after he had taken the bridge he gave two more successive blasts, as it appeared to him
that the man on horseback before him was not observing the rule of the road. Seeing that the pony was apparently
quiet, the defendant, instead of veering to the right while yet some distance away or slowing down, continued to
approach directly toward the horse without diminution of speed.
The plaintiff, it appears, saw the automobile coming and heard the warning signals. However, being perturbed by the
novelty of the apparition or the rapidity of the approach, he pulled the pony closely up against the railing on the right
side of the bridge instead of going to the left. He says that the reason he did this was that he thought he did not have
sufficient time to get over to the other side. The automobile passed in such close proximity to the animal that it
became frightened and turned its body across the bridge with its head toward the railing. The horse fell and its rider
was thrown off with some violence.
As a result of its injuries the horse died. The plaintiff received contusions which caused temporary unconsciousness
and required medical attention for several days.

DECISION OF LOWER COURTS:


1. CFI La Union absolved the defendant from liability.

ISSUE:
whether or not the defendant in maneuvering his car in the manner above described was guilty of negligence such as
gives rise to a civil obligation to repair the damage done

RULING:
Yes, he is liable.
The control of the situation had then passed entirely to the defendant; and it was his duty either to bring his car to an
immediate stop or, seeing that there were no other persons on the bridge, to take the other side and pass sufficiently
far away from the horse to avoid the danger of collision. Instead of doing this, the defendant ran straight on until he
was almost upon the horse.
The existence of negligence in a given case is not determined by reference to the personal judgment of the actor in
the situation before him. The law considers what would be reckless, blameworthy, or negligent in the man of ordinary
intelligence and prudence and determines liability by that.
It goes without saying that the plaintiff himself was not free from fault, for he was guilty of antecedent negligence in
planting himself on the wrong side of the road. But as we have already stated, the defendant was also negligent; and
in such case the problem always is to discover which agent is immediately and directly responsible. It will be noted
that the negligent acts of the two parties were not contemporaneous, since the negligence of the defendant
succeeded the negligence of the plaintiff by an appreciable interval. Under these circumstances the law is that the
person who has the last fair chance to avoid the impending harm and fails to do so is chargeable with the
consequences, without reference to the prior negligence of the other party.
1. Smith Bell vs. Borja
(G.R. No. 143008, June 10, 2002)
SMITH BELL DODWELL SHIPPING AGENCY CORPORATION, petitioner, vs. CATALINO BORJA and
INTERNATIONAL TO WAGE AND TRANSPORT CORPORATION, respondents.

PANGANIBAN, J.:

FACTS:
On September 23, 1987, Smith Bell (petitioner) requested the Bureau of Customs to inspect vessel M/T King
Family which was due to arrive at the port of Manila on September 24, 1987.
Customs Inspector Borja was instructed to inspect said vessel.
At about 11 o'clock in the morning on September 24, while M/T King Family was unloading chemicals unto two
(2) barges owned by ITTC (respondent), a sudden explosion occurred setting the vessels afire. Seeing the fire
and fearing for his life, Borja hurriedly jumped over board to save himself.
Borja survived but he became permanently disabled due to the incident. He made demands against Smith Bell
and ITTC for the damages caused by the explosion but both denied liabilities and attributed to each other
negligence.
RTC ruled in Borjas favor and held Smith Bell liable for damages and loss of income, and ordered the latter to
pay actual damages for loss of earning capacity, moral damages and attorneys fees.
CA affirmed.

ISSUE: Who, if any, is liable for Borjas injuries? SMITH BELL

HELD:
Smith Bell is liable. Both RTC and CA ruled that the fire and explosion originated from Smith Bells vessel. (As
supported by the testimonies of the eyewitnesses and the investigation conducted by the Special Board of Marine
Inquiry and affirmed by the secretary of the Dept. of National Defense.)

Negligence is conduct that creates undue risk of harm to another. It is the failure to observe that degree of care,
precaution and vigilance that the circumstances justly demand, whereby that other person suffers injury.
Smith Bell's vessel was carrying chemical cargo. While knowing that their vessel was carrying dangerous
inflammable chemicals, its officers and crew failed to take all the necessary precautions to prevent an accident. Smith
Bell was, therefore, negligent.

The three elements of quasi-delict are:


(a) damages suffered by the plaintiff,
(b) fault or negligence of the defendant, and
(c) the connection of cause and effect between the fault or negligence of the defendant and the damages inflicted on
the plaintiff.

All these elements were established in this case. Knowing fully well that it was carrying dangerous chemicals,
Smith Bell was negligent in not taking all the necessary precautions in transporting the cargo.

As a result of the fire and the explosion during the unloading of the chemicals from the vessel, Borja suffered
damages and injuries. Hence, 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
management or navigation.

SC awarded: loss of earning capacity; moral damages and attorneys fees under the Civil Codes Article 2219, par. 2,
and Article 2208, par. 11, respectively.

[G.R. No. 156034. October 1, 2003]


DELSAN TRANSPORT LINES, INC., petitioner, vs. C & A CONSTRUCTION, INC., respondent.
DECISION
YNARES-SANTIAGO, J.:

Assailed in this petition for review under Rule 45 of the Revised Rules of Court are the June 14, 2002
[1] [2]
decision of the Court of Appeals in CA-G.R. CV No. 59034, which reversed the decision of the Regional Trial
[3]
Court of Manila, Branch 46, in Civil Case No. 95-75565, and its November 7, 2002 resolution denying petitioners
motion for reconsideration.
The undisputed facts reveal that respondent C & A Construction, Inc. was engaged by the National Housing
[4]
Authority (NHA) to construct a deflector wall at the Vitas Reclamation Area in Vitas, Tondo, Manila. The project was
completed in 1994 but it was not formally turned over to NHA.
On October 9, 1994, M/V Delsan Express, a ship owned and operated by petitioner Delsan Transport Lines,
Inc., anchored at the Navotas Fish Port for the purpose of installing a cargo pump and clearing the cargo oil tank. At
around 12:00 midnight of October 20, 1994, Captain Demetrio T. Jusep of M/V Delsan Express received a report
from his radio head operator in Japan[5] that a typhoon was going to hit Manila[6] in about eight (8) hours.[7] At
approximately 8:35 in the morning of October 21, 1994, Capt. Jusep tried to seek shelter at the North Harbor but
[8]
could not enter the area because it was already congested. At 10:00 a.m., Capt. Jusep decided to drop anchor at
the vicinity of Vitas mouth, 4 miles away from a Napocor power barge. At that time, the waves were already reaching
8 to 10 feet high. Capt. Jusep ordered his crew to go full ahead to counter the wind which was dragging the ship
towards the Napocor power barge. To avoid collision, Capt. Jusep ordered a full stop of the vessel. [9] He succeeded
in avoiding the power barge, but when the engine was re-started and the ship was maneuvered full astern, it hit the
[10] [11]
deflector wall constructed by respondent. The damage caused by the incident amounted to P456,198.24.
Respondent demanded payment of the damage from petitioner but the latter refused to pay. Consequently,
respondent filed a complaint for damages with the Regional Trial Court of Manila, Branch 46, which was docketed as
Civil Case No. 95-75565. In its answer, petitioner claimed that the damage was caused by a fortuitous event.[12]
On February 13, 1998, the complaint filed by respondent was dismissed. The trial court ruled that petitioner was
not guilty of negligence because it had taken all the necessary precautions to avoid the accident.Applying the
emergency rule, it absolved petitioner of liability because the latter had no opportunity to adequately weigh the best
solution to a threatening situation. It further held that even if the maneuver chosen by petitioner was a wrong move, it
cannot be held liable as the cause of the damage sustained by respondent was typhoon Katring, which is an act of
God.[13]
On appeal to the Court of Appeals, the decision of the trial court was reversed and set aside. [14] It found Capt.
Jusep guilty of negligence in deciding to transfer the vessel to the North Harbor only at 8:35 a.m. of October 21, 1994
and thus held petitioner liable for damages.
Hence, petitioner filed the instant petition contending that Capt. Jusep was not negligent in waiting until 8:35 in
the morning of October 21, 1994 before transferring the vessel to the North Harbor inasmuch as it was not shown that
[15]
had the transfer been made earlier, the vessel could have sought shelter. It further claimed that it cannot be held
vicariously liable under Article 2180 of the Civil Code because respondent failed to allege in the complaint that
petitioner was negligent in the selection and supervision of its employees. [16] Granting that Capt. Jusep was indeed
guilty of negligence, petitioner is not liable because it exercised due diligence in the selection of Capt. Jusep who is a
duly licensed and competent Master Mariner. [17]
The issues to be resolved in this petition are as follows (1) Whether or not Capt. Jusep was negligent; (2) If yes,
whether or not petitioner is solidarily liable under Article 2180 of the Civil Code for the quasi-delictcommitted by Capt.
Jusep?
Article 2176 of the Civil Code provides that whoever by act or omission causes damage to another, there being
fault or negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing
contractual relation between the parties, is called a quasi-delict. The test for determining the existence of negligence
in a particular case may be stated as follows: Did the defendant in doing the alleged negligent act use the reasonable
care and caution which an ordinary prudent person would have used in the same situation? If not, then he is guilty of
negligence.[18]
In the case at bar, the Court of Appeals was correct in holding that Capt. Jusep was negligent in deciding to
transfer the vessel only at 8:35 in the morning of October 21, 1994. As early as 12:00 midnight of October 20, 1994,
[19] [20]
he received a report from his radio head operator in Japan that a typhoon was going to hit Manila after 8
[21]
hours. This, notwithstanding, he did nothing, until 8:35 in the morning of October 21, 1994, when he decided to
seek shelter at the North Harbor, which unfortunately was already congested. The finding of negligence cannot be
rebutted upon proof that the ship could not have sought refuge at the North Harbor even if the transfer was done
earlier. It is not the speculative success or failure of a decision that determines the existence of negligence in the
present case, but the failure to take immediate and appropriate action under the circumstances. Capt. Jusep, despite
knowledge that the typhoon was to hit Manila in 8 hours, complacently waited for the lapse of more than 8 hours
[22]
thinking that the typhoon might change direction. He cannot claim that he waited for the sun to rise instead of
moving the vessel at midnight immediately after receiving the report because of the difficulty of traveling at night. The
hour of 8:35 a.m. is way past sunrise. Furthermore, he did not transfer as soon as the sun rose because, according to
him, it was not very cloudy[23] and there was no weather disturbance yet. [24]
When he ignored the weather report notwithstanding reasonable foresight of harm, Capt. Jusep showed an
inexcusable lack of care and caution which an ordinary prudent person would have observed in the same
[25]
situation. Had he moved the vessel earlier, he could have had greater chances of finding a space at the North
[26]
Harbor considering that the Navotas Port where they docked was very near North Harbor. Even if the latter was
already congested, he would still have time to seek refuge in other ports.
The trial court erred in applying the emergency rule. Under this rule, one who suddenly finds himself in a place
of danger, and is required to act without time to consider the best means that may be adopted to avoid the impending
danger, is not guilty of negligence, if he fails to adopt what subsequently and upon reflection may appear to have
[27]
been a better method, unless the danger in which he finds himself is brought about by his own negligence. Clearly,
the emergency rule is not applicable to the instant case because the danger where Capt. Jusep found himself was
caused by his own negligence.
Anent the second issue, we find petitioner vicariously liable for the negligent act of Capt. Jusep. Under Article
2180 of the Civil Code an employer may be held solidarily liable for the negligent act of his employee. Thus

Art. 2180. The obligation imposed in Article 2176 is demandable not only for ones own acts or omissions, but also for
those of persons for whom one is responsible.
xxxxxxxxx
Employers shall be liable for the damages caused by their employees and household helpers acting within the scope
of their assigned tasks, even though the former are not engaged in any business or industry.
xxxxxxxxx
The responsibility treated of in this article shall cease when the persons herein mentioned prove that they observed
all the diligence of a good father of a family to prevent damage.

Whenever an employees negligence causes damage or injury to another, there instantly arises a
presumption juris tantum that the employer failed to exercise diligentissimi patris families in the selection (culpa in
eligiendo) or supervision (culpa in vigilando) of its employees. To avoid liability for a quasi-delict committed by his
employee, an employer must overcome the presumption by presenting convincing proof that he exercised the care
[28]
and diligence of a good father of a family in the selection and supervision of his employee.
There is no question that petitioner, who is the owner/operator of M/V Delsan Express, is also the employer of
Capt. Jusep who at the time of the incident acted within the scope of his duty. The defense raised by petitioner was
that it exercised due diligence in the selection of Capt. Jusep because the latter is a licensed and competent Master
Mariner. It should be stressed, however, that the required diligence of a good father of a family pertains not only to
the selection, but also to the supervision of employees. It is not enough that the employees chosen be competent and
qualified, inasmuch as the employer is still required to exercise due diligence in supervising its employees.
[29]
In Fabre, Jr. v. Court of Appeals, it was held that due diligence in supervision requires the formulation of rules
and regulations for the guidance of employees and the issuance of proper instructions as well as actual
implementation and monitoring of consistent compliance with the rules. Corollarily, in Ramos v. Court of
Appeals,[30] the Court stressed that once negligence on the part of the employees is shown, the burden of proving
that he observed the diligence in the selection and supervision of its employees shifts to the employer.
In the case at bar, however, petitioner presented no evidence that it formulated rules/guidelines for the proper
performance of functions of its employees and that it strictly implemented and monitored compliance
therewith. Failing to discharge the burden, petitioner should therefore be held liable for the negligent act of Capt.
Jusep.
So also, petitioner cannot disclaim liability on the basis of respondents failure to allege in its complaint that the
former did not exercise due diligence in the selection and supervision of its employees. In Viron Transportation Co.,
Inc. v. Delos Santos,[31] it was held that it is not necessary to state that petitioner was negligent in the supervision or
selection of its employees, inasmuch as its negligence is presumed by operation of law. Allegations of negligence
against the employee and that of an employer-employee relation in the complaint are enough to make out a case
[32]
of quasi-delict under Article 2180 of the Civil Code.
Considering that petitioner did not assail the damages awarded by the trial court, we find no reason to alter the
[33]
same. The interest imposed should, however, be modified. In Eastern Shipping Lines, Inc. v. Court of Appeals, it
was held that the rate of interest on obligations not constituting a loan or forbearance of money is six percent (6%)
per annum. If the purchase price can be established with certainty at the time of the filing of the complaint, the six
percent (6%) interest should be computed from the date the complaint was filed until finality of the decision. After the
judgment becomes final and executory until the obligation is satisfied, the amount due shall earn interest at 12% per
[34]
year, the interim period being deemed equivalent to a forbearance of credit.
Accordingly, the amount of P456,198.27 due the respondent shall earn 6% interest per annum from October 3,
1995 until the finality of this decision. If the adjudged principal and the interest (or any part thereof) remain unpaid
thereafter, the interest rate shall be twelve percent (12%) per annum computed from the time the judgment becomes
final and executory until it is fully satisfied.
WHEREFORE, in view of all the foregoing, the instant petition is DENIED. The June 14, 2002 decision of the
Court of Appeals in CA-G.R. CV No. 59034 ordering petitioner Delsan Transport Lines, Inc., to pay respondent C & A
Construction, Inc., damages in the amount of P456,198.27, plus P30,000.00 as attorneys fees, is AFFIRMED with the
MODIFICATION that the award of P456,198.27 shall earn interest at the rate of 6% per annum from October 3, 1995,
until finality of this decision, and 12% per annum thereafter on the principal and interest (or any part thereof) until full
payment.
SO ORDERED.
Vitug, and Carpio, JJ., concur.
Davide, Jr., C.J., (Chairman), no part; was former counsel of party.
Azcuna, J., on leave
Ong vs. Metropolitan Water District

MR. & MRS. ONG vs. METROPOLITAN WATER DISTRICT (govt-owned corp.)

No. L-7664. 29 August 1958.

4 Phil 397 Civil Law Torts and Damages Due Diligence as a Defense Last Clear Chance; when not applied
On July 5, 1952, Dominador Ong (14 years old) and his two brothers went to the swimming pool operated by
Metropolitan Water District (MWD). After paying the entrance fee, the three proceeded to the small pool.
The swimming pools of MWD are provided with a ring buoy, toy roof, towing line, oxygen resuscitator and a first aid
medicine kit. The bottom of the pools is painted with black colors so as to insure clear visibility. There is on display in
a conspicuous place within the area certain rules and regulations governing the use of the pools. MWD employs six
lifeguards who are all trained as they had taken a course for that purpose and were issued certificates of proficiency.
These lifeguards work on schedule prepared by their chief and arranged in such a way as to have two guards at a
time on duty to look after the safety of the bathers. There is a male nurse and a sanitary inspector with a clinic
provided with oxygen resuscitator. And there are security guards who are available always in case of emergency.
Later, Dominador told his brothers that hell just be going to the locker room to drink a bottle of Coke. No one saw him
returned. Later, the elder Ong noticed someone at the bottom of the big pool and notified the lifeguard in attendant
(Manuel Abao), who immediately dove into the water. The body was later identified as Dominadors. He was
attempted to be revived multiple times but of no avail.
The parents of Ong sued MWD averring that MWD was negligent in selecting its employees. During trial, the elder
brother of Ong and one other testified that Abao was reading a magazine and was chatting with a security guard
when the incident happened and that he was called a third time before he responded. Plaintiff further alleged that
even assuming that there was no negligence on the part of MWD, it is still liable under the doctrine of Last Clear
Chance for having the last opportunity to save the Dominador, its employees failed to do so.
ISSUE: Whether or not MWD is liable for the death of Dominador Ong.
HELD: No. As established by the facts, MWD was not negligent in selecting its employees as all of them were duly
certified. MWD was not negligent in managing the pools as there were proper safety measures and
precautions/regulations that were placed all over the pools. Hence, due diligence is appreciated as a complete and
proper defense in this case. Further, the testimony in court by the elder Ong and the other witness was belied by the
statements they have given to the investigators when they said that the lifeguard immediately dove into the water
when he was called about the boy at the bottom of the pool.
The doctrine of Last Clear Chance is of no application here. It was not established as to how Dominador was able to
go to the big pool. He went to the locker and thereafter no one saw him returned not until his body was retrieved from
the bottom of the big pool. The last clear chance doctrine can never apply where the party charged is required to act
instantaneously (how can the lifeguard act instantaneously in dissuading Dominador from going to the big pool if he
did not see him go there), and if the injury cannot be avoided by the application of all means at hand after the peril is
or should have been discovered; at least in cases in which any previous negligence of the party charged cannot be
said to have contributed to the injury.
057 MARIKINA AUTO LINE TRANSPORT CORPORATION vs. AUTHOR: Kelsey
PEOPLE OF THE PHILIPPINES NOTES:
G.R. No. 152040 March 31, 2006
TOPIC:
PONENTE: CALLEJO, SR., J.:

FACTS:
1. Erlinda V. Valdellon is the owner of a two-door commercial apartment located at No. 31 Kamias Road, Quezon City. The
Marikina Auto Line Transport Corporation (MALTC) is the owner-operator of a passenger bus, its employee, was assigned as
the regular driver of the bus.
2. At around 2:00 p.m. on October 3, 1992, Suelto was driving the passenger bus along Kamias Road, Kamuning, Quezon City,
going towards EDSA. The bus suddenly swerved to the right and struck the terrace of the commercial apartment owned by
Valdellon. Upon Valdellons request, the court ordered Sergio Pontiveros, the Senior Building Inspection Officer of the City
Engineers Office, to inspect the damaged terrace.
3. He recommended that since the structural members made of concrete had been displaced, the terrace would have to be
demolished "to keep its monolithicness, and to insure the safety and stability of the building."
4. In a letter addressed to the bus company and Suelto, Valdellon demanded payment of P148,440.00, within 10 days from
receipt thereof, to cover the cost of the damage to the terrace. he bus company and Suelto offered a P30,000.00 settlement
which Valdellon refused.
5. Valdellon filed a criminal complaint for reckless imprudence resulting in damage to property against Suelto. After the requisite
preliminary investigation, an Information was filed with the RTC of Quezon City.
6. Valdellon also filed a separate civil complaint against Suelto and the bus company for damages. She prayed that after due
proceedings, judgment be rendered in her favor.
7.
ISSUE(S):
1. W/N Suelto is guilty of reckless imprudence which resulted in the damage of Valdellons property
HELD:
1. Yes. Respondent People of the Philippines was able to prove beyond reasonable doubt that petitioner Suelto swerved the bus
to the right with recklessness, thereby causing damage to the terrace of private respondents apartment.
RATIO:
Although she did not testify to seeing the incident as it happened, petitioner Suelto himself admitted this in his answer to the complaint
and when he testified in the trial court.

Suelto narrated that he suddenly swerved the bus to the right of the road causing it to hit the column of the terrace of private respondent.
Petitioners were burdened to prove that the damage to the terrace of private respondent was not the fault of petitioner Suelto. We have
reviewed the evidence on record and find that petitioners failed to prove that petitioner acted on an emergency caused by the sudden
intrusion of a passenger jeepney into the lane of the bus he was driving.

It was the burden of petitioners herein to prove petitioner Sueltos defense that he acted on an emergency, that is, he had to swerve the
bus to the right to avoid colliding with a passenger jeep coming from EDSA that had overtaken another vehicle and intruded into the lane
of the bus.

It is clear from the photographs submitted by the prosecution that the commercial apartment of Dr. Valdellon sustained heavy damage
caused by the bus being driven by Suelto. "It seems highly improbable that the said damages were not caused by a strong impact. And,
it is quite reasonable to conclude that, at the time of the impact, the bus was traveling at a high speed when Suelto tried to avoid the
passenger jeepney."

The damages could not have been caused except by a speeding bus. Had the accused not been speeding, he could have easily
reduced his speed and come to a full stop when he noticed the jeep. Were he more prudent in driving, he could have avoided the
incident or even if he could not avoid the incident, the damages would have been less severe.

The severe damages sustained could not have resulted had the accused acted as a reasonable and prudent man would. The accused
was not diligent as he claims to be. What is more probable is that the accused had to swerve to the right and hit the commercial
apartment of the plaintiff because he could not make a full stop as he was driving too fast in a usually crowded street.
CASE LAW/ DOCTRINE:
Spouses Africa et al vs Caltex Philippines, Boquiren and the Court of Appeals

16 SCRA 448 Civil Law Torts and Damages Res Ipsa Loquitur
In March 1948, in Rizal Avenue, Manila, a tank truck was hosing gasoline into the underground storage of Caltex.
Apparently, a fire broke out from the gasoline station and the fire spread and burned several houses including the
house of Spouses Bernabe and Soledad Africa. Allegedly, someone (a passerby) threw a cigarette while gasoline
was being transferred which caused the fire. But there was no evidence presented to prove this theory and no other
explanation can be had as to the real reason for the fire. Apparently also, Caltex and the branch owner (Mateo
Boquiren) failed to install a concrete firewall to contain fire if in case one happens.
ISSUE: Whether or not Caltex and Boquiren are liable to pay for damages.
HELD: Yes. This is pursuant to the application on the principle of res ipsa loquitur (the transaction speaks for itself)
which states: where the thing which caused injury, without fault of the injured person, is under the exclusive control
of the defendant and the injury is such as in the ordinary course of things does not occur if he having such control use
proper care, it affords reasonable evidence, in the absence of the explanation, that the injury arose from defendants
want of care. The gasoline station, with all its appliances, equipment and employees, was under the control of Caltex
and Boquiren. A fire occurred therein and spread to and burned the neighboring houses. The persons who knew or
could have known how the fire started were Boquiren, Caltex and their employees, but they gave no explanation
thereof whatsoever. It is a fair and reasonable inference that the incident happened because of want of care.
Note that ordinarily, he who charges negligence shall prove it. However, res ipsa loquitur is the exception because
the burden of proof is shifted to the party charged of negligence as the latter is the one who had exclusive control of
the thing that caused the injury complained of.
Case of FGU INSURANCE CORPORATION vs. G.P.S TRUCKING CORPORATION and LAMBERT M. EROLES
G.R.No. 141910 06August2002

FACTS OF THE CASE:


G.P. Sarmiento Trucking Corporation (GPS) undertook to deliver on 18 June 1994 thirty (30) units of Condura S.D.
white refrigerators aboard one of its Isuzu truck, driven by Lambert Eroles. While the truck was traversing the north
diversion road along McArthur highway in Barangay Anupol, Bamban, Tarlac, it collided with an unidentified truck,
causing it to fall into a deep canal, resulting in damage to the cargoes.
FGU Insurance Corporation (FGU), an insurer of the shipment, paid to Concepcion Industries, Inc., the value of the
covered cargoes: P204, 450.00. FGU, in turn, being the subrogee of the rights and interests of the insured sought
reimbursement of the amount, from GPS. Since GPS failed to heed the claim, FGU filed a complaint for damages and
breach of contract of carriage against GPS and its driver with the Regional Trial Court, Branch 66, of Makati City. In
its answer, respondents asserted that GPS was the exclusive hauler only of Concepcion Industries, Inc., since 1988,
and it was not so engaged in business as a common carrier. Respondents further claimed that the cause of damage
was purely accidental. GPS, instead of submitting its evidence, filed with leave of court a motion to dismiss the
complaint by way of demurrer to evidence on the ground that petitioner had failed to prove that it was a common
carrier. The RTC and CA both ruled in favor of the Respondent.

ISSUES OF THE CASE:

WHETHER RESPONDENT GPS, EITHER AS A COMMON CARRIER OR A PRIVATE CARRIER, MAY BE


PRESUMED TO HAVE BEEN NEGLIGENT WHEN THE GOODS IT UNDERTOOK TO TRANSPORT SAFELY
WERE SUBSEQUENTLY DAMAGED WHILE IN ITS PROTECTIVE CUSTODY AND POSSESSION.

- In culpa contractual, upon which the action of petitioner rests as being the subrogee of Concepcion Industries, Inc.,
the mere proof of the existence of the contract and the failure of its compliance justify, prima facie, a corresponding
right of relief. Thus, FGU has a claim for the amount paid out.
- The law, recognizing the obligatory force of contracts, will not permit a party to be set free from liability for any kind
of misperformance of the contractual undertaking or a contravention of the tenor thereof
- GPS recognizes the existence of a contract of carriage between it and petitioners assured, and admits that the
cargoes it has assumed to deliver have been lost or damaged while in its custody. In such a situation, a default on, or
failure of compliance with, the obligation in this case, the delivery of the goods in its custody to the place of
destination - gives rise to a presumption of lack of care and corresponding liability on the part of the contractual
obligor the burden being on him to establish otherwise. GPS has failed to do so.

HELD:
The decision of the lower courts insofar as Lambert M. Eroles is concerned is affirmed but assailed decision with
regard to GPS trucking is reversed. It, is hereby ordered to pay FGU Insurance Corporation the value of the damaged
and lost cargoes in the amount of P204, 450.00

Obligations and Contracts Terms:

expectation interest- the interest in having the benefit of his bargain by being put in as good a position as he would
have been in had the contract been performed
reliance interest- the interest in being reimbursed for loss caused by reliance on the contract by being put in as good
a position as he would have been in had the contract not been made
Restitution interest- which is his interest in having restored to him any benefit that he has conferred on the other
party.
Subrogee- the person or entity that assumes the legal right to attempt to collect a claim of another (subrogor) in
return for paying the other's expenses or debts which the other claims against a third party. A subrogee is usually the
insurance company which has insured the party whose expenses were paid.
FGU INSURANCE CORPORATION vs. G.P.S TRUCKING CORPORATION

Lessons Applicable: Loss caused by negligence of the insured (Insurance)

FACTS:

Anco Enterprises Company (ANCO), a partnership between Ang Gui and Co To, was engaged in the shipping
business operating two common carriers
M/T ANCO tugboat
D/B Lucio barge - no engine of its own, it could not maneuver by itself and had to be towed by a tugboat for it to
move from one place to another.
September 23 1979: San Miguel Corporation (SMC) shipped from Mandaue City, Cebu, on board the D/B Lucio,
for towage by M/T ANCO:
25,000 cases Pale Pilsen and 350 cases Cerveza Negra - consignee SMCs Beer Marketing Division (BMD)-
Estancia Beer Sales Office, Estancia, Iloilo
15,000 cases Pale Pilsen and 200 cases Cerveza Negra - consignee SMCs BMD-San Jose Beer Sales Office,
San Jose, Antique
September 30, 1979: D/B Lucio was towed by the M/T ANCO arrived and M/T ANCO left the barge immediately
The clouds were dark and the waves were big so SMCs District Sales Supervisor, Fernando Macabuag,
requested ANCOs representative to transfer the barge to a safer place but it refused so around the midnight, the
barge sunk along with 29,210 cases of Pale Pilsen and 500 cases of Cerveza Negra totalling to P1,346,197
When SMC claimed against ANCO it stated that they agreed that it would not be liable for any losses or damages
resulting to the cargoes by reason of fortuitous event and it was agreed to be insured with FGU for 20,000 cases
or P858,500
ANCO filed against FGU
FGU alleged that ANCO and SMC failed to exercise ordinary diligence or the diligence of a good father of the
family in the care and supervision of the cargoes
RTC: ANCO liable to SMC and FGU liable for 53% of the lost cargoes
CA affirmed
ISSUE: W/N FGU should be exempted from liability to ANCO for the lost cargoes because of a fortuitous event and
negligence of ANCO

HELD: YES. Affirmed with modification. Third-party complainant is dismissed.


Art. 1733. Common carriers, from the nature of their business and for reasons of public policy are bound to
observe extraordinary diligence in the vigilance over the goods and for the safety of the passengers transported
by them, according to all the circumstances of each case.
Such extraordinary diligence in vigilance over the goods is further expressed in Articles 1734, 1735, and 1745 Nos. 5,
6, and 7 . . .

Art. 1734. Common carriers are responsible for the loss, destruction, or deterioration of the goods, unless the
same is due to any of the following causes only:

(1) Flood, storm, earthquake, lightning, or other natural disaster or calamity;

. . .

Art. 1739. In order that the common carrier may be exempted from responsibility, the natural disaster must have
been the proximate and only cause of the loss. However, the common carrier must exercise due diligence to
prevent or minimize loss before, during and after the occurrence of flood, storm, or other natural disaster in order
that the common carrier may be exempted from liability for the loss, destruction, or deterioration of the goods . . .
Caso fortuito or force majeure
extraordinary events not foreseeable or avoidable, events that could not be foreseen, or which though foreseen,
were inevitable
not enough that the event should not have been foreseen or anticipated, as is commonly believed but it must be
one impossible to foresee or to avoid - not in this case
other vessels in the port of San Jose, Antique, managed to transfer to another place
To be exempted from responsibility, the natural disaster should have been the proximate and only cause of the
loss. There must have been no contributory negligence on the part of the common carrier.
there was blatant negligence on the part of M/T ANCOs crewmembers, first in leaving the engine-less barge D/B
Lucio at the mercy of the storm without the assistance of the tugboat, and again in failing to heed the request of
SMCs representatives to have the barge transferred to a safer place
When evidence show that the insureds negligence or recklessness is so gross as to be sufficient to constitute a
willful act, the insurer must be exonerated.
ANCOs employees is of such gross character that it amounts to a wrongful act which must exonerate FGU from
liability under the insurance contract
both the D/B Lucio and the M/T ANCO were blatantly negligent
Torts And Damages Case Digest: Perla Compania De Seguros, Inc., Et Al. V. Sps. Gaudencio And Primitiva
Sarangaya (2005)

G.R. No. 147746 October 25, 2005


Lessons Applicable: Res Ipsa Loquitur (Torts and Damages

FACTS:
1986: Spouses Gaudencio Sarangaya III and Primitiva Sarangaya erected Super A Building, a semi-concrete,
semi-narra, one-storey commercial building fronting the provincial road of Santiago, Isabela
It has three doors which were leased out
The two-storey residence of the Sarangayas was behind the second and third doors of the building
On the left side of the commercial building stood the office of the Matsushita Electric Philippine Corporation
(Matsushita)
1988: Perla Compania de Seguros, Inc. through its branch manager Bienvenido Pascual, entered into a contract
of lease of the first door beside the Matsushita office
It was converted into a two door so he had a garage where he parked a company car 1981 model 4-door Ford
Cortina which he used to supervise different towns
July 7, 1988: Pascual went to San Fernando, Pampanga leaving the car
3 days later: When he returned and warmed up the car, it made an odd sound. On the second try, there was
again an odd sound and a small flames came out of its engine so he was startled, stopped the car, went out and
pushed it out of the garage
Soon, fire spewed out of its rear compartment and burned the whole garage where he was trapped so he suffered
burns in the face, legs and arms
The spouses were busy atching TV when they heard 2 loud explosions, smelt of gasoline and fire burned all their
belongings
city fire marshall investigated and concluded that the fire was accidental
Spouses filed a complaint against Pascual for gross negligence and Perla for lacking the required diligence in the
selection and supervision of its employee.
RTC: Pascual and Perla liable jointly and solidarily
Pascual was held liable under the doctrine of res ipsa loquitur
CA: affirmed but modified the amount of damages
ISSUE:
1. W/N the doctrine of res ipsa loquitur is applicable - YES
2. W/N Perla lacked the required diligence in the selection and supervision of its employee. - NO

HELD: DENIED
1. YES.
Res ipsa loquitur
Latin phrase which literally means the thing or the transaction speaks for itself.
It relates to the fact of an injury that sets out an inference to the cause thereof or establishes the plaintiffs prima
facie case
The doctrine rests on inference and not on presumption
facts of the occurrence warrant the supposition of negligence and they furnish circumstantial evidence of
negligence when direct evidence is lacking
based on the theory that the defendant either knows the cause of the accident or has the best opportunity of
ascertaining it and the plaintiff, having no knowledge thereof, is compelled to allege negligence in general terms
plaintiff relies on proof of the happening of the accident alone to establish negligence
provides a means by which a plaintiff can pin liability on a defendant who, if innocent, should be able to explain
the care he exercised to prevent the incident complained of
defendants responsibility to show that there was no negligence on his part
Requisites of Res Ipsa Loquitur
1) the accident is of a kind which does not ordinarily occur unless someone is negligent
Ordinary refers to the usual course of events
Flames spewing out of a car engine, when it is switched on, is obviously not a normal event. Neither does an
explosion usually occur when a car engine is revved.
Pascual, as the caretaker of the car, failed to submit any proof that he had it periodically checked - negligence
2) the cause of the injury was under the exclusive control of the person in charge and
3) the injury suffered must not have been due to any voluntary action or contribution on the part of the person
injured.
When there is caso fortuito:
(a) the cause of the unforeseen and unexpected occurrence was independent of the human will
human agency must be entirely excluded as the proximate cause or contributory cause of the injury or loss -Not
because car not maintained
(b) it was impossible to foresee the event which constituted the caso fortuito or, if it could be foreseen, it was
impossible to avoid - NOT under the control of pascual
(c) the occurrence must be such as to render it impossible to perform an obligation in a normal manner - Spouses
had no access nor obligation for the maintenance
(d) the person tasked to perform the obligation must not have participated in any course of conduct that
aggravated the accident
2. YES.
Perla did not include any rule or regulation that Pascual should have observed in performing his functions
There was no guidelines for the maintenance and upkeep of company property like the vehicle that caught fire
Did not require periodic reports on or inventories of its properties
Article 2180 of the Civil Code states that employers shall be liable for the damage caused by their employees.
The liability is imposed on all those who by their industry, profession or other enterprise have other persons in
their service or supervision
Nowhere does it state that the liability is limited to employers in the transportation business.

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