Consolidated-cases-torts.docx

Anisa Kim Ayunan ART 19 Civil Code of the Philippines Purpose of Article 19. Abuse of Rights: 1. To expand the concept of torts by granting adequate legal remedy for the untold number of moral wrongs which is impossible for human foresight to provide specifically in statutory law. Effect of Article 19. Abuse of: Rights “A right, though by itself legal because recognized or granted by law as such, may become the source of some illegality.” Requisites of 1. 2. 3. 4.

Article 19. Abuse of Rights: There is a legal right or duty; Such duty is exercised in Bad Faith; It is for the sole intent of prejudicing or injuring another; The absence of good faith is essential to abuse of right.

(1) GLOBE MACKAY CABLE v. CA, GR No. 81262, 1989-08-25 Facts: Private respondent Restituto M. Tobias was employed by petitioner Globe Mackay Cable and Radio Corporation (GLOBE MACKAY) in a dual capacity as a purchasing agent and administrative assistant to the engineering operations manager. In 1972, GLOBE MACKAY... discovered fictitious purchases and other fraudulent transactions for which it lost several thousands of pesos. According to private respondent it was he who actually discovered the anomalies and reported them on November 10, 1972 to his immediate superior Eduardo T. Ferraren and to petitioner Herbert C. Hendry who was then the Executive Vice-President and General Manager of GLOBE MACKAY. On November 11, 1972, one day after private respondent Tobias made the report, petitioner Hendry confronted him by stating that he was the number one suspect, and ordered him to take a one week forced leave, not to communicate with the office, to leave his table drawers open,... and to leave the office keys. On November 20, 1972, when private respondent Tobias returned to work after the forced leave, petitioner Hendry went up to him and called him a "crook" and a "swindler." Tobias was then ordered to take a lie detector test. He was also instructed to submit specimen of his... handwriting, signature, and initials for examination by the police investigators to determine his complicity in the anomalies. On December 6, 1972, the Manila police investigators submitted a laboratory crime report (Exh. "A") clearing private respondent of participation in the anomalies. Not satisfied with the police report, petitioners hired a private investigator, retired Col. Jose G. Fernandez, who on December 10, 1972, submitted a report (Exh. "2") finding Tobias guilty. This report however expressly stated that further investigation was still to be... conducted. Nevertheless, on December 12, 1972, petitioner Hendry issued a memorandum suspending Tobias from work preparatory to the filing of criminal charges against him. In the meantime, on January 17, 1973, Tobias received a notice (Exh. "F") from petitioners that his employment has been terminated effective December 13, 1972. Unemployed, Tobias sought employment with the Republic Telephone Company (RETELCO). However, petitioner Hendry, without being asked by RETELCO, wrote a letter to the latter stating that Tobias was dismissed by GLOBE MACKAY due to dishonesty. Private respondent Tobias filed a civil case for damages anchored on alleged unlawful, malicious, oppressive, and abusive acts of petitioners. Issues: The main issue in this case is whether or not petitioners are liable for damages to private respondent. Ruling:

One of the more notable innovations of the New Civil Code is the codification of "some basic principles that are to be observed for the rightful relationship between human beings and for the stability of the social order. The framers of the Code, seeking to remedy the defect of the old Code which merely stated the effects of the law, but failed to draw out its spirit, incorporated certain fundamental precepts which were "designed to indicate certain norms that... spring from the fountain of good conscience" and which were also meant to serve as "guides for human conduct [that] should run as golden threads through society, to the end that law may approach its supreme ideal, which is the sway and dominance of justice" Foremost among... these principles is that pronounced in Article 19 which provides: Art. 19. 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. The law, therefore, recognizes a primordial limitation on all rights; that in their exercise, the norms of human conduct set forth in Article 19 must be observed. A right, though by itself legal because... recognized or granted by law as such, may nevertheless become the source of some illegality. But while Article 19 lays down a rule of conduct for the government of human relations and for the maintenance of social order, it does not provide a remedy for its violation. Generally, an action for damages under either Article 20 or Article 21 would be proper. Art. 20. Every person who contrary to law, willfully or negligently causes damage to another, shall indemnify the latter for the same. Art. 21. Any person who willfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage. This article, adopted to remedy the "countless gaps in the statutes, which leave so many victims of moral wrongs helpless, even though they have actually suffered material and moral injury" [Id.] should "vouchsafe adequate legal remedy for that untold number of moral... wrongs which it is impossible for human foresight to provide for specifically in the statutes" In determining whether or not the principle of abuse of rights may be invoked, there is no rigid test which can be applied. While the Court has not hesitated to apply Article 19 whether the legal and factual circumstances called for its application... he question of whether or not the principle of abuse of rights has been violated resulting in damages under Article 20 or Article 21 or other applicable... provision of law, depends on the circumstances of each case. And in the instant case, the Court, after examining the record and considering certain significant circumstances, finds that petitioners have indeed abused the right that they invoke, causing damage to private... respondent and for which the latter must now be indemnified. The trial court made a finding that notwithstanding the fact that it was private respondent Tobias who reported the possible existence of anomalous transactions, petitioner Hendry "showed belligerence and told plaintiff (private respondent herein) that he was the number one... suspect and to take a one week vacation leave, not to communicate with the office, to leave his table drawers open, and to leave his keys to said defendant But petitioners were not content with just dismissing Tobias. Several other tortious acts were committed by petitioners against Tobias after the latter's termination from work. The next tortious act committed by petitioners was the writing of a letter to RETELCO sometime in October 1974, stating that Tobias had been dismissed by GLOBE MACKAY due to dishonesty. Finally, there is the matter of the filing by petitioners of six criminal complaints against Tobias. (2) Albenson Enterprises v. Court of Appeals, G.R. No. 88694, 11 January 1993 FACTS: Petitioner Albenson Enterprises Corporation delivered to Guaranteed Industries, Inc. at Baltao Building mild steel plates which the latter ordered and as part of the payment, a bouncing check was issued by one “Eugenio Baltao”.

Petitioner, in a sincere attempt to collect the sum of money due them, filed a criminal complaint against private respondent Eugenio S. Baltao after the latter refused to make good the amount of the bouncing check despite demand. However, there was a mistake of identity as there were two “Eugenio Baltaos” conducting business in the same building – Eugenio S. Baltao and his son, Eugenio Baltao III. It was found that the signature of the check was not of Eugenio S. Baltao and because of the alleged unjust filing of a criminal case against him, respondent Baltao filed a complaint for damages anchored on Articles 19, 20, and 21 of the Civil Code against petitioners. ISSUE: Whether or not the principle of abuse of rights (Article 19) has been violated, resulting in damages under Articles 20 and 21 or other applicable provision of law. RULING: No, petitioners could not be said to have violated the principle of abuse of rights. What prompted petitioners to file the case for violation of Batas Pambansa Bilang 22 against private respondent was their failure to collect the amount of P2,575.00 due on a bounced check which they honestly believed was issued to them by private respondent. Petitioners had conducted inquiries regarding the origin of the check. Private respondent, however, did nothing to clarify the case of mistaken identity at first hand. Instead, private respondent waited in ambush and thereafter pounced on the hapless petitioners at a time he thought was propitious by filing an action for damages. The elements of an abuse of right under Article 19 are the following: (1) There is a legal right or duty; (2) which is exercised in bad faith; (3) for the sole intent of prejudicing or injuring another. Article 20 speaks of the general sanction for all other provisions of law which do not especially provide for their own sanction. Thus, anyone who, whether willfully or negligently, in the exercise of his legal right or duty, causes damage to another, shall indemnify his victim for injuries suffered thereby. Article 21 deals with acts contra bonus mores, and has the following elements: 1) There is an act which is legal; 2) but which is contrary to morals, good custom, public order, or public policy; 3) and it is done with intent to injure. There is no proof or showing that petitioners acted maliciously or in bad faith in the filing of the case against private respondent. Consequently, in the absence of proof of fraud and bad faith committed by petitioners, they cannot be held liable for damages. Sittie Johayra Gundarangan (1) UNIVERSITY OF THE EAST v. ROMEO JADER, G.R. No. 132344, February 17, 2000 FACTS:

Romeo Jader, a law student of the University of the East, failed to take his regular examination in Practice Court I in his first semester of his last school year. However, he was able to remove the incomplete mark when the Dean of his college approved his application to take a removal examination. In the 2nd semester, his name appeared in the tentative list of candidates for graduation for the Decree of Bachelor of Laws and in the invitation for the 35th Investiture and Commencement Ceremonies, the plaintiff’s name appeared. Thus, he attended the investiture ceremonies and graduated. On April to September 1998, he took a leave of absence from his work and enrolled at the pre-bar review class in Far Eastern University. To his dismay upon knowing that he incurred a deficiency, he dropped his review class and was not able to take the bar examinations. He then filed a suit against UE praying for moral and exemplary damages arising from the latter’s negligence. The trial court ruled in his favor and was granted for actual damages. The Court of Appeals affirmed the trial court’s decision with modification. The CA awarded moral damages. On account of

suffering moral shock, mental anguish, serious anxiety, besmirched reputation, wounded feelings and sleepless nights and ultimately for not having to take the bar exam. ISSUE: Whether UE should be held liable for misleading a student into believing Jader satisfied all the requirements for graduation when such is not the case. RULING: The Supreme Court held that petitioner was guilty of negligence and thus liable to respondent for the latter’s actual damages. Educational institutions are duty-bound to inform the students of their academic status and not wait for the latter to inquire from the former. It is the contractual obligation of the school to timely inform and furnish sufficient notice and information to each and every student as to whether he or she had already complied with all the requirements for the conferment of a degree or whether they would be included among those who will graduate. In belatedly informing Jader, UE cannot be said to have acted in good faith. Absence of good faith must be sufficiently established for a successful prosecution by the aggrieved party in a suit for abuse of right under Art 19 of the Civil Code. Good faith connotes an honest intention to abstain from taking undue advantage of another, even though the forms and technicalities of the law, together with the absence of all information or belief of facts, would render the transaction unconscientious. Liability arose from its failure to promptly inform him of the exam results and in misleading the latter into believing that he had satisfied all course requirements. However, respondent should not have been awarded moral damages though he suffered shock, trauma, and pain when he was informed that he could not graduate and will not be allowed to take the bar examinations. As what the CA held, it’s also the respondent’s duty to verify for himself whether he has completed all necessary requirements to be eligible for the bar examinations. As a senior law student, he should have been responsible in ensuring that all his affairs specifically those in relation with his academic achievement are in order. Before taking the bar examinations, it doesn’t only entail a mental preparation on the subjects but there are other prerequisites such as documentation and submission of requirements which prospective examinee must meet. Petitioner is ORDERED to PAY respondent the sum of Thirty-five Thousand Four Hundred Seventy Pesos (P35,470.00), with legal interest of 6% per annum computed from the date of filing of the complaint until fully paid; the amount of Five Thousand Pesos (P5,000.00) as attorney's fees; and the costs of the suit. The award of moral damages is DELETED.

(2)SERGIO AMONOY v. SPS JOSE GUTIERREZ AND ANGELA FORNILDA, G.R. No. 140420 February 15, 2001 FACTS:

Amonoy bought at an auction sale several lots. Included in the lots sold was the lot on which the Gutierrez spouses had their house. These lots were under litigation but Amonoy obtained a judgment in his favor. The trial court issued a Writ of Possession and pursuant to which, a Notice to Vacate was made on august 26, 1985. On May 30, 1986, the petitioner commenced the demolition of the respondent’s house under the authority of a Writ of Demolition issued by the Regional Trial Court (RTC). However, records show that a Temporary Restraining Order (TRO) was issued by the Supreme Court (SC) on June 2, 1986 enjoining the demolition. It was also found out that the copy of the said TRO was also served to the petitioner on June 4, 1986. But the petitioner did not heed to the TRO and continued the demolition

until mid of 1987. The spouses filed a complaint for damages in connection with the destruction of their house. The trial court dismissed the complaint but the appellate court reversed the ruling. In this case, the petitioner was contending that the damages claimed by the respondent are not valid because he is just exercising his right. ISSUE: Whether or not the contention of the petitioner is correct. RULING: The petitioner’s contention is not correct. Petitioner invokes that it is well-settled that the maxim of damage resulting from the legitimate exercise of a person’s rights is a loss without injury — damnum absque injuria — for which the law gives no remedy, saying he is not liable for damages. The court explained the principle of damnum absque injuria. Under this principle, the legitimate exercise of a persons rights, even if it causes loss to another, does not automatically result in an actionable injury. The law does not prescribe a remedy for the loss. This principle does not, however, apply when there is an abuse of a persons right, or when the exercise of this right is suspended or extinguished pursuant to a court order. Indeed, in the availment of ones rights, one must act with justice, give others their due, and observe honesty and good faith. In the case at bar, the principle of damnum absque injuria cannot be applied because he abuses his right and exercise his suspended and extinguished right to demolish the respondent’s house. Clearly then, the demolition of respondents house by petitioner, despite his receipt of the TRO, was not only an abuse but also an unlawful exercise of such right. In insisting on his alleged right, he wantonly violated this Courts Order and wittingly caused the destruction of respondents house. Although the acts of petitioner may have been legally justified at the outset, their continuation after the issuance of the TRO amounted to an insidious abuse of his right. Indubitably, his actions were tainted with bad faith. Hence, petitioner is liable for the damages incurred in his abusive exercise of a suspended right.

(3)GMA NETWORK, INC. v. JESUS BUSTOS, M.D., ET. AL., G.R. No. 146848, October 17, 2006 FACTS:

In February 1988, a certain Abello and over 200 other unsuccessful examinees in the August1987 physicians’ licensure examinations, filed a Petition for Mandamus before the RTC of Manila to compel the Professional Regulatory Commission (PRC) and the board of medical examiners to re-check and re-evaluate the test papers. They alleged that mistakes in the counting of the total scores and erroneous checking of answers to test questions vitiated the results of the examinations. Rey Vidal, a news writer and reporter of GMA Network, Inc., covered the filing of the said petition. After securing a copy of the petition, he drafted and narrated the news report for the ten o’clock evening news edition of GMA’s Channel 7 Headline News. Jesus G. Bustos, et al., former chairman and members of the Board of Medicine of the PRC which conducted the examinations, filed a damage suit against Vidal and GMA Network. Claiming that GMA, in reckless disregard for the truth, defamed them by word of mouth. Simultaneous visual presentation on GMA’s Channel 7 of an unrelated and old footage showing physicians wearing black armbands.

According to them, Vidal and GMA Network made use of the said footage to make it appear that other doctors were supporting and sympathizing with the complaining unsuccessful examinees, when the same actually related to a 1982 demonstration staged by doctors and personnel of the Philippine General Hospital regarding wage and economic dispute with hospital management. The trial court dismissed the complaint for damages, holding that the news report was privileged, being but a narration of the allegations contained in and the circumstances attending the filing of the Petition for Mandamus. This was reversed by the CA which, while regarding the text of the news report as a qualifiedly privileged communication, nevertheless held that the insertion of the unrelated 1982 PGH picket film footage, “without the words “file video,” was evidence of malice. ISSUE: Whether or not the insertion of the old film footage depicting the doctors and personnel of PGH in their 1982 demonstrations constitutes malice to warrant the award of damages to the respondents. RULING: Contrary to the CA’s findings, the identifying character-generated words file video appeared to have been superimposed on screen, doubtless to disabuse the minds of televiewers of the idea that a particular footage is current. In the words of the trial court, the phrase file video was indicated on screen purposely to prevent misrepresentation so as not to confuse the viewing public. The trial court added the observation that the use of file footage in TV news reporting is a standard practice. At any rate, the absence of the accompanying character-generated words file video would not change the legal situation insofar as the privileged nature of the audio-video publication complained of is concerned. Nothing in the said footage, be it taken in isolation or in relation to the narrated Vidal report, can be viewed as reputation impeaching; it did not contain an attack, let alone a false one, on the honesty, character or integrity or like personal qualities of any of the respondents, who were not even named or specifically identified in the telecast. As records tend to indicate, the petitioners, particularly Vidal, do not personally know or had dealings with any of the respondents. The Court thus perceives no reason or motive on the part of either petitioner for malice. The respondents too had failed to substantiate by preponderant evidence that petitioners were animated by a desire to inflict them unjustifiable harm or at least to place them in a discomforting light. Given the foregoing considerations, the propriety of the award by the CA of moral and exemplary damages need not detain us long. Suffice it to state that moral damages may be recovered only if the existence of the factual and legal bases for the claim and their causal connection to the acts complained of are satisfactorily proven. Not being entitled to moral damages, neither may the respondents lay claim for exemplary damages. The Court holds and so rules that the subject news report was clearly a fair and true report, a simple narration of the allegations contained in and circumstances surrounding the filing by the unsuccessful examinees of the petition for mandamus before the court, and made without malice. Thus, we find the petitioners entitled to the protection and immunity of the rule on privileged matters under Article 354 (2) of the Revised Penal Code. It follows that they too cannot be held liable for damages sought by the respondents, who, during the period material, were holding public office. Principle of Abuse of Rights

Gestelee Pasaporte

The principle of abuse of rights is found under Articles 19, 20 and 21 of the Civil Code of the Philippines, which states that:

Art. 19. “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.” Art. 20. “Every person who, contrary to law, wilfully or negligently causes damage to another, shall indemnify the latter for the same.” Art. 21. “Any person who wilfully causes loss or injury to another in manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage.” When a right is exercised in a manner which does not conform with the norms enshrined in Article 19 and results in damage to another, a legal wrong is thereby committed for which the wrongdoer must be held responsible. Although the requirements of each provision is different, these three (3) articles are all related to each other The elements of an abuse of right under Article 19 are the following: (1) There is a legal right or duty; (2) which is exercised in bad faith; (3) for the sole intent of prejudicing or injuring another. Article 20 speaks of the general sanction for all other provisions of law which do not especially provide for their own Article 21 deals with acts contra bonus mores, and has the following elements: 1) There is an act which is legal; 2) but which is contrary to morals, good custom, public order, or public policy; 3) and it is done with intent to injure. Thus, under any of these three (3) provisions of law, an act which causes injury to another may be made the basis for an award of damages. Article 20, Chapter 2: Human Relations Art. 20. Every person who, contrary to law, willfully or negligently causes damage to another, shall indemnify the latter for the same. 1. Wilfully Negligence This article punishes illegal acts whether done wilfully or negligently. Thus, in the law of torts or quasi-delicts - “Whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done”. 2. Torts

Art. 20 introduces a broader concept of torts in our country, for it embraces: a. The Spanish tort- based on negligence b. American tort- based on malice 3. When no Action for Damages Would Prosper If someone be damaged, he does not necessarily have right to be indemnified. It is essential that some right of him be impaired. others.

Negligence is the failure to exercise the required amount of care to prevent injury to

Requirements for Negligence Most cases of negligence cannot be determined absolutely, for it depends on many factors. The main measure used to determine whether an act was negligent is to consider what a reasonably prudent person would do, given the age and knowledge of the tortfeasor, and other relevant factors.

4.

and the negligent act must have been the proximate cause of the injury. Theproximate cause is a cause that directly caused the loss or suffering; if the proximate cause didn't happen, then the harm would not have happened. All 4 elements of negligence must be present before a court will award damages. Contributory negligence is negligence that is caused by both plaintiff and defendant. If the plaintiff contributed to his injury, then, in some states, the plaintiff will be prevented from collecting any damages. Comparative negligence allows the plaintiff to collect some damages, but it will be reduced by the amount by which the plaintiff contributed to his own injury. There are 3 major rules, which differ according to state law and according to the amount of contributory negligence, that determine the amount that the plaintiff can collect. Damages There are 3 general types of damages awarded for negligence: (1) Special damages, are awarded for losses where the financial impact is quantifiable and can be itemized, such as medical expenses or loss of income. (2) General damages are losses that cannot be known with certainty or cannot really be compensated with money, such as loss of consortium or pain and suffering. (3) Punitive damages are assessed to deter the tortfeasor from committing the act again, which only makes sense for intentional torts. In general terms, negligence is "the failure to use ordinary care" through either an act or omission. That is, negligence occurs when: somebody does not exercise the amount of care that a reasonably careful person would use under the circumstances; or somebody does something that a reasonably careful person would not do under the circumstances. Proximate Cause Proximate cause exists where the plaintiff is injured as the result of negligent conduct, and plaintiff's injury must have been a natural and probable result of the negligent conduct. In order for a defendant to be liable, the plaintiff must establish both negligence and proximate cause. The Elements of a Negligence Action A typical formula for evaluating negligence requires that a plaintiff prove the following four factors by a "preponderance of the evidence": (1) The defendant owed a duty to the plaintiff (or a duty to the general public, including the plaintiff); (2) The defendant violated that duty; (3) As a result of the defendant's violation of that duty, the plaintiff suffered injury; and (4) The injury was a reasonably foreseeable consequence of the defendant's action or inaction. (1) Polo Pantaleon v. American Express International Inc (AMEX), G.R. No. 174269, August 25, 2010 FACTS:

Before a court will award damages, the presumed negligence must satisfy 4 requirements: 1. 2. 3.

there must be a legal duty to perform or to use reasonable care; there must have been a failure to perform that duty; the plaintiff must have suffered an injury or a loss;

This is a case involving a petition filed by the herein respondent AMEX questioning the decision of the Supreme Court, based on the conclusion that AMEX is guilty of culpable delay in fulfilling its obligation to its cardholder. Pantaleon together with his family (wife and two children) went on a guided European Tour. The next day after their arrival to Amsterdam, the group began their trip to Coster Diamond House at around 8:50am and planned to leave the Coster at 9:30am. Mrs. Pantaleon then decided to purchase

diamond pieces worth of US$ 13, 826, so Mr. Pantaleon presented his American Express credit card to sales clerk to pay for this purchase. However it took AMEX a total of 78 minutes to approve Pantaleon’s purchase and to transmit the approval to the jewelry store. Upon their return to the tour bus, they found their travel companions visibly irritated. After their trip to Europe, Pantaeon family proceeded to the US, where again he experienced delay in securing approval for purchases using his AMEX credit card on two separate occasions, first, upon the purchase of golf equipment and at the time he wanted to purchase childrens shoes. In the MR filed by AMEX, AMEX argues that this Court erred when it found AMEX guilty of culpable delay in complying with its obligation to act with timely dispatch on Pantaleons purchases. While AMEX admits that it normally takes seconds to approve charge purchases, it emphasizes that Pantaleon experienced delay in Amsterdam because his transaction was not a normal one. To recall, Pantaleon sought to charge in a single transaction jewelry items purchased from Coster in the total amount of US$13,826.00 or P383,746.16. While the total amount of Pantaleons previous purchases using his AMEX credit card did exceed US$13,826.00, AMEX points out that these purchases were made in a span of more than 10 years, not in a single transaction. AMEX argues that the transaction necessarily required the credit authorizer to carefully review Pantaleons credit history and bank references. AMEX maintains that it did this not only to ensure Pantaleons protection (to minimize the possibility that a third party was fraudulently using his credit card), but also to protect itself from the risk that Pantaleon might not be able to pay for his purchases on credit. This careful review, according to AMEX, is also in keeping with the extraordinary degree of diligence required of banks in handling its transactions. That the proximate cause of Pantaleons humiliation and embarrassment was his own decision to proceed with the purchase despite his awareness that the tour group was waiting for him and his wife. However, Pantaleon maintains that AMEX was guilty of delay in complying with its obligation to him. ISSUES:

(1) Whether or not AMEX is guilty of culpable delay. (2) Whether or not Pantaleon is entitle to damages.

RULING: (1) AMEX is not guilty of culpable delay. Since AMEX has no obligation to approve the purchase requests of its credit cardholders, Pantaleon cannot claim that AMEX defaulted in its obligation. Article 1169 of the Civil Code, which provides the requisites to hold a debtor guilty of culpable delay, states: Article 1169. Those obliged to deliver or to do something incur in delay from the time the obligee judicially or extrajudicially demands from them the fulfillment of their obligation. x xx. The three requisites for a finding of default are: (a) that the obligation is demandable and liquidated; (b) the debtor delays performance; and (c) the creditor judicially or extrajudicially requires the debtors performance. Based on the above, the first requisite is no longer met because AMEX, by the express terms of the credit card agreement, is not obligated to approve Pantaleons purchase request. Without a demandable obligation, there can be no finding of default.Apart from the lack of any demandable obligation, we also find that Pantaleon failed to make the demand required by Article 1169 of the Civil Code. The use of a credit card to pay for a purchase is only an offer to the credit card company to enter a loan agreement with the credit card holder. Before the credit card issuer accepts this offer, no obligation relating to the loan agreement exists between them. On the other hand, a demand is defined as the assertion of a legal right; an asking with authority, claiming or challenging as due. A demand presupposes the existence of an obligation between the parties. That AMEX obligation to act on the offer within a specified period of time is that: every time Pantaleon charges a purchase on his credit card, the credit card company still has to determine whether it will allow this charge, based on his past credit history. Also it is an elementary rule in our jurisdiction that good faith is presumed and that the burden of proving bad faith rests upon the party alleging it. As already established that: (a) AMEX

had neither a contractual nor a legal obligation to act upon Pantaleons purchases within a specific period of time; and (b) AMEX has a right to review a cardholders credit card history. However, it does not give AMEX an unlimited right to put off action on cardholders purchase requests for indefinite periods of time. In acting on cardholders purchase requests, AMEX must take care not to abuse its rights and cause injury to its clients and/or third persons. Citing Article 19, in conjunction with Article 21, of the Civil Code. Pantaleon action also was the proximate cause for his inury. The doctrine of volenti non fit injuria (to which a person assents is not esteemed in law as injury) refers to self-inflicted injury or to the consent to injury which precludes the recovery of damages by one who has knowingly and voluntarily exposed himself to danger, even if he is not negligent in doing so. And AMEX more importantly did not violate any legal duty to Pantaleon under the circumstances under the principle of damnum absque injuria, or damages without legal wrong, loss without injury. (2) Pantaleon is not entitled to damages. Because AMEX neither breached its contract with Pantaleon, nor acted with culpable delay or the willful intent to cause harm, we find the award of moral damages to Pantaleon unwarranted. Similarly, we find no basis to award exemplary damages. In contracts, exemplary damages can only be awarded if a defendant acted in a wanton, fraudulent, reckless, oppressive or malevolent manner. The plaintiff must also show that he is entitled to moral, temperate, or compensatory damages before the court may consider the question of whether or not exemplary damages should be awarded. (2) GF Equity, Inc. v. Arturu Valenzona, G.R. No. 156841, June 30, 2005 FACTS:

This is a case involving a petition filed by the herein petitioner assailing the decision of the CA reversing RTC’s decision which dismissed the complaint filed by herein respondent for breach of contract and damages against the petitioner. The GF Equity represented by its Chief Financial Officer W. Steven Uytengsu hired Valenzona as head coach of the Alaska basketball team in the Philippine Basketball Association (PBA) under a contract of Employment. While the employment period agreed upon was for two years commencing on January 1, 1988 and ending on December 31, 1989, the last sentence of paragraph 3 of the contract carried the following condition: 3. x x x If at any time during the contract, the COACH, in the sole opinion of the CORPORATION, fails to exhibit sufficient skill or competitive ability to coach the team, the CORPORATION may terminate this contract. Before affixing his signature on the contract, Valenzona consulted his lawyer who pointed out the one-sidedness of the above-quoted last sentence of paragraph 3 thereof. The caveat notwithstanding, Valenzona still acceded to the terms of the contract because he had trust and confidence in Uytengsu who had recommended him to the management of GF Equity. During his stint as Alaskas head coach, the team placed third both in the Open and All-Filipino PBA Conferences in 1988. Valenzona was later advised by the management of GF Equity by letter of September 26, 1988 of the termination of his services in this wise: We regret to inform you that under the contract of employment dated January 1, 1988 we are invoking our rights specified in paragraph 3. You will continue to be paid until your outstanding balance which, as of September 25, 1988, is P75,868.38 has been fully paid.Please return the service vehicle to my office no later than September 30, 1988. Valenzonas counsel, by letter of July 30, 1994, demanded from GF Equity payment of compensation arising from the arbitrary and unilateral termination of his employment. GF Equity, however, refused the claim. Valenzona challenged the condition in paragraph 3 of the contract as lacking the element of mutuality of contract, a clear transgression of Article 1308 of the New Civil Code, and reliance thereon, he contended, did not warrant his unjustified and arbitrary dismissal.

GF Equity maintained, on the other hand, that it merely exercised its right under the contract to pre-terminate Valenzonas employment due to incompetence. And it posited that he was guilty of laches and, in any event, his complaint should have been instituted before a labor arbiter. ISSUE: Whether or not the last sentence of paragraph 3 is violative of the principle of mutuality of contracts. RULING: It is violative of the principle of mutuality of contracts, therefore the said provision is null and void. The court ruled that GF Equity, Inc is liable to pay private respondent of actual damages and of attorneys fees. Under Article 1308 of the New Civil Code:The contract must bind both contracting parties; its validity or compliance cannot be left to the will of one of them. The said provision is a virtual reproduction of Article 1256 of the old Civil Code but it was so phrased as to emphasize the principle that the contract must bind both parties. This, of course is based firstly, on the principle that obligations arising from contracts have the force of law between the contracting parties and secondly, that there must be mutuality between the parties based on their essential equality to which is repugnant to have one party bound by the contract leaving the other free therefrom). Its ultimate purpose is to render void a contract containing a condition which makes its fulfillment dependent exclusively upon the uncontrolled will of one of the contracting parties. The ultimate purpose of the mutuality principle is thus to nullify a contract containing a condition which makes its fulfillment or pre-termination dependent exclusively upon theuncontrolled will of one of the contracting parties. The contract incorporates in paragraph 3 the right of GF Equity to pre-terminate the contract that if the coach, in the sole opinion of the corporation, fails to exhibit sufficient skill or competitive ability to coach the team, the corporation may terminate the contract. The assailed condition clearly transgresses the principle of mutuality of contracts. It leaves the determination of whether Valenzona failed to exhibit sufficient skill or competitive ability to coach Alaska team solely to the opinion of GF Equity. While GF Equitys act of pre-terminating Valenzonas services cannot be considered willful as it was based on a stipulation, albeit declared void, it, in doing so, failed to consider the abuse of rights principle enshrined in Art. 19 of the Civil Code which provides: 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. This provision of law sets standards which must be observed in the exercise of ones rights as well as in the performance of its duties, to wit: to act with justice; give every one his due; and observe honesty and good faith. Since the pre-termination of the contract was anchored on an illegal ground, hence, contrary to law, and GF Equity negligently failed to provide legal basis for such pretermination, e.g. that Valenzona breached the contract by failing to discharge his duties thereunder, GF Equity failed to exercise in a legitimate manner its right to pre-terminate the contract, thereby abusing the right of Valenzona to thus entitle him to damages under Art. 19 in relation to Article 20 of the Civil Code the latter of which provides: Art. 20. Every person who, contrary to law, willfully or negligently causes damage to another, shall indemnify the latter for the same. The exercise of a right ends when the right disappears, and it disappears when it is abused, especially to the prejudice of others. It cannot be said that a person exercises a right when he unnecessarily prejudices another or offends morals or good customs. Article 19 of New Civil Code is known to contain what is commonly referred to as the principle of abuse of rights, sets certain standards which must be observed not only in the exercise of one's rights but also in the performance of one's duties. These standards are the following: to act with justice; to give everyone his due; and to observe honesty and good faith. The law, therefore, recognizes a primordial limitation on all rights; that in their exercise, the norms of human conduct set forth in Article 19 must be observed. A right, though by itself legal because

recognized or granted by law as such, may nevertheless become the source of some illegality. When a right is exercised in a manner which does not conform with the norms enshrined in Article 19 and results in damage to another, a legal wrong is thereby committed for which the wrongdoer must be held responsible. But while Article 19 lays down a rule of conduct for the government of human relations and for the maintenance of social order, it does not provide a remedy for its violation. Generally, an action for damages under either Article 20 or Article 21 would be proper. Valenzona is entitled to recover actual damages his salary which he should have received from the time his services were terminated up to the time the employment contract expired, aand attorneys fees must remain. (3) Garcia v. Salvador, G.R. No. 168512, March 20, 2007 FACTS:

Respondent Ranida Salvador started working as a trainee in in a company and as a prerequisite for regular employment, she underwent a medical examination at the Community Diagnostic Center (CDC). Garcia who is a medical technologist, conducted the HBs Ag (Hepatitis B Surface Antigen) test and thereafter CDC issued the test result indicating that Ranida was HBs Ag: Reactive. The result bore the name and signature of Garcia as examiner and the rubber stamp signature of Castro as pathologist. When Ranida submitted the test result to Dr. Sto. Domingo, the Company physician, the latter apprised her that the findings indicated that she is suffering from Hepatitis B, a liver disease. Thus, based on the medical report submitted by Sto. Domingo, the Company terminated Ranidas employment for failing the physical examination. Ranida underwent another HBs Ag test and the result indicated that she is non-reactive. She informed Sto. Domingo of this development but was told that the test conducted by CDC was more reliable because it used the Micro-Elisa Method.Thus, Ranida went back to CDC for confirmatory testing, and this time, the Anti-HBs test conducted on her indicated a Negative result. Ranida also underwent another HBs Ag test at the Bataan Doctors Hospital using the Micro-Elisa Method. The result indicated that she was non-reactive. Ranida submitted the test results from Bataan Doctors Hospital and CDC to the Executive Officer of the Company who requested her to undergo another similar test before her re-employment would be considered. Thus, CDC conducted another HBs Ag test on Ranida which indicated a Negative result by Ma. Ruby G. Calderon, Med-Tech Officer-in-Charge of CDC, issued a Certification correcting the initial result and explaining that the examining medical technologist (Garcia) interpreted the delayed reaction as positive or reactive. Thereafter, the Company rehired Ranida. However, respondent filed a complaint for damages against petitioner Garcia and a purportedly unknown pathologist of CDC, claiming that, by reason of the erroneous interpretation of the results of Ranidas examination, she lost her job and suffered serious mental anxiety, trauma and sleepless nights, while Ramon was hospitalized and lost business opportunities. Garcia maintains he is not negligent, thus not liable for damages, because he followed the appropriate laboratory measures and procedures as dictated by his training and experience; and that he did everything within his professional competence to arrive at an objective, impartial and impersonal result. ISSUE: Whether or not petitioner Garcia is liable for damages for issuing an incorrect HBsAG test result. RULING: The court ruled that Garcia is guilty of gross negligence and therefore liabale to pay respondent for damages.

Negligence is the failure to observe for the protection of the interest of another person that degree of care, precaution and vigilance which the circumstances justly demand, whereby such other person suffers injury. For health care providers, the test of the existence of negligence is: whether did the health care provider either fail to do something which a reasonably prudent health care provider would have done, or that he or she did something that a reasonably prudent health care provider would not have done; and that failure or action caused injury to the patient; if yes, then he is guilty of negligence. Thus, the elements of an actionable conduct are: 1) duty, 2) breach, 3) injury, and 4) proximate causation. All the elements are present in the case at bar. A clinical laboratory must be administered, directed and supervised by a licensed physician authorized by the Secretary of Health, like a pathologist who is specially trained in methods of laboratory medicine; that the medical technologist must be under the supervision of the pathologist or a licensed physician; and that the results of any examination may be released only to the requesting physician or his authorized representative upon the direction of the laboratory pathologist. These rules are intended for the protection of the public by preventing performance of substandard clinical examinations by laboratories whose personnel are not properly supervised. The public demands no less than an effective and efficient performance of clinical laboratory examinations through compliance with the quality standards set by laws and regulations.We find that petitioner Garcia failed to comply with these standards. Garcia may not have intended to cause the consequences which followed after the release of the HBsAG test result. However, his failure to comply with the laws and rules promulgated and issued for the protection of public safety and interest is failure to observe that care which a reasonably prudent health care provider would observe. Thus, his act or omission constitutes a breach of duty. Indubitably, Ranida suffered injury as a direct consequence of Garcias failure to comply with the mandate of the laws and rules aforequoted. She was terminated from the service for failing the physical examination; suffered anxiety because of the diagnosis; and was compelled to undergo several more tests. All these could have been avoided had the proper safeguards been scrupulously followed in conducting the clinical examination and releasing the clinical report. Article 20 of the New Civil Code provides: Every person who, contrary to law, willfully or negligently causes damage to another, shall indemnify the latter for the same. The foregoing provision provides the legal basis for the award of damages to a party who suffers damage whenever one commits an act in violation of some legal provision. This was incorporated by the Code Commission to provide relief to a person who suffers damage because another has violated some legal provision. Faith Evangeline Maῆara (1)GASHEEM SHOOKAT BAKSH v. HON. COURT OF APPEALS and MARILOU T. GONZALES, G. R. No. 97336. February 19, 1993 FACTS: Petitioner was a medicine student at Lyceum Northwestern Colleges at Dagupan City. He was an Iranian exchange student and was 29 years old. Respondent was a former waitress on a luncheonette, and was 22 years old. Petitioner was allegedly the lover of the respondent, and was said to promise marriage to the latter, which convinced her to live with him in his apartment. It was even alleged that the petitioner went to the house of the respondent to inform her family about the marriage on the end of the semester. However, the marriage did not materialize, with several beatings and maltreatment experienced by the respondent from the petitioner. The case was filed in the RTC of Pangasinan, and the decision was held in favor of the respondent. However, the petitioner claimed that the judgment of the RTC was an error, for the claims of the respondent are not true, and that he did not know about the custom of the Filipinos; his acts were in accordance of his custom. The decision of the RTC was affirmed in toto by the Court of Appeals. Hence, the petitioner filed an appeal to the Supreme Court.

ISSUE: Whether or not the respondent could claim payment for the damages incurred by the petitioner. RULING: Mere breach of marriage is not punishable by law. However, since the respondent was proved to have a good moral character, and that she had just let her virginity be taken away by the petitioner since the latter offered a promise of marriage, then she could ask for payment for damages. Furthermore, since she let her lover, the petitioner, “deflowered” her since she believed that his promise to marry was true, and not due to her carnal desire, then she could have her claims against the petitioner. Moreover, the father of the respondent had already looked for pigs and chicken for the marriage reception and the sponsors for the marriage, and then damages were caused by the petitioner against the respondents, which qualified the claims of the respondent against the petitioner. (2)Alfredo Velayo v. Shell Company of the Philippine Islands, G.R. No. L-7817, October 31, 1956 FACTS:

As of August, 1948, the books, of the Defendant showed a balance of P170,162.S8 in its favor for goods it sold and delivered to CALI. Asa... matter of fact, according to Mr. Fitzgerald, CALFs Douglas C-54 plane, then in California, was offered to him by Mr. Alfonso Sycip, CALFs President of the Board of Directors, in partial settlement of their accounts, which offer was, however, declined by Mr. Crawford, probably... because upon inquiries made by Mr. Fitzgerald sometime before on August 6, 1948, the management of CALI informally convened its principal creditors (excepting only the insignificant small claims) who were invited to a luncheon that was held between 12:00 and 2:00 o'clock in the afternoon of that day in the Trade and Commerce Building at 123 Juan Luna St., Manila, and informed them that CALI was in a state of insolvency and had to stop operation. To this working committee, Mr. Desmond Fitzgerald, Credit Manager, of the Defendant, Atty. Agcaoili of the National Airports Corporation and Atty. Alexander Sycip (Exhs. Ill and PPP, par. 5 P. Agcaoili's memorandum dated August 7, 1948, to the General Manager of the National Airports (Corp.) were appointed. After the creditors present knew the balance sheet and heard the explanations of the officers of the CALI, it was their unanimous opinion that it would be advantageous not to present suits against this corporation but to strive for a fair... pro-rata division of its assets (Exh. MM, par 6, Memo of meeting), although the management of the CALI announced that in case of non-agreement of the creditors on a pro-rata division of the assets, it would file insolvency proceedings (p. 70, t.s.n., October 22, 1951). Mr. Fitzgerald did not decline the nomination to form part of said working committee and on August 9, 1948, the 3 members thereof discussed methods of achieving the objectives of the committee as decided at the creditors' meeting, which were to preserve the assets of the CALI... and to study the way of making a fair division of all the assets among the creditors. on that very day of the meeting of the working committee, August 9, 1948, which Mr. Fitzgerald attended, Defendant effected a telegraphic transfer of its credit against the CALI to the American corporation Shell Oil Company, ' Inc., assigning its credit, amounting to $79,440.00, which was subsequently followed by a deed of assignment of credit dated August 10, 1948, the credit amounting this time to the sum of $85,081.29 Unaware of Defendants assignments of credit and attachment suit, the stockholders of CALI resolved in a special meeting of August 12, 1948, to approve the memorandum agreement of sale to the Philippine Air Lines, Inc. and noted "that the Board had been trying to reach an... agreement with the creditors of the corporation to prevent insolvency proceedings, but so far no definite agreement had been reached" (Exh. 00 Minutes of August 12, 1948, stockholders' meeting). By the first week of September, 1948, the National Airports Corporation learned of Defendant's action in the United States and hastened to file its own complaint with attachment against the CALI in the Court of First Instance of Manila (Exhs. KKK, LLL, and MMM).

On this... date, an order of insolvency was issued by the court (Exh. JJ) which necessarily stayed the National Airports Corporation's action against the CALI and dissolved its attachment (Exh. NNN), thus compelling the National Airports Corporation to file its claims with the insolvency... court (Exh. SS). After properly qualifying as Assignee, Alfredo M. Velayo instituted this case (No. 6966 of the Court of First Instance of Manila) on December 17,1948, against the Shell Company of P. I., Ltd., for the purpose of securing from the Court a writ of injunction... restraining Defendant, its agents, servants, attorneys and solicitors from prosecuting in and for the County of San Bernardino in the Superior Court of the State of California, U.S.A. the aforementioned Civil Case No. 62576 against the in solvent Commercial Air Lines, Inc.,... begun by it in the name of the American corporation Shell Oil Company, Inc., and as an alternative remedy, in case the purported assignment of Defendant's alleged credit to the American corporation Shell Oil Company, Inc., and the attachment issued against CALI in the said Superior Court of California shall have the effect of defeating the procurement by plaintiff as Assignee in insolvency of the above-mentioned airplane, which is the property of the insolvent CALI, situated in the Ontario International Airport, within the County of San Bernardino, State of California, U.S.A., that judgment for damages in double the value of the airplane be awarded in favor of plaintiff against Defendant, with costs. Plaintiff haying failed to restrain the progress of the attachment, suit in the United States by... denial of his application for a writ of preliminary injunction and the consequences on execution of the C-54 plane in the County of San Bernardino, State of California, U. S. A., he confines his action to the recovery of damages against the Defendant. In its answer, Defendant, besides denying certain averments of the complaint alleged, among other reasons, that the. assignment of its credit in favor of the Shell Oil Company, Inc, in the United States was for a valuable consideration and made in accordance with the established commercial practices, there being no law prohibiting a creditor from assigning his credit to another; that it had no interest whatsoever in Civil Case No. 62576... instituted in the Superior Court in the State of California by the Shell Oil Company, Inc., which is a separate and distinct corporation organized and existing in the State of Virginia and doing business in the State of California, U. S. A., the Defendant having as its... stockholders the Shell Petroleum Company of London and other persons residing in that City, while the Shell Oil Company Inc., of the United State has its principal stockholders the Shell Union Oil Company of the U.S. and" presumably countless American investors inasmuch as its... shares of stock are being traded daily in the New York stock market; that Mr. Fitzgerald, Defendant's Credit Manager, was merely invited to a luncheon-meeting at the Trade and Commerce Building in the City of Manila on August 6, 1948, without knowing the purpose for... which it was called; and that Mr. Fitzgerald could not have officially represented the Defendant at that time because such authority resides on Mr. Stephen Crawfurd. Defendant, therefore, prays that the complaint be dismissed with costs against the plaintiff. ISSUE: Whether or not by reason of said betrayal of confidence and trust, Defendant may be made under the law to answer for the damages prayed by the plaintiff; and if so, what should be the amount of such damages. RULING: In addition to the aforementioned Section 37, Chapter 2 of the PRELIMINARY TITLE of the Civil Code, dealing on Human Relations, provides the following: "ART 19. Any person must, in the exercise of his rights and in the performances of his duties, act with justice, give everyone his due and observe honesty and good faith". It maybe said that this article only contains a mere declarations of principles and while such statement may be is essentially correct, yet We find that such declaration is implemented by Article 21 and sequence of the same Chapter which prescribe the following: "ART. 21. Any person who willfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage".

"Thus at one stroke, the legislator, if the forgoing rule is approved (as it was approved), would vouchsafe adequate legal remedy for that untold numbers of moral wrongs which is impossible for human foresight to provide for specifically in the statutes. "Another rule is expressed in Article 24 which compels the return of a thing acquired 'without just or legal grounds'. This provision embodies the doctrine that no person should unjustly enrich himself at the expense of another, which has been one of the mainstays of... every legal system for centuries. It is most needful that this ancient principles be clearly and specifically consecrated in the proposed Civil Code to the end that in cases not foreseen by the lawmaker, no one may unjustly benefit himself to the prejudice of another. The German Civil Code has a similar provision (art. 812)." From the Civil Code Annonated by Ambrosio Padilla, Vol. I, p. 51, 1956 edition, We also copy the following: "A moral wrong or injury, even if it does not constitute a violation of a statute law, should be compensated by damages. Moral damages (Art. 2217) may be recovered (Art. 2219). In Article 20, the... liability for damages arises from a willful or negligent act contrary to law. In this article, the act is contrary to morals, good customs or public policy" Now, if Article 23 of- the Civil Code goes as far as to provide that: "Even if an act or event causing damage to another's property was not due to the fault or negligence of the defendant, the latter shall be liable for indemnity if through the act or event he was benefited:"... with mere much more reason the Defendant should be liable for indemnity for acts it committed in bad faith and with betrayal of confidence. It may be argued that the aforequoted provisions of the Civil Code only came into effect on August 80, 1950, and that they cannot be applicable to acts that took place in 1948, prior to its effectivety. But Article 2252 of the Civil Code, though providing... that: ''Changes made and new provisions and rules land down by this Code which may be prejudice or impair vested or acquired rights in accordance with the old legislation, shall have no retroactive effect.***... implies that when the new provisions of the Code does nor prejudice or impair vested or acquired rights in accordance with the old legislation and it cannot be alleged that in the case at bar Defendant had any vested or acquired right to betray the confidence of the... insolvent CALI or of its creditors said new provisions, like those on Human Relations, can be given retroactive effect. In accordance with these quoted provisions of the Civil Code, We hold Defendant liable to pay to the plaintiff, for the benefit of the insolvent CALI and its creditors, as compensatory damages a sum equivalent to the value of the plane at the time aforementioned and another... equal sum as exemplary damages. Wherefore, and on the strength of the foregoing considerations, the decision appealed from is reversed and Defendant-Appellee, Shell Company of the Philippine Islands, Ltd., is hereby sentenced to pay to Plaintiff-Appellant, as Assignee of the insolvent CALI, damages in a sum... double the amount of the value of the insolvent's airplane C-54 at the time Dedenfant's credit against the CALI was assigned to its sister corporation in the United States, which value shall be determined in the corresponding incident in the lower court after this decision... becomes final. Costs are taxed against defendant-appellee. (3)Nikko Hotel Manila v. Reyes, G.R. No. 154259, 28 February 2005 FACTS:

There are two versions of the story: Mr. Reyes: On the eve of October 13, 1994, Mr. Reyes while having coffee at the lobby of Nikko Hotel was approached by Dr. Violet Filart, a friend several years back. According to Mr. Reyes, Dr. Filart invited him to join a birthday party at the penthouse for the hotel’s former General Manager, Mr. Tsuruoka. Plaintiff agreed as Dr. Filart agreed to vouch for him and carried a basket of fruits, the latter’s gift. He lined up at the buffet table as soon as it was ready but to his great shock, shame and embarrassment, Ruby Lim, Hotel’s Executive Secretary, asked him to leave in a loud voice enough to be heard by the people around them. He was asked to leave the party and a Makati policeman accompanied him to step-out the hotel. All these time, Dr.Filart ignored him adding to his shame and humiliation. Ms. Ruby Lim: She admitted asking Mr. Reyes to leave the party but not in the manner claimed by the plaintiff. Ms. Lim approached several people including Dr. Filart’s sister, Ms. ZenaidaFruto, if Dr. Filart did invite him as the captain waiter told Ms. Lim that Mr. Reyes was with

Dr. Filart’s group. She wasn’t able to ask it personally with Dr. Filart since the latter was talking over the phone and doesn’t want to interrupt her. She asked Mr. Reyes to leave because the celebrant specifically ordered that the party should be intimate consisting only of those who part of the list. She even asked politely with the plaintiff to finish his food then leave the party. During the plaintiff’s cross-examination, he was asked how close Ms. Lim was when she approached him at the buffet table. Mr. Reyes answered “very close because we nearly kissed each other”. Considering the close proximity, it was Ms. Lim’s intention to relay the request only be heard by him. It was Mr. Reyes who made a scene causing everybody to know what happened. The trial court dismissed the complaint, giving more credence to the testimony of Ms. Lim that she was discreet in asking Mr. Reyes to leave the party. The trial court likewise ruled that Mr. Reyes assumed the risk of being thrown out of the party as he was uninvited. However, the Court of Appeals reversed the ruling of the trial court as it found more commanding of belief the testimony of Mr. Reyes that Ms. Lim ordered him to leave in a loud voice within hearing distance of several guests. CA held petitioner liable for damages to Roberto Reyes aka “AmangBisaya”, an entertainment artist. Hence, this petition. ISSUE: Whether or not petitioners acted abusively in asking Mr. Reyes to leave the party. RULING: No. Supreme Court held that petitioners did not act abusively in asking Mr. Reyes to leave the party. Plaintiff failed to establish any proof of ill-motive on the part of Ms. Lim who did all the necessary precautions to ensure that Mr. Reyes will not be humiliated in requesting him to leave the party. Art. 19. of the Civil Code states 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”. When a right is exercised in a manner which does not conform with the norms enshrined in Article and results in damage to another, a legal wrong is thereby committed for which the wrongdoer must be responsible. The object of this article, therefore, is to set certain standards which must be observed not only in the exercise of one’s rights but also in the performance of one’s duties. These standards are the following: act with justice, give everyone his due and observe honesty and good faith. Its antithesis, necessarily, is any act evincing bad faith or intent to injure. Its elements are the following: (1) There is a legal right or duty; (2) which is exercised in bad faith; (3) for the sole intent of prejudicing or injuring another. Art. 21. of the Civil Code also states that: “Any person who willfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage”.Article 2165 refers to acts contra bonus mores and has the following elements: (1) There is an act which is legal; (2) but which is contrary to morals, good custom, public order, or public policy; and (3) it is done with intent to injure. As applied to herein case Mr. Reyes has not shown that Ms. Lim was driven by animosity against him. The manner by which Ms. Lim asked Mr. Reyes to leave was likewise acceptable and humane under the circumstances. Ms. Lim having been in the hotel business for twenty years wherein being polite and discreet are virtues to be emulated, the testimony of Mr. Reyes that she acted to the contrary does not inspire belief and is indeed incredible. Thus, the lower court was correct. Considering the closeness of defendant Lim to plaintiff when the request for the latter to leave the party was made such that they nearly kissed each other, the request was meant to be heard by him only and there could have been no intention on her part to cause embarrassment to him. Ms. Lim, not having abused her right to ask Mr. Reyes to leave the party to which he was not invited, cannot be made liable to pay for damages under Articles 19 and 21 of the Civil Code. Necessarily, neither can her employer, Hotel Nikko, be held liable as its liability springs from that of its employees.

Bai Amor Solaiman (1)HECTOR C VILLANUEVA V. UCPB, G.R. NO. 138291, MARCH 7, 2000 FACTS:

Sometime in December 1978, Hermenegildo Villanueva, father of herein petitioner, Hector Villanueva applied for and was granted a loan by UCPB, managed by Bobby Café. The respondent bank found certain faud anomalies, and irregularities that the petitioner, together with his father, Bobby Café and certain Reynaldo Ramos, confederated with each other. UCPB filed criminal complaints against the petitioners. RTC: Rendered decision acquitting all the accused. In view of the acquitting, Hector Villanueva filed a complaint for damages on the ground alleged malicious prosecution with the RTC: RTC: favored the petitioner CA: Reversed the RTC’s decision ISSUES: 1. Was there a probable cause? 2. May the private complainant in a criminal case be held liable for malicious prosecution, considering that it is the fiscal who prosecuted the criminal action against the accused. 3. Was the petitioner prosecuted out of malice? RULING: The petition has no merit. 1.There was a probable cause for filing the complaints which were not products of the whim or caprice of the respondent bank. In this case, the facts constituted prima facie evidence to engender a reasonable belief that the petitioner was part of a conspiracy to defraud the respondent bank. In malicious prosecution, even if the act complained of does not constitute a crime, there can still be probable cause behind the commission of a civil wrong. 2. Yes. For malicious prosecution suit to prosper, the plaintiff must prove the following: a. the prosecution did occur, and the defendant was himself the prosecutor or that he instigated its commencement. b. the criminal action finally ended with an acquittal. c. in bringing the action, the prosecutor acted without probable cause. d. the prosecution is impelled with legal malice- an improper or sinister motive. Clearly, the mere fact that the fiscal took full control of a litigation does not grant immunity to persons who misuse their rights to instigate criminal actions. Hence, the complainant may still be liable for malicious prosecution if the public prosecutor controlled the litigation. 3. No. There is no credible evidence to show that respondent bank was impelled by a desire to unjustly vex, annoy and inflict injury to the petitioner. Malicious prosecution requires proof that the prosecution was prompted by a sinister design to vex and humiliate the plaintiff. Before these cases were referred to the city fiscal, it had been conducted its own investigation with the assistance of the National Bureau of Investigation. Petition Denied. (2) MAGBANUA V. JUNSAY, G.R. No. 132659, February 12, 2007 FACTS:

Petitioner Magbanua, who worked as a housemaid in the residence of complaint, Pilar Junsay, herein respondent, was charged as a co-accused with the crime of robbery. On 18th of July 1982 in the city of Bacolod, Magbanua robed assorted jewelries and cash owned by Dr. Pilar Junsay. Her co-accused remain at large. RTC rendered decision dismissing the complaint. CA affirmed RTC’s decision ISSUE: Whether petitioners are entitled to damages for malicious prosecution.

RULING: NO. This court has drawn the four (4) elements that must be shown to concur to recover damages for malicious prosecution. Therefore, for a malicious prosecution to suit to prosper, the plaintiff must prove the following: 1. the prosecution did occur, and the defendant was himself the prosecutor or that he instigated its commencement; 2. the criminal action finally ended with an acquittal. 3. in bringing the action, the prosecutor acted without probable cause; and 4. the prosecution was impelled by legal malice-an improper or a sinister motive. All four (4) elements were in attendance in the prosecution of petitioner Magbanua for the crime of Robbery. > 1st and 2nd elements are present. The prosecution of Petitioner Magbanua for the crime of Robbery did occur, and Respondents Junsay, Ibarra, Juanito instigated its commencement. > On Dec. 20, 1985, the RTC rendered a decision acquitting Magbanua on the ground of insufficiency of evidence. > On the question of probable cause, thus a finding of probable cause does not require an inquiry into whether there is sufficient evidence to procure a conviction. The filing of criminal case for robbery was not without probable cause. > There was no proof of a sinister design on the part of the respondent Junsay to vex or humiliate petitioner Magbanua by instituting the criminal case against her and her co-accused. Mere filing of a suit does not render a person liable for malicious prosecution should be unsuccessful, for the law could not have meant to impose a penalty on the right to litigate. Appeal denied. (3) DRILON V. CA, G.R. No. 107019, March 20,1997 FACTS:

In a letter-complaint to then Secretary of Justice Franklin Drilon, dated March 20, 1990, Gen. Renato de Villa, who was then the Chief of Staff of the Armed Forces of the Philippines, requested the DOJ to order the investigation of several individuals named therein, including herein private respondent Homobono Adaza, for their alleged participation in the failed December 1989 coup de etat. RTC’s decision on April 18, 1990, charging private respondent with the crime of rebellion with murder and frustrated murder. Thus, respondent Adaza filed his complaint with the RTC for damages. ISSUE: Whether the petitioner can be held liable for malicious prosecution. RULING: NO. In order for a malicious prosecution suit to prosper, the plaintiff must prove three (3) elements: 1. the fact of the prosecution and the defendant was himself the prosecutor and action is terminated with an acquittal; 2. the prosecutor acted without probable cause; 3. the prosecutor is impelled by legal malice. > There is nothing in the records which shows, and the complaint does not allege that criminal case filed by the petitioners against respondent Adaza acquitted of the charged. Not even, Adaza himself, thru counsel, makes any positive asseveration that would establish his acquittal. What appears from the records only is that respondent has been discharged on writ of habeas corpus and granted bail. > The complaint likewise does not make any allegations that the prosecution acted without probable cause in filing the criminal information for rebellion with murder and frustrated murder. It is well settled that one cannot be held liable for maliciously instituting a prosecution where one has

acted with probable cause, only in cases where legal prosecution has been carried on without probable cause. Hence probable cause was not wanting in the institution of criminal case against Adaza. > As to requirement that the prosecutor must be impelled by malice in bringing the unfounded action, suffice it to state that the presence of probable cause signifies the absence of malice. It is evident in this case that petitioners were not motivated by malicious intent or by a sinister design to unduly harass private respondent, but only by a well founded belief that respondent Adaza can be held for trial for the crime alleged in the information. Petition Granted Sittie Khairon Tago 1. Manila Gas Corporation v. CA, G.R. No. L-44190 , October 30, 1980 FACTS: o Manila Gas Corporation is authorized to conduct and operate the business of servicing and supplying gas in the City of Manila and its suburbs. o Respondent Ongsip applied for gas service connection for his kitchen and 48-door apartment with petitioner Manila Gas Corporation. o In May and June, no gas consumption was registered in the meter, prompting petitioner to issue a 'meter order' with instructions to change the gas meter in respondent's residence. o At around 1 o'clock in the afternoon, petitioner's employee went to Ongsip's place. Without notifying or informing respondent, they changed the gas meter and installed new tube connections. o Ongsip inquired why they were taking pictures of the premises but the employee simply gave him a calling card with instructions to go to his (Coronel's) office. o There, he was informed about the existence of a by-pass valve or "jumper" in the gas connection and that unless he gave Coronel P3,000.00, he would be deported. He refused. o By the end of August, a reading was made on the new meter and expectedly, it registered a sudden increase in gas consumption. A complaint for qualified theft was filed by petitioner against respondent Ongsip. o The complaint was dismissed by the city fiscal. Ongsip later filed a complaint for moral and exemplary damages against petitioner based on two causes of action, firstly: the malicious, oppressive and malevolent filing of the criminal complaint; and, secondly: the illegal closure of respondent Ongsip's gas service connection without court order and without notice of warning.

ISSUE: Whether or not the amount of moral and exemplary damages awarded by the trial court and affirmed by the CA is excessive. o HELD: o

o

o o

o

o

The first cause of action, for which respondent Ongsip was awarded moral and exemplary damages in the amount of P50,000.00 and P10,000.00, respectively, is predicated on Article 2219 of the Civil Code which states that "moral damages may be recovered in the following and analogous cases: .. . (8) malicious prosecution;… To constitute malicious prosecution, there must be proof that the prosecution was prompted by a sinister design to vex and humiliate a person that it was initiated deliberately by the defendant knowing that his charges were false and groundless. There is reason to believe that there was malicious intent in the filing of the complaint for qualified theft. Evidently, petitioner Manila Gas Corporation, in failing to recover its lost revenue caused by the gas meter's incorrect recording, sought to vindicate its financial loss by filing the complaint for qualified theft against respondent Ongsip knowing it to be false. It was actually intended to vex and humiliate private respondent and to blacken his reputation not only as a businessman but also as a person. WE give due consideration to respondent Ongsip's social and financial status as a businessman and the mental anguish he suffered as a result of the false imputation. However, We also consider petitioner's financial capability. Petitioner is a public utility corporation whose primary concern is service to the people, the profit motive being merely secondary. WHEREFORE, PETITIONER MANILA GAS CORPORATION IS HEREBY DIRECTED TO PAY: (1) RESPONDENT ISIDRO M. ONGSIP P25,000.00 AS MORAL DAMAGES AND P5,000.00 AS EXEMPLARY DAMAGES FOR THE FIRST CAUSE OF ACTION, P15,000.00 AS MORAL DAMAGES AND P5,000.00 AS EXEMPLARY DAMAGES FOR THE SECOND CAUSE OF ACTION, AND P10,000.00 AS ATTORNEY'S FEES; AND (2) THE COSTS.

o

MODIFIED AS ABOVE STATED, THE DECISION OF RESPONDENT COURT OF APPEALS IS HEREBY AFFIRMED IN ALL OTHER RESPECTS.

2. A. Buchanan v. Pilar A. Viuda de Esteban, G.R. No. L-10402, November 30, 1915 FACTS: o On September 16, 1913, Esteban, laid a complaint against the plaintiff before the justice of the peace of Iloilo charging him with assault in that he, that day, struck the 13-year-old son of the complaining witness with a thrown stone. o The accused was convicted in the justice's court but, on appeal to the Court of First Instance was acquitted. o The court stating in the judgment of acquittal that the defendant "was authorized if he saw fit to bring suit against the plaintiff for damages for malicious prosecution." o Under that declaration and alleged authorization the accused brought this action. ISSUE: Whether or not Buchanan may recover damages on the ground of malicious prosecution. HELD: o

The plaintiff is not entitled to recover as he has not shown that the prosecution was without probable cause and that it was malicious. “To support an action for malicious prosecution under American law the plaintiff must prove, in the first place, the fact of the prosecution and the fact that the defendant was himself to prosecutor, or that he instigated its commencement, and that it finally terminated in his acquittal;

o o o

o

o

o

that, in bringing it, the prosecutor had acted without probable cause, and that he was actuated by a legal malice.” It cannot be said, because there is no evidence to that effect, that she knew that she was prosecuting an innocent person. She accepted the statement of her son that it was Buchanan who threw the stone that hit him. While Buchanan always denied the charge, there is nothing in the record which would require the complainant to accept the statement of Buchanan rather than that of her son. As a necessary consequence, there is a failure to prove lack of probable cause or malice. If the charge, although false, was made with an honest belief in its truth and justice, and there were reasonable grounds on which such a belief could be founded, the accusation could not be held to have been false in the legal sense. Complainant, in good faith, accepted the story of her son and, in the honest belief that he had been assaulted by Buchanan, laid a complaint before the justice of the peace of the locality looking to the punishment of the person guilty of the crime. She was fully justified in the belief that her son had told the truth by the decision of the justice of the peace, who held Buchanan guilty as charged. While the charge may have been false, it was not the falsity of the complainant; and while it may have been malicious, we cannot, on the record, and especially after the judgment of the justice of the peace, find it to be so. The judgment appealed from is reversed and the case dismissed on the merits. No special finding as to costs.

2. MAGTANGGOL QUE v. IAC, G.R. No. L-66865, January 13, 1989 FACTS: o In 1975, Antonio Nicolas ordered from Magtanggol Que canvass strollers, Nicolas issued to Que 5 post-dated checks with a total face value of P7,600.00. Nicolas ordered a "stop payment" because of defects in the articles sold which Que had not corrected, so Que was unable to encash the checks. o

Que filed a complaint for estafa against Nicolas. The charge was dismissed for lack of merit, as the investigating fiscal held that it was an accounting matter, which did not necessarily involve deceit on Nicolas’ part.

o

In 1976, Nicolas filed his own complaint for damages against Que for malicious prosecution. Que averred that Nicolas had maliciously filed the complaint in Bulacan although he was a resident of Caloocan City, and Nicolas was indebted to him in any case, and that it was he [Que] who suffered damages due to the unwarranted suit.

o

Judge Puno held in favor of Nicolas, finding that Que acted maliciously in filing the estafa charge and in alleging that Nicolas issued the dishonored checks with deceit. Que’s motion for reconsideration was denied. A 2nd motion for reconsideration was filed, and Que averred the mere dismissal of the charge in the fiscal's office was not a ground for damages nor did it constitute an actionable wrong. The trial court reversed the original decision, Que won.

o

Nicolas contended that the amended decision was null and void for several technical reasons. IAC reinstated the original decision of Judge Puno—Nicolas won.

ISSUE: Whether or not Que is guilty of malicious prosecution. HELD: o o

Que is not guilty of malicious prosecution. To constitute malicious prosecution, there must be proof that the prosecution was prompted by a sinister design to vex and humiliate a person that it was initiated

o

o

o

o

o

o

deliberately by the defendant knowing that his charges were false and groundless. The mere act of submitting a case to the authorities for prosecution does not make one liable for malicious prosecution. One cannot be held liable in damages for maliciously instituting a prosecution where he acted with probable cause. The presence of probable cause signifies as a legal consequence the absence of malice. If the charge, although false, was made with an honest belief in its truth and justice, and there were reasonable grounds on which such a belief could be founded, the accusation could not be held to have been false in the legal sense. [Buchanan v. Esteban] Proof and motive that the prosecution or institution of the action was prompted by a sinister design to vex and humiliate a person and to cast dishonor and disgrace must be clearly and preponderantly established to entitle the victims to damages and other rights granted by law. Otherwise, there would always be a civil action for damages after the prosecution's failure to prove its cause. The adverse result of an action does not per se make the act wrongful and subject the actor to the payment of moral damages. The law could not have meant to impose a penalty on the right to litigate; such right is so precious that moral damages may not be charged on those who may exercise it erroneously. Considering that the checks could not be encashed and the supposedly defective goods had not been returned, Que had reason to believe that Nicolas intended to deceive him. Que was not motivated by ill feeling but only by an anxiety to protect his rights. Even if the fiscal found that no deceit was involved and that Que’s claim was unfounded, the mistaken charge was not malicious. The mere dismissal of the criminal complaint by the fiscal's office did not create a cause of action. What was inquired into was WON there was a prima facie showing of estafa. Nowhere in the fiscal's investigation report is there any statement imputing malice to Que. SC finds Que’s claim of harassment more plausible. However, inasmuch as good faith is presumed, absent sufficient rebuttable evidence, neither of them is guilty of malice. SC denied both parties their respective claims for damages. Each of them must bear the financial consequences of one’s own acts, including the litigation expenses. IAC DECISION SET ASIDE; AMENDED DECISION OF TRIAL COURT REINSTATED.

Joan Kate Uy

(12) The right to become a member of associations or societies for purposes not contrary to law; (13) The right to take part in a peaceable assembly to petition the Government for redress or grievances; (14) The right to be free from involuntary servitude in any form; (15) The right of the accused against excessive bail; (16) The right of the accused to be heard by himself and counsel, to be informed of the nature and cause of the accusation against him, to have a speedy and public trial, to meet the witnesses face to face, and to have compulsory process to secure the attendance of witness in his behalf; (17) Freedom from being compelled to be a witness against one’s self, or from being forced to confess guilt, or from being induced by a promise of immunity or reward to make such confession except when the person confessing becomes a State witness; (18) Freedom from excessive fines, or cruel and unusual punishment, unless the same is imposed or inflicted in accordance with a statute which has not been judicially declared unconstitutional; and (19) Freedom of access to the courts. In any of the cases referred to in this article, whether or not the defendant’s act or omission constitutes a criminal offense, the aggrieved party has a right to commence an entirely separate and distinct civil action for damages, and for other relief. Such civil action shall proceed independently of any criminal prosecution (if the latter be instituted), and may be proved by a preponderance of evidence. The indemnity shall include moral damages. Exemplary damages may also be adjudicated. The responsibility herein set forth is not demandable from a judge unless his act or omission constitutes a violation of the Penal Code or other penal statute.”

(1) CIVIL LIBERTIES They generally refer “to those fundamental freedoms which, historically associated with the bill of rights, aim at protecting the individual against oppression through government action; they are the rights which are deemed essential to any enlightened scheme of ordered liberty which endows the individual with the dignity of man in the society of his equals.’’

(2) SCOPE

ARTICLE 32 of the Civil Code “Art. 32. Any public officer or employee, or any private individual, who directly or indirectly obstructs, defeats, violates or in any manner impedes or impairs any of the following rights and liberties of another person shall be liable to the latter for damages: (1) Freedom of religion; (2) Freedom of speech; (3) Freedom to write for the press or to maintain a periodical publication; (4) Freedom from arbitrary or illegal detention; (5) Freedom of suffrage; (6) The right against deprivation of property without due process of law; (7) The right to a just compensation when private property is taken for public use; (8) The right to the equal protection of the laws; (9) The right to be secure in one’s person, house, papers, and effects against unreasonable searches and seizures; (10) The liberty of abode and of changing the same; (11) The privacy of communication and correspondence;



 

It should be noted that the following can be made liable: (a) Any public officer or employee.  Under Art. 32 of the Civil Code, public officials are not exempt from responsibility for such acts, and they cannot take shelter in the fact that they are public agents. (Festejo v. Fernando, GR No. L-5156, Mar. 11, 1954) (b) Any private individual even if he be in good faith; the precise purpose of the Article is to eliminate the defense of good faith, otherwise the main reason for the Article would be lost. (See Memorandum of Dr. Bocobo, Chairman, July 22, 1950). Provision speaks “directly or indirectly” responsible which means it is not the actor alone who must answer for damages under Art. 32. The person indirectly responsible also has to answer for the injury caused to the aggrieved party EXCEPTION: judges are not liable unless the act or omission is a crime which constitutes a violation of the Penal Code or other penal statute.

(3) NATURE 

 

There must be a violation of the constitutional right of the plaintiff and must be listed thereof under Art. 32; otherwise, it will not be demandable o Art. 32 punishes not only direct and indirect violations of constitutional liberties, but also their impairment. The aggrieved party has the right to commence an entirely separate and distinct civil action for damages and for other reliefs, which will proceed independently of any criminal prosecution and may be proved by preponderance of evidence Malice or Bad Faith is not required; otherwise, it would defeat the purpose which is the effective protection of individual rights o The clear intention of the legislature was to create a distinct cause of action in the nature of tort for the violation of constitutional rights, irrespective of the motive or intent of the defendant (Vinzons-Chato v. Fortune, GR. No. 141309, 19 June 2007) o It is to put an end to the official abuse by the plea of good faith (Vinzons-Chato v. Fortune, GR. No. 141309, 19 June 2007)

(4) REMEDIES The Article allows an independent civil action, whether or not a crime has been committed, with indemnification for moral and exemplary damages in addition to other damages. In the case of exemplary damages, award thereof is discretionary with the Court.

(5) REASON for the Creation of an Independent Civil Action Under Art. 32 



Under Paras: (a) Sometimes the fiscal (prosecutor) is afraid to prosecute fellow public officials, and the citizen may be left without redress. (b) Even when the fiscal (prosecutor) files a criminal case, still said case requires proof of guilt beyond reasonable doubt, a requirement much harder to comply with than mere preponderance of evidence. (c) There are many unconstitutional acts which are not yet made crimes. The remedy for this is clearly a civil action. (Report of the Code Commission, pp. 30-31). Under Casis o To protect the deeply cherished rights and freedoms enshrined in the Consitution (Aberca v. Ver, GR. No. 69866, 15 April 1988)

SOURCES Casis, R. J. (2012). Analysis of Law and Jurisprudence on Torts and Quasi-Delicts. Quezon City: U.P. College of Law. Retrieved January 19, 2019 Paras, E. L. (2008). Civil Code of the Philippines Annotated (Sixteenth Edition ed.). Quezon City: Rex Printing Company, Inc. Retrieved January 19, 2019 (1)SILAHIS V. SOLUTA, GR No. 163087. Feb 20, 2006 FACTS: In late 1987, Coronel Floro Maniego, in charge of the security force, had been receiving reports of drug smuggling and other illegal activities in the union office of the Silahis International Hotel (SIH). Hence, he conducted a surveillance with the approval of the Vice President of SIH, Jose Marcel Panlilio.

There were two versions of the antecedents of the case: (1) Petitioner's version: In the morning of January 11, 1988, Panlilio, his personal secretary Andy Dizon, Maniego, Bulletin reporter Nonoy Rosales, and REPISA security guard Steve Villanueva (Villanueva) entered the union office located at the hotel basement, with the permission of union officer Henry Babay (Babay) who was apprised about the suspected illegal activities, and searched the premises in the course of which Villanueva found a plastic bag under a table. When opened, the plastic bag yielded dry leaves of marijuana. Panlilio thereupon ordered Maniego to investigate and report the matter to the authorities. (2) Respondent's version: On January 10, 1988, Loida Somacera (Loida), a laundrywoman of the hotel, stayed overnight at the female locker room at the basement of the hotel. At dawn of January 11, 1988, she heard pounding sounds outside, prompting her to open the door of the locker room upon which she saw five men in barong tagalog whom she failed to recognize but she was sure were not employees of the hotel, forcibly opening the door of the union office. She even saw one of the men hid something behind his back. She then closed the door and went back to bed. Soon after she heard the door of the union office opened. In the morning of January 11, 1988, as union officer Rogelio Soluta was trying in vain to open the door of the union office, Loida narrated to him what she had witnessed at dawn. Soluta thus immediately lodged a complaint before the Security Officer. And he fetched a locksmith, Efren Guevarra, who tried to assist him, Edna, Arnold Ilustrisimo and Ed Bautista open the door. At that instant, men in barong tagalog armed with clubs arrived and started hitting Soluta and his companions, drawing them to run to the female locker room, and to thereafter proceed to the Engineering Office where they called for police assistance. While awaiting the arrival of the police, Babay and Panlilio, on the latter’s request, met. At the meeting, Panlilio told Babay that they proceed to the union office where they would settle the mauling incident, to which Babay replied that the door of the office could not be opened. Panlilio thereupon instructed Villanueva to force open the door, and the latter did. Once inside, Panlilio and his companions began searching the office, over the objection of Babay who even asked them if they had a search warrant. A plastic bag was found containing marijuana flowering tops. As a result of the discovery of the presence of marijuana in the union office and after the police conducted an investigation of the incident, a complaint against the 13 union officers. The RTC acquitted the accused union members for lack of sufficient evidence on the ground that marijuana allegedly found in the Union Office is not admissible in evidence, coupled by the suspicious circumstance of confiscation. Thereafter, respondents filed before the Manila RTC a Complaint against petitioners et al. including prosecuting Fiscal Jose Bautista and Atty. Eduardo Tutan who assisted in the prosecution of the case against them, for malicious prosecution and violation of their constitutional right against illegal search. RTC ruling: held that the hotel, Panlilio, Maniego and Villanueva jointly and severally liable for damages as a result of malicious prosecution and illegal search of the union office. However, it dismissed the case against plaintiff Erlisa Ilustrisimo and defendants Ramos, Bautista and Tutaan for lack of merit CA ruling: found herein petitioners et al. civilly liable for damages for violation of individual respondents’ constitutional right against illegal search, not for malicious prosecution, set aside the award of actual damages to respondent union, and reduced the award of actual damages to individual respondents to ₱50,000 ISSUE: Whether the private individuals are liable under Art 32?

HELD:

Yes, because Art 32 made liable any public officer or employee, or any private individual. The Code Commission deemed it necessary to hold not only public officers but also private individuals civilly liable for violation of rights enumerated in Article 32 of the Civil Code. That is why it is not even necessary that the defendant under this Article should have acted with malice or bad faith, otherwise, it would defeat its main purpose, which is the effective protection of individual rights. It suffices that there is a violation of the constitutional right of the plaintiff. In the present case, as priorly stated, petitioners had, by their own claim, already received reports in late 1987 of illegal activities allegedly undertaken in the union office and Maniego conducted surveillance of the union officers. Yet, in the morning of January 11, 1988, petitioners and their companions barged into and searched the union office without a search warrant, despite ample time for them to obtain one, and notwithstanding the objection of Babay. Article 32 speaks of an officer or employee or person "directly or indirectly" responsible for the violation of the constitutional rights and liberties of another. Hence, it is not the actor alone who must answer for damages under Article 32; the person indirectly responsible has also to answer for the damages or injury caused to the aggrieved party. Such being the case, petitioners, together with Maniego and Villanueva, the ones who orchestrated the illegal search, are jointly and severally liable for actual, moral and exemplary damages to herein individual respondents. (2)ABERCA v. VER, GR No. L-69866. Apr 15, 1988 FACTS: Plaintiffs filed the suit against various intelligence units of the Armed Forces of the Philippines, known as Task Force Makabansa (TFM) ordered by General Fabian Ver "to conduct preemptive strikes against known communist-terrorist (CT) underground houses in view of increasing reports about CT plans to sow disturbances in Metro Manila. They alleged that complying with said order, the defendants committed violations of former’s constitutionally guaranteed human rights. A motion to dismiss was filed by defendants, through their counsel, then Solicitor-General Estelito Mendoz. RTC Judge Willelmo C. Fortun granted the motion to dismiss sustaining the defendant's contentions that (1) the plaintiffs may not cause a judicial inquiry into the circumstances of their detention in the guise of a damage suit because, as to them, the privilege of the writ of habeas corpus is suspended; (2) that assuming that the court can entertain the present action, defendants are immune from liability for acts done in the performance of their official duties; and (3) that the complaint states no cause of action against defendants, since there is no allegation that the defendants named in the complaint confiscated plaintiffs' purely personal properties in violation of their constitutional rights, and with the possible exception of Major Rodolfo Aguinaldo and Sergeant Bienvenido Balabo committed acts of torture and maltreatment, or that the defendants had the duty to exercise direct supervision and control of their subordinates or that they had vicarious liability as employers under Article 2180 of the Civil Code. On December 15, 1983, Judge Fortun issued an order voluntarily inhibiting himself from further proceeding in the case and leaving the resolution of the motion to set aside the order of dismissal to Judge Lising. In an order dated May 11, 1984, the trial court, Judge Esteban Lising issued an order that the Judge Fortun's order of dismissal is final against plaintiffs who failed to file a motion to reconsider. This was opposed by plaintiffs who argued that the amplificatory motion for reconsideration was filed for all the plaintiffs, although signed by only some of the lawyers. In its resolution of September 21, 1984, the respondent court affirmed its May 11, 1984 order; modified Judge Fortun's order of dismissal, dismissing the other defendants except Major Rodolfo Aguinaldo and Master Sgt. Bienvenido Balaba. Hence, the plaintiffs filed the instant petition for certiorari. ISSUES: (1) Whether the respondents can invoke state immunity from suit?

(2) Whether a superior officer under the notion of respondent superior be answerable for damages, jointly and severally with his subordinates, to the person whose constitutional rights and liberties have been violated? HELD:

(1) No, it is misplaced because it can only be invoked if the acts complained of are done by officers in the performance of official duties written in the ambit of their powers. Notwithstanding they are merely doing their duty, as they claim, "to prevent or suppress lawless violence, insurrection, rebellion and subversion" in accordance with Proclamation No. 2054 of President Marcos, this cannot be construed as a blanket license or a roving commission untrammeled by any constitutional restraint, to disregard or transgress upon the rights and liberties of the individual citizen enshrined in and protected by the Constitution. The Constitution remains the supreme law of the land to which all officials, high or low, civilian or military, owe obedience and allegiance at all times. Article 32 of the Civil Code which renders any public officer or employee or any private individual liable in damages for violating the Constitutional rights and liberties of another, as enumerated therein, does not exempt the respondents from responsibility. Only judges are excluded from liability under the said article, provided their acts or omissions do not constitute a violation of the Penal Code or other penal statute. Corollary, in carrying out this task and mission, constitutional and legal safeguards must be observed, otherwise, the very fabric of our faith will start to unravel. (2) Yes, because the language of Article 32 speaks of an officer or employee or person 'directly' or "indirectly" responsible for the violation of the constitutional rights and liberties of another. Thus, it is not the actor alone (i.e. the one directly responsible) who must answer for damages under Article 32; the person indirectly responsible has also to answer for the damages or injury caused to the aggrieved party. By this provision, the principle of accountability of public officials under the Constitution acquires added meaning and a larger dimension. No longer may a superior official relax his vigilance or abdicate his duty to supervise his subordinates, secure in the thought that he does not have to answer for the transgressions committed by the latter against the constitutionally protected rights and liberties of the citizen. Part of the factors that propelled people power in February 1986 was the widely held perception that the government was callous or indifferent to, if not actually responsible for, the rampant violations of human rights. While it would certainly be so naive to expect that violators of human rights would easily be deterred by the prospect of facing damage suits, it should nonetheless be made clear in no one’s terms that Article 32 of the Civil Code makes the persons who are directly, as well as indirectly, responsible for the transgression joint tortfeasors. RULING: grant the petition and annul and set aside the resolution of the respondent court, dated November 8, 1983, its order dated May 11, 1984 and its resolution dated September 21, 1984. Let the case be remanded to the respondent court for further proceedings NOTES: PRINCIPLE OF RESPONDEAT SUPERIOR OR COMMAND RESPONSIBILITY - hold a superior officer jointly and severally accountable for damages, including moral and exemplary, with his subordinates who committed such transgressions - judgment gives the caveat that a superior officer must not abdicate his duty to properly supervise his subordinates for he runs the risk of being held responsible for gross negligence and of being held under the cited provision of the Civil Code as indirectly and solidarily accountable with the tortfeasor. (3) MHP GARMENTS v. CA, GR No. 86720, Sept 2,1994 FACTS: MHP owns an exclusive franchise to sell and distribute official Boy Scouts uniforms, supplies, badges, and insignias. It was given the authority to "undertake or cause to be undertaken the prosecution in court of all illegal sources of scout uniforms and other scouting supplies."

Sometime in October 1983, MHP received information that the private respondents were selling Boy Scouts items and paraphernalia without any authority. Petitioner de Guzman, an employee of MHP, was tasked to undertake the necessary surveillance and to make a report to the Philippine Constabulary (PC). On October 25, 1983, at about 10:30 A.M., petitioner de Guzman, Captain Renato M. Peñafiel, and two (2) other constabulary men of the Reaction Force Battalion, Sikatuna Village, Diliman, Quezon City went to the stores of respondents at the Marikina Public Market. Without any warrant, they seized the boy and girl scouts pants, dresses, and suits on display at respondents' stalls. The seizure caused a commotion and embarrassed private respondents. Receipts were issued for the seized items. The items were then turned over by Captain Peñafiel to petitioner corporation for safekeeping. A criminal complaint for unfair competition was then filed against private respondents. During its pendency, petitioner de Guzman exacted from private respondent Lugatiman the sum of THREE THOUSAND ONE HUNDRED PESOS (P3,100.00) in order to be dropped from the complaint. On December 6, 1983, after a preliminary investigation, the Provincial Fiscal of Rizal dismissed the complaint against all the private respondents. On February 6, 1984, he also ordered the return of the seized items. The seized items were not immediately returned despite demands. Private respondents had to go personally to petitioners' place of business to recover their goods. Even then, not all the seized items were returned. The other items returned were of inferior quality. Thereafter, private respondents then filed Civil Case No. 51144 against the petitioners for sums of money and damages. RTC ruling: MHP and de Guzman to jointly and severally return the exacted amount to Lugatiman; pay for the items not return; pay moral and exemplary damages; and, pay for the ligation expenses. CA ruling: affirmed RTC decision w/ modification ISSUES:

(1) Whether there was an unlawful search and seizure? (2) Whether petitioners are liable? (3) Whether the award of moral damages is proper?

RULING: (1) Yes, because the seizure was made without any warrant. Article III, section 2, of the Constitution protects our people from unreasonable search and seizure. It provides: "The right of the people to be secure in their persons, houses, papers, and effects against unreasonable searches and seizures of whatever nature for any purpose shall be inviolable, and no search warrant or warrant of arrest shall issue except upon probable cause to be determined personally by the judge after examination under oath or affirmation of the complainant and the witnesses he may produce, and particularly describing the place to be searched and the persons or things to be seized." The progression of time between the receipt of the information (sometime in 1953) and the raid (October 25, 1983) of the stores of private respondents shows there was sufficient time for petitioners and the PC raiding party to apply for a judicial warrant. Despite the sufficiency of time, they did not apply for a warrant and seized the goods of private respondents. In doing so, they took the risk of a suit for damages in case the seizure would be proved to violate the right of private respondents against unreasonable search and seizure. In the case at bench, the search and seizure were clearly illegal. (2) Yes, because petitioners were indirectly involved in transgressing the right of private respondents against unreasonable search and seizure. Art. 32 of CC made liable any public officer or employee, or any private individual, who directly or indirectly. Firstly, they instigated the raid pursuant to their covenant in the Memorandum Agreement to undertake the prosecution in court of all illegal sources of scouting supplies. The raid was conducted

with the active participation of their employee. Larry de Guzman did not lift a finger to stop the seizure of the boy and girl scouts items. By standing by and apparently assenting thereto, he was liable to the same extent as the officers themselves. So with the petitioner corporation which even received for safekeeping the goods unreasonably seized by the PC raiding team and de Guzman, and refused to surrender them for quite a time despite the dismissal of its complaint for unfair competition. Second, Letter of Instruction No. 1299 of March 9, 1983 precisely provided that there must be an application of a warrant of arrest/seizure from the Boy Scouts of the Philippines. At bar, petitioners miserably failed to report the unlawful peddling of scouting goods to the Boy Scouts of the Philippines for the proper application of a warrant. Private respondents' rights are immutable and cannot be sacrificed to transient needs. 15 Petitioners did not have the unbridled license to cause the seizure of respondents' goods without any warrant. (3) Yes, because respondents must have suffered sleepless nights, serious anxiety, and wounded feelings due the tortious raid caused by petitioners. Private respondents' avowals of embarrassment and humiliation during the seizure of their merchandise were supported by their testimonies Art. 32. Any public officer or employee, or any private individual, who directly or indirectly obstructs, defeats, violates or in any manner impedes or impairs any of the following rights and liberties of another person shall be liable to the latter for damages. xxx xxx xxx (9) The rights to be secure in one's person, house, papers, and effects against unreasonable searches and seizures. xxx xxx xxx The indemnity shall include moral damages. Exemplary damages may also be adjudged. Art. 2219. Moral damages may be recovered in the following and analogous cases: xxx xxx xxx (6) Illegal search; xxx xxx xxx (10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34, and 35. Pursuant to the foregoing provisions, a person whose constitutional rights have been violated or impaired is entitled to actual and moral damages from the public officer or employee responsible therefor. In addition, exemplary damages may also be awarded The very nature of Article 32 is that the wrong may be civil or criminal. It is not necessary therefore that there should be malice or bad faith. To make such a requisite would defeat the main purpose of Article 32 which is the effective protection of individual rights. Public officials in the past have abused their powers on the pretext of justifiable motives or good faith in the performance of their duties. Precisely, the object of the Article is to put an end to official abuse by plea of the good faith. In the United States this remedy is in the nature of a tort. (emphasis supplied) It is consistently ruled that moral damages are not awarded to penalize the defendant but to compensate the plaintiff for the injuries he may have suffered. Needles to state, the wantonness of the wrongful seizure justifies the award of exemplary damages. It will also serve as a stern reminder to all and sundry that the constitutional protection against unreasonable search and seizure is a virile reality and not a mere burst of rhetoric. The all-encompassing protection extends against intrusions directly done both by government and indirectly by private entities. Ruling: appealed decision is AFFIRMED WITH MODIFICATION. We impose a SIX PERCENT (6%) interest from January 9, 1987 on the TWO THOUSAND PESOS (P2,000.00) for the unreturned twentysix (26) pieces of girl scouts items and a TWELVE PERCENT (12%) interest, in lieu of SIX PERCENT (6%), on the said amount upon finality of this Decision until the payment thereof. 22 Costs against petitioners.

Johaira Tomawis Newsweek, Inc. v Intermediate Appellate Court, G.R. NO. L-63559, MAY 30, 1986 FACTS:

Private respondents, incorporated associations of sugarcane planters in Negros Occidental filed Civil Case No. 15812 in their own behalf and/or as a class suit in behalf of all sugarcane planters in the province of Negros Occidental, against petitioner and two of petitioners' non-resident correspondents/reporters. The complaint alleged that petitioner and the other defendants committed libel against them by the publication of the article "An Island of Fear" in the February 23, 1981 issue of petitioner's weekly news magazine Newsweek. The article supposedly portrayed the island province of Negros Occidental as a place dominated by big landowners or sugarcane planters who not only exploited the impoverished and underpaid sugarcane workers/laborers, but also brutalized and killed them with imprunity. Petitioner filed a petition to dismiss arguing that private respondents' complaint failed to state a cause of action because the element of identifiability is absent. ISSUE : Whether the element of identifiabilty is present in the case at bar. RULING: No, the article does not refer specifically to any one of the respondents. "In order to maintain a libel suit, it is essential that the victim be identifiable, although it is not necessary that he be named ." In an earlier case, this Court declared that "defamatory matter which does not reveal the Identity of the person upon whom the imputation is cast, affords no ground of action unless it be shown that the readers of the libel could have Identified the personality of the individual defamed." It is evident from an earlier case that where the defamation is alleged to have been directed at a group or class, it is essential that the statement must be so sweeping or all-embracing as to apply to every individual in that group or class, or sufficiently specific so that each individual in the class or group can prove that the defamatory statement specifically pointed to him, so that he can bring the action separately, if need be. The case at bar is not a class suit. It is not a case where one or more may sue for the benefit of all or where the representation of class interest affected by the judgment or decree is indispensable to make each member of the class an actual party. We have here a case where each of the plaintiffs has a separate and distinct reputation in the community. They do not have a common or general interest in the subject matter of the controversy. Mukthar Guialel (1)GMA NETWORK, INC., ET AL v. JESUS BUSTOS, ET AL., GR. NO. 146848, OCTOBER 17, 2006 FACTS:

A libel complaint was filed against GMA NETWORK, INC and newscaster, Rey Vidal. The issue started from the Petition for Mandamus filed by the unsuccessful examinees of the physician’s licensure examinations before the RTC of Manila to compel the PRC and the board of medical examiners to re-check and reevaluate the test papers. As alleged, mistakes in the counting of the total scores and erroneous checking of answers to test questions vitiated the results of the examinations. As news writer and reporter of petitioner GMA Network, Inc. assigned to gather news from courts, among other beats, its co-petitioner Rey Vidal covered the filing of the mandamus petition. After securing a copy of the petition, Vidal composed and narrated the news coverage for the ten o'clock evening news edition of GMA's Channel 7 Headline News, quoting thereof the allegations of the

unsuccessful examiners that the gross, massive, haphazard, whimsical and capricious checking that must have been going on for years should now be stopped once and for all. Simultaneous with the news, was an old video footage showing physicians wearing black armbands. Along these lines, respondents claimed that the said report was false, malicious and onesided. Vidal and GMA Network, Inc., in reckless disregard for the truth, defamed them by word of mouth and simultaneous visual presentation on GMA Network, Inc.'s Channel 7. They added that, the showing of the unrelated old footage was done purposely so as to make a forceful impact on their audience making it appear that other doctors were supporting and sympathizing with the complaining unsuccessful examinees. In defense of the alleged libel, GMA Network argued that the same was but a privileged communication. ISSUE: Whether the said narration of the news reporter and the use of video footage were libelous. RULING: No, the statement in the news report falls within the ambit of privileged communication. For, although every defamatory imputation is presumed to be malicious, the presumption does not exist in matters considered privileged. Furthermore, neither the insertion of the file video constitutes malice on the part of the petitioners. Contrary to the CA's findings, the identifying character-generated words "file video" appeared to have been superimposed on screen, doubtless to disabuse the minds of televiewers of the idea that a particular footage is current. In the words of the trial court, the phrase "file video" was "indicated on screen purposely to prevent misrepresentation so as not to confuse the viewing public." The trial court added the observation that "the use of file footage in TV news reporting is a standard practice." the absence of the accompanying character-generated words "file video" would not nevertheless, change the legal situation insofar as the privileged nature of the audio-video publication complained of is concerned. In view of the state of things, the video footage was not libel in disguise; standing without accompanying sounds or voices, it was meaningless, or, at least, conveyed nothing derogatory in nature. (2) SALVADOR D. FLOR V. PEOPLE OF THE PHILIPPINES, GR. NO. 139987, MARCH 31, 2005 FACTS:

An information for libel was filed before the RTC, Branch 20, Naga City, against the petitioner and Ramos who were then the managing editor and correspondent, respectively, of the Bicol Forum, a local weekly newspaper circulated in the Bicol Region. It states: On or about the 18th day up to the 24th day of August, 1986, in the Bicol Region comprised by the Provinces of Albay, Catanduanes, Sorsogon, Masbate, Camarines Sur, and Camarines Norte, and the Cities of Iriga and Naga, Philippines, and within the jurisdiction of this Honorable Court under R.A. No. 4363, and B.P. Blg. 129, the above-named accused who are the news correspondent and the managing editor, respectively, of the local weekly newspaper Bicol Forum, did then and there willfully, unlawfully and feloniously, without justifiable motive and with malicious intent of impeaching, discrediting and destroying the honor, integrity, good name and reputation of the complainant as Minister of the Presidential Commission on Government Reorganization and concurrently Governor of the Province of Camarines Sur, and to expose him to public hatred, ridicule and contempt, write, edit, publish and circulate an issue of the local weekly newspaper BICOL FORUM throughout the Bicol Region, with banner headline and front page news item read by the public throughout the Bicol Region “VILLAFUERTE’S DENIAL CONVINCES NO ONE”. The trial court found the petitioner guilty. The Court of Appeals likewise upheld the decision of the trial court. Issue: Whether or not the questioned news item is libelous. RULING: No. Libel is defined as “a public and malicious imputation of a crime, or of a vice or defect, real or imaginary, or any act, omission, condition, status, or circumstance tending to cause the

dishonor, discredit, or contempt of a natural person or juridical person, or to blacken the memory of one who is dead.” The law recognizes two kinds of privileged matters. First are those which are classified as absolutely privileged which enjoy immunity from libel suits regardless of the existence of malice in fact. The other kind of privileged matters are the qualifiedly or conditionally privileged communications which, unlike the first classification, may be susceptible to a finding of libel provided the prosecution establishes the presence of malice in fact. The exceptions provided for in Article 354 of the Revised Penal Code fall into this category. The interest of society and the maintenance of good government demand a full discussion of public affairs. Complete liberty to comment on the conduct of public men is a scalpel in the case of free speech. The sharp incision of its probe relieves the abscesses of officialdom. Men in public life may suffer under a hostile and an unjust accusation; the wound can be assuaged with the balm of a clear conscience. Rising superior to any official, or set of officials, to the Chief Executive, to the Legislature, to the Judiciary – to any or all the agencies of Government – public opinion should be the constant source of liberty and democracy. (3)MVRS PUBLICATIONS v. ISLAMIC DA’WAH COUNCIL OF THE PHILIPPINES, GR. NO. 135306, JANUARY 28, 2003 FACTS:

Islamic Da'wah Council of the Philippines, Inc., a local federation of more than seventy (70) Muslim religious organizations, and individual Muslims (Linzag, Arcilla, de Guzman,da Silva, Junio) filed in the RTC a complaint for damages in their own behalf and as a class suit in behalf of the Muslim members nationwide against MVRS Publications, Inc., arising from an article published in the August 1, 1992 issue of Bulgar, a daily tabloid. The article reads: "ALAM BA NINYO? Na ang mga baboy at kahit anong uri ng hayop sa Mindanao ay hindi kinakain ng mga Muslim? Para sa kanila ang mga ito ay isang sagradong bagay. Hindi nila ito kailangang kainin kahit na sila pa ay magutom at mawalan ng ulam sa tuwing sila ay kakain. Ginagawa nila itong Diyos at sinasamba pa nila ito sa tuwing araw ng kanilang pangingilin lalung-lalo na sa araw na tinatawag nilang Ramadan." Islamic Da’Wah alleged that the libelous statement was insulting and damaging to the Muslims; that these words alluding to the pig as the God of the Muslims was not only published out of sheer ignorance but with intent to hurt the feelings, cast insult and disparage the Muslims and Islam, as a religion in this country, in violation of law, public policy, good morals and human relations; that on account of these libelous words Bulgar insulted not only the Muslims in the Philippines but the entire Muslim world, especially every Muslim individual in non-Muslim countries. MVRS PUBLICATIONS, INC., and AGUSTINO G. BINEGAS, JR., in their defense, contended that the article did not mention respondents as the object of the article and therefore were not entitled to damages; and, that the article was merely an expression of belief or opinion and was published without malice nor intention to cause damage, prejudice or injury to Muslims. RTC: dismissed the complaint; persons allegedly defamed by the article were not specifically identified CA: reversed RTC decision. The defamation was directed to all adherents of the Islamic faith. The suit for damages was a "class suit" and that ISLAMIC DA'WAH COUNCIL OF THE PHILIPPINES, INC.'s religious status as a Muslim umbrella organization gave it the requisite personality to sue and protect the interests of all Muslims. ISSUES: Whether Islamic Da’Wah has a cause of action for libel. RULING: NO, there is no cause of action for libel. Defamation - which includes libel and slander, means the offense of injuring a person's character, fame or reputation through false and malicious statements. It is that which tends to injure reputation or to diminish the esteem, respect, good will or confidence in the plaintiff or to excite derogatory feelings or opinions about the plaintiff. It is the publication of anything which is injurious to the good name or reputation of another or tends to bring him into disrepute. Defamation is an

invasion of a relational interest since it involves the opinion which others in the community may have, or tend to have, of the plaintiff. Words which are merely insulting are not actionable as libel or slander per se, and mere words of general abuse however ill-natured, whether written or spoken, do not constitute a basis for an action for defamation in the absence of an allegation for special damages. The fact that the language is offensive to the plaintiff does not make it actionable by itself. Declarations made about a large class of people cannot be interpreted to advert to an identified or identifiable individual. Absent circumstances specifically pointing or alluding to a particular member of a class, no member of such class has a right of action without at all impairing the equally demanding right of free speech and expression, as well as of the press. In this case, there was no fairly identifiable person who was allegedly injured by the Bulgar article. Since the persons allegedly defamed could not be identifiable, private respondents have no individual causes of action; hence, they cannot sue for a class allegedly disparaged. An individual Muslim has a reputation that is personal, separate and distinct in the community. A Muslim may find the article dishonorable, even blasphemous; others may find it as an opportunity to strengthen their faith and educate the non-believers and the "infidels." There is no injury to the reputation of the individual Muslims who constitute this community that can give rise to an action for group libel. Each reputation is personal in character to every person. Together, the Muslims do not have a single common reputation that will give them a commonor general interest in the subject matter of the controversy. If the group is a very large one, then the alleged libelous statement is considered to have no application to anyone in particular, since one might as well defame all mankind. As the size of these groups increases, the chances for members of such groups to recover damages on tortuous libel become elusive. This principle is said to embrace two (2) important public policies: first, where the group referred to is large, the courts presume that no reasonable reader would take the statements as so literally applying to each individual member. Second, the limitation on liability would satisfactorily safeguard freedom of speech and expression, as well as of the press, effecting a sound compromise between the conflicting fundamental interests involved in libel cases. Razul Kiram Ibrahim (1)HYATT INDUSTRIAL MANUFACTURING CORP v ASIA DYNAMIC ELECTRIC CORP GR 163597,July 29, 2005 Facts:

Hyatt Industrial Manufacturing Corporation (HIMC) alleged that Asia Dynamic Electrix Corporation (ADEC) purchased from it various electrical conduits and fittings. ADEC issued several checks in favor of HIMC as payment. The checks, however, were dishonored by the drawee bank on the ground of insufficient funds/account closed. HIMC then made several demand for payment but yielded no result. Before HIMC filed the instant complaint for recovery of sum of money against ADEC, it previously instituted a criminal case against ADEC officers Gil Santillan and Juanito Pamatmat for violation of Batas Pambansa Blg. 22 before the MTC of Pasig. ADEC moved to dismiss the civil complaint on the following grounds: (1) the civil action was deemed included in the criminal actions for violation of Batas Pambansa Blg. 22 (B.P. 22) previously filed by HIMC against the officers of ADEC; and (2) Section 1(b) of Rule 111 of the Revised Rules of Criminal Procedure prohibits the filing of a separate civil action in B.P. 22 cases. RTC decision RTC denied the motion to dismiss. It ruled that since the act complained of arose from the alleged non-payment of ADEC of its contractual debt, and not the issuance of checks with insufficient funds, in accordance with Article 31 of the Civil Code, the civil action could proceed independently of the criminal actions. It said that Section 1(b) of Rule 111 of the Revised Rules of Criminal Procedure does not apply to the obligation in this case, it being ex-contractu and not ex-delicto.

CA decision CA reversed the order of the trial court. It held that the civil actions deemed instituted with the filing of the criminal cases for violation of B.P. 22. Issue: Held: Yes, the civil action is deemed to have been instituted upon the filling of the criminal case for violation of BP Blg. 22 under Section 1(b) of Rule 111 of the 2000 Rules on Criminal Procedure. Under this rule, the reservation to file a separate civil action is no longer needed. The Rules even prohibit the reservation of a separate civil action, which means that one can no longer file a separate civil case after the criminal complaint is filed in court. The only instance when separate proceedings are allowed is when the civil action is filed ahead of the criminal case. Even then, the Rules encourage the consolidation of the civil and criminal cases. We have previously observed that a separate civil action for the purpose of recovering the amount of the dishonored checks would only prove to be costly, burdensome and time-consuming for both parties and would further delay the final disposition of the case. This multiplicity of suits must be avoided. Where petitioners rights may be fully adjudicated in the proceedings before the trial court, resort to a separate action to recover civil liability is clearly unwarranted. In view of this special rule governing actions for violation of B.P. 22, Article 31 of the Civil Code cited by the trial court will not apply to the case at bar. The pendency of the civil action before the court trying the criminal case bars the filing of another civil action in another court on the ground of litis pendentia. The elements of litis pendentia as a ground for dismissal of an action are: (1) identity of parties, or at least such parties who represent the same interest in both actions; (2) identity of rights asserted and relief prayed for, the relief being founded on the same facts; and (3) the identity, with respect to the two preceding particulars in the two cases, is such that any judgment that may be rendered in the pending case, regardless of which party is successful, would amount to res judicata in the other. (2)PRUDENTIAL BANK v. IAC, GR 74886, December 8, 1992 Facts:

On August 8, 1962, Philippine Rayon Mills, Inc. (PRMI) entered into a contract with Nissho Co., Ltd. of Japan (Nissho) for the importation of textile machineries under a five-year deferred payment plan. To effect payment for said machineries, PRMI applied for a commercial letter of credit with the Prudential Bank and Trust Company (Bank) in favor of Nissho. The bank granted the application for the opening of the letter of credit in favor of Nissho. Thereafter, drafts were drawn and issued by Nissho against the said letter of credit and were all paid by the Bank through its correspondent in Japan, the Bank of Tokyo, Ltd. Two of these drafts were accepted by PRMI through its president, Anacleto R. Chi, while the other ten were not. The Bank and PRMI agreed that the drafts will be sight drafts. Meaning to say, acceptance will not be necessary to render the parties liable thereon. Upon the arrival of the machineries, the Bank indorsed the shipping documents to PRMI which accepted delivery of the same. To enable the PRMI to take delivery of the machineries, it executed, by prior arrangement with the Bank, a trust receipt which was signed by Anacleto Chi in his capacity as President of PRMI. In 1967, PRMI ceased business operation. Consequently, the factory of PRMI was leased by Yupangco Cotton Mills. In 1974, all the textile machineries in the PRMI’s factory were sold to AIC Development Corporation. The obligation of PRMI arising from the letter of credit and the trust receipt remained unpaid and unliquidated. Repeated formal demands for the payment of the said trust receipt yielded no result. The Bank now commenced a criminal action for the violation of the Trust Receipts Law against PRMI.

Both the trial court and IAC ruled that PRMI could be held liable for the two (2) drafts because only these appear to have been accepted by the latter after due presentment. The liability for the remaining ten (10) drafts did not arise because the same were not presented for acceptance. In short, both courts concluded that acceptance of the drafts by PRMI was indispensable to make the latter liable thereon. The lower courts also ruled that the civil liability provided for in said Section 13 attaches only after conviction for the violation of the Trust Receipts Law. ISSUE: Is PRMI liable under the trust receipt? RULING: Yes, PRMI is liable to the Bank under the trust receipt. Let us first discuss the sight drafts, 2 of which were presented by the Bank to the PRMI for payment while the other 10 were not. The Supreme Court ruled that PRMI is liable for the ten (10) sight drafts even if the same were not presented to PRMI for acceptance because there was no need for acceptance as the issued drafts are sight drafts. Presentment for acceptance is necessary only in the cases expressly provided for in Section 143 of the Negotiable Instruments Law (NIL). Sec. 143. When presentment for acceptance must be made. — Presentment for acceptance must be made: (a) Where the bill is payable after sight, or in any other case, where presentment for acceptance is necessary in order to fix the maturity of the instrument; or (b) Where the bill expressly stipulates that it shall be presented for acceptance; or (c) Where the bill is drawn payable elsewhere than at the residence or place of business of the drawee. In no other case is presentment for acceptance necessary in order to render any party to the bill liable. Corollarily, they are, pursuant to Section 7 of the NIL, payable on demand. Sec. 7. When payable on demand. — An instrument is payable on demand — (a) When so it is expressed to be payable on demand, or at sight, or on presentation; or (b) In which no time for payment in expressed. Where an instrument is issued, accepted, or indorsed when overdue, it is, as regards the person so issuing, accepting, or indorsing it, payable on demand. (emphasis supplied) Even assuming arguendo that the drafts were not sight drafts, thereby necessitating acceptance, it would be the Bank and not PRMI which had to accept the same because PRMI was not the drawee. In the case at bar, the drawer of the sight drafts were Nissho and the drawee is the Bank. Presentment for acceptance is defined as the production of a bill of exchange to a drawee for acceptance. LIABILITY OF PRMI UNDER THE TRUST RECEIPT We recall that in order for PRMI to take delivery of the machineries, it executed with the Prudential Bank, a trust receipt which was signed by Anacleto Chi in his capacity as President of PRMI. PRMI did not only put the machinery to good use and profited by its operation but it also sold the machinery covered by the trust receipt to Yupangco Cotton Mills. As trustees of the property covered by the trust receipt, PRMI have willfully violated their duty to account for the whereabouts of the machinery covered by the trust receipt or for the proceeds of any lease, sale or other disposition of the same that they may have made, notwithstanding demands therefor. Under Section 13 of the Trust Receipts Law, the failure of an entrustee to turn over the proceeds of the sale of goods, documents or instruments covered by a trust receipt to the extent of the amount owing to the entruster or as appear in the trust receipt or to return said goods, documents or instruments if they were not sold or disposed of in accordance with the terms of the trust receipt shall constitute the crime of estafa, punishable under the provisions of Article 315, paragraph 1(b) of the Revised Penal Code. Under Article 33 of the Civil Code, a civil action for damages, entirely separate and distinct from the criminal action, may be brought by the injured party in cases of defamation, fraud and physical injuries. Estafa falls under fraud.

(3)SILVA v. PERALTA, 110 Phil 57, August 29, 1961

(4)HEIRS OF EDUARDO SIMON v. CHAN, G.R. No. 157547

FACTS:

FACTS:

Saturnino Silva, an American soldier, was married to Priscilla Isabel, an Australian citizen. When Saturnino Silva was deployed in the Philippines, he allegedly contracted marriage with Esther Peralta although there were no documents prepared to prove the validity of the said marriage. The marriage produced a child. While in the US for medical treatment, Saturnino Silva divorced Priscilla and contracted another marriage with Elenita Ledesma. Upon Saturnino’s return to the Philippines, Esther demanded support for the child but Saturnino Silva refused to give support. This caused for the filing by Esther of a case for child support in Manila against Saturnino. Esther had to quit her job as the Executive of the Girls Scout in Davao in order to pursue the case. However, the case for child support was later on dismissed. Thereupon, Elenita moved to enjoin Esther from representing herself as wife of Saturnino and prayed for the award of moral damages for the humiliation and distress she suffered upon learning that her husband had a child with Esther. Esther filed a counterclaim for actual damages and fees due to the harassment and moral damages caused by Saturnino’s marital relation with Elenita and his subsequent refusal to acknowledge their offspring. ISSUE: Who is entitled for damages? RULING: Esther Peralta is entitled for damages for the tortuous acts of Saturnino Silva. The damages awarded to Esther are a natural and direct consequence of Silva's deceitful maneuvers in making love to Esther, and inducing her to yield to his advances and live with him as his wife when Silva knew all the time that he could not marry Esther Peralta because of his undissolved marriage to an Australian woman, a prior wedlock that he concealed from Esther. It is clear that Esther Peralta would not have consented to the liaison had there been no concealment of Silva's previous marriage, or that the birth of the child was a direct result of this connection. That Esther had to support the child because Silva abandoned her before it was born. Silva's seduction and subsequent abandonment of Eshter and his illegitimate child were likewise the direct cause for the filling of the support case in Manila, and in order to prosecute the same, appellee had to quit her employment in Davao. While the case could have been filed in Davao, we do not believe that this error in selecting a more favorable venue (due to her unfamiliarity with the technicalities of the law) should be allowed to neutralize Saturnino Silva's responsibility as the primary causative factor of the prejudice and damage suffered by Esther. The court awarded Esther damages for the maintenance of their child as well as the loss of salary she suffered when she gave up her employment in Davao totaling to P15,000.00. With regards to the counterclaim for damages due to "mental torture, anguish and hurt feelings, all to her damage in the amount of P250,000.00”, the court granted the same based, not on the deceit practiced by Silva in securing Esther's assent to live maritally with him, but on his subsequent harassment of her in 1945, by filing suit against her in different provinces and otherwise applying pressure to cause her to abandon her child's case. On the other hand, an award for damages in Elenita's favor would require a further finding that the assumption of the disputed status by Esther Peralta was made in bad faith or through culpable negligence and no such finding has been made in the decision. Esther regarded herself as Saturnino's lawful wife in good faith, and that the man himself led her into this belief prior to his desertion. That later on, unknown to Esther, Silva should have married Elenita in the United States is not sufficient to impose upon Esther any liability for damages or to destroy her original good faith, there being no proof that the existence of a valid marriage between Saturnino and Elenita was adequately driven home to Esther before this case was instituted. That Saturnino and Elenita were living together as husband and wife was certainly not sufficient proof, considering Saturnino Silva's past history and conduct.

, February 23, 2011

Sometime in December 1996, Eduardo Simon (Simon) issued a check to Elvin Chan (Chan) assuring the latter that the check is duly funded and that he had an existing account with the Land Bank of the Philippines. However, when said check was presented for payment the same was dishonored on the ground that the account of Simon with the Land Bank of the Philippines has been closed contrary to his representation that he has an existing account with the said bank. Despite several demands for payment, Simon refused to comply. On July 11, 1997, the Office of the City Prosecutor of Manila charged Simon with a violation of BP 22. More than three years later, Elvin Chan commenced a civil action for the collection of the principal amount of P336,000.00, coupled with an application for a writ of preliminary attachment. Simon moved to dismiss the civil action on the ground of letis pendencia. He averred that the civil action for the recovery of damages has been deemed instituted upon the filing of the criminal action against him for violation of Batas Pambansa Bilang 22. Chan filed an opposition to the motion with the following contentions: 1. Plaintiff averred that a separate civil action for recovery of damages has been impliedly reserved because: First, by the fact that the information for violation of B.P. 22 did not make any allegation of damages suffered by the plaintiff nor was there any claim for recovery of damages; on top of this the plaintiff as private complainant in the criminal case, during the presentation of the prosecution evidence was not represented at all by a private prosecutor such that no evidence has been adduced by the prosecution on the criminal case to prove damages; all of these we respectfully submit demonstrate an effective implied reservation of the right of the plaintiff to file a separate civil action for damages; 2. In as much as the case is one that falls under Art. 33 of the Civil Code of the Philippines as it is based on fraud, this action therefore may be prosecuted independently of the criminal action; 3.

Even without any reservation at all of the right to file a separate civil action still the plaintiff is authorized to file this instant case because the plaintiff seeks to enforce an obligation which the defendant owes to the plaintiff by virtue of the negotiable instruments law. The plaintiff in this case sued the defendant to enforce his liability as drawer in favor of the plaintiff as payee of the check. ISSUE: The lone issue is whether or not Chan’s civil action to recover the amount of the unfunded check was an independent civil action. RULING: No, because there is no independent civil action to recover the civil liability arising from the issuance of an unfunded check prohibited and punished under Batas Pambansa Bilang 22 (BP 22). Every crime gives rise to a penal or criminal action for the punishment of the guilty party, and also to civil action for the restitution of the thing, repair of the damage, and indemnification for the losses (United States v. Bernardo, 19 Phil 265). However, there is no independent civil action to recover the value of a bouncing check issued in contravention of BP 22. This is clear from Rule 111 of the Rules of Court, effective December 1, 2000, which relevantly provides: Section 1. Institution of criminal and civil actions (a) xxx (b) The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to include the corresponding civil action. No reservation to file such civil action separately shall be allowed. Upon filing of the aforesaid joint criminal and civil actions, the offended party shall pay in full the filing fees based on the amount of the check involved, which shall be considered as the actual damages claimed. Where the complaint or information also seeks to

recover liquidated, moral, nominal, temperate or exemplary damages, the offended party shall pay the filing fees based on the amounts alleged therein. If the amounts are not so alleged but any of these damages are subsequently awarded by the court, the filing fees based on the amount awarded shall constitute a first lien on the judgment. Where the civil action has been filed separately and trial thereof has not yet commenced, it may be consolidated with the criminal action upon application with the court trying the latter case. If the application is granted, the trial of both actions shall proceed in accordance with section 2 of the Rule governing consolidation of the civil and criminal actions. Section 3. When civil action may proceed independently. In the cases provided in Articles 32, 33, 34 and 2176 of the Civil Code of the Philippines, the independent civil action may be brought by the offended party. It shall proceed independently of the criminal action and shall require only a preponderance of evidence. In no case, however, may the offended party recover damages twice for the same act or omission charged in the criminal action. The aforequoted provisions were not yet in effect when Chan instituted the civil case but it is nonetheless applicable. It is axiomatic that the retroactive application of procedural laws does not violate any right of a person who may feel adversely affected, nor is it constitutionally objectionable. The reason is simply that, as a general rule, no vested right may attach to, or arise from, procedural laws. Any new rules may validly be made to apply to cases pending at the time of their promulgation, considering that no party to an action has a vested right in the rules of procedure, except that in criminal cases, the changes do not retroactively apply if they permit or require a lesser quantum of evidence to convict than what is required at the time of the commission of the offenses, because such retroactivity would be unconstitutional for being ex post facto under the Constitution. Moreover, the application of the rule would not be precluded by the violation of any assumed vested right, because the new rule was adopted from Supreme Court Circular 57-97 that took effect on November 1, 1997. Although the Court has ruled that the issuance of a bouncing check may result in two separate and distinct crimes of estafa and violation of BP 22, the procedures for the recovery of the civil liabilities arising from these two distinct crimes are different and non-interchangeable. In prosecutions of estafa, the offended party may opt to reserve his right to file a separate civil action, or may institute an independent action based on fraud pursuant to Article 33 of the Civil Code. In prosecutions of violations of BP 22, however, the Court has adopted a policy to prohibit the reservation or institution of a separate civil action to claim the civil liability arising from the issuance of the bouncing check upon the reasons delineated in Hyatt Industrial Manufacturing Corporation, supra. To repeat, Chans separate civil action to recover the amount of the check involved in the prosecution for the violation of BP 22 could not be independently maintained under both Supreme Court Circular 57-97 and the aforequoted provisions of Rule 111 of the Rules of Court, notwithstanding the allegations of fraud and deceit. Therefore, the pendency of the civil action as the civil aspect in Criminal Case for violation of BP Bilang 22 bars the filing of Civil Case on the ground of litis pendentia. Sayyed-Ali Abdullah What is Nominal Damages? Nominal damages are adjudicated in order that a right of the plaintiff, which has been violated or invaded by the defendant, may be vindicated or recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered by him. (Art. 2221, NCC) 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. (Art. 2222, NCC) The adjudication of nominal damages shall preclude further contest upon the right involved and all accessory questions, as between the parties to the suit, or their respective heirs and assigns. (Art. 2223, NCC)

(1)Celebes Japan Foods v. Susan Yermo 602 SCRA 414 FACTS: Petitioner Celebes Japan Foods Corporation is engaged in the business of buying, processing and exporting of tuna fish, with buying station and plant located at the Davao Fish Port Complex, Daliao, Toril, Davao City. Petitioner contracted with Penta Manpower and Allied Resources to provide manpower services for the former's business, with the latter recruiting people to work for the former, people who included respondents Susan Yermo, et al. Respondents performed jobs such as slicer, laboratory crew packers, recorders/encoders, loiners, vinyl bag openers/receivers or storage persons, and who were necessary and desirable to the main business of petitioner. On November 7, 2000, respondents were refused entrance by the guards manning the gate of the Davao Fish Port Complex, as they were already terminated from work effective November 1, 2000 based on a memorandum dated November 7, 2000 issued by Romero, petitioner's office manager. The memorandum was posted in the guardhouse. The respondents filed a complaint with Labor Arbiter (LA) alleging that they were dismissed without just and valid cause and due process. The LA found respondents' dismissal to be illegal, without cause and due process, and proceeded to compute respondents' money claims. Thereafter, the petitioner filed with the NLRC an appeal, on the ground that the L.A rendered its decision contrary to law and applicable jurisprudence. The judgment appealed from is VACATED and SET ASIDE in favor of REMANDING the entire records to the arbitration branch of origin. The Labor Arbiter below is hereby directed to accord respondent Celebes Japan Foods Corporation and the other respondents their right to due process by allowing them to submit their position paper. Upon knowing the decision of NLRC, the respondents filed an appeal with Court of Appeals (CA) alleging that the NLRC gravely abused its discretion in finding that petitioner was denied due process and in remanding the case to the LA for further reception of evidence. The CA found that petitioner was not denied due process, since the latter was duly informed that it was a party to the illegal dismissal case. DECLARES the legality of the dismissal but ORDERS Celebes Japan Foods Corporation to PAY each petitioner herein P50,000.00 as NOMINAL DAMAGES for violation of statutory due process. ISSUE: Whether or not the court of appeals grossly erred and/or gravely abused its discretion by refusing to modify and/or reduce the award of nominal damages from p50,000.00 to p5,000.00 per employee terminated.

RULING: No, the CA did not err in refusing to modify and/or reduce the award of nominal damages because where an employee was terminated for cause, but the employer failed to comply with the notice requirement, the employee is entitled to the payment of nominal damages. According to Article 2221 of the New Civil Code, Nominal damages are adjudicated in order that a right of the plaintiff, which has been violated or invaded by the defendant, may be vindicated or recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered by him. The violation of the petitioners' right to statutory due process by the private respondent warrants the payment of indemnity in the form of nominal damages. The amount of such damages is addressed to the sound discretion of the court, taking into account the relevant circumstances. “x x x We believe this form of damages would serve to deter employers from future violations of the statutory due process rights of employees. At the very least, it provides a vindication or recognition of this fundamental right granted to the latter under the Labor Code and its Implementing Rules.” Finally, respondents learned of the existence of such memorandum, which was posted only in the guardhouse on the day... they were refused entrance to the gate. There was indeed no notice at all to respondents. Notably, there was not even any reason stated in the memorandum why they were being terminated. We cannot overemphasize the importance of the requirement of the notice of termination, for... we have ruled in a number of cases that non-compliance therewith is tantamount to deprivation of the employee's right to due process.

What is Actual Damages? Except as provided by law or by stipulation, one is entitled to an adequate compensation only for such pecuniary loss suffered by him as he has duly proved. Such compensation is referred to as actual or compensatory damages. (Art. 2199, NCC) Claimant must produce competent proof or the best evidence obtainable such as receipts to justify an award therefore. Actual or compensatory damages cannot be presumed but must be proved with reasonable certainty. (People v. Ereno, Feb. 22, 2000) (2)People v. Mangahas, 311 SCRA 384 FACTS: Herein accused is found guilty beyond reasonable doubt of the crime of Homicide punishable under article 249 of the revised penal code and is hereby sentenced to suffer the penalty of RECLUSION temporal. The aunt of the deceased was called to testify on the civil aspect of the case. The aunt of the victim, trinidad balatbat, was likewise presented and she testified mainly on the expenses their family incurred as a result of the death of the victim. The sum of FOURTEEN THOUSAND FIVE HUNDRED NINETY PESOS (p14,590.00) for funeral and burial expenses and TWENTY EIGHT THOUSAND EIGHT HUNDRED NINETY PESOS (P28, 890.00) for food during the vigil, the 9th day, 40th day and the 1st year anniversaries of the death of the victim; and to pay the costs. ISSUE: Whether or not the expenses incurred before the date of slaying and after burial of the victim should form part of actual damages. RULING: The expenses incurred before the date of slaying and after burial of the victim should not form part of actual damages because Except as provided by law or by stipulation, one is entitled to an adequate compensation only for such pecuniary loss suffered by him as he has duly proved. Such compensation is referred to as actual or compensatory damages. (Art. 2199, NCC) The Supreme Court held that with respect to the actual damages incurred by the relatives of the deceased:“of the expenses allegedly incurred, the court can only give credence to those supported by receipt and which appear to have been genuinely incurred in connection with the death, wake, or burial of the victim.” Thus, the court cannot take account of receipts showing expenses incurred before the date of slaying of the victim; those incurred after a considerable lapse of time from the burial of the victim and which do not have any relation to the death, wake, or burial of the victim; those incurred for purely aesthetic or social purposes, such as the lining of the tomb of the victim. From the evidence presented before the lower court, we affirm the award of P14,590.00 for funeral and burial expenses as these were properly supported by receipts and proven during the trial of the case. However, we reduce the amount awarded as actual damages for food served during the burial of the victim to P7,285.00 which cover only those expenses incurred during the wake and vigil of the victim. The other expenses relating to the 9th day, 40th day and 1st year death anniversaries are deleted as these were incurred after a considerable lapse of time from the burial of the victim. (3)Zamboanga Trans Corp v. CA, 30 SCRA 717 FACTS: It is a case of Breach of contract of carriage - wherein herein petitioners, along with their driver named marcos, were condemned to pay damages to herein private respondent Jose Mario for the deaths of his father and mother while on board a passenger bus owned (by purchase) and operated by petitioner zamboanga transportation co., Inc. But which, at the time of the mishap causing the deaths referred to, was still registered with the public service commission in the name of petitioner zamboanga rapids co., Inc. Jose mario, the only child of the deceased spouses, through his maternal grandmother as guardian ad-litem, instituted an action against zamboanga transportation co., Inc. (Zamtanco) and the zamboanga rapids co., Inc. (Zambraco) for breach of contract of carriage, alleging that the

accident was due to the fault and negligence of the driver in operating the bus and due to the negligence of the companies in their supervision of their driver. Jose Mario asks for actual or compensatory damages in the sum of P40,000, moral damages in the sum of P40,000, exemplary damages in the sum of P20,000, attorney’s fees in the sum of P5,000 and costs. The trial court Jose Mario asks for actual or compensatory damages in the sum of P11,520, moral damages in the sum of P4,000, exemplary damages in the sum of P4,000, attorney’s fees in the sum of P2,000 and costs. The Court of Appeals affirmed the decision of the trial court with modifications as to damages. ISSUE: Whether or not the Court of Appeals erred in awarding excessive compensatory damages. RULING: The S.C held that the award of compensatory damages amounting to 11,520 is not excessive for the loss of earnings of both spouses. It is undisputed that josefina was 32 years old at the time she died and a public school teacher receiving P120 a month or P1,440 a year, with the prospect of increase in salary. There is likewise no dispute that her husband ramon was 27 years old at the time of his death, a farmer by calling and in good health. All these have been established, allowing him a minimum income of P120 a month, he was earning at least P1,440 a year. For compensatory damages, josefina and ramon should have earned within a period of four years, in accordance with settled jurisprudence (alcantara vs. Curro, et al. 49 o. G. No. 7, 2769; heirs of tirso cura vs. Meralco, CA-G.R. 18221-R, feb. 14, 1958; lira vs. Mercado, CA-G.R. 15422-R-23-R, july 11, 1957; ybañez vs. North negros sugar co., Ca-g.R. 26608-R, oct. 14, 1963), a minimum of P5,760 each, or a total of P11,520 for both. FORMULA OF LOSS OF EARNING CAPACITY Citing the case of People vs Sanchez 367 SCRA 570 “ The Court believes that it is fair and reasonable to fix the monthly income that Eileen and Allan senior agriculture students at UPLB would have earned in 1993 at P8,000.00 per month (or P96,000.00/year) and their deductible living and other incidental expenses at P3,000.00 per month (or P36,000.00/year). ” Net earning capacity = Life expectancy x (Gross Annual Income - Living Expenses) where: Life expectancy = 2/3 (80 - the age of the deceased) Heirs of Eileen Sarmenta: = 2/3 (80-21) x (96,000 - 36,000) = 39.353 x 60,000 = P2,361,180.00 Heirs of Allan Gomez: = 2/3 (80-19) x (96,000 - 36,000) = 40.687 x 60,000 = P2,441,220.00 INTEREST/ REAL PARTY IN INTEREST BY CITING THE CASE OF CARIAGA VS LAGUNA TAYABAS CO., 4 SCRA 60 The Supreme Court held Laguna Tayabas Company liable and ordered it to pay P10,490.00 as compensatory damages, with interest at the legal rate from the filing of the complaint. Edgardo Cariaga’s the parents, filed to recover before RTC, the sum of P18,00.00 as actual, compensatory, moral and exemplary damages. The claim made by said spouses for actual and compensatory damages is likewise without merits. As held by the S.C, in so far as the LTB is concerned, the present action is based upon a breach of contract of carriage to which said spouses were not a party, and neither can they premise their claim upon the negligence or quasi-delict of the LTB for the simple reason that they were not themselves injured as a result of the collision between the LTB bus and train owned by the Manila Railroad Company.