Ty Transpo Origina Cases V

Contents Contents..................................................................................................................... 1 ISAAC v A.L AMMEN...................................................................................................2 NECESITO v PARAS...................................................................................................10 PAL v CA (1981)........................................................................................................17 SULPICIO v CA..........................................................................................................30 JAPAN AIRLINES v CA................................................................................................34 CANGCO v MRR........................................................................................................ 38 DEL PRADO v MERALCO digest.................................................................................56 DEL PRADO v MERALCO case...................................................................................59 LA MALLORCA v CA...................................................................................................63 BATACLAN v MEDINA................................................................................................67 ABOITIZ v CA............................................................................................................ 71 PAL v CA (1993)........................................................................................................80

ISAAC v A.L AMMEN G.R. No. L-9671

August 23, 1957

CESAR L. ISAAC, plaintiff-appellant, vs. A. L. AMMEN TRANSPORTATION CO., INC., defendant-appellee. Angel S. Gamboa for appellant. Manuel O. Chan for appellee. BAUTISTA ANGELO, J.: A. L. Ammen Transportation Co., Inc., hereinafter referred to as defendant, is a corporation engaged in the business of transporting passengers by land for compensation in the Bicol provinces and one of the lines it operates is the one connecting Legaspi City, Albay with Naga City, Camarines Sur. One of the buses which defendant was operating is Bus No. 31. On May 31, 1951, plaintiff boarded said bus as a passenger paying the required fare from Ligao, Albay bound for Pili, Camarines Sur, but before reaching his destination, the bus collided with a motor vehicle of the pick-up type coming from the opposite direction, as a result of which plaintiff's left arm was completely severed and the severed portion fell inside the bus. Plaintiff was rushed to a hospital in Iriga, Camarines Sur where he was given blood transfusion to save his life. After four days, he was transferred to another hospital in Tabaco, Albay, where he under went treatment for three months. He was moved later to the Orthopedic Hospital where he was operated on and stayed there for another two months. For these services, he incurred expenses amounting to P623.40, excluding medical fees which were paid by defendant. As an aftermath, plaintiff brought this action against defendants for damages alleging that the collision which resulted in the loss of his left arm was mainly due to the gross incompetence and recklessness of the driver of the bus operated by defendant and that defendant incurred in culpa contractual arising from its noncompliance with its obligation to transport plaintiff safely to his, destination. Plaintiff prays for judgment against defendant as follows: (1) P5,000 as expenses for his medical treatment, and P3,000 as the cost of an artificial arm, or a total of P8,000; (2) P6,000 representing loss of earning; (3) P75,000 for diminution of his earning capacity; (4) P50,000 as moral damages; and (5) P10,000 as attorneys' fees and costs of suit. Defendant set up as special defense that the injury suffered by plaintiff was due entirely to the fault or negligence of the driver of the pick-up car which collided with the bus driven by its driver and to the contributory negligence of plaintiff himself. Defendant further claims that the accident which resulted in the injury of plaintiff is one which defendant could not foresee or, though foreseen, was inevitable. The after trial found that the collision occurred due to the negligence of the driver of the pick-up car and not to that of the driver of the bus it appearing that the latter did everything he could to avoid the same but that notwithstanding his efforts, he was not able to avoid it. As a consequence, the court dismissed complaint, with costs against plaintiff. This is an appeal from said decision.

It appears that plaintiff boarded a bus of defendant as paying passenger from Ligao, Albay, bound for Pili, Camarines Sur, but before reaching his destination, the bus collided with a pick-up car which was coming from the opposite direction and, as a, result, his left arm was completely severed and fell inside the back part of the bus. Having this background in view, and considering that plaintiff chose to hold defendant liable on its contractual obligation to carry him safely to his place of destination, it becomes important to determine the nature and extent of the liability of a common carrier to a passenger in the light of the law applicable in this jurisdiction. In this connection, appellant invokes the rule that, "when an action is based on a contract of carriage, as in this case, all that is necessary to sustain recovery is proof of the existence of the contract of the breach thereof by act or omission", and in support thereof, he cites several Philippine cases.1 With the ruling in mind, appellant seems to imply that once the contract of carriage is established and there is proof that the same was broken by failure of the carrier to transport the passenger safely to his destination, the liability of the former attaches. On the other hand, appellee claims that is a wrong presentation of the rule. It claims that the decisions of this Court in the cases cited do not warrant the construction sought to be placed upon, them by appellant for a mere perusal thereof would show that the liability of the carrier was predicated not upon mere breach of its contract of carriage but upon the finding that its negligence was found to be the direct or proximate cause of the injury complained of. Thus, appellee contends that "if there is no negligence on the part of the common carrier but that the accident resulting in injuries is due to causes which are inevitable and which could not have been avoided or anticipated notwithstanding the exercise of that high degree of care and skill which the carrier is bound to exercise for the safety of his passengers", neither the common carrier nor the driver is liable therefor. We believe that the law concerning the liability of a common carrier has now suffered a substantial modification in view of the innovations introduced by the new Civil Code. These innovations are the ones embodied in Articles 1733, 1755 and 1756 in so far as the relation between a common carrier and its passengers is concerned, which, for ready reference, we quote hereunder: ART. 1733. Common carriers, from the nature of their business and for reasons of public policy, are bound to observe extra ordinary 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 the vigilance over the goods is further expressed in articles 1734, 1735, and 1745, Nos. 5, 6, and 7, while the extraordinary diligence for the safety of the passengers is further set forth in articles 1755 and 1756. ART. 1755. A common carrier is bound to carry the passengers safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with a due regard for all the circumstances.

ART. 1756. In case of death of or injuries to passengers, common carriers are presumed to have been at fault or to have acted negligently, unless they prove that they observed extraordinary diligence as prescribed in articles 1733 and 1755. The Code Commission, in justifying this extraordinary diligence required of a common carrier, says the following: A common carrier is bound to carry the passengers safely as far as human care and foresight can provide, using the utmost deligence of very cautions persons, with due regard for all circumstances. This extraordinary diligence required of common carriers is calculated to protect the passengers from the tragic mishaps that frequently occur in connection with rapid modern transportation. This high standard of care is imperatively demanded by the precariousness of human life and by the consideration that every person must in every way be safeguarded against all injury. (Report of the Code Commission, pp. 35-36)" (Padilla, Civil Code of the Philippines, Vol. IV, 1956 ed., p. 197). From the above legal provisions, we can make the following restatement of the principles governing the liability of a common carrier: (1) the liability of a carrier is contractual and arises upon breach of its obligation. There is breach if it fails to exert extraordinary diligence according to all circumstances of each case; (2) a carrier is obliged to carry its passenger with the utmost diligence of a very cautious person, having due regard for all the circumstances; (3) a carrier is presumed to be at fault or to have acted negligently in case of death of, or injury to, passengers, it being its duty to prove that it exercised extraordinary diligence; and (4) the carrier is not an insurer against all risks of travel. The question that now arises is: Has defendant observed extraordinary diligence or the utmost diligence of every cautious person, having due regard for all circumstances, in avoiding the collision which resulted in the injury caused to the plaintiff? After examining the evidence in connection with how the collision occurred, the lower court made the following finding: Hemos examinado muy detenidamente las pruebas presentadas en la vista, principalmente, las declaraciones que hemos acotado arriba, y hernos Ilegado a la conclusion de que el demandado ha hecho, todo cuanto estuviere de su parte para evitar el accidente, pero sin embargo, no ha podido evitarlo. EI hecho de que el demandado, antes del choque, tuvo que hacer pasar su truck encima de los montones de grava que estaban depositados en la orilla del camino, sin que haya ido mas alla, por el grave riesgo que corrian las vidas de sus pasajeros, es prueba concluyente de lo que tenemos dicho, a saber: — que el cuanto esuba de su parte, para evitar el accidente, sin que haya podidoevitardo, por estar fuera de su control. The evidence would appear to support the above finding. Thus, it appears that Bus No. 31, immediately prior to the collision, was running at a moderate speed because it had just stopped at the school zone of Matacong, Polangui, Albay. The pick-up car

was at full speed and was running outside of its proper lane. The driver of the bus, upon seeing the manner in which the pick-up was then running, swerved the bus to the very extreme right of the road until its front and rear wheels have gone over the pile of stones or gravel situated on the rampart of the road. Said driver could not move the bus farther right and run over a greater portion of the pile, the peak of which was about 3 feet high, without endangering the safety of his passengers. And notwithstanding all these efforts, the rear left side of the bus was hit by the pick-up car. Of course, this finding is disputed by appellant who cannot see eye to eye with the evidence for the appellee and insists that the collision took place because the driver of the bus was going at a fast speed. He contends that, having seen that a car was coming from the opposite direction at a distance which allows the use of moderate care and prudence to avoid an accident, and knowing that on the side of the road along which he was going there was a pile of gravel, the driver of the bus should have stopped and waited for the vehicle from the opposite direction to pass, and should have proceeded only after the other vehicle had passed. In other words, according to appellant, the act of the driver of the bus in squeezing his way through of the bus in squeezing his way through between the oncoming pick-up and the pile of gravel under the circumstances was considered negligent. But this matter is one of credibility and evaluation of the evidence. This is evidence. This is the function of the trial court. The trial court has already spoken on this matter as we have pointed out above. This is also a matter of appreciation of the situation on the part of the driver. While the position taken by appellant appeals more to the sense of caution that one should observe in a given situation to avoid an accident or mishap, such however can not always be expected from one who is placed suddenly in a predicament where he is not given enough time to take the course of action as he should under ordinary circumstances. One who is placed in such a predicament cannot exercise such coolness or accuracy of judgment as is required of him under ordinary circumstances and he cannot therefore be expected to observe the same judgment, care and precaution as in the latter. For this reason, authorities abound where failure to observe the same degree of care that as ordinary prudent man would exercise under ordinary circumstances when confronted with a sadden emergency was held to be warranted and a justification to exempt the carrier from liability. Thus, it was held that "where a carrier's employee is confronted with a sudden emergency, the fact that he is obliged to act quickly and without a chance for deliberation must be taken into account, and he is held to the some degree of care that he would otherwise be required to exercise in the absence of such emergency but must exercise only such care as any ordinary prudent person would exercise under like circumstances and conditions, and the failure on his part to exercise the best judgement the case renders possible does not establish lack of care and skill on his part which renders the company, liable. . . . (13 C. J. S., 1412; 10 C. J.,970). Considering all the circumstances, we are persuaded to conclude that the driver of the bus has done what a prudent man could have done to avoid the collision and in our opinion this relieves appellee from legibility under our law. A circumstances which miliates against the stand of appellant is the fact borne out by the evidence that when he boarded the bus in question, he seated himself on the

left side thereof resting his left arm on the window sill but with his left elbow outside the window, this being his position in the bus when the collision took place. It is for this reason that the collision resulted in the severance of said left arm from the body of appellant thus doing him a great damage. It is therefore apparent that appellant is guilty of contributory negligence. Had he not placed his left arm on the window sill with a portion thereof protruding outside, perhaps the injury would have been avoided as is the case with the other passenger. It is to be noted that appellant was the only victim of the collision. It is true that such contributory negligence cannot relieve appellee of its liability but will only entitle it to a reduction of the amount of damage caused (Article 1762, new Civil Code), but this is a circumstance which further militates against the position taken by appellant in this case. It is the prevailing rule that it is negligence per se for a passenger on a railroad voluntarily or inadvertently to protrude his arm, hand, elbow, or any other part of his body through the window of a moving car beyond the outer edge of the window or outer surface of the car, so as to come in contact with objects or obstacles near the track, and that no recovery can be had for an injury which but for such negligence would not have been sustained. (10 C. J. 1139) Plaintiff, (passenger) while riding on an interurban car, to flick the ashes, from his cigar, thrust his hand over the guard rail a sufficient distance beyond the side line of the car to bring it in contact with the trunk of a tree standing beside the track; the force of the blow breaking his wrist. Held, that he was guilty of contributory negligence as a matter of law. (Malakia vs. Rhode Island Co., 89 A., 337.) Wherefore, the decision appealed from is affirmed, with cost against appellant. Paras, C.J., Bengzon, Padilla, Montemayor, Reyes, A., Labrador, Concepcion, Endencia and Felix, JJ., concur. LANDINGIN v PANTRANCO G.R. No. L-28014-15 May 29, 1970 En Banc SPOUSES MARCELO LANDINGIN and RACQUEL BOCASAS, plaintiffs-appellees, vs. PANGASINAN TRANSPORTATION CO. and MARCELO OLIGAN, defendants-appellants. SPOUSES PEDRO GARCIA and EUFRACIA LANDINGIN, plaintiffs-appellees, vs. PANGASINAN TRANSPORTATION CO. and MARCELO OLIGAN, defendants-appellants. Gabriel A. Zabala for plaintiffs-appellees. Vicente M. Erfe Law Office for defendants-appellants.

VILLAMOR, J.:

Direct appeal on a question of law from the portion of the judgment of the Court of First Instance of Manila ordering the defendants Pangasinan Transportation Co. (PANTRANCO) and Marcelo Oligan to pay the plaintiffs in Civil Case No. D-1468 (L-28014) the sum of P6,500.00, and the plaintiffs in Civil Case No. 1470 (L-28015) the sum of P3,500.00. The complaints in said Civil Cases Nos. D-1468 and D-1470 were filed by the spouses Marcelo Landingin and Racquel Bocasas, and the spouses Pedro Garcia and Eufracia Landingin, respectively, for damages allegedly suffered by them in connection with the death of their respective daughter, Leonila Landingin and Estrella Garcia, due to the alleged negligence of the defendants and/or breach of contract of carriage. In their complaints, plaintiffs averred, among others, that in the morning of April 20, 1963, their above-mentioned daughters were among the passengers in the bus driven by defendant Marcelo Oligan and owned and operated by defendant PANTRANCO on an excursion trip from Dagupan City to Baguio City and back, that the bus was open on one side and enclosed on the other, in gross violation of the rules of the Public Service Commission; that defendant PANTRANCO acted with negligence, fraud and bad faith in pretending to have previously secured a special permit for the trip when in truth it had not done so; that upon reaching an uphill point at Camp 8, Kennon Road, Baguio City, on the onward trip, defendant driver, through utter lack of foresight, experience and driving knowledge, caused the bus to stall and stop for a few moments; that through the said defendant's fault and mishandling, the motor ceased to function, causing the bus to slide back unchecked; that when the said defendant suddenly swerved and steered the bus toward the mountainside, Leonila and Estrella, together with several other passengers, were thrown out of the bus through its open side unto the road, suffering serious injuries as a result of which Leonila and Estrella died at the hospital and the same day; and that in connection with the incident, defendant driver had been charged with and convicted of multiple homicide and multiple slight physical injuries on account of the death of Leonila and Estrella and of the injuries suffered by four others, although it may be said, by way of parenthesis, that this case is now pending appeal in a higher court. The plaintiffs prayed for awards of moral, actual and exemplary damages in the total sum of P40,000.00 in Civil Case No. D-1468, and in the total sum of P25,000.00 in Civil Case No. D-1470 as well as attorney's fees in the amounts of P5,000.00 and P4,000.00, respectively. Defendants filed a joint answer to each of the two complaints alleging, among others, that at the time of the accident, defendant driver was driving the bus at, the slow speed of about 10 kilometers per hour; that while the said defendant was steering his bus toward the mountainside after hearing a sound coming from under the rear end of the bus, Leonila and Estrella recklessly, and in disobedience to his shouted warnings and advice, jumped out of the bus causing their heads to hit the road or pavement; that the bus was then being driven with extraordinary care, prudence and diligence; that defendant PANTRANCO observed the care and diligence of a good father of a family to prevent the accident as well as in the selection and supervision of its employees, particularly of defendant driver; and that the decision convicting the said defendant was not yet final, the same having been appealed to the Court of Appeals where it was still pending.

By agreement of the parties, the two cases were tried jointly. On October 17, 1966, the court a quo rendered its decision therein in which it made the following findings; that upon reaching the fatal spot at Camp 8, a sudden snapping or breaking of metal below the floor of the bus was heard, and the bus abruptly stopped, rolling back a few moments later; that as a result, some of the passengers jumped out of the bus, while others stepped down; that defendant driver maneuvered the bus safely to and against the side of the mountain where its rear end was made to rest, ensuring the safety of the many passengers still inside the bus; that while defendant driver as steering the bus towards the mountainside, he advised the passengers not to jump, but to remain seated; that Leonila and Estrella were not thrown out of the bus, but that they panicked and jumped out; that the malfunctioning of the motor resulted from the breakage of the cross-joint; that there was no negligence on the part of either of the defendants; that only the day before, the said cross-joint was duly inspected and found to be in order; and that defendant PANTRANCO had exercised the requisite care in the selection and supervision of its employees, including the defendant driver. The court concluded that "the accident was caused by a fortuitous event or an act of God brought about by some extra-ordinary circumstances independent of the will of the Pantranco or its employees." One would wonder why in the face of such factual findings and conclusion of the trial court, the defendants, instead of the plaintiffs, should come to this Court on appeal. The answer lies in the dispositive portion of the decision, to wit: IN VIEW OF THE FOREGOING CONSIDERATIONS, the Court hereby renders judgment: (a) Absolving the defendants from any liability on account of negligence on their part and therefore dismissing the complaints in these two cases; (b) However, as stated above, the Court hereby orders the defendant Pantranco to pay to the plaintiffs spouses Marcelo Tandingin and Racquel Bocasas in Civil Case No. D-1468 the amount of P6,500.00; and the amount of P3,500.00 to the spouses Pedro Garcia and Eufracia Landingin in Civil Case No. D-1470, not in payment of liability because of any negligence on the part of the defendants but as an expression of sympathy and goodwill. (Emphasis supplied.) As to what impelled the court below to include item (b) in the dispositive portion of its decision, can be gathered from the penultimate paragraph of the decision, which reads: However, there is evidence to the effect that an offer of P8,500.00 in the instant cases without any admission of fault or negligence had been made by the defendant Pantranco and that actually in Civil Case No. D-1469 for the death of Pacita Descalso, the other deceased passenger of the bus in question, the heirs of the decease received P3,000.00 in addition to hospital and medical bills and the coffin of the deceased for the dismissal of the said case without Pantranco accepting liability. There was as a matter of fact during the pre-trial of these two cases a continuing offer of settlement on the part of the defendant Pantranco without accepting any liability for such damages, and the Court understood that the Pantranco would be willing still to pay said amounts even if these cases were to be tried on the merits. It is well-known that the defendant Pantranco is zealous in the preservation of its public relations. In the spirit therefore of the offer of the

defendant Pantranco aforesaid, to assuage the feelings of the herein plaintiffs an award of P6,500.00 for the spouses Marcelo Landingin and Racquel Bocasas in Civil Case No. D-1468 whose daughter Leonila was, when she died, a third-year Commerce student at the Far Eastern University, and P3,500.00 for the spouses Pedro Garcia and Eufracia Landingin in Civil Case No. D-1470 whose daughter Estrella was in the fourth year High at the Dagupan Colleges when she died, is hereby made in their favor. This award is in addition to what Pantranco might have spent to help the parents of both deceased after the accident. Defendants-appellants complain that having found them to be absolutely free from fault or negligence, and having in fact dismissed the complaints against them, the court should not have ordered them to assume any pecuniary liability. There would be merit in his argument but for the fact that defendant-appellant PANTRANCO was guilty of breach of contract of carriage. It will be noted that in each of the two complaints it is averred that two buses including the one in which the two deceased girls were riding, were hired to transport the excursionist passengers from Dagupan City to Baguio City, and return, and that the said two passengers did not reach destination safely. As a common carrier, defendant-appellant PANTRANCO was duty bound to carry its passengers "safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with a due regard for all the circumstances." (Article 1755, Civil Code.) Did defendant-appellant PANTRANCO measure up to the degree of care and foresight required it under the circumstances? We think not. The court below found that the cross-joint of the bus in which the deceased were riding broke, which caused the malfunctioning of the motor, which in turn resulted in panic among some of the passengers. This is a finding of fact which this Court may not disturb. We are of the opinion, however, that the lower court's conclusion drawn from that fact, i.e., that "the accident was caused by a fortuitous event or an act of God brought about by some extraordinary circumstances independent of the will of the Pantranco or its employees," is in large measure conjectural and speculative, and was arrived at without due regard to all the circumstances, as required by Article 1755. In Lasam vs. Smith (45 Phil. 660), this Court held that an accident caused by defects in the automobile is not a caso fortuito. The rationale of the carrier's liability is the fact that "the passenger has neither the choice nor control over the carrier in the selection and use of the equipment and appliances in use by the carrier." (Necesito, et al. vs. Paras, et al., 104 Phil. 75.) When a passenger dies or is injured, the presumption is that the common carrier is at fault or that it acted negligently (Article 1756). This presumption is only rebutted by proof on the carrier's part that it observed the "extraordinary diligence" required in Article 1733 and the "utmost diligence of very cautious persons" required in Article 1755 (Article 1756). In the instant case it appears that the court below considered the presumption rebutted on the strength of defendants-appellants' evidence that only the day before the incident, the crossjoint in question was duly inspected and found to be in order. It does not appear, however, that the carrier gave due regard for all the circumstances in connection with the said inspection. The bus in which the deceased were riding was heavily laden with passengers, and it would be traversing mountainous, circuitous and ascending roads. Thus the entire

bus, including its mechanical parts, would naturally be taxed more heavily than it would be under ordinary circumstances. The mere fact that the bus was inspected only recently and found to be in order would not exempt the carrier from liability unless it is shown that the particular circumstances under which the bus would travel were also considered. In the premises, it was error for the trial court to dismiss the complaints. The awards made by the court should be considered in the concept of damages for breach of contracts of carriage. IN VIEW OF THE FOREGOING CONSIDERATIONS, the judgment appealed from is modified as indicated above, and defendant-appellant PANTRANCO is ordered to pay to plaintiffs-appellees the amounts stated in the judgment appealed from, as damages for breach of contracts, with interest thereon at the legal rate from the date of the filing of the complaints. Costs against defendant-appellant PANTRANCO. Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Fernando, Teehankee and Barredo, JJ., concur. Castro, J., is on leave.

NECESITO v PARAS EN BANC DECISION June 30, 1958 G.R. No. L-10606 GERMAN NECESITO, ET AL., plaintiffs-appellants, vs. NATIVIDAD PARAS, ET AL., defendants-appellees. Tomas Besa and Federico Agrava for appellants. Jose W. Diokno for appellees. , J.: These cases involve ex contractu against the owners and operators of the common carrier known as Philippine Rabbit Bus Lines, filed by one passenger, and the heirs of another, who injured as a result of the fall into a river of the vehicle in which they were riding. In the morning of January 28, 1964, Severina Garces and her one-year old son, Precillano Necesito, carrying vegetables, boarded passenger auto truck or bus No. 199 of the Philippine Rabbit Bus Lines at Agno, Pangasinan. The passenger truck, driven by Francisco Bandonell, then proceeded on its regular run from Agno to Manila. After passing Mangatarem, Pangasinan truck No. 199 entered a wooden bridge, but the front wheels swerved to the right; the driver lost control, and after

wrecking the bridge's wooden rails, the truck fell on its right side into a creek where water was breast deep. The mother, Severina Garces, was drowned; the son, Precillano Necesito, was injured, suffering abrasions and fracture of the left femur. He was brought to the Provincial Hospital at Dagupan, where the fracture was set but with fragments one centimeter out of line. The money, wrist watch and cargo of vegetables were lost. Two actions for damages and attorney's fees totalling over P85,000 having been filed in the Court of First Instance of Tarlac (Cases Nos. 908 and 909) against the carrier, the latter pleaded that the accident was due to "engine or mechanical trouble" independent or beyond the control of the defendants or of the driver Bandonell. After joint trial, the Court of First Instance found that the bus was proceeding slowly due to the bad condition of the road; that the accident was caused by the fracture of the right steering knuckle, which was defective in that its center or core was not compact but "bubbled and cellulous", a condition that could not be known or ascertained by the carrier despite the fact that regular thirty-day inspections were made of the steering knuckle, since the steel exterior was smooth and shiny to the depth of 3/16 of an inch all around; that the knuckles are designed and manufactured for heavy duty and may last up to ten years; that the knuckle of bus No. 199 that broke on January 28, 1954, was last inspected on January 5, 1954, and was due to be inspected again on February 5th. Hence, the trial court, holding that the accident was exclusively due to fortuitous event, dismissed both actions. Plaintiffs appealed directly to this Court in view of the amount in controversy. We are inclined to agree with the trial court that it is not likely that bus No. 199 of the Philippine Rabbit Lines was driven over the deeply rutted road leading to the bridge at a speed of 50 miles per hour, as testified for the plaintiffs. Such conduct on the part of the driver would have provoked instant and vehement protest on the part of the passengers because of the attendant discomfort, and there is no trace of any such complaint in the records. We are thus forced to assume that the proximate cause of the accident was the reduced strength of the steering knuckle of the vehicle caused by defects in casting it. While appellants hint that the broken knuckle exhibited in court was not the real fitting attached to the truck at the time of the accident, the records they registered no objection on that ground at the trial below. The issue is thus reduced to the question whether or not the carrier is liable for the manufacturing defect of the steering knuckle, and whether the evidence discloses that in regard thereto the carrier exercised the diligence required by law (Art. 1755, new Civil Code). ART. 1755. A common carrier is bound to carry the passengers safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with a due regard for the all the circumstances. It is clear that the carrier is not an insurer of the passengers' safety. His liability rests upon negligence, his failure to exercise the "utmost" degree of diligence that the law requires, and by Art. 1756, in case of a passenger's death or injury the carrier bears the burden of satisfying the court that he has duly discharged the duty of prudence required. In the American law, where the carrier is held to the same

degree of diligence as under the new Civil Code, the rule on the liability of carriers for defects of equipment is thus expressed: "The preponderance of authority is in favor of the doctrine that a passenger is entitled to recover damages from a carrier for an injury resulting from a defect in an appliance purchased from a manufacturer, whenever it appears that the defect would have been discovered by the carrier if it had exercised the degree of care which under the circumstances was incumbent upon it, with regard to inspection and application of the necessary tests. For the purposes of this doctrine, the manufacturer is considered as being in law the agent or servant of the carrier, as far as regards the work of constructing the appliance. According to this theory, the good repute of the manufacturer will not relieve the carrier from liability" (10 Am. Jur. 205, s, 1324; see also Pennsylvania R. Co. vs. Roy, 102 U. S. 451; 20 L. Ed. 141; Southern R. Co. vs. Hussey, 74 ALR 1172; 42 Fed. 2d 70; and Ed Note, 29 ALR 788; Ann. Cas. 1916E 929). The rationale of the carrier's liability is the fact that the passenger has neither choice nor control over the carrier in the selection and use of the equipment and appliances in use by the carrier. Having no privity whatever with the manufacturer or vendor of the defective equipment, the passenger has no remedy against him, while the carrier usually has. It is but logical, therefore, that the carrier, while not in insurer of the safety of his passengers, should nevertheless be held to answer for the flaws of his equipment if such flaws were at all discoverable. Thus Hannen, J., in Francis vs. Cockrell, LR 5 Q. B. 184, said: In the ordinary course of things, the passenger does not know whether the carrier has himself manufactured the means of carriage, or contracted with someone else for its manufacture. If the carrier has contracted with someone else the passenger does not usually know who that person is, and in no case has he any share in the selection. The liability of the manufacturer must depend on the terms of the contract between him and the carrier, of which the passenger has no knowledge, and over which he can have no control, while the carrier can introduce what stipulations and take what securities he may think proper. For injury resulting to the carrier himself by the manufacturer's want of care, the carrier has a remedy against the manufacturer; but the passenger has no remedy against the manufacturer for damage arising from a mere breach of contract with the carrier . . . . Unless, therefore, the presumed intention of the parties be that the passenger should, in the event of his being injured by the breach of the manufacturer's contract, of which he has no knowledge, be without remedy, the only way in which effect can be given to a different intention is by supposing that the carrier is to be responsible to the passenger, and to look for his indemnity to the person whom he selected and whose breach of contract has caused the mischief. (29 ALR 789) And in the leading case of Morgan vs. Chesapeake & O. R. Co. 15 LRA (NS) 790, 16 Ann. Cas. 608, the Court, in holding the carrier responsible for damages caused by the fracture of a car axle, due to a "sand hole" in the course of moulding the axle, made the following observations. The carrier, in consideration of certain well-known and highly valuable rights granted to it by the public, undertakes certain duties toward the public, among them being to provide itself with suitable and safe cars and vehicles in which carry the traveling public. There is no such duty on the manufacturer of the cars. There is

no reciprocal legal relation between him and the public in this respect. When the carrier elects to have another build its cars, it ought not to be absolved by that facts from its duty to the public to furnish safe cars. The carrier cannot lessen its responsibility by shifting its undertaking to another's shoulders. Its duty to furnish safe cars is side by side with its duty to furnish safe track, and to operate them in a safe manner. None of its duties in these respects can be sublet so as to relieve it from the full measure primarily exacted of it by law. The carrier selects the manufacturer of its cars, if it does not itself construct them, precisely as it does those who grade its road, and lay its tracks, and operate its trains. That it does not exercise control over the former is because it elects to place that matter in the hands of the manufacturer, instead of retaining the supervising control itself. The manufacturer should be deemed the agent of the carrier as respects its duty to select the material out of which its cars and locomotive are built, as well as in inspecting each step of their construction. If there be tests known to the crafts of car builders, or iron moulders, by which such defects might be discovered before the part was incorporated into the car, then the failure of the manufacturer to make the test will be deemed a failure by the carrier to make it. This is not a vicarious responsibility. It extends, as the necessity of this business demands, the rule of respondeat superior to a situation which falls clearly within its scope and spirit. Where an injury is inflicted upon a passenger by the breaking or wrecking of a part of the train on which he is riding, it is presumably the result of negligence at some point by the carrier. As stated by Judge Story, in Story on Bailments, sec. 601a: "When the injury or damage happens to the passenger by the breaking down or overturning of the coach, or by any other accident occurring on the ground, the presumption prima facie is that it occurred by the negligence of the coachmen, and onus probandi is on the proprietors of the coach to establish that there has been no negligence whatever, and that the damage or injury has been occasioned by inevitable casualty, or by some cause which human care and foresight could not prevent; for the law will, in tenderness to human life and limb, hold the proprietors liable for the slightest negligence, and will compel them to repel by satisfactory proofs every imputation thereof." When the passenger has proved his injury as the result of a breakage in the car or the wrecking of the train on which he was being carried, whether the defect was in the particular car in which he was riding or not, the burden is then cast upon the carrier to show that it was due to a cause or causes which the exercise of the utmost human skill and foresight could not prevent. And the carrier in this connection must show, if the accident was due to a latent defect in the material or construction of the car, that not only could it not have discovered the defect by the exercise of such care, but that the builders could not by the exercise of the same care have discovered the defect or foreseen the result. This rule applies the same whether the defective car belonged to the carrier or not. In the case now before us, the record is to the effect that the only test applied to the steering knuckle in question was a purely visual inspection every thirty days, to see if any cracks developed. It nowhere appears that either the manufacturer or the carrier at any time tested the steering knuckle to ascertain whether its strength was up to standard, or that it had no hidden flaws would impair that strength. And yet the carrier must have been aware of the critical importance of the knuckle's resistance; that its failure or breakage would result in loss of balance and steering control of the bus, with disastrous effects upon the passengers. No argument is

required to establish that a visual inspection could not directly determine whether the resistance of this critically important part was not impaired. Nor has it been shown that the weakening of the knuckle was impossible to detect by any known test; on the contrary, there is testimony that it could be detected. We are satisfied that the periodical visual inspection of the steering knuckle as practiced by the carrier's agents did not measure up to the required legal standard of "utmost diligence of very cautious persons" — "as far as human care and foresight can provide", and therefore that the knuckle's failure can not be considered a fortuitous event that exempts the carrier from responsibility (Lasam vs. Smith, 45 Phil. 657; Son vs. Cebu Autobus Co., 94 Phil. 892.) 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; 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 strength of those vehicle portions the failure of which may endanger the safe of the passengers. As to the damages suffered by the plaintiffs, we agree with appellee that no allowance may be made for moral damages, since under Article 2220 of the new Civil Code, in case of suits for breach of contract, moral damages are recoverable only where the defendant acted fraudulently or in bad faith, and there is none in the case before us. As to exemplary damages, the carrier has not acted in a "wanton, fraudulent, reckless, oppressive or malevolent manner" to warrant their award. Hence, we believe that for the minor Precillano Necesito (G. R. No. L-10605), an indemnity of P5,000 would be adequate for the abrasions and fracture of the femur, including medical and hospitalization expenses, there being no evidence that there would be any permanent impairment of his faculties or bodily functions, beyond the lack of anatomical symmetry. As for the death of Severina Garces (G. R. No. L10606) who was 33 years old, with seven minor children when she died, her heirs are obviously entitled to indemnity not only for the incidental loses of property (cash, wrist watch and merchandise) worth P394 that she carried at the time of the accident and for the burial expenses of P490, but also for the loss of her earnings (shown to average P120 a month) and for the deprivation of her protection, guidance and company. In our judgment, an award of P15,000 would be adequate (cf Alcantara vs. Surro, 49 O.G. 2769; 93 Phil. 472). The low income of the plaintiffs-appellants makes an award for attorney's fees just and equitable (Civil Code, Art. 2208, par. 11). Considering that he two cases filed were tried jointly, a fee of P3,500 would be reasonable. In view of the foregoing, the decision appealed from is reversed, and the defendants-appellees are sentenced to indemnify the plaintiffs-appellants in the following amounts: P5,000 to Precillano Necesito, and P15,000 to the heirs of the deceased Severina Garces, plus P3,500 by way of attorney's fees and litigation expenses. Costs against defendants-appellees. So ordered. Paras, C.J. Bengzon, Reyes, A., Bautista Angelo, Concepcion, and Endencia, JJ., concur. Felix, J., concurs in the result.

RESOLUTION September 11, 1958 REYES, J. B. L., J.: Defendants-appellees have Submitted a motion asking this Court to reconsider its decision of June 30, 1958, and that the same be modified with respect to (1) its holding the carrier liable for the breakage of the steering knuckle that caused the autobus No. 199 to overturn, whereby the passengers riding in it were injured; (2) the damages awarded, that appellees argue to be excessive; and (3) the award of attorneys' fees mswY. (1) The rule prevailing in this jurisdiction as established in previous decisions of this Court, cited in our main opinion, is that a carrier is liable to its passengers for damages caused by mechanical defects of the conveyance. As early as 1924, in Lasam vs. Smith, 45 Phil. 659 this Court ruled: As far as the record shows, the accident was caused either by defects in the automobile or else through the negligence of its driver. That is not caso fortuito. And in Son vs. Cebu Autobus Company, 94 Phil. 892, this Court held a common carrier liable in damages to passenger for injuries cause by an accident due to the breakage of a faulty drag-link spring. It can be seen that while the courts of the United States are at variance on the question of a carrier's liability for latent mechanical defects, the rule in this jurisdiction has been consistent in holding the carrier responsible. This Court has quoted from American and English decisions, not because it felt bound to follow the same, but merely in approval of the rationale of the rule as expressed therein, since the previous Philippine cases did not enlarge on the ideas underlying the doctrine established thereby. The new evidence sought to be introduced do not warrant the grant of a new trial, since the proposed proof available when the original trial was held. Said evidence is not newly discovered. (2) With regard to the indemnity awarded to the child Precilliano Necesito, the injuries suffered by him are incapable of accurate pecuniary estimation, particularly because the full effect of the injury is not ascertainable immediately. This uncertainty, however, does not preclude the right to an indemnity, since the injury is patent and not denied (Civil Code, Art. 2224). The reasons behind this award are expounded by the Code Commission in its report: There are cases where from the nature of the case, definite proof of pecuniary loss cannot be offered, although the court is convinced that there has been such loss. For instance, injury to one's commercial credit or to the goodwill of a business firm is often hard to show with certainty in terms of money. Should damages be denied for that reason? The judge should be empowered to calculate moderate damages in

such cases, rather than that the plaintiff should suffer, without redress, from the defendant's wrongful act." (Report of the Code Commission, p. 75) In awarding to the heirs of the deceased Severina Garces an indemnity for the loss of her "guidance, protection and company," although it is but moral damage, the Court took into account that the case of a passenger who dies in the course of an accident, due to the carrier's negligence constitutes an exception to the general rule. While, as pointed out in the main decision, under Article 2220 of the new Civil Code there can be no recovery of moral damages for a breach of contract in the absence of fraud malice or bad faith, the case of a violation of the contract of carriage leading to a passenger's death escapes this general rule, in view of Article 1764 in connection with Article 2206, No. 3 of the new Civil Code. ART. 1764. Damages in cases comprised in this Section shall be awarded in accordance with Title XVIII of this Book, concerning Damages. Article 2206 shall also apply to the death of a passenger caused by the breach of contract by a comman carrier. ART. 2206. . . . (3) The spouse, legitimate and eligimate descendants and ascendants of the deceased may demand moral damages for mental anguish by reason of the death of the deceased. Being a special rule limited to cases of fatal injuries, these articles prevail over the general rule of Art. 2220. Special provisions control general ones (Lichauco & Co. vs. Apostol, 44 Phil. 138; Sancio vs. Lizarraga, 55 Phil. 601). It thus appears that under the new Civil Code, in case of accident due to a carrier's negligence, the heirs of a deceased passenger may recover moral damages, even though a passenger who is injured, but manages to survive, is not entitled to them. There is, therefore, no conflict between our main decision in the instant case and that of Cachero vs. Manila Yellow Taxi Cab Co., 101 Phil. 523, where the passenger suffered injuries, but did not lose his life. (3) In the Cachero case this Court disallowed attorneys' fees to the injured plaintiff because the litigation arose out of his exaggerated and unreasonable deeds for an indemnity that was out of proportion with the compensatory damages to which he was solely entitled. But in the present case, plaintiffs' original claims can not be deemed a priori wholly unreasonable, since they had a right to indemnity for moral damages besides compensatory ones, and moral damages are not determined by set and invariable bounds. Neither does the fact that the contract between the passengers and their counsel was on a contingent basis affect the former's right to counsel fees. As pointed out for appellants, the Court's award is an party and not to counsel. A litigant who improvidently stipulate higher counsel fees than those to which he is lawfully entitled, does not for that reason earn the right to a larger indemnity; but, by parity of reasoning, he should not be deprived of counsel fees if by law he is entitled to recover them.

We find no reason to alter the main decision heretofore rendered. Ultimately, the position taken by this Court is that a common carrier's contract is not to be regarded as a game of chance wherein the passenger stakes his limb and life against the carrier's property and profits. Wherefore, the motion for reconsideration is hereby denied. So ordered. Paras, C.J. Bengzon, Padilla, Montemayor, Reyes, A., Bautista Angelo, Concepcion, Endencia, and Felix, JJ., concur.

PAL v CA (1981) FIRST DIVISION [G.R. No. L-46558 : July 31, 1981.] PHILIPPINE AIR LINES, INC., Petitioner, vs. THE COURT OF APPEALS and JESUS V. SAMSON, Respondents.

DECISION

GUERRERO, J.:

This is a petition for review on Certiorari of the decision of the Court of Appeals 1 dated April 18, 1977, affirming with modification the decision of the Court of First Instance of Albay in Civil Case No. 1279, entitled “Jesus V. Samson, plaintiff, vs. Philippine Air Lines, Inc., defendant,” for damages. The dispositive portion of the trial court’s decision reads: “WHEREFORE, for all the foregoing considerations, judgment is hereby rendered in favor of the plaintiff and against the defendant ordering the defendant to pay the plaintiff, the following sums: P1988,000.00 as unearned income or damages; P50,000.00 for moral damages; P20,000.00 as attorney’s fees and P5,000.00 as expenses of litigation, or a total of P273,000.00. Costs against the defendant.” The appellate court modified the above decision, to wit: “However, Plaintiff-Appellee, who has been deprived of his job since 1954, is entitled to the legal rate of interest on the P198,000.00 unearned income from the filing of the complaint cranad(Sec. 8, Rule 51, Rules of Court).

WHEREFORE, with the modification indicated above, the judgment appealed from is affirmed, with costs against defendant-appellant.” The complaint filed on July 1, 1954 by plaintiff Jesus V. Samson, private respondent herein, averred that on January 8, 1951, he flew as co-pilot on a regular flight from Manila to Legaspi with stops at Daet, Camarines Norte and Pili, Camarines Sur, with Captain Delfin Bustamante as commanding pilot of a C-47 plane belonging to defendant Philippine Air Lines, Inc., now the herein petitioner; that on attempting to land the plane at Daet airport, Captain Delfin Bustamante due to his very slow reaction and poor judgment overshot the airfield and as a result, notwithstanding the diligent efforts of the plaintiff co-pilot to avert an accident, the airplane crashlanded beyond the runway; that the jolt caused the head of the plaintiff to hit and break through the thick front windshield of the airplane causing him severe brain concussion, wounds and abrasions on the forehead with intense pain and suffering cranad(par. 6, complaint).:onad The complaint further alleged that instead of giving plaintiff expert and proper medical treatment called for by the nature and severity of his injuries, defendant simply referred him to a company physician, a general medical practitioner, who limited the treatment to the exterior injuries without examining the severe brain concussion of plaintiff cranad(par. 7, complaint); that several days after the accident, defendant Philippine Air Lines called back the plaintiff to active duty as copilot, and inspite of the latter’s repeated request for expert medical assistance, defendant had not given him any cranad(par. 8, complaint); that as a consequence of the brain injury sustained by plaintiff from the crash, he had been having periodic dizzy spells and had been suffering from general debility and nervousness cranad(par. 9, complaint); that defendant airline company instead of submitting the plaintiff to expert medical treatment, discharged the latter from its employ on December 21, 1953 on grounds of physical disability, thereby causing plaintiff not only to lose his job but to become physically unfit to continue as aviator due to defendant’s negligence in not giving him the proper medical attention cranad(pars. 10-11, complaint). Plaintiff prayed for damages in the amount of P180,000.00 representing his unearned income, P50,000.00 as moral damages, P20,000.00 as attorney’s fees and P5,000.00 as expenses, or a total of P255,000.00. In its answer filed on July 28, 1954, defendant PAL denied the substantial averments in the complaint, alleging among others, that the accident was due solely and exclusively to inevitable unforeseen circumstances whereby plaintiff sustained only superficial wounds and minor injuries which were promptly treated by defendant’s medical personnel cranad(par. 5, answer); that plaintiff did not sustain brain injury or cerebral concussion from the accident since he passed the annual physical and medical examination given thereafter on April 24, 1951; that the headaches and dizziness experienced by plaintiff were due to emotional disturbance over his inability to pass the required up-grading or promotional course given by defendant company cranad(par. 6, answer), and that, as confirmed by an expert neurosurgeon, plaintiff was suffering-from neurosis and in view of this unfitness and disqualification from continuing as a pilot, defendant had to terminate plaintiff’s employment cranad(pars. 7, 9, answer).

Further, defendant alleged that by the very nature of its business as a common carrier, it is bound to employ only pilots who are proficient and in good mental, emotional and physical condition; that the pilot, Captain Delfin Bustamante, was a competent and proficient pilot, and although he was already afflicted with a tumor of the nasopharynx even before the accident of January 8, 1951, the Civil Aeronautics Administration, in passing upon the fitness of pilots, gave Capt. Bustamante a waiver of physical standards to enable him to retain his first class airman certificate since the affliction had not in the least affected his proficiency cranad(pars. 16-17, answer). By way of counterclaim, defendant prayed for P10,000.00 as expenses for the litigation. On March 25, 1958, defendant filed a Motion to Dismiss on the ground that the complaint is essentially a Workmen’s Compensation claim, stating a cause of action not cognizable within the general jurisdiction of the court. The Motion to Dismiss was denied in the order of April 14, 1958. After the reception of evidence, the trial court rendered on January 15, 1973 the decision, the dispositive portion of which has been earlier cited. The defendant Philippine Air Lines, Inc. appealed the decision to the Court of Appeals as being contrary to law and unsupported by the evidence. It raised as errors of the trial court cranad(a) the holding that the damages allegedly suffered by plaintiff are attributable to the accident of January 8, 1951 which was due to the negligence of defendant in having allowed Capt. Delfin Bustamante to continue flying despite his alleged slow reaction and poor judgment; cranad(b) the finding that defendant was negligent in not having given plaintiff proper and adequate expert medical treatment and assistance for the injuries allegedly sustained in the accident of January 8, 1951; and cranad(c) in ordering defendant to pay actual or compensatory damages, moral damages and attorney’s fees to the plaintiff. On April 18, 1977, the Court of Appeals rendered its decision affirming the judgment of the lower court but modified the award of damages by imposing legal rate of interest on the P198,000.00 unearned income from the filing of the complaint, citing Sec. 8, Rule 51 of the Rules of Court. Its motion for reconsideration of the above judgment having been denied, Philippine Air Lines, Inc. filed this instant petition for Certiorari on the ground that the decision is not in accord with law or with the applicable jurisprudence, aside from its being replete with findings in the nature of speculation, surmises and conjectures not borne out by the evidence on record thereby resulting to misapprehension of facts and amounting to a grave abuse of discretion cranad(p. 7, Petition). Petitioner raises the fundamental question in the case at bar as follows: Is there a causal connection between the injuries suffered by private respondent during the accident on 8 January 1951 and the subsequent “periodic dizzy spells, headache and general debility” of which private respondent complained every now and then, on the one hand, and such “periodic dizzy spells, headache and general debility” allegedly caused by the accident and private respondent’s eventual discharge from employment, on the other? PAL submits that respondent court’s award of damages to private respondent is anchored on findings in the nature of speculations, surmises and conjectures and not borne out by the evidence on record, thereby

resulting in a misapprehension of facts and amounting to a grave abuse of discretion. Petitioner’s submission is without merit. As found by the respondent court, the following are the essential facts of the case: “It appears that plaintiff, a licensee aviator, was employed by defendant a few years prior to January 8, 1951 as a regular co-pilot on a guaranteed basic salary of P750.00 a month. He was assigned to and/or paired with pilot Delfin Bustamante. Sometime in December 1950, he complained to defendant through its authorized official about the slow reaction and poor judgment of pilot Delfin Bustamante. Notwithstanding said complaint, defendant allowed the pilot to continue flying. On January 8, 1951, the two manned the regular afternoon flight of defendant’s plane from Manila to Legaspi, with stops at Daet, Camarines Norte, and Pili, Camarines Sur. Upon making a landing at Daet, the pilot, with his slow reaction and poor judgment, overshot the airfield and, as a result of and notwithstanding diligent efforts of plaintiff to avert an accident, the airplane crash-landed beyond the runway into a mangrove. The jolt and impact caused plaintiff to hit his head upon the front windshield of the plane thereby causing his brain concussions and wounds on the forehead, with concomittant intense pain. Plaintiff was not given proper medical attention and treatment demanded by the nature and severity of his injuries. Defendant merely referred him to its clinic attended by general practitioners on his external injuries. His brain injury was never examined, much less treated. On top of that negligence, defendant recalled plaintiff to active duty as a co-pilot, completely ignoring his plea for expert medical assistance. Suffering periodic dizzy spells, headache and general debility, plaintiff every now and then complained to defendant. To make matters worst for plaintiff, defendant discharged him from his employment on December 21, 1953. In consequence, plaintiff has been beset with additional worries, basically financial. He is now a liability instead of a provider, of his family. On July 1, 1954, plaintiff filed a complaint for damages. Defendant vainly sought to dismiss the complaint after filing an answer. Then, the judgment and this appeal.” Continuing, the respondent Court of Appeals further held: “There is no question about the employment of plaintiff by defendant, his age and salary, the overshooting by pilot Bustamante of the airfield and crashlanding in a mangrove, his hitting his head on the front windshield of the plane, his intermittent dizzy spells, headache and general debility for which he was discharged from his employment on December 21, 1953. As the lower court aptly stated: ‘From the evidence adduced by the parties, the Court finds the following facts to be uncontroverted: That the plaintiff Jesus V. Samson, on January 8, 1951 and a few

years prior thereto, December 21, 1953, was a duly licensed pilot employed as a regular co-pilot of the defendant with assignment in its domestic air service in the Philippines; that on January 8, 1951, the defendant’s airplane met an accident in crashlanding at the Daet Airport, Camarines Norte by overshooting the runway and reaching the mangroves at the edge of the landing strip; that the jolt caused plaintiff’s head to hit the front windshield of the airplane causing him to suffer wounds and abrasion on the forehead; that the defendant, instead of giving the plaintiff expert and proper medical treatment called for by the nature and severity of the injuries of the plaintiff, simply referred him to the clinic of the defendant’s physicians who are only general medical practitioners and not brain specialists; that the defendant’s physicians limited their treatment to the exterior injuries on the forehead of the plaintiff and made no examination of the severe concussion of the brain of the plaintiff; that the Medical Director and Flight Surgeon of the defendant were not able to definitely determine the cause of the complaint of the plaintiff as to the periodic attack of dizziness, spells and headache; that due to this laxity of the defendant’s physician and the continuous suffering of the ailment of the plaintiff complained of, he demanded for expert medical assistance for his brain injury and to send him to the United States, which demand was turned down and in effect denied by the defendant; that instead the defendant referred the plaintiff to a neurologist, Dr. Victor Reyes; that from the time that said accident occurred on January 21, 1953, he was ordered grounded on several occasions because of his complaint of dizzy spells and headache; that instead of submitting the plaintiff to expert medical treatment as demanded by him and denied by the defendant, he was discharged from its employment on December 21, 1953 on the ground of physical disability, and that the plaintiff, at the time when the defendant’s plane met the accident, up to the time he was discharged, was regularly employed as a co-pilot and receiving a basic salary of P750.00 a month plus extra pay for flying time, and bonuses amounting to P300.00 a month.’ Even defendant-appellant itself admits as not controverted the following facts which generally admit what have been stated above as not controverted. “In the case at bar, the following facts are not the subject of controversy: ‘(1) First, that from July 1950 to 21 December 1953, plaintiff was employed with defendant company as a first officer or co-pilot and served in that capacity in defendant’s domestic services. (2) Second, that on January 1951, plaintiff did fly on defendant’s PI-C 94, as first officer or co-pilot, with the late Capt. Delfin Bustamante in command as pilot; that while making a landing at the Daet airport on that date, PI-C 94 did meet an accident as stated above. (3) Third, that at or about the time of the discharge from defendant company, plaintiff had complained of “spells of dizziness,” “headaches” and “nervousness”, by reason of which he was grounded from flight duty. In short, that at that time, or approximately from November 1953 up to the date of his discharge on 21 December 1953, plaintiff was actually physically unfit to discharge his duties as pilot.

(4) Fourth, that plaintiff’s unfitness for flight duty was properly established after a thorough medical examination by competent medical experts.’cralaw cranad(pp. 11-12, appellant’s brief) hence, there can hardly be an issue, factual, legal or medical.” Taking exception from “the rest of the essential facts of the case as found by the respondent court” PAL claims said facts are not fully borne out by the evidence on record and insists that the injuries suffered by private respondent during the accident on January 8, 1951 were superficial in nature; that the “periodic spells, headache, and general debility” complaint of every now and then by private respondent subsequent to the Jan. 8, 1951 incident were due to emotional disturbances and that no negligence can be attributed to Capt. Delfin Bustamante much less to PAL for the occurrence on January 8, 1951, hence PAL cannot be held liable for damages. Petitioner claims absence of any causal connection between private respondent’s superficial injuries and his alleged subsequent “periodic spells, headache and general debility,” pointing out that these subsequent ailments were found by competent physician, including an expert neuro-surgeon, to be due to emotional disturbances insights the conclusions of Dr. Trajano V. Bernardo that respondent’s complaints were “psychosomatic symptoms” on the basis of declarations made by respondent himself, which conclusions are supported by similar diagnosis made by Drs. Damaceno J. Ago and Villaraza stating that respondent Samson was suffering from neurosis as well as the report of Dr. Victor Reyes, a neurological specialist, indicating that the symptoms were probably, most probably due to psychogenic factors and have no organic basis. In claiming that there is no factual basis for the finding of the respondent court that the crash-landing caused respondent’s “brain concussion . cra ., with concomittant intense pain, for on the contrary, testimonial evidence establish the superficiality of the injuries sustained by respondent during the accident of January 8, 1951,” petitioner quotes portions of the testimony of Dr. Manuel S. Sayas, who declared that he removed the band-aid on the forehead of respondent and that he found out after removal that the latter had two contussed superficial wounds over the supra orbiter regions or just above the eyes measuring one centimeter long and one millimeter deep. He examined and found his blood pressure normal, no discharges from the nose and ears. Dr. Trajano V. Bernardo also testified that when he examined respondent Samson three days after the accident, the wound was already healed and found nothing wrong with his ears, nose and throat so that he was declared fit for duty after the sixth day. Petitioner goes further. It contends that there is no causal connection between respondent’s superficial injuries sustained during the accident on January 8, 1951 and plaintiff’s discharge from employment with PAL on December 21, 1953. According to PAL, it was the repeated recurrence of respondent’s neurasthenic symptoms cranad(dizzy spells, headache, nervousness) which prompted PAL’s Flight Surgeon, Dr. Bernardo, to recommend that plaintiff be grounded permanently as respondent was “psychologically unfit to resume his duties as pilot.” PAL concludes that respondent’s eventual discharge from employment with PAL was

effected for absolutely valid reasons, and only after he was thoroughly examined and found unfit to carry out his responsibilities and duties as a pilot.:onad We agree with the respondent court in finding that the dizzy spells, headache and general debility of private respondent Samson was an after-effect of the crashlanding and We find that such holding is supported by substantial evidence, which We quote from the court’s decision, to wit: “Defendant would imply that plaintiff suffered only superficial wounds which were treated and not brain injury. It would, by the opinion of its company doctors, Dr. Bernardo and Dr. Reyes, attribute the dizzy spells and headache to organic or as phychosomatic, neurasthenic or psychogenic, which we find outlandishly exaggerated. That plaintiff’s condition as psychosomatic rather than organic in nature is allegedly confirmed by the fact that on six cranad(6) separate occasions after the accident he passed the required CAA physical examination for airman’s certificate. cranad(Exhs. 78, 79, 80, 81, 83 and 92). We noticed, however, that there were other similar physical examinations conducted by the CAA on the person of plaintiff the report on which were not presented in evidence. Obviously, only those which suited defendants cause were hand-picked and offered in evidence. We hesitate to accept the opinion of the defendant’s two physicians, considering that Dr. Bernardo admittedly referred to Dr. Reyes because he could not determine the cause of the dizzy spells and headache and the latter admitted that ‘it is extremely hard to be certain of the cause of his dizzy spells,’ and suggested a possibility that it ‘was due to postraumatic syndrome, evidently due to the injuries suffered by the plaintiff in hitting the forehead against the windshield of the plane during the accident.’ Judgment are not based on possibilities. The admitted difficulty of defendant’s doctors in determining the cause of the dizzy spells and headache cannot be a sound basis for finding against the plaintiff and in favor of defendant. Whatever it might be, the fact is that such dizzy spells, headache and general debility was an after-effect of the crash-landing. Be it brain injury or psychosomatic, neurasthenic or psychogenic, there is no gainsaying the fact that it was caused by the crash-landing. As an effect of the cause, not fabricated or concocted, plaintiff has to be indemnified. The fact is that such effect caused his discharge. We are prone to believe the testimony of the plaintiff’s doctors. Dr. Morales, a surgeon, found that blood was coming from plaintiff’s ears and nose. He testified that plaintiff was suffering from cerebral concussion as a result of traumatic injury to the brain caused by his head hitting on the windshield of the plane during the crash-landing cranad(Exhibit “G”). Dr. Conrado Aramil, a neurologist and psychiatrist with experience in two hospitals abroad, found abnormality reflected by the electroencephalogram examination in the frontal area on both sides of plaintiff’s head cranad(Exhibits “K”, “K-1”).

The opinion of these two specialist renders unnecessary that of plaintiff’s wife who is a physician in her own right and because of her relation to the plaintiff, her testimony and opinion may not be discussed here, although her testimony is crystallized by the opinions of Dr. Ador Dionisio, Dr. Marquez, Dr. Jose O. Chan, Dr. Yambao and Dr. Sandico. Even the doctors presented by defendant admit vital facts about plaintiff’s brain injury. Dr. Bernardo admits that due to the incident, the plaintiff continuously complained of his fainting spells, dizziness and headache everytime he flew as a copilot and everytime he went to defendant’s clinic no less than 25 times cranad(Exhibits “15” to “36”), that he complained of the same to Dr. Reyes; that he promised to help send plaintiff to the United States for expert medical assistance provided that whatever finding thereat should not be attributed to the crash-landing incident to which plaintiff did not agree and that plaintiff was completely ignored by the defendant in his plea for expert medical assistance. They admitted that they could not determine definitely the cause of the fainting spells, dizziness and headache, which justifies the demand for expert medical assistance.” We also find the imputation of gross negligence by respondent court to PAL for having allowed Capt. Delfin Bustamante to fly on that fateful day of the accident on January 8, 1951 to be correct, and We affirm the same, duly supported as it is by substantial evidence, clearly established and cited in the decision of said court which states as follows: “The pilot was sick. He admittedly had tumor of the nasopharynx cranad(nose). He is now in the Great Beyond. The spot is very near the brain and the eyes. Tumor on the spot will affect the sinus, the breathing, the eyes which are very near it. No one will certify the fitness to fly a plane of one suffering from the disease. “. cra . The fact First Pilot Bustamante has a long standing tumor of the Nasopharynx for which reason he was grounded since November 1947 is admitted in the letter cranad(Exh. 69-A) of Dr. Bernardo to the Medical Director of the CAA requesting waiver of physical standards. The request for waiver of physical standards is itself a positive proof that the physical condition of Capt. Bustamante is short of the standard set by the CAA. The Deputy Administrator of the CAA granted the request relying on the representation and recommendation made by Dr. Bernardo cranad(See Exh. 69). We noted, however, that the request cranad(Exh. 69-A) says that ‘it is believed that his continuing to fly as a co-pilot does not involve any hazard.’cralaw cranad(Italics supplied). Flying as a First Officer entails a very different responsibility than flying as a mere co-pilot. Defendant requested the CAA to allow Capt. Bustamante to fly merely as a co-pilot and it is safe to conclude that the CAA approved the request thus allowing Bustamante to fly only as a co-pilot. For having allowed Bustamante to fly as a First Officer on January 8, 1951, defendant is guilty of gross negligence and therefore should be made liable for the resulting accident. As established by the evidence, the pilot used to get treatments from Dr. Sycangco. He used to complain of pain in the face more particularly in the nose which caused him to have sleepless nights. Plaintiff’s observation of the pilot was reported to the Chief Pilot who did nothing about it. Captain Carbonel of the defendant corroborated

plaintiff of this matter. The complaint against the slow reaction of the pilot at least proved the observation. The observation could be disregarded. The fact that the complaint was not in writing does not detract anything from the seriousness thereof, considering that a miscalculation would not only cause the death of the crew but also of the passengers. One month prior to the crash-landing, when the pilot was preparing to land in Daet, plaintiff warned him that they were not in the vicinity of Daet but above the town of Ligao. The plane hit outside the airstrip. In another instance, the pilot would hit the Mayon Volcano had not plaintiff warned him. These more than prove what plaintiff had complained of. Disregard thereof by defendant is condemnable. To bolster the claim that Capt. Bustamante has not suffered from any kind of sickness which hampered his flying ability, appellant contends that for at least one or more years following the accident of January 8, 1951, Capt. Bustamante continued to fly for defendant company as a pilot, and did so with great skill and proficiency, and without any further accident or mishap, citing tsn. pp. 756-765, January 20, 1965. We have painstakingly perused the records, particularly the transcript of stenographic notes cited, but found nothing therein to substantiate appellant’s contention. Instead, We discovered that the citation covers the testimony of Dr. Bernardo on the physical condition of Bustamante and nothing about his skills or proficiency to fly nor on the mishaps or accidents, matters which are beyond Dr. Bernardo’s competence anyway. Assuming that the pilot was not sick or that the tumor did not affect the pilot in managing the plane, the evidence shows that the overshooting of the runway and crash-landing at the mangrove was caused by the pilot for which acts the defendant must answer for damages caused thereby. And for this negligence of defendant’s employee, it is liable cranad(Joaquin vs. Aniceto, 12 SCRA 308). At least, the law presumes the employer negligent imposing upon it the burden of proving that it exercised the diligence of a good father of a family in the supervision of its employees. Defendant would want to tie plaintiff to the report he signed about the crashlanding. The report was prepared by his pilot and because the latter pleaded that he had a family too and would have nowhere to go if he lost his job, plaintiff’s compassion would not upturn the truth about the crash-landing. We are for the truth not logic of any argumentation. At any rate, it is incorrect to say that the Accident Report cranad(Exh. 12 & 12-A), signed by plaintiff, exculpated Capt. Bustamante from any fault. We observed that the Report does not categorically state that Capt. Bustamante was not at fault. It merely relates in chronological sequence what Capt. Bustamante and plaintiff did from the take-off from Manila to the landing in Daet which resulted in an accident. On the contrary, we may infer the negligence of Bustamante from the following portion of the Report, to wit: “. cra . I felt his brakes strong but as we neared the intersection of the NE-SW runway, the brakes were not as strong and I glanced at the system pressure which indicated 900 lbs. per sq. m.”

It was during the above precise instance that Capt. Bustamante lost his bearing and disposition. Had he maintained the pressure on the brakes the plane would not have overshot the runway. Verily, Bustamante displayed slow reaction and poor judgment. cranad(CA decision, pp. 8-12). This Court is not impressed by, much less can We accept petitioner’s invocation to calibrate once again the evidence testified to in detail and plucked from the voluminous transcript to support petitioner’s own conclusion. It is not the task of this Court to discharge the functions of a trier of facts much less to enter into a calibration of the evidence, notwithstanding petitioner’s wail that the judgment of the respondent court is based entirely on speculations, surmises and conjectures. We are convinced that respondent court’s judgment is supported by strong, clear and substantial evidence.:onad Petitioner is a common carrier engaged in the business of carrying or transporting passengers or goods or both, by land, water, or air, for compensation, offering their services to the public, as defined in Art. 1732, New Civil Code. The law is clear in requiring a common carrier to exercise the highest degree of care in the discharge of its duty and business of carriage and transportation under Arts. 1733, 1755 and 1756 of the New Civil Code. These Articles provide: 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 the vigilance over the goods is further expressed in Articles 1734, and 1745, Nos. 5, 6, and 7, while the extraordinary diligence for the safety of the passengers is further set forth in articles 1755 and 1756. Art. 1755. A common carrier is bound to carry the passenger safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with a due regard for all the circumstances. Art. 1756. In case of death of or injuries to passengers, common carriers are presumed to have been at fault or to have acted negligently, unless they prove that they observed extraordinary diligence as prescribed in Articles 1733 and 1755. The duty to exercise the utmost diligence on the part of common carriers is for the safety of passengers as well as for the members of the crew or the complement operating the carrier, the airplane in the case at bar. And this must be so for any omission, lapse or neglect thereof will certainly result to the damage, prejudice, nay injuries and even death to all aboard the plane, passengers and crew members alike. Now to the damages. The Court of Appeals affirmed the award of damages made by the trial court, stating that “the damages awarded plaintiff by the lower court are in accordance with the facts, law and jurisprudence.” The court further observed that “defendant-appellant is still fortunate, considering that the unearned income was

reckoned with only up to 1968 and not up to the present as plaintiff-appellee is still living. Whatever mathematical error defendant-appellant could show by abstract argumentation, the same must be compensated by such deficiency of the damages awarded to plaintiff-appellee.” As awarded by the trial court, private respondent was entitled to P198,000.00 as unearned income or compensatory damages; P50,000.00 for moral damages, P20,000.00 as attorney’s fees and P5,000.00 as expenses of litigation, or a total of P273,000.00. The trial court arrived at the sum of P198,000.00 as unearned income or damages by considering that respondent Samson “could have continued to work as airline pilot for fifteen more years, he being only 38 years at the time the services were terminated by the defendant cranad(PAL) and he would have earned P120,000.00 from 1954 to 1963 or a period of ten cranad(10) years at the rate of one thousand per month cranad(P750.00 basic salary plus P300.00 extra pay for extra flying time and bonuses; and considering further that in 1964 the basic pay of defendant’s pilot was increased to P12,000.00 annually, the plaintiff could have earned from 1964 to 1968 the sum of P60,000.00 in the form of salaries and another P18,000.00 as bonuses and extra pay for extra flying time at the same rate of P300 a month, or a grand total of P198,000.00 for the entire period. This claim of the plaintiff for loss or impairment of earning capacity is based on the provision of Article 2205 of the New Civil Code of the Philippines which provides that “damages may be recovered for loss or impairment of earning capacity in cases of temporary or permanent personal injury.” This provision of law has been construed and interpreted in the case of Aureliano Ropato, et al. vs. La Mallorca General Partnership, 56 O.G., 7812, which rules that law allows the recovery of damages for loss or impairment of earning capacity in cases of temporary or permanent personal injury.” chanroblesvirtualawlibrary(Decision, CFI, pp. 98-99, Record on Appeal) The respondent appellate court modified the above award by ordering payment of legal interest on the P198,000.00 unearned income from the filing of the claim, citing Sec. 8, Rule 51 of the Rules of Court. Petitioner assails the award of the total sum of P198,000.00 as unearned income up to 1968 as being tenuous because firstly, the trial court’s finding affirmed by the respondent court is allegedly based on pure speculation and conjecture and secondly, the award of P300.00 a month as extra pay for extra flying time from 1954 to 1968 is likewise speculative. PAL likewise rejects the award of moral damages in the amount of P50,000.00 on the ground that private respondent’s action before the trial court does not fall under any of the cases enumerated in the law cranad(Art. 2219 of the New Civil Code) for which moral damages are recoverable and that although private respondent’s action gives the appearance that it is covered under quasi-delict as provided in Art. 21 of the New Civil Code, the definition of quasi-delict in Art. 2176 of the New Civil Code expressly excludes cases where there is a pre-existing contractual relation between the parties, as in the case under consideration, where an employer-employee relationship existed between PAL and private respondent. It is further argued that private respondent’s action cannot be deemed to be covered by Art. 21, inasmuch as there is no evidence on record to show that PAL “wilfully cause(d) loss or injury to cranad(private

respondent) in a manner that is contrary to morals, good customs or public policy . cra .” Nor can private respondent’s action be considered “analogous” to either of the foregoing, for the reasons are obvious that it is not.” chanroblesvirtualawlibrary(Memorandum of petitioner, pp. 418-421, Records) Having affirmed the gross negligence of PAL in allowing Capt. Delfin Bustamante to fly the plane to Daet on January 8, 1951 whose slow reaction and poor judgment was the cause of the crash-landing of the plane which resulted in private respondent Samson hitting his head against the windshield and causing him injuries for which reason PAL terminated his services and employment as pilot after refusing to provide him with the necessary medical treatment of respondent’s periodic spells, headache and general debility produced from said injuries, We must necessarily affirm likewise the award of damages or compensation under the provisions of Art. 1711 and Art. 1712 of the New Civil Code which provide: Art. 1711. Owners of enterprises and other employers are obliged to pay compensation for the death or injuries to their laborers, workmen, mechanics or other employees, even though the event may have been purely accidental or entirely due to a fortuitous cause, if the death or personal injury arose out of and in the course of the employment. The employer is also liable for compensation if the employee contracts any illness or disease caused by such employment or as the result of the nature of the employment. If the mishap was due to the employee’s own notorious negligence, or voluntary act, or drunkenness, the employer shall not be liable for compensation. When the employee’s lack of due care contributed to his death or injury, the compensation shall be equitably reduced. Art. 1712. If the death or injury is due to the negligence of a fellow-worker, the latter and the employer shall be solidarily liable for compensation. If a fellowworker’s intentional or malicious act is the only cause of the death or injury, the employer shall not be answerable, unless it should be shown that the latter did not exercise due diligence in the selection or supervision of the plaintiffs fellow-worker. The grant of compensatory damages to the private respondent made by the trial court and affirmed by the appellate court by computing his basic salary per annum at P750.00 a month as basic salary and P300.00 a month for extra pay for extra flying time including bonus given in December every year is justified. The correct computation however should be P750 plus P300 x 12 months = P12,600 per annum x 10 years = P126,000.00 cranad(not P120,000.00 as computed by the court a quo). The further grant of increase in the basic pay of the pilots to P12,000 annually for 1964 to 1968 totalling P60,000.00 and another P18,000.00 as bonuses and extra pay for extra flying time at the same rate of P300.00 a month totals P78,000.00. Adding P126,000.00 cranad(1964 to 1968 compensation) makes a grand total of P204,000.00 cranad(not P198,000.00 as originally computed). As to the grant of moral damages in the sum of P50,000.00 We also approve the same. We have noted and considered the holding of the appellate court in the matter of bad faith on the part of PAL, stated hereunder, this wise: “None of the essential facts material to the determination of the case have been seriously assailed: the overshooting of runway and crash-landing into the

mangroves; the hitting of plaintiff’s head to the front windshield of the plane; the oozing of blood out of his ears, nose and mouth; the intermittent dizzy spells, headaches and general debility thereafter for which he was discharged from his employment; the condition of not to attribute the cause of the ailment to the crashlanding imposed in bad faith for a demanded special medical service abroad; and the resultant brain injury which defendant’s doctors could not understand nor diagnose.” xxx “The act of defendant-appellant in unjustly refusing plaintiff-appellee’s demand for special medical service abroad for the reason that plaintiff-appellee’s deteriorating physical condition was not due to the accident violates the provisions of Article 19 of the Civil Code on human relations “to act with justice, give everyone his due, and observe honesty and good faith.” chanroblesvirtualawlibrary(CA Resolution, pp. 151-152, Records) We reject the theory of petitioner that private respondent is not entitled to moral damages. Under the facts found by the trial court and affirmed by the appellate court and under the law and jurisprudence cited and applied, the grant of moral damages in the amount of P50,000.00 is proper and justified. The fact that private respondent suffered physical injuries in the head when the plane crash-landed due to the negligence of Capt. Bustamante is undeniable. The negligence of the latter is clearly a quasi-delict and therefore Article 2219, cranad(2) New Civil Code is applicable, justifying the recovery of moral damages. Even from the standpoint of the petitioner that there is an employer-employee relationship between it and private respondent arising from the contract of employment, private respondent is still entitled to moral damages in view of the finding of bad faith or malice by the appellate court, which finding We hereby affirm, applying the provisions of Art. 2220, New Civil Code which provides that willful injury to property may be a legal ground for awarding moral damages if the court should find that, under the circumstances, such damages are justly due. The same rule applies to breaches of contract where the defendant acted fraudulently or in bad faith. The justification in the award of moral damages under Art. 19 of the New Civil Code on Human Relations which requires that every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith, as applied by respondent court is also welltaken and We hereby give Our affirmance thereto. With respect to the award of attorney’s fees in the sum of P20,000.00 the same is likewise correct. As pointed out in the decision of the Court of Appeals, “the plaintiff is entitled to attorney’s fees because he was forced to litigate in order to enforce his valid claim cranad(Ganaban vs. Bayle, 30 SCRA 365; De la Cruz vs. De la Cruz, 22 SCRA 33; and many others); defendant acted in bad faith in refusing plaintiff’s valid claim cranad(Filipino Pipe Foundry Corporation vs. Central Bank, 23 SCRA 1044);

and plaintiff was dismissed and was forced to go to court to vindicate his right cranad(Nadura vs. Benguet Consolidated, Inc., 5 SCRA 879).” We also agree with the modification made by the appellate court in ordering payment of legal interest from the date judicial demand was made by Pilot Samson against PAL with the filing of the complaint in the lower court. We affirm the ruling of the respondent court which reads: “Lastly, the defendant-appellant claims that the legal rate of interest on the unearned compensation should be computed from the date of the judgment in the lower court, not from the filing of the complaint, citing a case where the issue raised in the Supreme Court was limited to when the judgment was rendered in the lower court or in the appellate court, which does not mean that it should not be computed from the filing of the complaint. Articles 1169, 2209 and 2212 of the Civil Code govern when interest shall be computed. Thereunder interest begins to accrue upon demand, extrajudicial or judicial. A complaint is a judicial demand cranad(Cabarroguis vs. Vicente, 107 Phil. 340). Under Article 2212 of the Civil Code, interest due shall earn legal interest from the time it is judicially demanded, although the obligation may be silent upon this point.” chanroblesvirtualawlibrary(CA Resolution, pp. 153-154, Records). The correct amount of compensatory damages upon which legal interest shall accrue from the filing of the complaint is P204,000.00 as herein computed and not P198,000.00. WHEREFORE, in view of all the foregoing, the judgment of the appellate court is hereby affirmed with slight modification in that the correct amount of compensatory damages is P204,000.00. With costs against petitioner. SO ORDERED. Makasiar and De Castro, JJ., concur. Teehankee and Melencio-Herrera, JJ., concur in the result.

SULPICIO v CA FIRST DIVISION

G.R. No. 106279

July 14, 1995

SULPICIO LINES, INC., petitioner, vs. THE HONORABLE COURT OF APPEALS (Twelfth Division) and JACINTA L. PAMALARAN, respondents.

QUIASON, J.: This is a petition for review on certiorari under Rule 45 of the Revised Rules of Court to reverse the Decision dated April 8, 1992 of the Court of Appeals in CA-G.R. CV No. 21919, affirming the decision of the Regional Trial Court of Bohol, Branch 2, Tagbilaran City, which awarded the claim for damages filed by private respondent against CBL Timber Corporation (CBL), AGO Lumber Company (ALC), Sulpicio Lines, Inc. (SLI) and Ernie Santiago (Civil Case No. 2864). We deny the petition. I A contract of carriage was entered into between petitioner and ALC for the transport of the latter's timber from Pugad, Lianga, Surigao del Sur. On March 17, 1976, petitioner sent its tugboat "MT Edmund" and barge "Solid VI" to Lianga to pick up ALC's timber. However, no loading could be made because of the heavy downpour. The next morning, several stevedores of CBL, who were hired by ALC, boarded the "Solid VI" and opened its storeroom. The stevedores were warned of the gas and heat generated by the copra stored in the holds of the ship. Not heeding the warning, a stevedore entered the storeroom and fell unconscious. Two other stevedores followed, one of whom was Leoncio L. Pamalaran. He also lost consciousness and eventually died of gas poisoning. Thus, Civil Case No. 2864 for damages was filed with the Regional Trial Court of Bohol, Branch 2, Tagbilaran by Pamalaran's heirs against petitioner CBL, ALC and its manager, Ernie Santiago. The trial court ruled in favor of plaintiffs, disposing as follows: WHEREFORE, finding a preponderance of evidence in favor of the plaintiffs, judgment is hereby rendered: Ordering defendants CBL Timber Corporation, AGO Lumber Company, Sulpicio Lines, Inc. and Ernie Santiago to pay plaintiffs jointly and severally: 1.

Actual and compensatory damages of P40,000.00;

2.

Moral damages of P50,000.00;

3.

Attorney's fees of P20,000.00 and the costs of the suit (Rollo, p. 57).

On appeal, the Court of Appeals in its Decision dated April 8, 1992 in CA-G.R. No. CV No. 21919, affirmed the lower court's decision, the dispositive portion of which reads: WHEREFORE, WE AFFIRM the appealed judgment there being no justifiable reason that warrants the reversal thereof. Costs against defendant-appellant (Rollo, p. 32).

Not satisfied with the appellate court's decision, petitioner filed this petition. II Petitioner raises the following arguments: 1. Pamalaran was never a passenger of petitioner. Therefore, it is not liable as a common carrier; 2. Petitioner and its employees were not negligent in the series of events which led to the death of Pamalaran; 3.

Petitioner is not liable under Article 2180 of the New Civil Code;

4. and,

It is CBL and/or ALC which should be held liable for the death of the victim;

5. Petitioner should have been granted its just and valid counterclaims and cross claims. We agree with the Court of Appeals that although Pamalaran was never a passenger of petitioner, still the latter is liable as a common carrier for his death. The Court of Appeals relied on Canas v. Dabatos, 8 Court of Appeals Report 918 (1965). In said case, 13 persons were on board the vessel of defendant not as passengers but as 'cargadores' of the shipper's goods. They were there with the consent and knowledge of the owner of the vessel. Despite the absence of a passenger-carrier relationship between them, the appellate court, just the same, held the patron thereof liable as a common carrier. The appellate court ruled: There is no debate as to the fact that not one of the thirteen passengers have paid an amount of money as fare for their conveyance from Hingotanan to Cebu. The undisputed fact, however, is that all of them were in the boat with the knowledge and consent of the patron. The eleven passengers, other than Encarnacion and Diosdado were in the boat because they have helped in loading cargoes in the boat, and "to serve as cargadores of the cargoes," presumably, in unloading them at the place of destination. For those services they were permitted to be in the boat and to proceed to their destination in Cebu. The services rendered were the valuable consideration in exchange for the transportation fare. "In onerous contracts the cause is understood to be, for each contracting party, the prestation or promise of a thing or service by the other; . . ." (at p. 925; emphasis supplied). ALC had a contract of carriage with petitioner. The presence of the stevedores sent by ALC on board the barge of petitioner was called for by the contract of carriage. For how else would its lumber be transported unless it is placed on board? And by whom? Of course, the stevedores. Definitely, petitioner could not expect the shipper itself to load the lumber without the aid of the stevedores. Furthermore, petitioner knew of the presence and role of the stevedores in its barge and thus consented to their presence. Hence, petitioner was responsible for their safety while on board the barge.

Petitioner next claims that its employees even warned the stevedores and tried to prevent their entry into the storeroom. Such argument, again, is demolished by the findings of the Court of Appeals, thus: . . . . However, appellant failed to prove that its employees were actually trained or given specific instructions to see to it that the barge is fit and safe not only in transporting goods but also for people who would be loading the cargo into the bodega of the barge. It is not enough that appellant's employees have warned the laborers not to enter the barge after the hatch was opened. Appellant's employees should have been sufficiently instructed to see to it that the hatch of the barge is not opened by any unauthorized person and that the hatch is not easily opened by anyone. At the very least, precautionary measures should have been observed by appellant's employees to see to it that no one could enter the bodega of the barge until after they have made sure that it is safe for anyone to enter the same. Failing to exercise due diligence in the supervision of its employees, the lower court was correct in holding appellant liable for damages (Rollo, pp. 31-32; Emphasis supplied). Inasmuch as the findings of the Court of Appeals are merely an affirmance of the findings of the trial court, which findings are supported by the evidence, we do not find any reason to reverse the same. There is no quarrel that ALC and CBL are also liable as they were in fact held liable by both the trial and appellate courts. Both the counterclaims and cross claims of petitioner are without legal basis. The counterclaims and cross claims were based on the assumption that the other defendants are the ones solely liable. However, inasmuch as its solidary liability with the other defendants has clearly been established by both the trial and the appellate courts, which we find to be in order, we cannot make a different conclusion contrary to that of the said courts. Finally, the indemnity for the death of Leoncio L. Pamalaran is increased from P40,000.00 to P50,000.00 in accordance with our ruling in People v. Flores, 237 SCRA 653 (1994). WHEREFORE, the Decision of the Court of Appeals is AFFIRMED with the MODIFICATION that the award of actual and compensatory damages is increased to P50,000.00. SO ORDERED. Padilla, Davide, Jr. and Kapunan, JJ., concur. Bellosillo, J., is on leave.

JAPAN AIRLINES v CA THIRD DIVISION

G.R. No. 118664

August 7, 1998

JAPAN AIRLINES, petitioner, vs. THE COURT OF APPEALS, ENRIQUE AGANA., MARIA ANGELA NINA AGANA, ADALIA B. FRANCISCO and JOSE MIRANDA, respondents.

ROMERO, J.: Before us is an appeal by certiorari filed by petitioner Japan Airlines, Inc. (JAL) seeking the reversal of the decision of the Court of Appeals, 1 which affirmed with modification the award of damages made by the trial court in favor of herein private respondents Enrique Agana, Maria Angela Nina Agana, Adelia Francisco and Jose Miranda. On June 13, 1991, private respondent Jose Miranda boarded JAL flight No. JL 001 in San Francisco, California bound for Manila. Likewise, on the same day private 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 travelling 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 day. 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 of their journey, went to the airport to take their flight to Manila. However, due to the Mt. Pinatubo eruption, unrelenting ashfall blanketed Ninoy Aquino International Airport (NAIA), rendering it inaccessible to airline traffic. Hence, private respondents' trip to Manila was cancelled indefinitely. To accommodate the needs of its stranded passengers, JAL rebooked all the Manilabound passengers on flight No. 741 due to depart on June 16, 1991 and also paid for the hotel expenses for their unexpected overnight stay. On June 16, 1991, much to the dismay of the private respondents, their long anticipated flight to Manila was again cancelled due to NAIA's indefinite closure. At this point, JAL informed the private respondents that it would no longer defray their hotel and accommodation expense during their stay in Narita. Since NAIA was only reopened to airline traffic on June 22, 1991, private respondents were forced to pay for their accommodations and meal expenses from their personal funds from June 16 to June 21, 1991. Their unexpected stay in Narita ended on June 22, 1991 when they arrived in Manila on board JL flight No. 741.

Obviously, still reeling from the experience, private respondents, on July 25, 1991, commenced an action for damages against JAL before the Regional Trial Court of Quezon City, Branch 104. 2 To support their claim, private respondents asserted that JAL failed to live up to its duty to provide care and comfort to its stranded passengers when it refused to pay for their hotel and accommodation expenses from June 16 to 21, 1991 at Narita, Japan. In other words, they insisted that JAL was 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." On June 18, 1992, the trial court rendered its judgment in favor of private respondents holding JAL liable for damages, viz.: WHEREFORE, judgment is rendered in favor of plaintiffs ordering the defendant Japan Airlines to pay the plaintiffs Enrique Agana, Adalia B. Francisco and Maria Angela Nina Agana the sum of One million Two Hundred forty-six Thousand Nine Hundred Thirty-Six Pesos (P1,246,936.00) and Jose Miranda the sum of Three Hundred Twenty Thousand Six Hundred sixteen and 31/100 (P320,616.31) as actual, moral and exemplary damages and pay attorney's fees in the amount of Two Hundred Thousand Pesos (P200,000.00), and to pay the costs of suit. Undaunted, JAL appealed the decision before the Court of Appeals, which, however, with the exception of lowering the damages awarded affirmed the trial court's finding, 3 thus: Thus, the award of moral damages should be as it is hereby reduced to P200,000.00 for each of the plaintiffs, the exemplary damages to P300,000.00 and the attorney's fees to P100,000.00 plus the costs. WHEREFORE, with the foregoing Modification, the judgment appealed from is hereby AFFIRMED in all other respects. JAL filed a motion for reconsideration which proved futile and unavailing. 4 Failing in its bid to reconsider the decision, JAL has now filed this instant petition. The issue to be resolved is whether JAL, as a common carrier has the obligation to shoulder the hotel and meal expenses of its stranded passengers until they have reached their final destination, even if the delay were caused by "force majeure." To begin with, there is no dispute that the Mt. Pinatubo eruption prevented JAL from proceeding to Manila on schedule. Likewise, private respondents concede that such event can be considered as "force majeure" since their delayed arrival in Manila was not imputable to JAL. 5 However, private respondents contend that while JAL cannot be held responsible for the delayed arrival in Manila, it was nevertheless liable for their living expenses during their unexpected stay in Narita since airlines have the obligation to ensure

the comfort and convenience of its passengers. While we sympathize with the private respondents' plight, we are unable to accept this contention. We are not unmindful of the fact that in a plethora of cases we have consistently ruled that 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 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 may be sustained by its passengers. However, this is not to say that common carriers are absolutely responsible for all injuries or damages even if the same were caused by a fortuitous event. To rule otherwise would render the defense of "force majeure," as an exception from any liability, illusory and ineffective. Accordingly, there is no question that 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. 6 Corollarily, when JAL was prevented from resuming its flight to Manila due to the effects of Mt. Pinatubo eruption, whatever losses or damages in the form of hotel and meal expenses the stranded passengers 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. Admittedly, to be stranded for almost a week in a foreign land was an exasperating experience for the private respondents. To be sure, they underwent distress and anxiety during their unanticipated stay in Narita, but their predicament was not due to the fault or negligence of JAL but the closure of 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 fortuitous event is too much of a burden to assume. Furthermore, it has been held that airline passengers must take such risks incident to the mode of travel. 7 In this regard, adverse weather conditions or extreme climatic 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 all risks. 8 Paradoxically, the Court of Appeals, despite the presence of "force majeure," still ruled against JAL relying in our decision in PAL v. Court of Appeals, 9 thus: The position taken by PAL in this case clearly illustrates its failure to grasp the exacting standard required by law. Undisputably, PAL's diversion of its flight due to inclement weather was a fortuitous event. Nonetheless, such occurrence did not terminate PAL's contract with its passengers. Being in the business of air carriage and the sole one to operate in the country, PAL is deemed equipped to deal with situations as in the case at bar. What we said in one case once again must be stressed, i.e., the relation of carrier and passenger continues until the latter has been landed at the port of destination and has left the carrier's premises. Hence, PAL necessarily would still have to exercise extraordinary diligence in safeguarding the comfort, convenience and safety of its stranded passengers until they have reached their final destination. On this score, PAL grossly failed considering the then

ongoing battle between government forces and Muslim rebels in Cotabato City and the fact that the private respondent was a stranger to the place. The reliance is misplaced. The factual background of the PAL case is different from the instant petition. In that case there was indeed a fortuitous event resulting in the diversion of the PAL flight. However, the unforeseen diversion was worsened when "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 apathy of the PAL station manager as to the predicament of the stranded passengers. 11 In light of 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 present in the instant petition. 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 States with Manila as their final destination. While JAL was no longer required to defray private respondents' living expenses during their stay in Narita on account of the fortuitous event, JAL had the duty to make the necessary arrangements to transport private respondents on the first available connecting flight 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 passengers" to "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. SO ORDERED.

CANGCO v MRR G.R. No. L-12191

October 14, 1918

JOSE CANGCO, plaintiff-appellant, vs. MANILA RAILROAD CO., defendant-appellee. Ramon Sotelo for appellant. Kincaid & Hartigan for appellee.

FISHER, J.: At the time of the occurrence which gave rise to this litigation the plaintiff, Jose Cangco, was in the employment of Manila Railroad Company in the capacity of clerk, with a monthly wage of P25. He lived in the pueblo of San Mateo, in the province of Rizal, which is located upon the line of the defendant railroad company; and in coming daily by train to the company's office in the city of Manila where he worked, he used a pass, supplied by the company, which entitled him to ride upon the company's trains free of charge. Upon the occasion in question, January 20, 1915, the plaintiff arose from his seat in the second class-car where he was riding and, making, his exit through the door, took his position upon the steps of the coach, seizing the upright guardrail with his right hand for support. On the side of the train where passengers alight at the San Mateo station there is a cement platform which begins to rise with a moderate gradient some distance away from the company's office and extends along in front of said office for a distance sufficient to cover the length of several coaches. As the train slowed down another passenger, named Emilio Zuñiga, also an employee of the railroad company, got off the same car, alighting safely at the point where the platform begins to rise from the level of the ground. When the train had proceeded a little farther the plaintiff Jose Cangco stepped off also, but one or both of his feet came in contact with a sack of watermelons with the result that his feet slipped from under him and he fell violently on the platform. His body at once rolled from the platform and was drawn under the moving car, where his right arm was badly crushed and lacerated. It appears that after the plaintiff alighted from the train the car moved forward possibly six meters before it came to a full stop. The accident occurred between 7 and 8 o'clock on a dark night, and as the railroad station was lighted dimly by a single light located some distance away, objects on the platform where the accident occurred were difficult to discern especially to a person emerging from a lighted car.

The explanation of the presence of a sack of melons on the platform where the plaintiff alighted is found in the fact that it was the customary season for harvesting these melons and a large lot had been brought to the station for the shipment to the market. They were contained in numerous sacks which has been piled on the platform in a row one upon another. The testimony shows that this row of sacks was so placed of melons and the edge of platform; and it is clear that the fall of the plaintiff was due to the fact that his foot alighted upon one of these melons at the moment he stepped upon the platform. His statement that he failed to see these objects in the darkness is readily to be credited. The plaintiff was drawn from under the car in an unconscious condition, and it appeared that the injuries which he had received were very serious. He was therefore brought at once to a certain hospital in the city of Manila where an examination was made and his arm was amputated. The result of this operation was unsatisfactory, and the plaintiff was then carried to another hospital where a second operation was performed and the member was again amputated higher up near the shoulder. It appears in evidence that the plaintiff expended the sum of P790.25 in the form of medical and surgical fees and for other expenses in connection with the process of his curation. Upon August 31, 1915, he instituted this proceeding in the Court of First Instance of the city of Manila to recover damages of the defendant company, founding his action upon the negligence of the servants and employees of the defendant in placing the sacks of melons upon the platform and leaving them so placed as to be a menace to the security of passenger alighting from the company's trains. At the hearing in the Court of First Instance, his Honor, the trial judge, found the facts substantially as above stated, and drew therefrom his conclusion to the effect that, although negligence was attributable to the defendant by reason of the fact that the sacks of melons were so placed as to obstruct passengers passing to and from the cars, nevertheless, the plaintiff himself had failed to use due caution in alighting from the coach and was therefore precluded form recovering. Judgment was accordingly entered in favor of the defendant company, and the plaintiff appealed. It can not be doubted that the employees of the railroad company were guilty of negligence in piling these sacks on the platform in the manner above stated; that their presence caused the plaintiff to fall as he alighted from the train; and that they therefore constituted an effective legal cause of the injuries sustained by the plaintiff. It necessarily follows that the defendant company is liable for the damage thereby occasioned unless recovery is barred by the plaintiff's own contributory negligence. In resolving this problem it is necessary that each of these conceptions of liability, to-wit, the primary responsibility of the defendant company and the contributory negligence of the plaintiff should be separately examined. It is important to note that the foundation of the legal liability of the defendant is the contract of carriage, and that the obligation to respond for the damage which plaintiff has suffered arises, if at all, from the breach of that contract by reason of the failure of defendant to exercise due care in its performance. That is to say, its liability is direct and immediate, differing essentially, in legal viewpoint

from that presumptive responsibility for the negligence of its servants, imposed by article 1903 of the Civil Code, which can be rebutted by proof of the exercise of due care in their selection and supervision. Article 1903 of the Civil Code is not applicable to obligations arising ex contractu, but only to extra-contractual obligations — or to use the technical form of expression, that article relates only to culpa aquiliana and not to culpa contractual. Manresa (vol. 8, p. 67) in his commentaries upon articles 1103 and 1104 of the Civil Code, clearly points out this distinction, which was also recognized by this Court in its decision in the case of Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil. rep., 359). In commenting upon article 1093 Manresa clearly points out the difference between "culpa, substantive and independent, which of itself constitutes the source of an obligation between persons not formerly connected by any legal tie" and culpa considered as an accident in the performance of an obligation already existing . . . ." In the Rakes case (supra) the decision of this court was made to rest squarely upon the proposition that article 1903 of the Civil Code is not applicable to acts of negligence which constitute the breach of a contract. Upon this point the Court said: The acts to which these articles [1902 and 1903 of the Civil Code] are applicable are understood to be those not growing out of pre-existing duties of the parties to one another. But where relations already formed give rise to duties, whether springing from contract or quasi-contract, then breaches of those duties are subject to article 1101, 1103, and 1104 of the same code. (Rakes vs. Atlantic, Gulf and Pacific Co., 7 Phil. Rep., 359 at 365.) This distinction is of the utmost importance. The liability, which, under the Spanish law, is, in certain cases imposed upon employers with respect to damages occasioned by the negligence of their employees to persons to whom they are not bound by contract, is not based, as in the English Common Law, upon the principle of respondeat superior — if it were, the master would be liable in every case and unconditionally — but upon the principle announced in article 1902 of the Civil Code, which imposes upon all persons who by their fault or negligence, do injury to another, the obligation of making good the damage caused. One who places a powerful automobile in the hands of a servant whom he knows to be ignorant of the method of managing such a vehicle, is himself guilty of an act of negligence which makes him liable for all the consequences of his imprudence. The obligation to make good the damage arises at the very instant that the unskillful servant, while acting within the scope of his employment causes the injury. The liability of the master is personal and direct. But, if the master has not been guilty of any negligence whatever in the selection and direction of the servant, he is not liable for the acts of the latter, whatever done within the scope of his employment or not, if the damage done by the servant does not amount to a breach of the contract between the master and the person injured. It is not accurate to say that proof of diligence and care in the selection and control of the servant relieves the master from liability for the latter's acts — on the

contrary, that proof shows that the responsibility has never existed. As Manresa says (vol. 8, p. 68) the liability arising from extra-contractual culpa is always based upon a voluntary act or omission which, without willful intent, but by mere negligence or inattention, has caused damage to another. A master who exercises all possible care in the selection of his servant, taking into consideration the qualifications they should possess for the discharge of the duties which it is his purpose to confide to them, and directs them with equal diligence, thereby performs his duty to third persons to whom he is bound by no contractual ties, and he incurs no liability whatever if, by reason of the negligence of his servants, even within the scope of their employment, such third person suffer damage. True it is that under article 1903 of the Civil Code the law creates a presumption that he has been negligent in the selection or direction of his servant, but the presumption is rebuttable and yield to proof of due care and diligence in this respect. The supreme court of Porto Rico, in interpreting identical provisions, as found in the Porto Rico Code, has held that these articles are applicable to cases of extracontractual culpa exclusively. (Carmona vs. Cuesta, 20 Porto Rico Reports, 215.) This distinction was again made patent by this Court in its decision in the case of Bahia vs. Litonjua and Leynes, (30 Phil. rep., 624), which was an action brought upon the theory of the extra-contractual liability of the defendant to respond for the damage caused by the carelessness of his employee while acting within the scope of his employment. The Court, after citing the last paragraph of article 1903 of the Civil Code, said: From this article two things are apparent: (1) That when an injury is caused by the negligence of a servant or employee there instantly arises a presumption of law that there was negligence on the part of the master or employer either in selection of the servant or employee, or in supervision over him after the selection, or both; and (2) that that presumption is juris tantum and not juris et de jure, and consequently, may be rebutted. It follows necessarily that if the employer shows to the satisfaction of the court that in selection and supervision he has exercised the care and diligence of a good father of a family, the presumption is overcome and he is relieved from liability. This theory bases the responsibility of the master ultimately on his own negligence and not on that of his servant. This is the notable peculiarity of the Spanish law of negligence. It is, of course, in striking contrast to the American doctrine that, in relations with strangers, the negligence of the servant in conclusively the negligence of the master. The opinion there expressed by this Court, to the effect that in case of extracontractual culpa based upon negligence, it is necessary that there shall have been some fault attributable to the defendant personally, and that the last paragraph of article 1903 merely establishes a rebuttable presumption, is in complete accord with the authoritative opinion of Manresa, who says (vol. 12, p. 611) that the liability created by article 1903 is imposed by reason of the breach of the duties inherent in the special relations of authority or superiority existing between the person called upon to repair the damage and the one who, by his act or omission, was the cause of it.

On the other hand, the liability of masters and employers for the negligent acts or omissions of their servants or agents, when such acts or omissions cause damages which amount to the breach of a contact, is not based upon a mere presumption of the master's negligence in their selection or control, and proof of exercise of the utmost diligence and care in this regard does not relieve the master of his liability for the breach of his contract. Every legal obligation must of necessity be extra-contractual or contractual. Extra-contractual obligation has its source in the breach or omission of those mutual duties which civilized society imposes upon it members, or which arise from these relations, other than contractual, of certain members of society to others, generally embraced in the concept of status. The legal rights of each member of society constitute the measure of the corresponding legal duties, mainly negative in character, which the existence of those rights imposes upon all other members of society. The breach of these general duties whether due to willful intent or to mere inattention, if productive of injury, give rise to an obligation to indemnify the injured party. The fundamental distinction between obligations of this character and those which arise from contract, rests upon the fact that in cases of non-contractual obligation it is the wrongful or negligent act or omission itself which creates the vinculum juris, whereas in contractual relations the vinculum exists independently of the breach of the voluntary duty assumed by the parties when entering into the contractual relation. With respect to extra-contractual obligation arising from negligence, whether of act or omission, it is competent for the legislature to elect — and our Legislature has so elected — whom such an obligation is imposed is morally culpable, or, on the contrary, for reasons of public policy, to extend that liability, without regard to the lack of moral culpability, so as to include responsibility for the negligence of those person who acts or mission are imputable, by a legal fiction, to others who are in a position to exercise an absolute or limited control over them. The legislature which adopted our Civil Code has elected to limit extra-contractual liability — with certain well-defined exceptions — to cases in which moral culpability can be directly imputed to the persons to be charged. This moral responsibility may consist in having failed to exercise due care in the selection and control of one's agents or servants, or in the control of persons who, by reason of their status, occupy a position of dependency with respect to the person made liable for their conduct. The position of a natural or juridical person who has undertaken by contract to render service to another, is wholly different from that to which article 1903 relates. When the sources of the obligation upon which plaintiff's cause of action depends is a negligent act or omission, the burden of proof rests upon plaintiff to prove the negligence — if he does not his action fails. But when the facts averred show a contractual undertaking by defendant for the benefit of plaintiff, and it is alleged that plaintiff has failed or refused to perform the contract, it is not necessary for plaintiff to specify in his pleadings whether the breach of the contract is due to willful fault or to negligence on the part of the defendant, or of his servants or agents. Proof of the contract and of its nonperformance is sufficient prima facie to warrant a recovery.

As a general rule . . . it is logical that in case of extra-contractual culpa, a suing creditor should assume the burden of proof of its existence, as the only fact upon which his action is based; while on the contrary, in a case of negligence which presupposes the existence of a contractual obligation, if the creditor shows that it exists and that it has been broken, it is not necessary for him to prove negligence. (Manresa, vol. 8, p. 71 [1907 ed., p. 76]). As it is not necessary for the plaintiff in an action for the breach of a contract to show that the breach was due to the negligent conduct of defendant or of his servants, even though such be in fact the actual cause of the breach, it is obvious that proof on the part of defendant that the negligence or omission of his servants or agents caused the breach of the contract would not constitute a defense to the action. If the negligence of servants or agents could be invoked as a means of discharging the liability arising from contract, the anomalous result would be that person acting through the medium of agents or servants in the performance of their contracts, would be in a better position than those acting in person. If one delivers a valuable watch to watchmaker who contract to repair it, and the bailee, by a personal negligent act causes its destruction, he is unquestionably liable. Would it be logical to free him from his liability for the breach of his contract, which involves the duty to exercise due care in the preservation of the watch, if he shows that it was his servant whose negligence caused the injury? If such a theory could be accepted, juridical persons would enjoy practically complete immunity from damages arising from the breach of their contracts if caused by negligent acts as such juridical persons can of necessity only act through agents or servants, and it would no doubt be true in most instances that reasonable care had been taken in selection and direction of such servants. If one delivers securities to a banking corporation as collateral, and they are lost by reason of the negligence of some clerk employed by the bank, would it be just and reasonable to permit the bank to relieve itself of liability for the breach of its contract to return the collateral upon the payment of the debt by proving that due care had been exercised in the selection and direction of the clerk? This distinction between culpa aquiliana, as the source of an obligation, and culpa contractual as a mere incident to the performance of a contract has frequently been recognized by the supreme court of Spain. (Sentencias of June 27, 1894; November 20, 1896; and December 13, 1896.) In the decisions of November 20, 1896, it appeared that plaintiff's action arose ex contractu, but that defendant sought to avail himself of the provisions of article 1902 of the Civil Code as a defense. The Spanish Supreme Court rejected defendant's contention, saying: These are not cases of injury caused, without any pre-existing obligation, by fault or negligence, such as those to which article 1902 of the Civil Code relates, but of damages caused by the defendant's failure to carry out the undertakings imposed by the contracts . . . . A brief review of the earlier decision of this court involving the liability of employers for damage done by the negligent acts of their servants will show that in no case has the court ever decided that the negligence of the defendant's servants has been held to constitute a defense to an action for damages for breach of contract.

In the case of Johnson vs. David (5 Phil. Rep., 663), the court held that the owner of a carriage was not liable for the damages caused by the negligence of his driver. In that case the court commented on the fact that no evidence had been adduced in the trial court that the defendant had been negligent in the employment of the driver, or that he had any knowledge of his lack of skill or carefulness. In the case of Baer Senior & Co's Successors vs. Compania Maritima (6 Phil. Rep., 215), the plaintiff sued the defendant for damages caused by the loss of a barge belonging to plaintiff which was allowed to get adrift by the negligence of defendant's servants in the course of the performance of a contract of towage. The court held, citing Manresa (vol. 8, pp. 29, 69) that if the "obligation of the defendant grew out of a contract made between it and the plaintiff . . . we do not think that the provisions of articles 1902 and 1903 are applicable to the case." In the case of Chapman vs. Underwood (27 Phil. Rep., 374), plaintiff sued the defendant to recover damages for the personal injuries caused by the negligence of defendant's chauffeur while driving defendant's automobile in which defendant was riding at the time. The court found that the damages were caused by the negligence of the driver of the automobile, but held that the master was not liable, although he was present at the time, saying: . . . unless the negligent acts of the driver are continued for a length of time as to give the owner a reasonable opportunity to observe them and to direct the driver to desist therefrom. . . . The act complained of must be continued in the presence of the owner for such length of time that the owner by his acquiescence, makes the driver's acts his own. In the case of Yamada vs. Manila Railroad Co. and Bachrach Garage & Taxicab Co. (33 Phil. Rep., 8), it is true that the court rested its conclusion as to the liability of the defendant upon article 1903, although the facts disclosed that the injury complaint of by plaintiff constituted a breach of the duty to him arising out of the contract of transportation. The express ground of the decision in this case was that article 1903, in dealing with the liability of a master for the negligent acts of his servants "makes the distinction between private individuals and public enterprise;" that as to the latter the law creates a rebuttable presumption of negligence in the selection or direction of servants; and that in the particular case the presumption of negligence had not been overcome. It is evident, therefore that in its decision Yamada case, the court treated plaintiff's action as though founded in tort rather than as based upon the breach of the contract of carriage, and an examination of the pleadings and of the briefs shows that the questions of law were in fact discussed upon this theory. Viewed from the standpoint of the defendant the practical result must have been the same in any event. The proof disclosed beyond doubt that the defendant's servant was grossly negligent and that his negligence was the proximate cause of plaintiff's injury. It also affirmatively appeared that defendant had been guilty of negligence in its failure to exercise proper discretion in the direction of the servant. Defendant was, therefore, liable for the injury suffered by plaintiff, whether the breach of the duty were to be regarded as constituting culpa aquiliana or culpa contractual. As

Manresa points out (vol. 8, pp. 29 and 69) whether negligence occurs an incident in the course of the performance of a contractual undertaking or its itself the source of an extra-contractual undertaking obligation, its essential characteristics are identical. There is always an act or omission productive of damage due to carelessness or inattention on the part of the defendant. Consequently, when the court holds that a defendant is liable in damages for having failed to exercise due care, either directly, or in failing to exercise proper care in the selection and direction of his servants, the practical result is identical in either case. Therefore, it follows that it is not to be inferred, because the court held in the Yamada case that defendant was liable for the damages negligently caused by its servants to a person to whom it was bound by contract, and made reference to the fact that the defendant was negligent in the selection and control of its servants, that in such a case the court would have held that it would have been a good defense to the action, if presented squarely upon the theory of the breach of the contract, for defendant to have proved that it did in fact exercise care in the selection and control of the servant. The true explanation of such cases is to be found by directing the attention to the relative spheres of contractual and extra-contractual obligations. The field of non- contractual obligation is much more broader than that of contractual obligations, comprising, as it does, the whole extent of juridical human relations. These two fields, figuratively speaking, concentric; that is to say, the mere fact that a person is bound to another by contract does not relieve him from extracontractual liability to such person. When such a contractual relation exists the obligor may break the contract under such conditions that the same act which constitutes the source of an extra-contractual obligation had no contract existed between the parties. The contract of defendant to transport plaintiff carried with it, by implication, the duty to carry him in safety and to provide safe means of entering and leaving its trains (civil code, article 1258). That duty, being contractual, was direct and immediate, and its non-performance could not be excused by proof that the fault was morally imputable to defendant's servants. The railroad company's defense involves the assumption that even granting that the negligent conduct of its servants in placing an obstruction upon the platform was a breach of its contractual obligation to maintain safe means of approaching and leaving its trains, the direct and proximate cause of the injury suffered by plaintiff was his own contributory negligence in failing to wait until the train had come to a complete stop before alighting. Under the doctrine of comparative negligence announced in the Rakes case (supra), if the accident was caused by plaintiff's own negligence, no liability is imposed upon defendant's negligence and plaintiff's negligence merely contributed to his injury, the damages should be apportioned. It is, therefore, important to ascertain if defendant was in fact guilty of negligence. It may be admitted that had plaintiff waited until the train had come to a full stop before alighting, the particular injury suffered by him could not have occurred. Defendant contends, and cites many authorities in support of the contention, that it is negligence per se for a passenger to alight from a moving train. We are not

disposed to subscribe to this doctrine in its absolute form. We are of the opinion that this proposition is too badly stated and is at variance with the experience of every-day life. In this particular instance, that the train was barely moving when plaintiff alighted is shown conclusively by the fact that it came to stop within six meters from the place where he stepped from it. Thousands of person alight from trains under these conditions every day of the year, and sustain no injury where the company has kept its platform free from dangerous obstructions. There is no reason to believe that plaintiff would have suffered any injury whatever in alighting as he did had it not been for defendant's negligent failure to perform its duty to provide a safe alighting place. We are of the opinion that the correct doctrine relating to this subject is that expressed in Thompson's work on Negligence (vol. 3, sec. 3010) as follows: The test by which to determine whether the passenger has been guilty of negligence in attempting to alight from a moving railway train, is that of ordinary or reasonable care. It is to be considered whether an ordinarily prudent person, of the age, sex and condition of the passenger, would have acted as the passenger acted under the circumstances disclosed by the evidence. This care has been defined to be, not the care which may or should be used by the prudent man generally, but the care which a man of ordinary prudence would use under similar circumstances, to avoid injury." (Thompson, Commentaries on Negligence, vol. 3, sec. 3010.) Or, it we prefer to adopt the mode of exposition used by this court in Picart vs. Smith (37 Phil. rep., 809), we may say that the test is this; Was there anything in the circumstances surrounding the plaintiff at the time he alighted from the train which would have admonished a person of average prudence that to get off the train under the conditions then existing was dangerous? If so, the plaintiff should have desisted from alighting; and his failure so to desist was contributory negligence.1awph!l.net As the case now before us presents itself, the only fact from which a conclusion can be drawn to the effect that plaintiff was guilty of contributory negligence is that he stepped off the car without being able to discern clearly the condition of the platform and while the train was yet slowly moving. In considering the situation thus presented, it should not be overlooked that the plaintiff was, as we find, ignorant of the fact that the obstruction which was caused by the sacks of melons piled on the platform existed; and as the defendant was bound by reason of its duty as a public carrier to afford to its passengers facilities for safe egress from its trains, the plaintiff had a right to assume, in the absence of some circumstance to warn him to the contrary, that the platform was clear. The place, as we have already stated, was dark, or dimly lighted, and this also is proof of a failure upon the part of the defendant in the performance of a duty owing by it to the plaintiff; for if it were by any possibility concede that it had right to pile these sacks in the path of alighting passengers, the placing of them adequately so that their presence would be revealed. As pertinent to the question of contributory negligence on the part of the plaintiff in this case the following circumstances are to be noted: The company's platform was constructed upon a level higher than that of the roadbed and the

surrounding ground. The distance from the steps of the car to the spot where the alighting passenger would place his feet on the platform was thus reduced, thereby decreasing the risk incident to stepping off. The nature of the platform, constructed as it was of cement material, also assured to the passenger a stable and even surface on which to alight. Furthermore, the plaintiff was possessed of the vigor and agility of young manhood, and it was by no means so risky for him to get off while the train was yet moving as the same act would have been in an aged or feeble person. In determining the question of contributory negligence in performing such act — that is to say, whether the passenger acted prudently or recklessly — the age, sex, and physical condition of the passenger are circumstances necessarily affecting the safety of the passenger, and should be considered. Women, it has been observed, as a general rule are less capable than men of alighting with safety under such conditions, as the nature of their wearing apparel obstructs the free movement of the limbs. Again, it may be noted that the place was perfectly familiar to the plaintiff as it was his daily custom to get on and of the train at this station. There could, therefore, be no uncertainty in his mind with regard either to the length of the step which he was required to take or the character of the platform where he was alighting. Our conclusion is that the conduct of the plaintiff in undertaking to alight while the train was yet slightly under way was not characterized by imprudence and that therefore he was not guilty of contributory negligence. The evidence shows that the plaintiff, at the time of the accident, was earning P25 a month as a copyist clerk, and that the injuries he has suffered have permanently disabled him from continuing that employment. Defendant has not shown that any other gainful occupation is open to plaintiff. His expectancy of life, according to the standard mortality tables, is approximately thirty-three years. We are of the opinion that a fair compensation for the damage suffered by him for his permanent disability is the sum of P2,500, and that he is also entitled to recover of defendant the additional sum of P790.25 for medical attention, hospital services, and other incidental expenditures connected with the treatment of his injuries. The decision of lower court is reversed, and judgment is hereby rendered plaintiff for the sum of P3,290.25, and for the costs of both instances. So ordered. Arellano, C.J., Torres, Street and Avanceña, JJ., concur.

Separate Opinions

MALCOLM, J., dissenting:

With one sentence in the majority decision, we are of full accord, namely, "It may be admitted that had plaintiff waited until the train had come to a full stop before alighting, the particular injury suffered by him could not have occurred." With the general rule relative to a passenger's contributory negligence, we are likewise in full accord, namely, "An attempt to alight from a moving train is negligence per se." Adding these two points together, should be absolved from the complaint, and judgment affirmed. Johnson, J., concur. G.R. No. L-9671

August 23, 1957

CESAR L. ISAAC, plaintiff-appellant, vs. A. L. AMMEN TRANSPORTATION CO., INC., defendant-appellee. Angel S. Gamboa for appellant. Manuel O. Chan for appellee. BAUTISTA ANGELO, J.: A. L. Ammen Transportation Co., Inc., hereinafter referred to as defendant, is a corporation engaged in the business of transporting passengers by land for compensation in the Bicol provinces and one of the lines it operates is the one connecting Legaspi City, Albay with Naga City, Camarines Sur. One of the buses which defendant was operating is Bus No. 31. On May 31, 1951, plaintiff boarded said bus as a passenger paying the required fare from Ligao, Albay bound for Pili, Camarines Sur, but before reaching his destination, the bus collided with a motor vehicle of the pick-up type coming from the opposite direction, as a result of which plaintiff's left arm was completely severed and the severed portion fell inside the bus. Plaintiff was rushed to a hospital in Iriga, Camarines Sur where he was given blood transfusion to save his life. After four days, he was transferred to another hospital in Tabaco, Albay, where he under went treatment for three months. He was moved later to the Orthopedic Hospital where he was operated on and stayed there for another two months. For these services, he incurred expenses amounting to P623.40, excluding medical fees which were paid by defendant. As an aftermath, plaintiff brought this action against defendants for damages alleging that the collision which resulted in the loss of his left arm was mainly due to the gross incompetence and recklessness of the driver of the bus operated by defendant and that defendant incurred in culpa contractual arising from its noncompliance with its obligation to transport plaintiff safely to his, destination. Plaintiff prays for judgment against defendant as follows: (1) P5,000 as expenses for his medical treatment, and P3,000 as the cost of an artificial arm, or a total of P8,000; (2) P6,000 representing loss of earning; (3) P75,000 for diminution of his earning capacity; (4) P50,000 as moral damages; and (5) P10,000 as attorneys' fees and costs of suit.

Defendant set up as special defense that the injury suffered by plaintiff was due entirely to the fault or negligence of the driver of the pick-up car which collided with the bus driven by its driver and to the contributory negligence of plaintiff himself. Defendant further claims that the accident which resulted in the injury of plaintiff is one which defendant could not foresee or, though foreseen, was inevitable. The after trial found that the collision occurred due to the negligence of the driver of the pick-up car and not to that of the driver of the bus it appearing that the latter did everything he could to avoid the same but that notwithstanding his efforts, he was not able to avoid it. As a consequence, the court dismissed complaint, with costs against plaintiff. This is an appeal from said decision. It appears that plaintiff boarded a bus of defendant as paying passenger from Ligao, Albay, bound for Pili, Camarines Sur, but before reaching his destination, the bus collided with a pick-up car which was coming from the opposite direction and, as a, result, his left arm was completely severed and fell inside the back part of the bus. Having this background in view, and considering that plaintiff chose to hold defendant liable on its contractual obligation to carry him safely to his place of destination, it becomes important to determine the nature and extent of the liability of a common carrier to a passenger in the light of the law applicable in this jurisdiction. In this connection, appellant invokes the rule that, "when an action is based on a contract of carriage, as in this case, all that is necessary to sustain recovery is proof of the existence of the contract of the breach thereof by act or omission", and in support thereof, he cites several Philippine cases.1 With the ruling in mind, appellant seems to imply that once the contract of carriage is established and there is proof that the same was broken by failure of the carrier to transport the passenger safely to his destination, the liability of the former attaches. On the other hand, appellee claims that is a wrong presentation of the rule. It claims that the decisions of this Court in the cases cited do not warrant the construction sought to be placed upon, them by appellant for a mere perusal thereof would show that the liability of the carrier was predicated not upon mere breach of its contract of carriage but upon the finding that its negligence was found to be the direct or proximate cause of the injury complained of. Thus, appellee contends that "if there is no negligence on the part of the common carrier but that the accident resulting in injuries is due to causes which are inevitable and which could not have been avoided or anticipated notwithstanding the exercise of that high degree of care and skill which the carrier is bound to exercise for the safety of his passengers", neither the common carrier nor the driver is liable therefor. We believe that the law concerning the liability of a common carrier has now suffered a substantial modification in view of the innovations introduced by the new Civil Code. These innovations are the ones embodied in Articles 1733, 1755 and 1756 in so far as the relation between a common carrier and its passengers is concerned, which, for ready reference, we quote hereunder: ART. 1733. Common carriers, from the nature of their business and for reasons of public policy, are bound to observe extra ordinary 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 the vigilance over the goods is further expressed in articles 1734, 1735, and 1745, Nos. 5, 6, and 7, while the extraordinary diligence for the safety of the passengers is further set forth in articles 1755 and 1756. ART. 1755. A common carrier is bound to carry the passengers safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with a due regard for all the circumstances. ART. 1756. In case of death of or injuries to passengers, common carriers are presumed to have been at fault or to have acted negligently, unless they prove that they observed extraordinary diligence as prescribed in articles 1733 and 1755. The Code Commission, in justifying this extraordinary diligence required of a common carrier, says the following: A common carrier is bound to carry the passengers safely as far as human care and foresight can provide, using the utmost deligence of very cautions persons, with due regard for all circumstances. This extraordinary diligence required of common carriers is calculated to protect the passengers from the tragic mishaps that frequently occur in connection with rapid modern transportation. This high standard of care is imperatively demanded by the precariousness of human life and by the consideration that every person must in every way be safeguarded against all injury. (Report of the Code Commission, pp. 35-36)" (Padilla, Civil Code of the Philippines, Vol. IV, 1956 ed., p. 197). From the above legal provisions, we can make the following restatement of the principles governing the liability of a common carrier: (1) the liability of a carrier is contractual and arises upon breach of its obligation. There is breach if it fails to exert extraordinary diligence according to all circumstances of each case; (2) a carrier is obliged to carry its passenger with the utmost diligence of a very cautious person, having due regard for all the circumstances; (3) a carrier is presumed to be at fault or to have acted negligently in case of death of, or injury to, passengers, it being its duty to prove that it exercised extraordinary diligence; and (4) the carrier is not an insurer against all risks of travel. The question that now arises is: Has defendant observed extraordinary diligence or the utmost diligence of every cautious person, having due regard for all circumstances, in avoiding the collision which resulted in the injury caused to the plaintiff? After examining the evidence in connection with how the collision occurred, the lower court made the following finding: Hemos examinado muy detenidamente las pruebas presentadas en la vista, principalmente, las declaraciones que hemos acotado arriba, y hernos Ilegado a la conclusion de que el demandado ha hecho, todo cuanto estuviere de su parte para evitar el accidente, pero sin embargo, no ha podido evitarlo.

EI hecho de que el demandado, antes del choque, tuvo que hacer pasar su truck encima de los montones de grava que estaban depositados en la orilla del camino, sin que haya ido mas alla, por el grave riesgo que corrian las vidas de sus pasajeros, es prueba concluyente de lo que tenemos dicho, a saber: — que el cuanto esuba de su parte, para evitar el accidente, sin que haya podidoevitardo, por estar fuera de su control. The evidence would appear to support the above finding. Thus, it appears that Bus No. 31, immediately prior to the collision, was running at a moderate speed because it had just stopped at the school zone of Matacong, Polangui, Albay. The pick-up car was at full speed and was running outside of its proper lane. The driver of the bus, upon seeing the manner in which the pick-up was then running, swerved the bus to the very extreme right of the road until its front and rear wheels have gone over the pile of stones or gravel situated on the rampart of the road. Said driver could not move the bus farther right and run over a greater portion of the pile, the peak of which was about 3 feet high, without endangering the safety of his passengers. And notwithstanding all these efforts, the rear left side of the bus was hit by the pick-up car. Of course, this finding is disputed by appellant who cannot see eye to eye with the evidence for the appellee and insists that the collision took place because the driver of the bus was going at a fast speed. He contends that, having seen that a car was coming from the opposite direction at a distance which allows the use of moderate care and prudence to avoid an accident, and knowing that on the side of the road along which he was going there was a pile of gravel, the driver of the bus should have stopped and waited for the vehicle from the opposite direction to pass, and should have proceeded only after the other vehicle had passed. In other words, according to appellant, the act of the driver of the bus in squeezing his way through of the bus in squeezing his way through between the oncoming pick-up and the pile of gravel under the circumstances was considered negligent. But this matter is one of credibility and evaluation of the evidence. This is evidence. This is the function of the trial court. The trial court has already spoken on this matter as we have pointed out above. This is also a matter of appreciation of the situation on the part of the driver. While the position taken by appellant appeals more to the sense of caution that one should observe in a given situation to avoid an accident or mishap, such however can not always be expected from one who is placed suddenly in a predicament where he is not given enough time to take the course of action as he should under ordinary circumstances. One who is placed in such a predicament cannot exercise such coolness or accuracy of judgment as is required of him under ordinary circumstances and he cannot therefore be expected to observe the same judgment, care and precaution as in the latter. For this reason, authorities abound where failure to observe the same degree of care that as ordinary prudent man would exercise under ordinary circumstances when confronted with a sadden emergency was held to be warranted and a justification to exempt the carrier from liability. Thus, it was held that "where a carrier's employee is confronted with a sudden emergency, the fact that he is obliged to act quickly and without a chance for deliberation must be taken into account, and he is held to the some degree of care that he would otherwise be required to exercise in the

absence of such emergency but must exercise only such care as any ordinary prudent person would exercise under like circumstances and conditions, and the failure on his part to exercise the best judgement the case renders possible does not establish lack of care and skill on his part which renders the company, liable. . . . (13 C. J. S., 1412; 10 C. J.,970). Considering all the circumstances, we are persuaded to conclude that the driver of the bus has done what a prudent man could have done to avoid the collision and in our opinion this relieves appellee from legibility under our law. A circumstances which miliates against the stand of appellant is the fact borne out by the evidence that when he boarded the bus in question, he seated himself on the left side thereof resting his left arm on the window sill but with his left elbow outside the window, this being his position in the bus when the collision took place. It is for this reason that the collision resulted in the severance of said left arm from the body of appellant thus doing him a great damage. It is therefore apparent that appellant is guilty of contributory negligence. Had he not placed his left arm on the window sill with a portion thereof protruding outside, perhaps the injury would have been avoided as is the case with the other passenger. It is to be noted that appellant was the only victim of the collision. It is true that such contributory negligence cannot relieve appellee of its liability but will only entitle it to a reduction of the amount of damage caused (Article 1762, new Civil Code), but this is a circumstance which further militates against the position taken by appellant in this case. It is the prevailing rule that it is negligence per se for a passenger on a railroad voluntarily or inadvertently to protrude his arm, hand, elbow, or any other part of his body through the window of a moving car beyond the outer edge of the window or outer surface of the car, so as to come in contact with objects or obstacles near the track, and that no recovery can be had for an injury which but for such negligence would not have been sustained. (10 C. J. 1139) Plaintiff, (passenger) while riding on an interurban car, to flick the ashes, from his cigar, thrust his hand over the guard rail a sufficient distance beyond the side line of the car to bring it in contact with the trunk of a tree standing beside the track; the force of the blow breaking his wrist. Held, that he was guilty of contributory negligence as a matter of law. (Malakia vs. Rhode Island Co., 89 A., 337.) Wherefore, the decision appealed from is affirmed, with cost against appellant. Paras, C.J., Bengzon, Padilla, Montemayor, Reyes, A., Labrador, Concepcion, Endencia and Felix, JJ., concur. G.R. No. L-28014-15

May 29, 1970

SPOUSES MARCELO LANDINGIN and RACQUEL BOCASAS, plaintiffs-appellees, vs. PANGASINAN TRANSPORTATION CO. and MARCELO OLIGAN, defendants-appellants.

SPOUSES PEDRO GARCIA and EUFRACIA LANDINGIN, plaintiffs-appellees, vs. PANGASINAN TRANSPORTATION CO. and MARCELO OLIGAN, defendants-appellants. Gabriel A. Zabala for plaintiffs-appellees. Vicente M. Erfe Law Office for defendants-appellants.

VILLAMOR, J.: Direct appeal on a question of law from the portion of the judgment of the Court of First Instance of Manila ordering the defendants Pangasinan Transportation Co. (PANTRANCO) and Marcelo Oligan to pay the plaintiffs in Civil Case No. D-1468 (L-28014) the sum of P6,500.00, and the plaintiffs in Civil Case No. 1470 (L-28015) the sum of P3,500.00. The complaints in said Civil Cases Nos. D-1468 and D-1470 were filed by the spouses Marcelo Landingin and Racquel Bocasas, and the spouses Pedro Garcia and Eufracia Landingin, respectively, for damages allegedly suffered by them in connection with the death of their respective daughter, Leonila Landingin and Estrella Garcia, due to the alleged negligence of the defendants and/or breach of contract of carriage. In their complaints, plaintiffs averred, among others, that in the morning of April 20, 1963, their above-mentioned daughters were among the passengers in the bus driven by defendant Marcelo Oligan and owned and operated by defendant PANTRANCO on an excursion trip from Dagupan City to Baguio City and back, that the bus was open on one side and enclosed on the other, in gross violation of the rules of the Public Service Commission; that defendant PANTRANCO acted with negligence, fraud and bad faith in pretending to have previously secured a special permit for the trip when in truth it had not done so; that upon reaching an uphill point at Camp 8, Kennon Road, Baguio City, on the onward trip, defendant driver, through utter lack of foresight, experience and driving knowledge, caused the bus to stall and stop for a few moments; that through the said defendant's fault and mishandling, the motor ceased to function, causing the bus to slide back unchecked; that when the said defendant suddenly swerved and steered the bus toward the mountainside, Leonila and Estrella, together with several other passengers, were thrown out of the bus through its open side unto the road, suffering serious injuries as a result of which Leonila and Estrella died at the hospital and the same day; and that in connection with the incident, defendant driver had been charged with and convicted of multiple homicide and multiple slight physical injuries on account of the death of Leonila and Estrella and of the injuries suffered by four others, although it may be said, by way of parenthesis, that this case is now pending appeal in a higher court. The plaintiffs prayed for awards of moral, actual and exemplary damages in the total sum of P40,000.00 in Civil Case No. D-1468, and in the total sum of P25,000.00 in Civil Case No. D-1470 as well as attorney's fees in the amounts of P5,000.00 and P4,000.00, respectively. Defendants filed a joint answer to each of the two complaints alleging, among others, that at the time of the accident, defendant driver was driving the bus at, the

slow speed of about 10 kilometers per hour; that while the said defendant was steering his bus toward the mountainside after hearing a sound coming from under the rear end of the bus, Leonila and Estrella recklessly, and in disobedience to his shouted warnings and advice, jumped out of the bus causing their heads to hit the road or pavement; that the bus was then being driven with extraordinary care, prudence and diligence; that defendant PANTRANCO observed the care and diligence of a good father of a family to prevent the accident as well as in the selection and supervision of its employees, particularly of defendant driver; and that the decision convicting the said defendant was not yet final, the same having been appealed to the Court of Appeals where it was still pending. By agreement of the parties, the two cases were tried jointly. On October 17, 1966, the court a quo rendered its decision therein in which it made the following findings; that upon reaching the fatal spot at Camp 8, a sudden snapping or breaking of metal below the floor of the bus was heard, and the bus abruptly stopped, rolling back a few moments later; that as a result, some of the passengers jumped out of the bus, while others stepped down; that defendant driver maneuvered the bus safely to and against the side of the mountain where its rear end was made to rest, ensuring the safety of the many passengers still inside the bus; that while defendant driver as steering the bus towards the mountainside, he advised the passengers not to jump, but to remain seated; that Leonila and Estrella were not thrown out of the bus, but that they panicked and jumped out; that the malfunctioning of the motor resulted from the breakage of the cross-joint; that there was no negligence on the part of either of the defendants; that only the day before, the said cross-joint was duly inspected and found to be in order; and that defendant PANTRANCO had exercised the requisite care in the selection and supervision of its employees, including the defendant driver. The court concluded that "the accident was caused by a fortuitous event or an act of God brought about by some extra-ordinary circumstances independent of the will of the Pantranco or its employees." One would wonder why in the face of such factual findings and conclusion of the trial court, the defendants, instead of the plaintiffs, should come to this Court on appeal. The answer lies in the dispositive portion of the decision, to wit: IN VIEW OF THE FOREGOING CONSIDERATIONS, the Court hereby renders judgment: (a) Absolving the defendants from any liability on account of negligence on their part and therefore dismissing the complaints in these two cases; (b) However, as stated above, the Court hereby orders the defendant Pantranco to pay to the plaintiffs spouses Marcelo Tandingin and Racquel Bocasas in Civil Case No. D-1468 the amount of P6,500.00; and the amount of P3,500.00 to the spouses Pedro Garcia and Eufracia Landingin in Civil Case No. D-1470, not in payment of liability because of any negligence on the part of the defendants but as an expression of sympathy and goodwill. (Emphasis supplied.) As to what impelled the court below to include item (b) in the dispositive portion of its decision, can be gathered from the penultimate paragraph of the decision, which reads:

However, there is evidence to the effect that an offer of P8,500.00 in the instant cases without any admission of fault or negligence had been made by the defendant Pantranco and that actually in Civil Case No. D-1469 for the death of Pacita Descalso, the other deceased passenger of the bus in question, the heirs of the decease received P3,000.00 in addition to hospital and medical bills and the coffin of the deceased for the dismissal of the said case without Pantranco accepting liability. There was as a matter of fact during the pre-trial of these two cases a continuing offer of settlement on the part of the defendant Pantranco without accepting any liability for such damages, and the Court understood that the Pantranco would be willing still to pay said amounts even if these cases were to be tried on the merits. It is well-known that the defendant Pantranco is zealous in the preservation of its public relations. In the spirit therefore of the offer of the defendant Pantranco aforesaid, to assuage the feelings of the herein plaintiffs an award of P6,500.00 for the spouses Marcelo Landingin and Racquel Bocasas in Civil Case No. D-1468 whose daughter Leonila was, when she died, a third-year Commerce student at the Far Eastern University, and P3,500.00 for the spouses Pedro Garcia and Eufracia Landingin in Civil Case No. D-1470 whose daughter Estrella was in the fourth year High at the Dagupan Colleges when she died, is hereby made in their favor. This award is in addition to what Pantranco might have spent to help the parents of both deceased after the accident. Defendants-appellants complain that having found them to be absolutely free from fault or negligence, and having in fact dismissed the complaints against them, the court should not have ordered them to assume any pecuniary liability. There would be merit in his argument but for the fact that defendant-appellant PANTRANCO was guilty of breach of contract of carriage. It will be noted that in each of the two complaints it is averred that two buses including the one in which the two deceased girls were riding, were hired to transport the excursionist passengers from Dagupan City to Baguio City, and return, and that the said two passengers did not reach destination safely. As a common carrier, defendant-appellant PANTRANCO was duty bound to carry its passengers "safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with a due regard for all the circumstances." (Article 1755, Civil Code.) Did defendant-appellant PANTRANCO measure up to the degree of care and foresight required it under the circumstances? We think not. The court below found that the cross-joint of the bus in which the deceased were riding broke, which caused the malfunctioning of the motor, which in turn resulted in panic among some of the passengers. This is a finding of fact which this Court may not disturb. We are of the opinion, however, that the lower court's conclusion drawn from that fact, i.e., that "the accident was caused by a fortuitous event or an act of God brought about by some extraordinary circumstances independent of the will of the Pantranco or its employees," is in large measure conjectural and speculative, and was arrived at without due regard to all the circumstances, as required by Article 1755. In Lasam vs. Smith (45 Phil. 660), this Court held that an accident caused by defects in the automobile is not a caso fortuito. The rationale of the carrier's liability is the fact that "the passenger has neither the choice nor control over the carrier in the selection and use of the equipment and appliances in use by the carrier." (Necesito, et al. vs. Paras, et al., 104 Phil. 75.)

When a passenger dies or is injured, the presumption is that the common carrier is at fault or that it acted negligently (Article 1756). This presumption is only rebutted by proof on the carrier's part that it observed the "extraordinary diligence" required in Article 1733 and the "utmost diligence of very cautious persons" required in Article 1755 (Article 1756). In the instant case it appears that the court below considered the presumption rebutted on the strength of defendants-appellants' evidence that only the day before the incident, the crossjoint in question was duly inspected and found to be in order. It does not appear, however, that the carrier gave due regard for all the circumstances in connection with the said inspection. The bus in which the deceased were riding was heavily laden with passengers, and it would be traversing mountainous, circuitous and ascending roads. Thus the entire bus, including its mechanical parts, would naturally be taxed more heavily than it would be under ordinary circumstances. The mere fact that the bus was inspected only recently and found to be in order would not exempt the carrier from liability unless it is shown that the particular circumstances under which the bus would travel were also considered. In the premises, it was error for the trial court to dismiss the complaints. The awards made by the court should be considered in the concept of damages for breach of contracts of carriage. IN VIEW OF THE FOREGOING CONSIDERATIONS, the judgment appealed from is modified as indicated above, and defendant-appellant PANTRANCO is ordered to pay to plaintiffs-appellees the amounts stated in the judgment appealed from, as damages for breach of contracts, with interest thereon at the legal rate from the date of the filing of the complaints. Costs against defendant-appellant PANTRANCO. Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Fernando, Teehankee and Barredo, JJ., concur. Castro, J., is on leave.

DEL PRADO v MERALCO digest From Haystacks (Berne Guerrero) Del Prado vs. Meralco (GR 29462, 7 March 1929) En Banc, Street (J): 5 concur Facts: The Manila Electric Company, is engaged in operating street cars in the City of Manila for theconveyance of passengers; and on the morning of 18 November 1925, one Teodorico Florenciano, asMeralco’s motorman, was in charge of car 74 running from east to west on R. Hidalgo Street, the scene of theaccident being at a point near the intersection of said street and Mendoza Street. After the car had stopped atits appointed place for taking on and letting off passengers, just east of the intersection, it resumed its courseat a moderate speed under the guidance of the motorman. The car had proceeded only a short distance,however, when Ignacio del Prado ran across the street to catch the car, his approach being made from the

left.The car was of the kind having entrance and exit at either end, and the movement of del Prado was so timedthat he arrived at the front entrance of the car at the moment when the car was passing. Del Prado, uponapproaching the car, raised his hand as an indication to the motorman of his desire to board the car, inresponse to which the motorman eased up a little, without stopping. Upon this, del Prado seized, with his lefthand, the front perpendicular handpost, at the same time placing his left foot upon the platform. However,before del Prado’s position had become secure, and even before his raised right foot had reached the platform,the motorman applied the power, with the result that the car gave a slight lurch forward. This sudden impulseto the car caused del Prado’s foot to slip, and his hand was jerked loose from the handpost. He therefore fell tothe ground, and his right foot was caught and crushed by the moving car. The next day the member had to beamputated in the hospital.An action was instituted in the CFI of Manila by Ignacio del Prado to recover damages in the amount ofP50,000 for personal injuries alleged to have been caused by the negligence of Meralco in the operation ofone of its street cars in the City of Manila. Upon hearing the cause the trial court awarded to del Prado thesum of P10,000, as damages, with costs of suit. Meralco appealed.The Supreme Court affirmed the appealed judgment with the modification that the sum to be recoveredreduced to P2,500; with costs against Meralco. 1.No obligation on the part of a street railway company to stop cars at points other thanappointed for stoppage There is no oblig ation on the part of a street railway company to stop its cars to let on intendingpassengers at other points than those appointed for stoppage. It would be impossible to operate a system ofstreet cars if a company engaged in this business were required to stop any and everywhere to take on peoplewho are too indolent, or who imagine themselves to be in too great a hurry, to go to the proper places forboarding the cars. 2.Duty of the motorman of the car Although the motorman of the car was not bound to stop to let the passenger on, it was his duty to dono act that would have the effect of increasing the passenger’s peril while he was attempting to board the car.The premature acceleration of the car was a breach of this duty. 3.Nature of relation between a carrier of passengers for hire and its patrons; Duty of the carrier The relation between a carrier of passengers for hire and its patrons is of a contractual nature; and afailure on the part of the carrier to use due care in carrying its passengers safely is a breach of duty (culpacontractual) under articles 1101, 1103, and 1104 of the Civil Code. Furthermore, the duty that the carrier ofpassengers owes to its patrons extends to persons boarding the cars as well as to those alighting therefrom. 4.Cangco vs. Manila Railroad; Culpa Contractual The case of Cangco vs. Manila Railroad Co. (38 Phil., 768), supplies an instance of the violation ofthe duty with respect to a passenger who was getting off of a train. In that case, the plaintiff stepped off of amoving train, while it was slowing down in a station, and at a time when it was too dark for him to see clearlywhere he was putting his feet. The employees of the company had carelessly left watermelons on

the platformat the place where the plaintiff alighted, with the result that his feet slipped and he fell under the car, where his right arm was badly injured. This court held that the railroad company was liable for breach of positiveduty (culpa contractual), and the plaintiff was awarded damages in the amount of P2,500 for the loss of hisarm. In the opinion in that case the distinction is clearly drawn between a liability for negligence arising frombreach of contractual duty and that arising under articles 1902 and 1903 of the Civil Code (culpa aquiliana). 5.Relevance of distinction between Culpa Contractual and Culpa Aquiliana as to defensesavailable The distinction between the two sorts of negligence is important in this jurisdiction, for the reasonthat where liability arises from a mere tort (culpa aquiliana), not involving a breach of positive obligation, anemployer, or master, may exculpate himself, under the last paragraph of article 1903 of the Civil Code, byproving that he had exercised due diligence to prevent the damage; whereas this defense is not available if theliability of the master arises from a breach of contractual duty (culpa contractual). 6.Training of motorman irrelevant in breach of obligation under Article 1101 of the Civil Code Herein, the company pleaded as a special defense that it had used all the diligence of a good father ofa family to prevent the damage suffered by del Prado; and to establish this contention the company introducedtestimony showing that due care had been used in training and instructing the motorman in charge of this carin his art. This proof is irrelevant in view of the fact that the liability involved was derived from a breach ofobligation under article 1101 of the Civil Code and related provisions. 7.Relevance of distinction between negligence arising under Article 1902 and 1101 as to mitigationof liability Another practical difference between liability for negligence arising under article 1902 of the CivilCode and liability arising from negligence in the performance of a positive duty, under article 1101 andrelated provisions of the Civil Code, is that, in dealing with the latter form of negligence, the court is given adiscretion to mitigate liability according to the circumstances of the case (art 1103). No such generaldiscretion is given by the Code in dealing with liability arising under article 1902; though possibly the sameend is reached by courts in dealing with the latter form of liability because of the latitude of the considerationspertinent to cases arising under this article 8.Contributory negligence a mitigating circumstance under Article 1103 Civil Code As to the contributory negligence of del Prado, as in Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil.,359), it is treated as a mitigating circumstance under article 1103 of the Civil Code. Herein, the negligence ofdel Prado was contributory to the accident and must be considered as a mitigating circumstance. 9.Proximate cause of the accident Del Prado’s negligence in attempting to board the moving car was not the proximate cause of theinjury. The direct and proximate cause of the injury was the act of Meralco’s motorman in putting on thepower prematurely. A person boarding a

moving car must be taken to assume the risk of injury from boardingthe car under the conditions open to his view, but he cannot fairly be held to assume the risk that themotorman, having the situation in view, will increase his peril by accelerating the speed of the car before he isplanted safely on the platform. Again, the situation is one where the negligent act of the company’s servantsucceeded the negligent act of the passenger, and the negligence of the company must be considered theproximate cause of the injury. 10.Rule analogous to the doctrine of “the last clear chance” The rule applicable seems to be analogous to, if not identical with that which is sometimes referred toas the doctrine of “the last clear chance.” In accordance with this doctrine, the contributory negligence of theparty injured will not defeat the action if it be shown that the defendant might, by the exercise of reasonablecare and prudence, have avoided the consequences of the negligence of the injured party. 11.Award of damage With respect to the effect of this injury upon del Prado’s earning power, although he lost his foot, heis able to use an artificial member without great inconvenience and his earning capacity has probably not beenreduced by more than 30%. In view of the precedents found in the Court’s decisions with respect to thedamages that ought to be awarded for the loss of a limb, and more particularly Rakes vs. Atlantic, Gulf andPacific Co. (7 Phil., 359); Cangco vs. Manila Railroad Co. (38 Phil., 768); and Borromeo vs. Manila ElectricRailroad and Light Co. (44 Phil., 165), and in view of all the circumstances connected with the case, the Courtis of the opinion that del Prado will be adequately compensated by an award of P2,500.

DEL PRADO v MERALCO case EN BANC G.R. No. L-29462

March 7, 1929

IGNACIO DEL PRADO, plaintiff-appellee, vs. MANILA ELECTRIC CO., defendant-appellant. Ross, Lawrence and Selph and Antonio T. Carrascoso, jr., for appellant. Vicente Sotto for appellee. STREET, J.: This action was instituted in the Court of First Instance of Manila by Ignacio del Prado to recover damages in the amount of P50,000 for personal injuries alleged to have been caused by the negligence of te defendant, the Manila Electric Company, in the operation of one of its street cars in the City of Manila. Upon hearing the

cause the trial court awarded to the plaintiff the sum of P10,000, as damages, with costs of suit, and the defendant appealed. The appellant, the Manila Electric Company, is engaged in operating street cars in the City for the conveyance of passengers; and on the morning of November 18, 1925, one Teodorico Florenciano, as appellant's motorman, was in charge of car No. 74 running from east to west on R. Hidalgo Street, the scene of the accident being at a point near the intersection of said street and Mendoza Street. After the car had stopped at its appointed place for taking on and letting off passengers, just east of the intersection, it resumed its course at a moderate speed under the guidance of the motorman. The car had proceeded only a short distance, however, when the plaintiff, Ignacio del Prado, ran across the street to catch the car, his approach being made from the left. The car was of the kind having entrance and exist at either end, and the movement of the plaintiff was so timed that he arrived at the front entrance of the car at the moment when the car was passing. The testimony of the plaintiff and of Ciriaco Guevara, one of his witnesses, tends to shows that the plaintiff, upon approaching the car, raised his hand as an indication to the motorman of his desire to board the car, in response to which the motorman eased up a little, without stopping. Upon this the plaintiff seized, with his hand, the front perpendicular handspot, at the same time placing his left foot upon the platform. However, before the plaintiff's position had become secure, and even before his raised right foot had reached the flatform, the motorman applied the power, with the result that the car gave a slight lurch forward. This sudden impulse to the car caused the plaintiff's foot to slip, and his hand was jerked loose from the handpost, He therefore fell to the ground, and his right foot was caught and crushed by the moving car. The next day the member had to be amputated in the hospital. The witness, Ciriaco Guevara, also stated that, as the plaintiff started to board the car, he grasped the handpost on either side with both right and left hand. The latter statement may possibly be incorrect as regards the use of his right hand by the plaintiff, but we are of the opinion that the finding of the trial court to the effect that the motorman slowed up slightly as the plaintiff was boarding the car that the plaintiff's fall was due in part at lease to a sudden forward movement at the moment when the plaintiff put his foot on the platform is supported by the evidence and ought not to be disturbed by us. The motorman stated at the trial that he did not see the plaintiff attempting to board the car; that he did not accelerate the speed of the car as claimed by the plaintiff's witnesses; and that he in fact knew nothing of the incident until after the plaintiff had been hurt and some one called to him to stop. We are not convinced of the complete candor of this statement, for we are unable to see how a motorman operating this car could have failed to see a person boarding the car under the circumstances revealed in this case. It must be remembered that the front handpost which, as all witness agree, was grasped by the plaintiff in attempting to board the car, was immediately on the left side of the motorman. With respect to the legal aspects of the case we may observe at the outset that there is no obligation on the part of a street railway company to stop its cars to let on intending passengers at other points than those appointed for stoppage. In fact it would be impossible to operate a system of street cars if a company engage in this

business were required to stop any and everywhere to take on people who were too indolent, or who imagine themselves to be in too great a hurry, to go to the proper places for boarding the cars. Nevertheless, although the motorman of this car was not bound to stop to let the plaintiff on, it was his duty to do act that would have the effect of increasing the plaintiff's peril while he was attempting to board the car. The premature acceleration of the car was, in our opinion, a breach of this duty. The relation between a carrier of passengers for hire and its patrons is of a contractual nature; and in failure on the part of the carrier to use due care in carrying its passengers safely is a breach of duty (culpa contructual) under articles 1101, 1103 and 1104 of the Civil Code. Furthermore, the duty that the carrier of passengers owes to its patrons extends to persons boarding the cars as well as to those alighting therefrom. The case of Cangco vs. Manila Railroad Co. (38 Phil., 768), supplies an instance of the violation of this duty with respect to a passenger who was getting off of a train. In that case the plaintiff stepped off of a moving train, while it was slowing down in a station, and at the time when it was too dark for him to see clearly where he was putting his feet. The employees of the company had carelessly left watermelons on the platform at the place where the plaintiff alighted, with the result that his feet slipped and he fell under the car, where his right arm badly injured. This court held that the railroad company was liable for breach positive duty (culpa contractual), and the plaintiff was awarded damages in the amount of P2,500 for the loss of his arm. In the opinion in that case the distinction is clearly drawn between a liability for negligence arising from breach of contructual duty and that arising articles 1902 and 1903 of the Civil Code (culpa aquiliana). The distiction between these two sorts of negligence is important in this jurisdiction, for the reason that where liability arises from a mere tort (culpa aquiliana), not involving a breach of positive obligation, an employer, or master, may exculpate himself, under the last paragraph of article 1903 of the Civil Code, by providing that he had exercised due degligence to prevent the damage; whereas this defense is not available if the liability of the master arises from a breach of contrauctual duty (culpa contractual). In the case bfore us the company pleaded as a special defense that it had used all the deligence of a good father of a family to prevent the damage suffered by the plaintiff; and to establish this contention the company introduced testimony showing that due care had been used in training and instructing the motorman in charge of this car in his art. But this proof is irrelevant in view of the fact that the liability involved was derived from a breach of obligation under article 1101 of the Civil Code and related provisions. (Manila Railroad Co. vs. Compana Transatlantica and Atlantic, Gulf & Pacific Co., 38 Phil., 875, 887; De Guia vs. Manila Electric Railroad & Light Co., 40 Phil., 706, 710.) Another practical difference between liability for negligence arising under 1902 of the Civil Code and liability arising from negligence in the performance of a positive duty, under article 1101 and related provisions of the Civil Code, is that, in dealing with the latter form of negligence, the court is given a discretion to mitigate liability according to the circumstances of the case (art 1103). No such general discretion is given by the Code in dealing with liability arising under article 1902; although possibly the same end is reached by courts in dealing with the latter form of liability

because of the latitude of the considerations pertinent to cases arising under this article. As to the contributory negligence of the plaintiff, we are of the opinion that it should be treated, as in Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil., 359), as a mitigating circumstance under article 1103 of the Civil Code. It is obvious that the plaintiff's negligence in attempting to board the moving car was not the proximate cause of the injury. The direct and proximate cause of the injury was the act of appellant's motorman in putting on the power prematurely. A person boarding a moving car must be taken to assume the risk of injury from boarding the car under the conditions open to his view, but he cannot fairly be held to assume the risk that the motorman, having the situation in view, will increase his peril by accelerating the speed of the car before he is planted safely on the platform. Again, the situation before us is one where the negligent act of the company's servant succeeded the negligent act of the plaintiff, and the negligence of the company must be considered the proximate cause of the injury. The rule here applicable seems to be analogous to, if not identical with that which is sometimes referred to as the doctrine of "the last clear chance." In accordance with this doctrine, the contributory negligence of the party injured will not defeat the action if it be shown that the defendant might, by the exercise of reasonable care and prudence, have avoided the consequences of the negligence of the injured party (20 R. C. L., p. 139; Carr vs. Interurban Ry. Co., 185 Iowa, 872; 171 N. W., 167). The negligence of the plaintiff was, however, contributory to the accident and must be considered as a mitigating circumstance. With respect to the effect of this injury upon the plaintiff's earning power, we note that, although he lost his foot, he is able to use an artificial member without great inconvenience and his earning capacity has probably not been reduced by more than 30 per centum. In view of the precedents found in our decisions with respect to the damages that ought to be awarded for the loss of limb, and more particularly Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil., 359); Cangco vs. Manila Railroad Co. (38 Phil., 768); and Borromeo vs. Manila Electric Railroad and Light Co. (44 Phil., 165), and in view of all the circumstances connected with the case, we are of the opinion that the plaintiff will be adequately compensated by an award of P2,500. It being understood, therefore, that the appealed judgment is modified by reducing the recovery to the sum of P2,500, the judgment, as thus modified, is affirmed. So ordered, with costs against the appellant. Malcolm, Villamor, Ostrand, Romualdez and Villa-Real, JJ., concur.

Separate Opinions JOHNSON, J., dissenting: This appeal presents a hard case, whichever way it is decided.

I read the entire record in this case before it was submitted to the second division for decision. I was then the ponente. I was then convinced, as I am now, after a reexamination of the record, that the judgment of the lower court should be revoked for the following reasons: (a) That the motorman managed the car carefully and with ordinary prudence at the moment the alleged accident occured; (b) That the appellee acted with imprudence and lack of due care in attempting to board a street car while the same was in motion; and (c) That he contributed to his own injury, without any negligence or malice or imprudence on the part of the defendant. There is nothing in the record which even remotely justifies a contribution of damages between the appellee and the appellant. The appellee should be required to suffer the damages which he himself, through his own negligence, occasioned, without any negligence, imprudence or malice on the part of the appellant. Therefore, the judgment of the court a quo should be revoked, and the appellant absolved from all liability under the complaint. Johns, J., concur.

LA MALLORCA v CA EN BANC G.R. No. L-20761

July 27, 1966

LA MALLORCA, petitioner, vs. HONORABLE COURT OF APPEALS, MARIANO BELTRAN, ET AL., respondents. G. E. Yabut, R. Monterey and M.C. Lagman for petitioner. Ahmed Garcia for respondents. BARRERA, J.: La Mallorca seeks the review of the decision of the Court of Appeals in CA-G.R. No. 23267-R, holding it liable for quasi-delict and ordering it to pay to respondents Mariano Beltran, et al., P6,000.00 for the death of his minor daughter Raquel Beltran, plus P400.00 as actual damages. The facts of the case as found by the Court of Appeals, briefly are:

On December 20, 1953, at about noontime, plaintiffs, husband and wife, together with their minor daughters, namely, Milagros, 13 years old, Raquel, about 4½ years old, and Fe, over 2 years old, boarded the Pambusco Bus No. 352, bearing plate TPU No. 757 (1953 Pampanga), owned and operated by the defendant, at San Fernando, Pampanga, bound for Anao, Mexico, Pampanga. At the time, they were carrying with them four pieces of baggages containing their personal belonging. The conductor of the bus, who happened to be a half-brother of plaintiff Mariano Beltran, issued three tickets (Exhs. A, B, & C) covering the full fares of the plaintiff and their eldest child, Milagros. No fare was charged on Raquel and Fe, since both were below the height at which fare is charged in accordance with the appellant's rules and regulations. After about an hour's trip, the bus reached Anao whereat it stopped to allow the passengers bound therefor, among whom were the plaintiffs and their children to get off. With respect to the group of the plaintiffs, Mariano Beltran, then carrying some of their baggages, was the first to get down the bus, followed by his wife and his children. Mariano led his companions to a shaded spot on the left pedestrians side of the road about four or five meters away from the vehicle. Afterwards, he returned to the bus in controversy to get his other bayong, which he had left behind, but in so doing, his daughter Raquel followed him, unnoticed by her father. While said Mariano Beltran was on the running board of the bus waiting for the conductor to hand him his bayong which he left under one of its seats near the door, the bus, whose motor was not shut off while unloading, suddenly started moving forward, evidently to resume its trip, notwithstanding the fact that the conductor has not given the driver the customary signal to start, since said conductor was still attending to the baggage left behind by Mariano Beltran. Incidentally, when the bus was again placed into a complete stop, it had travelled about ten meters from the point where the plaintiffs had gotten off. Sensing that the bus was again in motion, Mariano Beltran immediately jumped from the running board without getting his bayong from the conductor. He landed on the side of the road almost in front of the shaded place where he left his wife and children. At that precise time, he saw people beginning to gather around the body of a child lying prostrate on the ground, her skull crushed, and without life. The child was none other than his daughter Raquel, who was run over by the bus in which she rode earlier together with her parents. For the death of their said child, the plaintiffs commenced the present suit against the defendant seeking to recover from the latter an aggregate amount of P16,000 to cover moral damages and actual damages sustained as a result thereof and attorney's fees. After trial on the merits, the court below rendered the judgment in question. On the basis of these facts, the trial court found defendant liable for breach of contract of carriage and sentenced it to pay P3,000.00 for the death of the child and P400.00 as compensatory damages representing burial expenses and costs. On appeal to the Court of Appeals, La Mallorca claimed that there could not be a breach of contract in the case, for the reason that when the child met her death, she was no longer a passenger of the bus involved in the incident and, therefore,

the contract of carriage had already terminated. Although the Court of Appeals sustained this theory, it nevertheless found the defendant-appellant guilty of quasidelict and held the latter liable for damages, for the negligence of its driver, in accordance with Article 2180 of the Civil Code. And, the Court of Appeals did not only find the petitioner liable, but increased the damages awarded the plaintiffsappellees to P6,000.00, instead of P3,000.00 granted by the trial court. In its brief before us, La Mallorca contends that the Court of Appeals erred (1) in holding it liable for quasi-delict, considering that respondents complaint was one for breach of contract, and (2) in raising the award of damages from P3,000.00 to P6,000.00 although respondents did not appeal from the decision of the lower court. Under the facts as found by the Court of Appeals, we have to sustain the judgement holding petitioner liable for damages for the death of the child, Raquel Beltran. It may be pointed out that although it is true that respondent Mariano Beltran, his wife, and their children (including the deceased child) had alighted from the bus at a place designated for disembarking or unloading of passengers, it was also established that the father had to return to the vehicle (which was still at a stop) to get one of his bags or bayong that was left under one of the seats of the bus. There can be no controversy that as far as the father is concerned, when he returned to the bus for his bayong which was not unloaded, the relation of passenger and carrier between him and the petitioner remained subsisting. For, the relation of carrier and passenger does not necessarily cease where the latter, after alighting from the car, aids the carrier's servant or employee in removing his baggage from the car.1 The issue to be determined here is whether as to the child, who was already led by the father to a place about 5 meters away from the bus, the liability of the carrier for her safety under the contract of carriage also persisted. It has been recognized as a rule that the relation of carrier and passenger does not cease at the moment the passenger alights from the carrier's vehicle at a place selected by the carrier at the point of destination, but continues until the passenger has had a reasonable time or a reasonable opportunity to leave the carrier's premises. And, what is a reasonable time or a reasonable delay within this rule is to be determined from all the circumstances. Thus, a person who, after alighting from a train, walks along the station platform is considered still a passenger.2 So also, where a passenger has alighted at his destination and is proceeding by the usual way to leave the company's premises, but before actually doing so is halted by the report that his brother, a fellow passenger, has been shot, and he in good faith and without intent of engaging in the difficulty, returns to relieve his brother, he is deemed reasonably and necessarily delayed and thus continues to be a passenger entitled as such to the protection of the railroad and company and its agents.3 In the present case, the father returned to the bus to get one of his baggages which was not unloaded when they alighted from the bus. Raquel, the child that she was, must have followed the father. However, although the father was still on the running board of the bus awaiting for the conductor to hand him the bag or bayong, the bus started to run, so that even he (the father) had to jump down from the moving vehicle. It was at this instance that the child, who must be near the bus, was run over and killed. In the circumstances, it cannot be claimed that the carrier's agent had exercised the "utmost diligence" of a "very cautions person" required by

Article 1755 of the Civil Code to be observed by a common carrier in the discharge of its obligation to transport safely its passengers. In the first place, the driver, although stopping the bus, nevertheless did not put off the engine. Secondly, he started to run the bus even before the bus conductor gave him the signal to go and while the latter was still unloading part of the baggages of the passengers Mariano Beltran and family. The presence of said passengers near the bus was not unreasonable and they are, therefore, to be considered still as passengers of the carrier, entitled to the protection under their contract of carriage. But even assuming arguendo that the contract of carriage has already terminated, herein petitioner can be held liable for the negligence of its driver, as ruled by the Court of Appeals, pursuant to Article 2180 of the Civil Code. Paragraph 7 of the complaint, which reads — That aside from the aforesaid breach of contract, the death of Raquel Beltran, plaintiffs' daughter, was caused by the negligence and want of exercise of the utmost diligence of a very cautious person on the part of the defendants and their agent, necessary to transport plaintiffs and their daughter safely as far as human care and foresight can provide in the operation of their vehicle. is clearly an allegation for quasi-delict. The inclusion of this averment for quasidelict, while incompatible with the other claim under the contract of carriage, is permissible under Section 2 of Rule 8 of the New Rules of Court, which allows a plaintiff to allege causes of action in the alternative, be they compatible with each other or not, to the end that the real matter in controversy may be resolved and determined.4 The plaintiffs sufficiently pleaded the culpa or negligence upon which the claim was predicated when it was alleged in the complaint that "the death of Raquel Beltran, plaintiffs' daughter, was caused by the negligence and want of exercise of the utmost diligence of a very cautious person on the part of the defendants and their agent." This allegation was also proved when it was established during the trial that the driver, even before receiving the proper signal from the conductor, and while there were still persons on the running board of the bus and near it, started to run off the vehicle. The presentation of proof of the negligence of its employee gave rise to the presumption that the defendant employer did not exercise the diligence of a good father of the family in the selection and supervision of its employees. And this presumption, as the Court of Appeals found, petitioner had failed to overcome. Consequently, petitioner must be adjudged peculiarily liable for the death of the child Raquel Beltran. The increase of the award of damages from P3,000.00 to P6,000.00 by the Court of Appeals, however, cannot be sustained. Generally, the appellate court can only pass upon and consider questions or issues raised and argued in appellant's brief. Plaintiffs did not appeal from that portion of the judgment of the trial court awarding them on P3,000.00 damages for the death of their daughter. Neither does it appear that, as appellees in the Court of Appeals, plaintiffs have pointed out in their brief the inadequacy of the award, or that the inclusion of the figure P3,000.00 was merely a clerical error, in order that the matter may be treated as an exception to the general rule.5 Herein petitioner's contention, therefore, that the Court of

Appeals committed error in raising the amount of the award for damages is, evidently, meritorious.1äwphï1.ñët Wherefore, the decision of the Court of Appeals is hereby modified by sentencing, the petitioner to pay to the respondents Mariano Beltran, et al., the sum of P3,000.00 for the death of the child, Raquel Beltran, and the amount of P400.00 as actual damages. No costs in this instance. So ordered. Concepcion, C.J., Reyes, J.B.L., Dizon, Regala, Bengzon, J.P., Zaldivar, Sanchez and Castro, JJ., concur. Makalintal, J., concurs in the result.

BATACLAN v MEDINA EN BANC G.R. No. L-10126

October 22, 1957

SALUD VILLANUEVA VDA. DE BATACLAN and the minors NORMA, LUZVIMINDA, ELENITA, OSCAR and ALFREDO BATACLAN, represented by their Natural guardian, SALUD VILLANUEVA VDA. DE BATACLAN, plaintiffs-appellants, vs. MARIANO MEDINA, defendant-appellant. Lope E. Adriano, Emmanuel Andamo and Jose R. Francisco for plaintiffs-appellants. Fortunato Jose for defendant and appellant. MONTEMAYOR, J.: Shortly after midnight, on September 13, 1952 bus no. 30 of the Medina Transportation, operated by its owner defendant Mariano Medina under a certificate of public convenience, left the town of Amadeo, Cavite, on its way to Pasay City, driven by its regular chauffeur, Conrado Saylon. There were about eighteen passengers, including the driver and conductor. Among the passengers were Juan Bataclan, seated beside and to the right of the driver, Felipe Lara, sated to the right of Bataclan, another passenger apparently from the Visayan Islands whom the witnesses just called Visaya, apparently not knowing his name, seated in the left side of the driver, and a woman named Natalia Villanueva, seated just behind the four last mentioned. At about 2:00 o'clock that same morning, while the bus was running within the jurisdiction of Imus, Cavite, one of the front tires burst and the vehicle began to zig-zag until it fell into a canal or ditch on the right side of the road and turned turtle. Some of the passengers managed to leave the bus the best way they could, others had to be helped or pulled out, while the three passengers seated beside the driver, named Bataclan, Lara and the Visayan and the woman behind them named Natalia Villanueva, could not get out of the overturned bus. Some of the passengers, after they had clambered up to the road, heard groans and moans from inside the bus, particularly, shouts for help from Bataclan and Lara, who said they could not get out of the bus. There is nothing in the evidence to show whether or not the passengers already free from the wreck, including the driver and

the conductor, made any attempt to pull out or extricate and rescue the four passengers trapped inside the vehicle, but calls or shouts for help were made to the houses in the neighborhood. After half an hour, came about ten men, one of them carrying a lighted torch made of bamboo with a wick on one end, evidently fueled with petroleum. These men presumably approach the overturned bus, and almost immediately, a fierce fire started, burning and all but consuming the bus, including the four passengers trapped inside it. It would appear that as the bus overturned, gasoline began to leak and escape from the gasoline tank on the side of the chassis, spreading over and permeating the body of the bus and the ground under and around it, and that the lighted torch brought by one of the men who answered the call for help set it on fire. That same day, the charred bodies of the four deemed passengers inside the bus were removed and duly identified that of Juan Bataclan. By reason of his death, his widow, Salud Villanueva, in her name and in behalf of her five minor children, brought the present suit to recover from Mariano Medina compensatory, moral, and exemplary damages and attorney's fees in the total amount of P87,150. After trial, the Court of First Instance of Cavite awarded P1,000 to the plaintiffs plus P600 as attorney's fee, plus P100, the value of the merchandise being carried by Bataclan to Pasay City for sale and which was lost in the fire. The plaintiffs and the defendants appealed the decision to the Court of Appeals, but the latter endorsed the appeal to us because of the value involved in the claim in the complaint. Our new Civil Code amply provides for the responsibility of common carrier to its passengers and their goods. For purposes of reference, we are reproducing the pertinent codal provisions: 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 the vigilance over the goods is further expressed in articles 1734, 1735, and 1745, Nos. 5, 6, and 7, while the extra ordinary diligence for the safety of the passengers is further set forth in articles 1755 and 1756. ART. 1755. A common carrier is bound to carry the passengers safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with a due regard for all the circumstances. ART. 1756. In case of death of or injuries to passengers, common carriers are presumed to have been at fault or to have acted negligently, unless they prove that they observed extraordinary diligence as prescribed in articles 1733 and 1755 ART. 1759. Common carriers are liable for the death of or injuries to passengers through the negligence or willful acts of the former's employees, although such employees may have acted beyond the scope of their authority or in violation of the order of the common carriers.

This liability of the common carriers does not cease upon proof that they exercised all the diligence of a good father of a family in the selection and supervision of their employees. ART. 1763. A common carrier responsible for injuries suffered by a passenger on account of the willful acts or negligence of other passengers or of strangers, if the common carrier's employees through the exercise of the diligence of a good father of a family could have prevented or stopped the act or omission. We agree with the trial court that the case involves a breach of contract of transportation for hire, the Medina Transportation having undertaken to carry Bataclan safely to his destination, Pasay City. We also agree with the trial court that there was negligence on the part of the defendant, through his agent, the driver Saylon. There is evidence to show that at the time of the blow out, the bus was speeding, as testified to by one of the passengers, and as shown by the fact that according to the testimony of the witnesses, including that of the defense, from the point where one of the front tires burst up to the canal where the bus overturned after zig-zaging, there was a distance of about 150 meters. The chauffeur, after the blow-out, must have applied the brakes in order to stop the bus, but because of the velocity at which the bus must have been running, its momentum carried it over a distance of 150 meters before it fell into the canal and turned turtle. There is no question that under the circumstances, the defendant carrier is liable. The only question is to what degree. The trial court was of the opinion that the proximate cause of the death of Bataclan was not the overturning of the bus, but rather, the fire that burned the bus, including himself and his co-passengers who were unable to leave it; that at the time the fire started, Bataclan, though he must have suffered physical injuries, perhaps serious, was still alive, and so damages were awarded, not for his death, but for the physical injuries suffered by him. We disagree. A satisfactory definition of proximate cause is found in Volume 38, pages 695-696 of American jurisprudence, cited by plaintiffs-appellants in their brief. It is as follows: . . . 'that cause, which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces the injury, and without which the result would not have occurred.' And more comprehensively, 'the proximate legal cause is that acting first and producing the injury, either immediately or by setting other events in motion, all constituting a natural and continuous chain of events, each having a close causal connection with its immediate predecessor, the final event in the chain immediately effecting the injury as a natural and probable result of the cause which first acted, under such circumstances that the person responsible for the first event should, as an ordinary prudent and intelligent person, have reasonable ground to expect at the moment of his act or default that an injury to some person might probably result therefrom. It may be that ordinarily, when a passenger bus overturns, and pins down a passenger, merely causing him physical injuries, if through some event, unexpected and extraordinary, the overturned bus is set on fire, say, by lightning, or if some highwaymen after looting the vehicle sets it on fire, and the passenger is burned to death, one might still contend that the proximate cause of his death was the fire

and not the overturning of the vehicle. But in the present case under the circumstances obtaining in the same, we do not hesitate to hold that the proximate cause was the overturning of the bus, this for the reason that when the vehicle turned not only on its side but completely on its back, the leaking of the gasoline from the tank was not unnatural or unexpected; that the coming of the men with a lighted torch was in response to the call for help, made not only by the passengers, but most probably, by the driver and the conductor themselves, and that because it was dark (about 2:30 in the morning), the rescuers had to carry a light with them, and coming as they did from a rural area where lanterns and flashlights were not available; and what was more natural than that said rescuers should innocently approach the vehicle to extend the aid and effect the rescue requested from them. In other words, the coming of the men with a torch was to be expected and was a natural sequence of the overturning of the bus, the trapping of some of its passengers and the call for outside help. What is more, the burning of the bus can also in part be attributed to the negligence of the carrier, through is driver and its conductor. According to the witness, the driver and the conductor were on the road walking back and forth. They, or at least, the driver should and must have known that in the position in which the overturned bus was, gasoline could and must have leaked from the gasoline tank and soaked the area in and around the bus, this aside from the fact that gasoline when spilled, specially over a large area, can be smelt and directed even from a distance, and yet neither the driver nor the conductor would appear to have cautioned or taken steps to warn the rescuers not to bring the lighted torch too near the bus. Said negligence on the part of the agents of the carrier come under the codal provisions above-reproduced, particularly, Articles 1733, 1759 and 1763. As regard the damages to which plaintiffs are entitled, considering the earning capacity of the deceased, as well as the other elements entering into a damage award, we are satisfied that the amount of SIX THOUSAND (P6,000) PESOS would constitute satisfactory compensation, this to include compensatory, moral, and other damages. We also believe that plaintiffs are entitled to attorney's fees, and assessing the legal services rendered by plaintiffs' attorneys not only in the trial court, but also in the course of the appeal, and not losing sight of the able briefs prepared by them, the attorney's fees may well be fixed at EIGHT HUNDRED (P800) PESOS for the loss of merchandise carried by the deceased in the bus, is adequate and will not be disturbed. There is one phase of this case which disturbs if it does not shock us. According to the evidence, one of the passengers who, because of the injuries suffered by her, was hospitalized, and while in the hospital, she was visited by the defendant Mariano Medina, and in the course of his visit, she overheard him speaking to one of his bus inspectors, telling said inspector to have the tires of the bus changed immediately because they were already old, and that as a matter of fact, he had been telling the driver to change the said tires, but that the driver did not follow his instructions. If this be true, it goes to prove that the driver had not been diligent and had not taken the necessary precautions to insure the safety of his passengers. Had he changed the tires, specially those in front, with new ones, as he had been instructed to do, probably, despite his speeding, as we have already stated, the blow out would not have occurred. All in all, there is reason to believe that the driver operated and drove his vehicle negligently, resulting in the death of four of

his passengers, physical injuries to others, and the complete loss and destruction of their goods, and yet the criminal case against him, on motion of the fiscal and with his consent, was provisionally dismissed, because according to the fiscal, the witnesses on whose testimony he was banking to support the complaint, either failed or appear or were reluctant to testify. But the record of the case before us shows the several witnesses, passengers, in that bus, willingly and unhesitatingly testified in court to the effect of the said driver was negligent. In the public interest the prosecution of said erring driver should be pursued, this, not only as a matter of justice, but for the promotion of the safety of passengers on public utility buses. Let a copy of this decision be furnished the Department of Justice and the Provincial Fiscal of Cavite. In view of the foregoing, with the modification that the damages awarded by the trial court are increased from ONE THOUSAND (P1,000) PESOS TO SIX THOUSAND (P6,000) PESOS, and from SIX HUNDRED PESOS TO EIGHT HUNDRED (P800) PESOS, for the death of Bataclan and for the attorney's fees, respectively, the decision appealed is from hereby affirmed, with costs.

ABOITIZ v CA SECOND DIVISION [G.R. No. 121833, October 17, 2008] ABOITIZ SHIPPING CORPORATION, PETITIONER, VS. COURT OF APPEALS, MALAYAN INSURANCE COMPANY, INC., COMPAGNIE MARITIME DES CHARGEURS REUNIS, AND F.E. ZUELLIG (M), INC., RESPONDENTS. G.R. NO. 130752 ABOITIZ SHIPPING CORPORATION, PETITIONER, VS. COURT OF APPEALS, THE HON. JUDGE REMEGIO E. ZARI, IN HIS CAPACITY AS PRESIDING JUDGE OF THE RTC, BRANCH 20; ASIA TRADERS INSURANCE CORPORATION, AND ALLIED GUARANTEE INSURANCE CORPORATION, RESPONDENTS. G.R. NO. 137801 ABOITIZ SHIPPING CORPORATION, PETITIONER, VS. EQUITABLE INSURANCE CORPORATION, RESPONDENT. DECISION TINGA, J.: Before this Court are three consolidated Rule 45 petitions all involving the issue of whether the real and hypothecary doctrine may be invoked by the shipowner in relation to the loss of cargoes occasioned by the sinking of M/V P. Aboitiz on 31 October 1980. The petitions filed by Aboitiz Shipping Corporation (Aboitiz) commonly seek the computation of its liability in accordance with the Court's

pronouncement in Aboitiz Shipping Corporation v. General Accident Fire and Life Assurance Corporation, Ltd.[1] (hereafter referred to as "the 1993 GAFLAC case"). The three petitions stemmed from some of the several suits filed against Aboitiz before different regional trial courts by shippers or their successors-in-interest for the recovery of the monetary value of the cargoes lost, or by the insurers for the reimbursement of whatever they paid. The trial courts awarded to various claimants the amounts of P639,862.02, P646,926.30, and P87,633.81 in G.R. Nos. 121833, 130752 and 137801, respectively. ANTECEDENTS G.R. No. 121833 Respondent Malayan Insurance Company, Inc. (Malayan) filed five separate actions against several defendants for the collection of the amounts of the cargoes allegedly paid by Malayan under various marine cargo policies[2] issued to the insurance claimants. The five civil cases, namely, Civil Cases No. 138761, No. 139083, No. 138762, No. R-81-526 and No. 138879, were consolidated and heard before the Regional Trial Court (RTC) of Manila, Branch 54. The defendants in Civil Case No. 138761 and in Civil Case No. 139083 were Malayan International Shipping Corporation, a foreign corporation based in Malaysia, its local ship agent, Litonjua Merchant Shipping Agency (Litonjua), and Aboitiz. The defendants in Civil Case No. 138762 were Compagnie Maritime des Chargeurs Reunis (CMCR), its local ship agent, F.E. Zuellig (M), Inc. (Zuellig), and Aboitiz. Malayan also filed Civil Case No. R-81-526 only against CMCR and Zuellig. Thus, defendants CMCR and Zuellig filed a third-party complaint against Aboitiz. In the fifth complaint docketed as Civil Case No. 138879, only Aboitiz was impleaded as defendant. The shipments were supported by their respective bills of lading and insured separately by Malayan against the risk of loss or damage. In the five consolidated cases, Malayan sought the recovery of amounts totaling P639,862.02. Aboitiz raised the defenses of lack of jurisdiction, lack of cause of action and prescription. It also claimed that M/V P. Aboitiz was seaworthy, that it exercised extraordinary diligence and that the loss was caused by a fortuitous event. After trial on the merits, the RTC of Manila rendered a Decision dated 27 November 1989, adjudging Aboitiz liable on the money claims. The decretal portion reads: WHEREFORE, judgment is hereby rendered as follows: In Civil Case No. 138072 (R-81-526-CV), the defendants are adjudged liable and ordered to pay to the plaintiffs jointly and severally the amount of P128,896.79; the third-party defendant Aboitiz is adjudged liable to reimburse and ordered to pay the defendants or whosoever of them paid the plaintiff up to the said amount; In Civil Case No. 138761, Aboitiz is adjudged liable and ordered to pay plaintiff the amount of One Hundred Sixty Three-Thousand Seven Hundred Thirteen Pesos and Thirty-Eight Centavos (P163,713.38).

In Civil Case No. 138762, defendant Aboitiz is adjudged liable and ordered to pay plaintiff the sum of Seventy Three Thousand Five Hundred Sixty-Nine Pesos and Ninety-Four Centavos (P73,569.94); and Sixty-Four Thousand Seven Hundred Four Pesos and Seventy-Seven Centavos (P64,704.77); In Civil Case No. 139083, defendant Aboitiz is adjudged liable and ordered to pay plaintiff the amount of One Hundred Fifty-Six Thousand Two Hundred Eighty-Seven Pesos and Sixty-Four Centavos (P156,287.64); In Civil Case No. 138879, defendant Aboitiz is adjudged liable and ordered to pay plaintiff the amount of Fifty-Two Thousand Six Hundred Eighty-Nine Pesos and Fifty Centavos (P52,689.50). All the aforesaid award shall bear interest at the legal rate from the filing of the respective complaints. Considering that there is no clear showing that the cases fall under Article 2208, Nos. 4 and 5, of the Civil Code, and in consonance with the basic rule that there be no penalty (in terms of attorney's fees) imposed on the right to litigate, no damages by way of attorney's fees are awarded; however, costs of the party/parties to whom judgment awards are made shall be made by the party ordered to pay the said judgment awards. SO ORDERED.[3] Aboitiz, CMCR and Zuellig appealed the RTC decision to the Court of Appeals. The appeal was docketed as CA-G.R. SP No. 35975-CV. During the pendency of the appeal, the Court promulgated the decision in the 1993 GAFLAC case. On 31 March 1995, the Court of Appeals (Ninth Division) affirmed the RTC decision. It disregarded Aboitiz's argument that the sinking of the vessel was caused by a force majeure, in view of this Court's finding in a related case, Aboitiz Shipping Corporation v. Court of Appeals, et al. (the 1990 GAFLAC case).[4] In said case, this Court affirmed the Court of Appeals' finding that the sinking of M/V P. Aboitiz was caused by the negligence of its officers and crew. It is one of the numerous collection suits against Aboitiz, which eventually reached this Court in connection with the sinking of M/V P. Aboitiz. As to the computation of Aboitiz's liability, the Court of Appeals again based its ruling on the 1990 GAFLAC case that Aboitiz's liability should be based on the declared value of the shipment in consonance with the exceptional rule under Section 4(5)[5] of the Carriage of Goods by Sea Act. Aboitiz moved for reconsideration[6] to no avail. Hence, it filed this petition for review on certiorari docketed as G.R. No. 121833.[7] The instant petition is based on the following grounds: THE COURT OF APPEALS SHOULD HAVE LIMITED THE RECOVERABLE AMOUNT FROM ASC TO THAT AMOUNT STIPULATED IN THE BILL OF LADING. IN THE ALTERNATIVE, THE COURT OF APPEALS SHOULD HAVE FOUND THAT THE TOTAL LIABILITY OF ASC IS LIMITED TO THE VALUE OF THE VESSEL OR THE INSURANCE PROCEEDS THEREOF.[8]

On 4 December 1995, the Court issued a Resolution[9] denying the petition. Aboitiz moved for reconsideration, arguing that the limited liability doctrine enunciated in the 1993 GAFLAC case should be applied in the computation of its liability. In the Resolution[10] dated 6 March 1996, the Court granted the motion and ordered the reinstatement of the petition and the filing of a comment. G.R. No. 130752 Respondents Asia Traders Insurance Corporation (Asia Traders) and Allied Guarantee Insurance Corporation (Allied) filed separate actions for damages against Aboitiz to recover by way of subrogation the value of the cargoes insured by them and lost in the sinking of the vessel M/V P. Aboitiz. The two actions were consolidated and heard before the RTC of Manila, Branch 20. Aboitiz reiterated the defense of force majeure. The trial court rendered a decision[11] on 25 April 1990 ordering Aboitiz to pay damages in the amount of P646,926.30. Aboitiz sought reconsideration, arguing that the trial court should have considered the findings of the Board of Marine Inquiry that the sinking of the M/V P. Aboitiz was caused by a typhoon and should have applied the real and hypothecary doctrine in limiting the monetary award in favor of the claimants. The trial court denied Aboitiz's motion for reconsideration. Aboitiz elevated the case to the Court of Appeals. While the appeal was pending, this Court promulgated the decision in the 1993 GAFLAC case. The Court of Appeals subsequently rendered a decision on 30 May 1994, affirming the RTC decision.[12] Aboitiz appealed the Court of Appeals decision to this Court.[13] In a Resolution dated 20 September 1995,[14] the Court denied the petition for raising factual issues and for failure to show that the Court of Appeals committed any reversible error. Aboitiz's motion for reconsideration was also denied in a Resolution dated 22 November 1995.[15] The 22 November 1995 Resolution became final and executory. On 26 February 1996, Asia Traders and Allied filed a motion for execution before the RTC of Manila, Branch 20. Aboitiz opposed the motion. On 16 August 1996, the trial court granted the motion and issued a writ of execution. Alleging that it had no other speedy, just or adequate remedy to prevent the execution of the judgment, Aboitiz filed with the Court of Appeals a petition for certiorari and prohibition with an urgent prayer for preliminary injunction and/or temporary restraining order docketed as CA-G.R. SP No. 41696.[16] The petition was mainly anchored on this Court's ruling in the 1993 GAFLAC case. On 8 August 1997, the Court of Appeals (Special Seventeenth Division) rendered the assailed decision dismissing the petition.[17] Based on the trial court's finding that Aboitiz was actually negligent in ensuring the seaworthiness of M/V P. Aboitiz, the appellate court held that the real and hypothecary doctrine enunciated in the 1993 GAFLAC case may not be applied in the case.

In view of the denial of its motion for reconsideration,[18] Aboitiz filed before this Court the instant petition for review on certiorari docketed as G.R. No. 130752.[19] The petition attributes the following errors to the Court of Appeals: THE COURT OF APPEALS GRAVELY ERRED WHEN IT RULED THAT THE LOWER COURT HAD MADE AN EXPRESS FINDING OF THE ACTUAL NEGLIGENCE OF ABOITIZ IN THE SINKING OF THE M/V P. ABOITIZ THEREBY DEPRIVING ABOITIZ OF THE BENEFIT OF THE DOCTRINE OF THE REAL AND HYPOTHECARY NATURE OF MARITIME LAW.[20] THE COURT OF APPEALS ERRED IN NOT GIVING WEIGHT TO THE GAFLAC CASE DECIDED BY THE HONORABLE COURT WHICH SUPPORTS THE APPLICABILITY OF THE REAL AND HYPOTHECARY NATURE OF MARITIME LAW IN THE PRESENT CASE.[21] G.R. No. 137801 On 27 February 1981, Equitable Insurance Corporation (Equitable) filed an action for damages against Aboitiz to recover by way of subrogation the value of the cargoes insured by Equitable that were lost in the sinking of M/V P. Aboitiz.[22] The complaint, which was docketed as Civil Case No. 138395, was later amended to implead Seatrain Pacific Services S.A. and Citadel Lines, Inc. as party defendants. [23] The complaint against the latter defendants was subsequently dismissed upon motion in view of the amicable settlement reached by the parties. On 7 September 1989, the RTC of Manila, Branch 7, rendered judgment[24] ordering Aboitiz to pay Equitable the amount of P87,633.81, plus legal interest and attorney's fees.[25] It found that Aboitiz was guilty of contributory negligence and, therefore, liable for the loss. In its appeal, docketed as CA-G.R. CV No. 43458, Aboitiz invoked the doctrine of limited liability and claimed that the typhoon was the proximate cause of the loss. On 27 November 1998, the Court of Appeals rendered a decision, affirming the RTC decision.[26] The Court of Appeals (Fifteenth Division) ruled that the loss of the cargoes and the sinking of the vessel were due to its unseaworthiness and the failure of the crew to exercise extraordinary diligence. Said findings were anchored on the 1990 GAFLAC case and on this Court's resolution dated November 13, 1989 in G.R. No. 88159, dismissing Aboitiz's petition and affirming the findings of the appellate court on the vessel's unseaworthiness and the crew's negligence. Its motion for reconsideration[27] having been denied,[28] Aboitiz filed before this Court a petition for review on certiorari, docketed as G.R. No. 137801,[29] raising this sole issue, to wit: WHETHER OR NOT THE DOCTRINE OF REAL AND HYPOTHECARY NATURE OF MARITIME LAW (ALSO KNOWN AS THE "LIMITED LIABILITY RULE") APPLIES.[30] ISSUES The principal issue common to all three petitions is whether Aboitiz can avail limited liability on the basis of the real and hypothecary doctrine of maritime law. Corollary to this issue is the determination of actual negligence on the part of Aboitiz.

These consolidated petitions similarly posit that Aboitiz's liability to respondents should be limited to the value of the insurance proceeds of the lost vessel plus pending freightage and not correspond to the full insurable value of the cargoes paid by respondents, based on the Court's ruling in the 1993 GAFLAC case. Respondents in G.R. No. 121833 counter that the limited liability rule should not be applied because there was a finding of negligence in the care of the goods on the part of Aboitiz based on this Court's Resolution dated 4 December 1995 in G.R. No. 121833, which affirmed the trial court's finding of negligence on the part of the vessel's captain. Likewise, respondent in G.R. No. 137801 relies on the finding of the trial court, as affirmed by the appellate court, that Aboitiz was guilty of negligence. Respondents in G.R No. 130752 argue that this Court had already affirmed in toto the appellate court's finding that the vessel was not seaworthy and that Aboitiz failed to exercise extraordinary diligence in the handling of the cargoes. This being the law of the case, Aboitiz should not be entitled to the limited liability rule as far as this petition is concerned, respondents contend. RULING of the COURT These consolidated petitions are just among the many others elevated to this Court involving Aboitiz's liability to shippers and insurers as a result of the sinking of its vessel, M/V P. Aboitiz, on 31 October 1980 in the South China Sea. One of those petitions is the 1993 GAFLAC case, docketed as G.R. No. 100446.[31] The 1993 GAFLAC case was an offshoot of an earlier final and executory judgment in the 1990 GAFLAC case, where the General Accident Fire and Life Assurance Corporation, Ltd. (GAFLAC), as judgment obligee therein, sought the execution of the monetary award against Aboitiz. The trial court granted GAFLAC's prayer for execution of the full judgment award. The appellate court dismissed Aboitiz's petition to nullify the order of execution, prompting Aboitiz to file a petition with this Court. In the 1993 GAFLAC case, Aboitiz argued that the real and hypothecary doctrine warranted the immediate stay of execution of judgment to prevent the impairment of the other creditors' shares. Invoking the rule on the law of the case, private respondent therein countered that the 1990 GAFLAC case had already settled the extent of Aboitiz's liability. Following the doctrine of limited liability, however, the Court declared in the 1993 GAFLAC case that claims against Aboitiz arising from the sinking of M/V P. Aboitiz should be limited only to the extent of the value of the vessel. Thus, the Court held that the execution of judgments in cases already resolved with finality must be stayed pending the resolution of all the other similar claims arising from the sinking of M/V P. Aboitiz. Considering that the claims against Aboitiz had reached more than 100, the Court found it necessary to collate all these claims before their payment from the insurance proceeds of the vessel and its pending freightage. As a result, the Court exhorted the trial courts before whom similar cases remained pending to

proceed with trial and adjudicate these claims so that the pro-rated share of each claim could be determined after all the cases shall have been decided.[32] In the 1993 GAFLAC case, the Court applied the limited liability rule in favor of Aboitiz based on the trial court's finding therein that Aboitiz was not negligent. The Court explained, thus: x x x In the few instances when the matter was considered by this Court, we have been consistent in this jurisdiction in holding that the only time the Limited Liability Rule does not apply is when there is an actual finding of negligence on the part of the vessel owner or agent x x x. The pivotal question, thus, is whether there is finding of such negligence on the part of the owner in the instant case. A careful reading of the decision rendered by the trial court in Civil Case No. 144425 as well as the entirety of the records in the instant case will show that there has been no actual finding of negligence on the part of petitioner. x x x The same is true of the decision of this Court in G.R. No. 89757 affirming the decision of the Court of Appeals in CA-G.R. CV No. 10609 since both decisions did not make any new and additional finding of fact. Both merely affirmed the factual findings of the trial court, adding that the cause of the sinking of the vessel was because of unseaworthiness due to the failure of the crew and the master to exercise extraordinary diligence. Indeed, there appears to have been no evidence presented sufficient to form a conclusion that petitioner shipowner itself was negligent, and no tribunal, including this Court, will add or subtract to such evidence to justify a conclusion to the contrary.[33] (Citations entitled) (Emphasis supplied) The ruling in the 1993 GAFLAC case cited the real and hypothecary doctrine in maritime law that the shipowner or agent's liability is merely co-extensive with his interest in the vessel such that a total loss thereof results in its extinction. "No vessel, no liability" expresses in a nutshell the limited liability rule.[34] In this jurisdiction, the limited liability rule is embodied in Articles 587, 590 and 837 under Book III of the Code of Commerce, thus: Art. 587. The ship agent shall also be civilly liable for the indemnities in favor of third persons which may arise from the conduct of the captain in the care of the goods which he loaded on the vessel; but he may exempt himself therefrom by abandoning the vessel with all her equipment and the freight it may have earned during the voyage. Art. 590. The co-owners of the vessel shall be civilly liable in the proportion of their interests in the common fund for the results of the acts of the captain referred to in Art. 587. Each co-owner may exempt himself from this liability by the abandonment, before a notary, of the part of the vessel belonging to him. Art. 837. The civil liability incurred by shipowners in the case prescribed in this section, shall be understood as limited to the value of the vessel with all its appurtenances and freightage served during the voyage. These articles precisely intend to limit the liability of the shipowner or agent to the value of the vessel, its appurtenances and freightage earned in the voyage,

provided that the owner or agent abandons the vessel.[35] When the vessel is totally lost in which case there is no vessel to abandon, abandonment is not required. Because of such total loss the liability of the shipowner or agent for damages is extinguished.[36] However, despite the total loss of the vessel, its insurance answers for the damages for which a shipowner or agent may be held liable.[37] Nonetheless, there are exceptional circumstances wherein the ship agent could still be held answerable despite the abandonment of the vessel, as where the loss or injury was due to the fault of the shipowner and the captain. The international rule is to the effect that the right of abandonment of vessels, as a legal limitation of a shipowner's liability, does not apply to cases where the injury or average was occasioned by the shipowner's own fault.[38] Likewise, the shipowner may be held liable for injuries to passengers notwithstanding the exclusively real and hypothecary nature of maritime law if fault can be attributed to the shipowner.[39] As can be gleaned from the foregoing disquisition in the 1993 GAFLAC case, the Court applied the doctrine of limited liability in view of the absence of an express finding that Aboitiz's negligence was the direct cause of the sinking of the vessel. The circumstances in the 1993 GAFLAC case, however, are not obtaining in the instant petitions. A perusal of the decisions of the courts below in all three petitions reveals that there is a categorical finding of negligence on the part of Aboitiz. For instance, in G.R. No. 121833, the RTC therein expressly stated that the captain of M/V P. Aboitiz was negligent in failing to take a course of action that would prevent the vessel from sailing into the typhoon. In G.R. No. 130752, the RTC concluded that Aboitiz failed to show that it had exercised the required extraordinary diligence in steering the vessel before, during and after the storm. In G.R. No. 137801, the RTC categorically stated that the sinking of M/V P. Aboitiz was attributable to the negligence or fault of Aboitiz. In all instances, the Court of Appeals affirmed the factual findings of the trial courts. The finding of actual fault on the part of Aboitiz is central to the issue of its liability to the respondents. Aboitiz's contention, that with the sinking of M/V P. Aboitiz, its liability to the cargo shippers and shippers should be limited only to the insurance proceeds of the vessel absent any finding of fault on the part of Aboitiz, is not supported by the record. Thus, Aboitiz is not entitled to the limited liability rule and is, therefore, liable for the value of the lost cargoes as so duly alleged and proven during trial. Events have supervened during the pendency of the instant petitions. On two other occasions, the Court ruled on separate petitions involving monetary claims against Aboitiz as a result of the 1980 sinking of the vessel M/V P. Aboitiz. One of them is the consolidated petitions of Monarch Ins. Co., Inc v. Court of Appeals,[40] Allied Guarantee Insurance Company v. Court of Appeals[41] and Equitable Insurance Corporation v. Court of Appeals[42] (hereafter collectively referred to as Monarch Insurance) promulgated on 08 June 2000. This time, the petitioners consisted of claimants against Aboitiz because

either the execution of the judgment awarding full indemnification of their claims was stayed or set aside or the lower courts awarded damages only to the extent of the claimants' proportionate share in the insurance proceeds of the vessel. In Monarch Insurance, the Court deemed it fit to settle once and for all this factual issue by declaring that the sinking of M/V P. Aboitiz was caused by the concurrence of the unseaworthiness of the vessel and the negligence of both Aboitiz and the vessel's crew and master and not because of force majeure. Notwithstanding this finding, the Court did not reverse but reiterated instead the pronouncement in GAFLAC to the effect that the claimants be treated as "creditors in an insolvent corporation whose assets are not enough to satisfy the totality of claims against it."[43] The Court explained that the peculiar circumstances warranted that procedural rules of evidence be set aside to prevent frustrating the just claims of shippers/insurers. Thus, the Court in Monarch Insurance ordered Aboitiz to institute the necessary limitation and distribution action before the proper RTC and to deposit with the said court the insurance proceeds of and the freightage earned by the ill-fated ship. However, on 02 May 2006, the Court rendered a decision in Aboitiz Shipping Corporation v. New India Assurance Company, Ltd.[44] (New India), reiterating the well-settled principle that the exception to the limited liability doctrine applies when the damage is due to the fault of the shipowner or to the concurrent negligence of the shipowner and the captain. Where the shipowner fails to overcome the presumption of negligence, the doctrine of limited liability cannot be applied.[45] In New India, the Court clarified that the earlier pronouncement in Monarch Insurance was not an abandonment of the doctrine of limited liability and that the circumstances therein still made the doctrine applicable.[46] In New India, the Court declared that Aboitiz failed to discharge its burden of showing that it exercised extraordinary diligence in the transport of the goods it had on board in order to invoke the limited liability doctrine. Thus, the Court rejected Aboitiz's argument that the award of damages to respondent therein should be limited to its pro rata share in the insurance proceeds from the sinking of M/V P. Aboitiz. The instant petitions provide another occasion for the Court to reiterate the wellsettled doctrine of the real and hypothecary nature of maritime law. As a general rule, a ship owner's liability is merely co-extensive with his interest in the vessel, except where actual fault is attributable to the shipowner. Thus, as an exception to the limited liability doctrine, a shipowner or ship agent may be held liable for damages when the sinking of the vessel is attributable to the actual fault or negligence of the shipowner or its failure to ensure the seaworthiness of the vessel. The instant petitions cannot be spared from the application of the exception to the doctrine of limited liability in view of the unanimous findings of the courts below that both Aboitiz and the crew failed to ensure the seaworthiness of the M/V P. Aboitiz.

WHEREFORE, the petitions in G.R. Nos. 121833, 130752 and 137801 are DENIED. The decisions of the Court of Appeals in CA-G.R. SP No. 35975-CV, CA-G.R. SP No. 41696 and CA-G.R. CV No. 43458 are hereby AFFIRMED. Costs against petitioner. SO ORDERED. Quisumbing, (Chairperson), Carpio Morales, *Leonardo De Castro and Brion, JJ., Concur.

PAL v CA (1993) FIRST DIVISION

G.R. No. L-82619

September 15, 1993

PHILIPPINE AIRLINES, INC., petitioner, vs. COURT OF APPEALS and PEDRO ZAPATOS, respondents. Leighton R. Liazon for petitioner. Balmes L. Ocampo for private respondent.

BELLOSILLO, J.: This petition for review in certiorari seeks to annul and set aside the decision of the then Intermediate Appellant Court, 1 now Court of Appeals, dated 28 February 1985, in AC-G.R. CV No. 69327 ("Pedro Zapatos v. Philippine Airlines, Inc.") affirming the decision of the then Court of first Instance, now Regional Trial Court, declaring Philippine Airlines, Inc., liable in damages for breach of contract. On 25 November 1976, private respondent filed a complaint for damages for breach of contract of carriage 2 against Philippine Airlines, Inc. (PAL), before the then Court of First Instance, now Regional Trial Court, of Misamis Occidental, at Ozamiz City. According to him, on 2 August 1976, he was among the twenty-one (21) passengers of PAL Flight 477 that took off from Cebu bound for Ozamiz City. The routing of this flight was Cebu-Ozamiz-Cotabato. While on flight and just about fifteen (15) minutes before landing at Ozamiz City, the pilot received a radio message that the airport was closed due to heavy rains and inclement weather and that he should proceed to Cotabato City instead. Upon arrival at Cotabato City, the PAL Station Agent informed the passengers of their options to return to Cebu on flight 560 of the same day and thence to Ozamiz City on 4 August 1975, or take the next flight to Cebu the following day, or remain at Cotabato and take the next available flight to Ozamiz City on 5 August 1975. 3

The Station Agent likewise informed them that Flight 560 bound for Manila would make a stop-over at Cebu to bring some of the diverted passengers; that there were only six (6) seats available as there were already confirmed passengers for Manila; and, that the basis for priority would be the check-in sequence at Cebu. Private respondent chose to return to Cebu but was not accommodated because he checked-in as passenger No. 9 on Flight 477. He insisted on being given priority over the confirmed passengers in the accommodation, but the Station Agent refused private respondent's demand explaining that the latter's predicament was not due to PAL's own doing but to be a force majeure. 4 Private respondent tried to stop the departure of Flight 560 as his personal belongings, including a package containing a camera which a certain Miwa from Japan asked him to deliver to Mrs. Fe Obid of Gingoog City, were still on board. His plea fell on deaf ears. PAL then issued to private respondent a free ticket to Iligan city, which the latter received under protest. 5 Private respondent was left at the airport and could not even hitch a ride in the Ford Fiera loaded with PAL personnel. 6 PAL neither provided private respondent with transportation from the airport to the city proper nor food and accommodation for his stay in Cotabato City. The following day, private respondent purchased a PAL ticket to Iligan City. He informed PAL personnel that he would not use the free ticket because he was filing a case against PAL. 7 In Iligan City, private respondent hired a car from the airport to Kolambugan, Lanao del Norte, reaching Ozamiz City by crossing the bay in a launch. 8 His personal effects including the camera, which were valued at P2,000.00 were no longer recovered. On 13 January 1977, PAL filed its answer denying that it unjustifiably refused to accommodate private respondent. 9 It alleged that there was simply no more seat for private respondent on Flight 560 since there were only six (6) seats available and the priority of accommodation on Flight 560 was based on the check-in sequence in Cebu; that the first six (6) priority passengers on Flight 477 chose to take Flight 560; that its Station Agent explained in a courteous and polite manner to all passengers the reason for PAL's inability to transport all of them back to Cebu; that the stranded passengers agreed to avail of the options and had their respective tickets exchanged for their onward trips; that it was only the private respondent who insisted on being given priority in the accommodation; that pieces of checked-in baggage and had carried items of the Ozamiz City passengers were removed from the aircraft; that the reason for their pilot's inability to land at Ozamis City airport was because the runway was wet due to rains thus posing a threat to the safety of both passengers and aircraft; and, that such reason of force majeure was a valid justification for the pilot to bypass Ozamiz City and proceed directly to Cotabato City. On 4 June 1981, the trial court rendered its decision 10 the dispositive portion of which states: WHEREFORE, judgment is hereby rendered in favor of the plaintiff and against the defendant Philippine AirLines, Inc. ordering the latter to pay:

(1) As actual damages, the sum of Two Hundred Pesos (P200.00) representing plaintiff's expenses for transportation, food and accommodation during his stranded stay at Cotabato City; the sum of Forty-Eight Pesos (P48.00) representing his flight fare from Cotabato City to Iligan city; the sum of Five Hundred Pesos (P500.00) representing plaintiff's transportation expenses from Iligan City to Ozamiz City; and the sum of Five Thousand Pesos (P5,000.00) as loss of business opportunities during his stranded stay in Cotabato City; (2) As moral damages, the sum of Fifty Thousand Pesos (P50,000.00) for plaintiff's hurt feelings, serious anxiety, mental anguish and unkind and discourteous treatment perpetrated by defendant's employees during his stay as stranded passenger in Cotabato City; (3) As exemplary damages, the sum of Ten Thousand Pesos (P10,000.00) to set a precedent to the defendant airline that it shall provide means to give comfort and convenience to stranded passengers; (4)

The sum of Three Thousand Pesos (P3,000.00) as attorney's fees;

(5)

To pay the costs of this suit.

PAL appealed to the Court of Appeals which on 28 February 1985, finding no reversible error, affirmed the judgment of the court a quo. 11 PAL then sought recourse to this Court by way of a petition for review on certiorari 12 upon the following issues: (1) Can the Court of Appeals render a decision finding petitioner (then defendant-appellant in the court below) negligent and, consequently, liable for damages on a question of substance which was neither raised on a question nor proved at the trial? (2) Can the Court of Appeals award actual and moral damages contrary to the evidence and established jurisprudence? 13 An assiduous examination of the records yields no valid reason for reversal of the judgment on appeal; only a modification of its disposition. In its petition, PAL vigorously maintains that private respondent's principal cause of action was its alleged denial of private respondent's demand for priority over the confirmed passengers on Flight 560. Likewise, PAL points out that the complaint did not impute to PAL neglect in failing to attend to the needs of the diverted passengers; and, that the question of negligence was not and never put in issue by the pleadings or proved at the trial. Contrary to the above arguments, private respondent's amended complaint touched on PAL's indifference and inattention to his predicament. The pertinent portion of the amended complaint 14 reads: 10. That by virtue of the refusal of the defendant through its agent in Cotabato to accommodate (sic) and allow the plaintiff to take and board the plane back to Cebu, and by accomodating (sic) and allowing passengers from Cotabato for Cebu in his stead and place, thus forcing the plaintiff against his will, to be left and stranded in

Cotabato, exposed to the peril and danger of muslim rebels plundering at the time, the plaintiff, as a consequence, (have) suffered mental anguish, mental torture, social humiliation, bismirched reputation and wounded feeling, all amounting to a conservative amount of thirty thousand (P30,000.00) Pesos. To substantiate this aspect of apathy, private respondent testified 15 A I did not even notice that I was I think the last passenger or the last person out of the PAL employees and army personnel that were left there. I did not notice that when I was already outside of the building after our conversation. Q

What did you do next?

A I banished (sic) because it seems that there was a war not far from the airport. The sound of guns and the soldiers were plenty. Q

After that what did you do?

A I tried to look for a transportation that could bring me down to the City of Cotabato. Q

Were you able to go there?

A I was at about 7:00 o'clock in the evening more or less and it was a private jeep that I boarded. I was even questioned why I and who am (sic) I then. Then I explained my side that I am (sic) stranded passenger. Then they brought me downtown at Cotabato. Q During your conversation with the Manager were you not offered any vehicle or transportation to Cotabato airport downtown? A In fact I told him (Manager) now I am by-passed passenger here which is not my destination what can you offer me. Then they answered, "it is not my fault. Let us forget that." Q In other words when the Manager told you that offer was there a vehicle ready? A Not yet. Not long after that the Ford Fiera loaded with PAL personnel was passing by going to the City of Cotabato and I stopped it to take me a ride because there was no more available transportation but I was not accommodated. Significantly, PAL did not seem to mind the introduction of evidence which focused on its alleged negligence in caring for its stranded passengers. Well-settled is the rule in evidence that the protest or objection against the admission of evidence should be presented at the time the evidence is offered, and that the proper time to make protest or objection to the admissibility of evidence is when the question is presented to the witness or at the time the answer thereto is given. 16 There being no objection, such evidence becomes property of the case and all the parties are amenable to any favorable or unfavorable effects resulting from the evidence. 17

PAL instead attempted to rebut the aforequoted testimony. In the process, it failed to substantiate its counter allegation for want of concrete proof 18 — Atty. Rubin O. Rivera — PAL's counsel: Q

You said PAL refused to help you when you were in Cotabato, is that right?

Private respondent: A

Yes.

Q Did you ask them to help you regarding any offer of transportation or of any other matter asked of them? A

Yes, he (PAL PERSONNEL) said what is? It is not our fault.

Q Are you not aware that one fellow passenger even claimed that he was given Hotel accommodation because they have no money? xxx

xxx

xxx

A No, sir, that was never offered to me. I said, I tried to stop them but they were already riding that PAL pick-up jeep, and I was not accommodated. Having joined in the issue over the alleged lack of care it exhibited towards its passengers, PAL cannot now turn around and feign surprise at the outcome of the case. When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings. 19 With regard to the award of damages affirmed by the appellate court, PAL argues that the same is unfounded. It asserts that it should not be charged with the task of looking after the passengers' comfort and convenience because the diversion of the flight was due to a fortuitous event, and that if made liable, an added burden is given to PAL which is over and beyond its duties under the contract of carriage. It submits that granting arguendo that negligence exists, PAL cannot be liable in damages in the absence of fraud or bad faith; that private respondent failed to apprise PAL of the nature of his trip and possible business losses; and, that private respondent himself is to be blamed for unreasonably refusing to use the free ticket which PAL issued. The contract of air carriage is a peculiar one. Being imbued with public interest, the law requires common carriers to carry the passengers safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with due regard for all the circumstances. 20 In Air France v. Carrascoso, 21 we held that — A contract to transport passengers is quite different in kind and degree from any other contractual relation. And this, because of the relation which an air carrier

sustains with the public. Its business is mainly with the travelling public. It invites people to avail of the comforts and advantages it offers. The contract of air carriage, therefore, generates a relation attended with a public duty . . . . ( emphasis supplied). The position taken by PAL in this case clearly illustrates its failure to grasp the exacting standard required by law. Undisputably, PAL's diversion of its flight due to inclement weather was a fortuitous event. Nonetheless, such occurrence did not terminate PAL's contract with its passengers. Being in the business of air carriage and the sole one to operate in the country, PAL is deemed equipped to deal with situations as in the case at bar. What we said in one case once again must be stressed, i.e., the relation of carrier and passenger continues until the latter has been landed at the port of destination and has left the carrier's premises. 22 Hence, PAL necessarily would still have to exercise extraordinary diligence in safeguarding the comfort, convenience and safety of its stranded passengers until they have reached their final destination. On this score, PAL grossly failed considering the then ongoing battle between government forces and Muslim rebels in Cotabato City and the fact that the private respondent was a stranger to the place. As the appellate court correctly ruled — While the failure of plaintiff in the first instance to reach his destination at Ozamis City in accordance with the contract of carriage was due to the closure of the airport on account of rain and inclement weather which was radioed to defendant 15 minutes before landing, it has not been disputed by defendant airline that Ozamis City has no all-weather airport and has to cancel its flight to Ozamis City or by-pass it in the event of inclement weather. Knowing this fact, it becomes the duty of defendant to provide all means of comfort and convenience to its passengers when they would have to be left in a strange place in case of such by-passing. The steps taken by defendant airline company towards this end has not been put in evidence, especially for those 7 others who were not accommodated in the return trip to Cebu, only 6 of the 21 having been so accommodated. It appears that plaintiff had to leave on the next flight 2 days later. If the cause of non-fulfillment of the contract is due to a fortuitous event, it has to be the sole and only cause (Art. 1755 CC., Art. 1733 C.C.) Since part of the failure to comply with the obligation of common carrier to deliver its passengers safely to their destination lay in the defendant's failure to provide comfort and convenience to its stranded passengers using extra-ordinary diligence, the cause of non-fulfillment is not solely and exclusively due to fortuitous event, but due to something which defendant airline could have prevented, defendant becomes liable to plaintiff. 23 While we find PAL remiss in its duty of extending utmost care to private respondent while being stranded in Cotabato City, there is no sufficient basis to conclude that PAL failed to inform him about his non-accommodation on Flight 560, or that it was inattentive to his queries relative thereto. On 3 August 1975, the Station Agent reported to his Branch Manager in Cotabato City that — 3. Of the fifteen stranded passengers two pax elected to take F478 on August 05, three pax opted to take F442 August 03. The remaining ten (10) including

subject requested that they be instead accommodated (sic) on F446 CBO-IGN the following day where they intended to take the surface transportation to OZC. Mr. Pedro Zapatos had by then been very vocal and boiceterous (sic) at the counter and we tactfully managed to steer him inside the Station Agent's office. Mr. Pedro Zapatos then adamantly insisted that all the diverted passengers should have been given priority over the originating passengers of F560 whether confirmed or otherwise. We explained our policies and after awhile he seemed pacified and thereafter took his ticket (in-lieued (sic) to CBO-IGN, COCON basis), at the counter in the presence of five other passengers who were waiting for their tickets too. The rest of the diverted pax had left earlier after being assured their tickets will be ready the following day. 24 Aforesaid Report being an entry in the course of business is prima facie evidence of the facts therein stated. Private respondent, apart from his testimony, did not offer any controverting evidence. If indeed PAL omitted to give information about the options available to its diverted passengers, it would have been deluged with complaints. But, only private respondent complained — Atty. Rivera (for PAL) Q I understand from you Mr. Zapatos that at the time you were waiting at Cotabato Airport for the decision of PAL, you were not informed of the decision until after the airplane left is that correct? A

Yes.

COURT: Q

What do you mean by "yes"? You meant you were not informed?

A Yes, I was not informed of their decision, that they will only accommodate few passengers. Q

Aside from you there were many other stranded passengers?

A

I believed, yes.

Q And you want us to believe that PAL did not explain (to) any of these passengers about the decision regarding those who will board the aircraft back to Cebu? A

No, Sir.

Q Despite these facts Mr. Zapatos did any of the other passengers complained (sic) regarding that incident? xxx A

xxx

xxx

There were plenty of argument and I was one of those talking about my case.

Q Did you hear anybody complained (sic) that he has not been informed of the decision before the plane left for Cebu? A

No. 25

Admittedly, private respondent's insistence on being given priority in accommodation was unreasonable considering the fortuitous event and that there was a sequence to be observed in the booking, i.e., in the order the passengers checked-in at their port of origin. His intransigence in fact was the main cause for his having to stay at the airport longer than was necessary. Atty. Rivera: Q And, you were saying that despite the fact that according to your testimony there were at least 16 passengers who were stranded there in Cotabato airport according to your testimony, and later you said that there were no other people left there at that time, is that correct? A Yes, I did not see anyone there around. I think I was the only civilian who was left there. Q

Why is it that it took you long time to leave that place?

A

Because I was arguing with the PAL personnel. 26

Anent the plaint that PAL employees were disrespectful and inattentive toward private respondent, the records are bereft of evidence to support the same. Thus, the ruling of respondent Court of Appeals in this regard is without basis. 27 On the contrary, private respondent was attended to not only by the personnel of PAL but also by its Manager." 28 In the light of these findings, we find the award of moral damages of Fifty Thousand Pesos (P50,000.00) unreasonably excessive; hence, we reduce the same to Ten Thousand Pesos (P10,000.00). Conformably herewith, the award of exemplary damages is also reduced to five Thousand Pesos (5,000.00). Moral damages are not intended to enrich the private respondent. They are awarded only to enable the injured party to obtain means, diversion or amusements that will serve to alleviate the moral suffering he has undergone by reason of the defendant's culpable action. 29 With regard to the award of actual damages in the amount of P5,000.00 representing private respondent's alleged business losses occasioned by his stay at Cotabato City, we find the same unwarranted. Private respondent's testimony that he had a scheduled business "transaction of shark liver oil supposedly to have been consummated on August 3, 1975 in the morning" and that "since (private respondent) was out for nearly two weeks I missed to buy about 10 barrels of shark liver oil," 30 are purely speculative. Actual or compensatory damages cannot be presumed but must be duly proved with reasonable degree of certainty. A court cannot rely on speculation, conjecture or guesswork as to the fact and amount of

damages, but must depend upon competent proof that they have suffered and on evidence of the actual amount thereof. 31 WHEREFORE the decision appealed from is AFFIRMED with modification however that the award of moral damages of Fifty Thousand Pesos (P50,000.00) is reduced to Ten Thousand Pesos (P10,000.00) while the exemplary damages of Ten Thousand Pesos (P10,000.00) is also reduced to Five Thousand Pesos (P5,000.00). The award of actual damages in the amount Five Thousand Pesos (P5,000.00) representing business losses occasioned by private respondent's being stranded in Cotabato City is deleted. SO ORDERED. Cruz, Griño-Aquino, Davide, Jr. and Quiason, JJ., concur.