G.R. No.

L-9605             September 30, 1957 even though the same had been transferred to a
third person. (Montoya vs. Ignacio, 94 Phil., 182, 50
GAUDIOSO EREZO, ET AL., plaintiff-appellee, Off. Gaz., 108; Roque vs. Malibay Transit Inc.,1 G. R.
vs. No. L- 8561, November 18,1955; Vda. de Medina vs.
AGUEDO JEPTE, defendant-appellant. Cresencia, 99 Phil., 506, 52 Off. Gaz., [10], 4606.)The
principle upon which this doctrine is based is that in
dealing with vehicles registered under the Public
Gesolgon, Matti and Custodio for appellees.
Service Law, the public has the right to assume or
Aguedo Y. Jepte in his own behalf.
presume that the registered owner is the actual
owner thereof, for it would be difficult for the public
LABRADOR, J.: to enforce the actions that they may have for injuries
caused to them by the vehicles being negligently
Appeal from a judgment of the Court of First Instance of operated if the public should be required to prove
Manila ordering defendant to pay plaintiff Gaudioso who the actual owner is. How would the public or third
Erezo P3,000 on the death of Ernesto Erezo, son of persons know against whom to enforce their rights in
plaintiff Gaudioso Erezo. case of subsequent transfers of the vehicles? We do not
imply by this doctrine, however, that the registered
Defendant-appellant is the registered owner of a six by owner may not recover whatever amount he had
six truck bearing plate No. TC-1253. On August, 9, paid by virtue of his liability to third persons from
1949, while the same was being driven by Rodolfo the person to whom he had actually sold, assigned
Espino y Garcia, it collided with a taxicab at the or conveyed the vehicle.
intersection of San Andres and Dakota Streets,
Manila. As the truck went off the street, it hit Ernesto Under the same principle the registered owner of any
Erezo and another, and the former suffered injuries, vehicle, even if not used for a public service, should
as a result of which he died. The driver was primarily be responsible to the public or to third
prosecuted for homicide through reckless negligence in persons for injuries caused the latter while the
criminal case No. 10663 of the Court of First Instance of vehicle is being driven on the highways or streets.
Manila. The accused pleaded guilty and was sentenced The members of the Court are in agreement that the
to suffer imprisonment and to pay the heirs of Ernesto defendant-appellant should be held liable to plaintiff-
Erezo the sum of P3,000. As the amount of the judgment appellee for the injuries occasioned to the latter because
could not be enforced against him, plaintiff brought this of the negligence of the driver even if the defendant-
action against the registered owner of the truck, the appellant was no longer the owner of the vehicle at the
defendant-appellant. The circumstances material to the time of the damage because he had previously sold it to
case are stated by the court in its decision. another. What is the legal basis for his (defendant-
appellant's) liability?.
The defendant does not deny at the time of the
fatal accident the cargo truck driven by Rodolfo There is a presumption that the owner of the guilty
Espino y Garcia was registered in his name. He, vehicle is the defendant-appellant as he is the registered
however, claims that the vehicle belonged to the owner in the Motor Vehicle Office. Should he not be
Port Brokerage, of which he was the broker at allowed to prove the truth, that he had sold it to another
the time of the accident. He explained, and his and thus shift the responsibility for the injury to the real
explanation was corroborated by Policarpio and actual owner? The defendant holds the affirmative
Franco, the manager of the corporation, that the of this proposition; the trial court held the negative.
trucks of the corporation were registered in his
name as a convenient arrangement so as to The Revised Motor Vehicle Law (Act No. 3992, as
enable the corporation to pay the registration fee amended) provides that no vehicle may be used or
with his backpay as a pre-war government operated upon any public highway unless the same is
employee. Franco, however, admitted that the properly registered. It has been stated that the system of
arrangement was not known to the Motor licensing and the requirement that each machine must
Vehicle Office. carry a registration number, conspicuously displayed, is
one of the precautions taken to reduce the danger of
The trial court held that as the defendant-appellant injury to pedestrians and other travelers from the
represented himself to be the owner of the truck and the careless management of automobiles, and to furnish a
Motor Vehicle Office, relying on his representation, means of ascertaining the identity of persons violating
registered the vehicles in his name, the Government and the laws and ordinances, regulating the speed and
all persons affected by the representation had the right operation of machines upon the highways (2 R. C. L.
to rely on his declaration of ownership and registration. 1176). Not only are vehicles to be registered and that no
It, therefore, held that the defendant-appellant is liable motor vehicles are to be used or operated without being
because he cannot be permitted to repudiate his own properly registered for the current year, but that dealers
declaration. (Section 68 [a], Rule 123, and Art. 1431, in motor vehicles shall furnish the Motor Vehicles Office
New Civil Code.). a report showing the name and address of each
purchaser of motor vehicle during the previous month
Against the judgment, the defendant has prosecuted this and the manufacturer's serial number and motor
appeal claiming that at the time of the accident the number. (Section 5 [c], Act. No. 3992, as amended.).
relation of employer and employee between the driver
and defendant-appellant was not established, it having Registration is required not to make said registration the
been proved at the trial that the owner of the truck was operative act by which ownership in vehicles is
the Port Brokerage, of which defendant-appellant was transferred, as in land registration cases, because the
merely a broker. We find no merit or justice in the above administrative proceeding of registration does not bear
contention. In previous decisions, We already have any essential relation to the contract of sale between the
held that the registered owner of a certificate of parties (Chinchilla vs. Rafael and Verdaguer, 39 Phil.
public convenience is liable to the public for the 888), but to permit the use and operation of the vehicle
injuries or damages suffered by passengers or third upon any public highway (section 5 [a], Act No. 3992, as
persons caused by the operation of said vehicle, amended).The main aim of motor vehicle registration is
to identify the owner so that if any accident happens, or recourse to a third-party complaint, in the same action
that any damage or injury is caused by the vehicles on brought against him to recover for the damage or injury
the public highways, responsibility therefore can be fixed done, against the vendee or transferee of the vehicle.
on a definite individual, the registered owner. Instances The inconvenience of the suit is no justification for
are numerous where vehicles running on public relieving him of liability; said inconvenience is the price
highways caused accidents or injuries to pedestrians or he pays for failure to comply with the registration that the
other vehicles without positive identification of the owner law demands and requires.
or drivers, or with very scant means of identification. It is
to forestall those circumstances, so inconvenient or In synthesis, we hold that the registered owner, the
prejudicial to the public, that the motor vehicle defendant-appellant herein, is primarily responsible for
registration is primarily ordained, in the interest of the the damage caused to the vehicle of the plaintiff-
determination of persons responsible for damages or appellee, but he (defendant-appellant) has a right to be
injuries caused on public highways. indemnified by the real or actual owner of the amount
that he may be required to pay as damage for the injury
One of the principal purposes of motor vehicles caused to the plaintiff-appellant.1âwphïl.nêt
legislation is identification of the vehicle and of
the operator, in case of accident; and another is Bengzon, Paras, C.J., Bautista Angelo, Concepcion,
that the knowledge that means of detection are Reyes, J. B. L., and Felix, JJ., concur.
always available may act as a deterrent from lax Montemayor, J., concurs in the result.
observance of the law and of the rules of
conservative and safe operation. Whatever
purpose there may be in these statutes, it is
subordinate at the last to the primary purpose of
rendering it certain that the violator of the law or
of the rules of safety shall not escape because
of lack of means to discover him." The purpose
of the statute is thwarted, and the displayed
number becomes a "snare and delusion," if
courts will entertain such defenses as that put
forward by appellee in this case. No responsible
person or corporation could be held liable for the
most outrageous acts of negligence, if they
should be allowed to place a "middleman"
between them and the public, and escape
liability by the manner in which they recompense
their servants. (King vs. Brenham Automobile
Co., 145 S. W. 278,279.)

With the above policy in mind, the question that

defendant-appellant poses is: should not be registered
owner be allowed at the trial to prove who the actual and
real owner is, and in accordance with such proof escape
or evade responsibility and lay the same on the person
actually owning the vehicle? We hold with the trial court
that the laws does not allow him to do so; the law, with
its aim and policy in mind, does not relieve him directly
of the responsibility that the law fixes and places upon
him as an incident or consequence of registration. Were
a registered owner allowed to evade responsibility by
proving who the supposed transferee or owner is, it
would be easy for him, by collusion with others or
otherwise, to escape said responsibility and transfer the
same to an indefinite person, or to one who possesses
no property with which to respond financially for the
damage or injury done. A victim of recklessness on the
public highways is usually without means to discover or
identify the person actually causing the injury or
damage. He has no means other than by a recourse to
the registration in the Motor Vehicles Office to determine
who is the owner. The protection that the law aims to
extend to him would become illusory were the registered
owner given the opportunity to escape liability by
disproving his ownership. If the policy of the law is to be
enforced and carried out, the registered owner should be
allowed to prove the contrary to the prejudice of the
person injured that is, to prove that a third person or
another has become the owner, so that he may thereby
be relieved of the responsibility to the injured
person.1âwphïl.nêt

The above policy and application of the law may appear

quite harsh and would seem to conflict with truth and
justice. We do not think it is so. A registered owner who
has already sold or transferred a vehicle has the
G.R. No. L-17459             September 29, 1962 "anomalous operation" of the jeepney she sold to Jose
B. Aguas without the required authorization or approval
DIWATA VARGAS, Petitioner, vs. SALVADOR of the Public Service Commission. Appellant's failure to
LANGCAY, CORAZON LANGCAY, HELEN LANGCAY stop the operation of the vehicle in question and to
and JOSE AGUAS, Respondents. surrender to the Motor Vehicles Office the corresponding
plates, as ordered by exhibit 4-D, Vargas constitutes a
violation of the Revised Motor Vehicle Law and
Mary Concepcion for petitioner.
Commonwealth No. 146, which violation makes her
Jose R. Abalos and A. M. Ronquillo for respondents.
liability and responsibility clearer and more inescapable.

x x x           x x x           x x xchanrobles virtual law library

          . . . Appellant's liability stems from and is a form of

LABRADOR, J.:chanrobles virtual law library punishment for her failure to comply with section 20 (g)
of Commonwealth Act 146 and with 5 of Act 3992. . . .
          This is a petition for review of the decision of the
Court of Appeals finding petitioner subsidiarily liable for x x x           x x x           x x xchanrobles virtual law library
damages under article 103 of the Revised Penal
Code.chanroblesvirtualawlibrarychanrobles virtual law
library           There is no question that appellees Corazon and
Helen Langcay were not passengers of the jeepney, the
reckless operation of which resulted in their injuries.
          At about 8:00 o'clock in the morning of June 5, Therefore, the direct and immediate liability of a common
1955, at Rizal Avenue, Manila, Corazon and Helen carrier as provided for by the Civil Code cannot be
Langcay, sisters, were hit and injured by a jeepney ascribed to appellant. Accordingly, her liability should be
bearing plate No. AC-4859-Quezon City-1955, then based on article 103 of the Revised Penal Code. . . .
driven by Ramon B. Aguas. Criminally charged with Therefore, appellant's responsibility is mere subsidiary,
physical injuries, the said Ramon B. Aguas was finally pursuant to the above cited article of the Revised Penal
sentenced by the Court of Appeals, in CA-G.R. No. Code.
17900-R, to 3 months and 6 days of arresto mayor for
serious and slight physical injuries through reckless
imprudence, caused to Corazon and Helen Langcay, x x x           x x x           x x xchanrobles virtual law library
"without pronouncement with respect to the indemnity
due to the aggrieved parties, because the action therefor           . . . the judgment appealed from is hereby
had been reserved."chanrobles virtual law library modified in the sense that should defendant Ramon B.
Aguas be found insolvent, appellant should pay
          Since the records of the Public Service appellees the sum of P953.00 as compensatory
Commission and the Motor Vehicles Office showed damages, P4,000.00 and P500.00 as moral damages
that Diwata Vargas was, at the time of the accident, suffered by Corazon and Helen Langcay, respectively,
the owner and operator of the jeepney in question, and P2,000.00 for attorney's fees. It is also ordered that
the parents of Corazon and Helen sued Diwata this case be returned to the court of origin not only for
Vargas and the driver for damages. In spite of the the execution of this decision once it becomes final, but
defense of appellant Diwata Vargas that prior to the also for further proceedings against Jose B. Aguas, after
accident, precisely on August 17, 1953, she had sold the proper summons, in the third party complaint above
vehicle to Jose B. Aguas (father of the driver), so that at mentioned. Without special pronouncement as to the
the time of the accident she was no longer the owner of payment of the costs.
the jeepney, and that, further, Public Service
Commission, on October 27, 1953, cancelled the           Appellant-petitioner Diwata Vargas brought the
certificate of public convenience issued in her name, the case to this Court on a question of law, alleging that she
defendants Diwata Vargas and Ramon B. Aguas were cannot be held liable under Art. 103 of the Revised
jointly and severally sentenced to pay damages and Penal Code for whatever violation or offense she may
attorneys fees by the Court of First Instance of Manila. have committed under the Public Service Law and the
Diwata Vargas appealed to the Court of Appeals which Motor Vehicle Law and in the absence of a showing that
affirmed, with modifications, the lower court's she employed the person (driver) who caused the
decision.chanroblesvirtualawlibrarychanrobles virtual law damage, and that she was engaged in an industry or a
library business, and where the evidence prove that the father
(Jose B. Aguas ) of the person primarily liable (Ramon
          Pertinent parts of the Appeals Court decision are Aguas) is his actual
hereby reproduced for a clearer understanding of the employer.chanroblesvirtualawlibrarychanrobles virtual
issue involved in this appeal: law library

          The order of cancellation and revocation of           We hold that the Court of Appeals erred in
appellant certificate of public convenience, dated considering appellant-petitioner Diwata Vargas only
October 27, 1953 (Exh. 4-D) does not relieve her of the subsidiarily liable under Article 103 of the Revised Penal
liability established by above quoted legal provisions as Code. This Court, in previous decisions, has always
clearly and positively construed by the highest tribunal of considered the registered owner/operator of a
the land. This order was issued motu propio by the passenger vehicle, jointly and severally liable with
Commission in view of appellant failure to pay the the driver for damages incurred by passengers or
P15.00 supervision and regulation fee and its 50% third persons as a consequence of injuries (or
surcharge, and not for the purpose of transferring the death) sustained in the operation of said vehicles.
same certificate to Jose B. Aguas. A copy of the above (Montoya vs. Ignacio, G.R. No. L-5868, Dec. 29, 1953;
mentioned order was furnished appellant, so that she Timbol vs. Osias, G.R. No. L-7547, April 30, 1955; Vda.
cannot profess ignorance of what she termed the de Medina vs. Cresencia, G.R. No. L-8194, July 11,
1956; Necesito vs. Paras, G.R. No. L-10605, June 30,
1955; Erezo vs. Jepte, G.R. No. damage. He has no means other than by a recourse to
L-9605, Sept. 30, 1957; Tamayo vs. Aquino, G.R. No. L- the registration in the Motor Vehicles Office to determine
12634, May 29, 1959; Rayos vs. Tamayo, G.R. No. L- who is the owner. The protection that the law aims to
12720, May 29, 1959.) In the case of Erezo vs. Jepte, extend to him would become illusory were the registered
supra  We held: owner given the opportunity to escape liability by
disproving his ownership. If the policy of the law is to be
          . . . In synthesis, we hold that the registered enforced and carried out, the registered owner should
owner, the defendant-appellant herein, is primarily not be allowed to prove the contrary to the prejudice of
responsible for the damages caused . . . (Emphasis the person injured; that is, to prove that a third person or
ours) another has become the owner, so that he may thereby
be relieved of the responsibility to the injured person.
          In the case of Tamayo vs. Aquino, supra We said:
          For the foregoing considerations, we hold that
Article 103 is not the law applicable in this case; the
          . . . As Tamayo is the registered owner of the
petitioner stands liable, however, on the basis of the
truck, his responsibility to the public or to any passenger
settled principle that as the registered owner, she is
riding in the vehicle or truck must be direct . . .
directly and primarily responsible and liable for
(Emphasis ours)
damages sustained by passengers or third persons
as a consequence of the negligent or careless
          Petitioner argues that there was no showing that operation of the vehicle registered in her name.
she employed the person (the driver) who caused the Petitioner does not question the amounts of damages
injuries. On the contrary, she argues, the evidence show granted to respondents by the Court of Appeals and the
that J B. Aguas, the father of the driver, is his actual same not appearing to be excessive or unconscionable,
employer. We believe that it is immaterial whether or they should be
not the driver was actually employed by the operator maintained.chanroblesvirtualawlibrarychanrobles virtual
of record. is even not necessary to prove who the law library
actual owner of the vehicle and the employer of the
driver is. Granting that, in this case, the father of the
          WHEREFORE, the decision of the Court of
driver is the act owner and that he is the actual
Appeals is hereby modified, as above indicated. With
employer, following well-settled principle that the
costs.
operator of record continues to be the operator of
the vehicle in contemplation of law, as regards the
public and third persons, and such is responsible
for the consequences incident to its operation, we
must hold and consider such owner-operation of
record as the employer, in contemplation of law, the
driver. And, to give effect to this policy of law
enunciated in the above-cited decisions of this
Court, must now extend the same and consider the
actual operation and employer as the agent of the
operator of record. In the case of Tamayo vs. Aquino,
supra, this Court said:

          . . . In operating the truck without transfer thereof

having been approved by the Public Service
Commission, the transferee acted merely as agent of
the registered owner. . . (Emphasis our)

          The purpose of the principles evolved by the

decision in these matters will be defeated and thwarted if
we entertain the argument of petitioner that she is not
liable because the actual owner and employer was
establish by the evidence. In the case of Erezo vs.
Jepte, supra, the Court said:

          . . . With the above policy in mind, the question

that defendant-appellant poses is: Should not the
registered owner allowed at the trial to prove who the
actual and real owner is, and in accordance with such
proof escape or evade responsibility and lay the same
on the person actually owning the vehicle? We hold with
the trial court that the law does not allow him to do so;
the law, with its aim and policy in mind, does not relieve
him directly of the responsibility that the law fixes and
places upon him as an incident or consequence of
registration. Were a registered owner allowed to evade
responsibility by proving who the supposed transferee or
owner is, it would be easy for him by collusion with
others or otherwise, to escape said responsibility and
transfer the same to an indefinite person, or to one who
possesses no property with which to respond financially
for the damage or injury done. A victim of recklessness
on the public highways is without means to discover or
identify the person actually causing the injury or
[G.R. No. 82318. May 18, 1989.] windshield, the differential, the part near the left rear
wheel and the top cover the jeep; that plaintiff Virgilio
GILBERTO M. DUAVIT, Petitioner, v. THE HON. Catuar was shown to the middle of the road; his wrist
COURT OF APPEALS, Acting through the Third was broken and he sustained contusions on the head;
Division, as Public Respondent, and ANTONIO that likewise plaintiff Antonio Sarmiento, Sr. was trapped
SARMIENTO, SR. & VIRGILIO inside the fallen jeep, and one of his legs was fractured.
CATUAR, Respondents.
"Evidence also shows that the plaintiff Virgilio Catuar
Rodolfo d. Dela Cruz for Petitioner. spent a total of P2,464.00 for repairs of the jeep, as
shown by the receipts of payment of labor and spare
Bito, Lozada, Ortega & Castillo for Respondents. parts (Exhs. H to H-7). Plaintiffs likewise tried to prove
that plaintiff Virgilio Catuar, immediately after the
accident was taken to Immaculate Concepcion Hospital,
and then was transferred to the National Orthopedic
SYLLABUS
Hospital; that while plaintiff Catuar was not confined in
the hospital, his wrist was in a plaster cast for a period of
one month, and the contusions on his head were under
1. TORTS AND DAMAGES; OWNER OF A VEHICLE IS treatment for about two (2) weeks; that for
NOT LIABLE FOR AN ACCIDENT INVOLVING THE hospitalization, medicine and allied expenses, plaintiff
VEHICLE IF DRIVEN WITHOUT THE OWNER’S Catuar spent P5,000.00.
CONSENT BY ONE NOT EMPLOYED BY HIM. — The
Supreme Court ruled in Duquilleo v. Bayot (67 Phil. 131- "Evidence also shows that as a result of the incident,
133-134) [1939] that an owner of a vehicle cannot be plaintiff Antonio Sarmiento, Sr. sustained injuries on his
held liable for an accident involving the said vehicle if the leg; that at first, he was taken to the National Orthopedic
same was driven without his consent or knowledge and Hospital (Exh. K), but later he was confined at the Makati
by a person not employed by him. Medical Center from July 29, to August 29, 1971 and
then from September 15 to 25, 1971; that his leg was in
2. CIVIL PROCEDURE; ABSOLUTE RULES NOT a plaster cast for a period of eight (8) months; and that
APPLIED UNQUALIFIEDLY UNLESS THEY FIT FOUR for hospitalization and medical attendance, plaintiff
SQUARE WITH PENDING CASES. — The Court cannot Antonio Sarmiento, Sr. spent no less than P13,785.25 as
blindly apply absolute rules based on precedents whose evidenced by receipts in his possession. (Exhs. N to N-
facts do not jibe four square with pending cases. Every 1).
case must be determined on its own peculiar factual
circumstances. Where, as in this case, the records of the "Proofs were adduced also to show that plaintiff Antonio
petition fail to indicate the slightest indicia of an Sarmiento, Sr. is employed as Assistant Accountant of
employer-employee relationship between the owner and the Canlubang Sugar Estate with a salary of P1,200.00 a
the erring driver or any consent given by the owner for month; that as sideline, he also works as accountant of
the vehicle’s use, we cannot hold the owner liable. United Haulers, Inc. with a salary of P500.00 a month;
and that as a result of this incident, plaintiff Sarmiento
was unable to perform his normal work for a period of at
least 8 months. On the other hand, evidence shows that
DECISION the other plaintiff Virgilio Catuar is a Chief Clerk in
Canlubang Sugar Estate with a salary of P500.00 a
month, and as a result of the incident, he was
GUTIERREZ, JR., J.: incapacitated to work for a period of one (1) month.

"The plaintiffs have filed this case both against Oscar

This petition raises the sole issue of whether or not the Sabiniano as driver, and against Gualberto Duavit as
owner of a private vehicle which figured in an accident owner of the jeep.
can be held liable under Article 2180 of the Civil Code
when the said vehicle was neither driven by an "Defendant Gualberto Duavit, while admitting ownership
employee of the owner nor taken with the consent of the of the other jeep (Plate No. 99-07-F-J Manila, 1971),
latter. denied that the other defendant (Oscar Sabiniano) was
his employee. Duavit claimed that he has not been an
The facts are summarized in the contested decision, as employer of defendant Oscar Sabiniano at anytime up to
follows:jgc:chanrobles.com.ph the present.

"From the evidence adduced by the plaintiffs, consisting "On the other hand documentary and testimonial
of the testimonies of witnesses Virgilio Catuar, Antonio evidence show that defendant Oscar Sabiniano was an
Sarmiento, Jr., Ruperto Catuar, Jr. and Norberto employee of the Board of Liquidators from November 14,
Bernarte it appears that on July 28, 1971 plaintiffs 1966 up to January 4, 1973 (Annex A of Answer).
Antonio Sarmiento, Sr. and Virgilio Catuar were aboard
a jeep with plate number 77-99-F-1-Manila, 1971, owned "Defendant Sabiniano, in his testimony, categorically
by plaintiff, Ruperto Catuar was driving the said jeep on admitted that he took the jeep from the garage of
Ortigas Avenue, San Juan, Rizal; that plaintiff’s jeep, at defendant Duavit without the consent or authority of
the time, was running moderately at 20 to 35 kilometers the latter (TSN, September 7, 1978, p. 8). He testified
per hour — and while approaching Roosevelt Avenue, further, that Duavit even filed charges against him for
Virgilio Catuar slowed down; that suddenly, another theft of the jeep, but which Duavit did not push through
jeep with plate number 99-97-F-J, Manila 1971 driven as his (Sabiniano’s) parents apologized to Duavit on his
by defendant Oscar Sabiniano hit and bumped behalf.
plaintiff’s jeep on the portion near the left rear wheel,
and as a result of the impact plaintiff’s jeep fell on its "Defendant Oscar Sabiniano, on the other hand in an
right and skidded by about 30 yards; that as a result attempt to exculpate himself from liability, makes it
plaintiff’s jeep was damaged, particularly the appear that he was taking all necessary precaution while
driving and the accident occurred due to the negligence
of Virgilio Catuar. Sabiniano claims that it was plaintiff’s held liable for anything. At the time of the accident,
vehicle which hit and bumped their jeep." (Rollo, pp. 21- James McGurk was driving the truck, and he was not an
23) employee of the defendant, nor did he have anything to
do with the latter’s business; neither the defendant nor
The trial court found Oscar Sabiniano negligent in driving Father Ayson, who was in charge of her business,
the vehicle but found no employer-employee relationship consented to have any of her trucks driven on the day of
between him and the petitioner because the latter was the accident, as it was a holy day, and much less by a
then a government employee and he took the vehicle chauffeur who was not in charge of driving it; the use of
without the authority and consent of the owner. The the defendant’s truck in the circumstances indicated was
petitioner was, thus, absolved from liability under Article done without her consent or knowledge; it may,
2180 of the Civil Code. therefore, be said, that there was not the remotest
contractual relation between the deceased Pio Duquillo
The private respondents appealed the case. and the defendant. It necessarily follows from all this that
articles 1101 and following of the Civil Code, cited by the
On January 7, 1988, the Court of Appeals rendered the appellant, have no application in this case, and,
questioned decision holding the petitioner jointly and therefore, the errors attributed to the inferior court are
severally liable with Sabiniano. The appellate court in without basis."cralaw virtua1aw library
part ruled:jgc:chanrobles.com.ph
The Court upholds the above ruling as still relevant and
"We cannot go along with appellee’s argument. It will be better applicable to present day circumstances.
seen that in Vargas v. Langcay, supra, it was held that it
is immaterial whether or not the driver was actually The respondent court’s misplaced reliance on the cases
employed by the operator of record or registered owner, of Erezo v. Jepte (102 Phil. 103 [1957] and Vargas v.
and it is even not necessary to prove who the actual Langcay (6 SCRA 174 [1962]) cannot be sustained. In
owner of the vehicle and who the employer of the driver the Erezo case, Jepte, the registered owner of the truck
is. When the Supreme Court ruled, thus: `We must hold which collided with a taxicab, and which resulted in the
and consider such owner-operator of record (registered killing of Erezo, claimed that at the time of the accident,
owner) as the employer in contemplation of law, of the the truck belonged to the Port Brokerage in an
driver,’ it cannot be construed other than that the arrangement with the corporation but the same was not
registered owner is the employer of the driver in known to the Motor Vehicles Office. This Court sustained
contemplation of law. It is a conclusive presumption of the trial court’s ruling that since Jepte represented
fact and law, and is not subject to rebuttal of proof to the himself to be the owner of the truck and the Motor
contrary. Otherwise, as stated in the decision, we Vehicles Office, relying on his representation, registered
quote:jgc:chanrobles.com.ph the vehicle in his name, the Government and all persons
affected by the representation had the right to rely on his
"‘The purpose of the principles evolved by the decisions declaration of ownership and registration. Thus, even if
in these matters will be defeated and thwarted if we Jepte were not the owner of the truck at the time of the
entertain the argument of petitioner that she is not liable accident, he was still held liable for the death of Erezo.
because the actual owner and employer was established Significantly, the driver of the truck was fully authorized
by the evidence. . . . .’" to drive it.

Along the same vein, the defendant-appellee Gualberto Likewise, in the Vargas case, just before the accident
Duavit cannot be allowed to prove that the driver occurred, Vargas had sold her jeepney to a third person,
Sabiniano was not his employee at the time of the so that at the time of the accident she was no longer the
vehicular accident. owner of the jeepney. This court, nevertheless, affirmed
Vargas’ liability since she failed to surrender to the Motor
"The ruling laid down in Amar V. Soberano (1966), 63 Vehicles Office the corresponding AC plates in violation
O.G. 6850, by this Court to the effect that the burden of of the Revised Motor Vehicle Law and Commonwealth
proving the non-existence of an employer-employee Act No. 146. We further ruled that the operator of record
relationship is upon the defendant and this he must do continues to be the operator of the vehicle in
by a satisfactory preponderance of evidence, has to contemplation of law, as regards the public and third
defer to the doctrines evolved by the Supreme Court in persons, and as such is responsible for the
cases of damages arising from vehicular mishaps consequences incident to its operator. The vehicle
involving registered motor vehicle. (See Tugade v. Court involved was a public utility jeepney for hire. In such
of Appeals, 85 SCRA 226, 230). (Rollo, pp. 26-27). cases, the law does not only require the surrender of the
AC plates but orders the vendor operator to stop the
The appellate court also denied the petitioner’s motion operation of the jeepney as a form of public
for reconsideration. Hence, this petition. transportation until the matter is reported to the
authorities.
The petitioner contends that the respondent appellate
court committed grave abuse of discretion in holding him As can be seen, the circumstances of the above cases
jointly and severally liable with Sabiniano in spite of the are entirely different from those in the present case.
absence of an employer-employee relationship between Herein petitioner does not deny ownership of the
them and despite the fact that the petitioner’s jeep was vehicle involved in the mishap but completely
taken out of his garage and was driven by Sabiniano denies having employed the driver Sabiniano or
without his consent. even having authorized the latter to drive his jeep.
The jeep was virtually stolen from the petitioner’s
As early as in 1939, we have ruled that an owner of a garage. To hold, therefore, the petitioner liable for
vehicle cannot be held liable for an accident involving the accident caused by the negligence of Sabiniano
the said vehicle if the same was driven without his who was neither his driver nor employee would be
consent or knowledge and by a person not employed by absurd as it would be like holding liable the owner of
him. Thus, in Duquillo v. Bayot (67 Phil. 131-133-134) a stolen vehicle for an accident caused by the
[1939] we said:jgc:chanrobles.com.ph person who stole such vehicle. In this regard, we
cannot ignore the many cases of vehicles forcibly taken
"Under the facts established, the defendant cannot be from their owners at gunpoint or stolen from garages and
parking areas and the instances of service station
attendants or mechanics of auto repair shops using,
without the owner’s consent, vehicles entrusted to them
for servicing or repair.chanrobles law library : red

We cannot blindly apply absolute rules based on

precedents whose facts do not jibe four square with
pending cases. Every case must be determined on its
own peculiar factual circumstances. Where, as in this
case, the records of the petition fail to indicate the
slightest indicia of an employer-employee relationship
between the owner and the erring driver or any consent
given by the owner for the vehicle’s use, we cannot hold
the owner liable.

We, therefore, find that the respondent appellate court

committed reversible error in holding the petitioner jointly
and severally liable with Sabiniano to the
private Respondent.

WHEREFORE, the petition is GRANTED and the

decision and resolution appealed from are hereby
ANNULLED and SET ASIDE. The decision of the then
Court of First Instance (now Regional Trial Court) of
Laguna, 8th Judicial District, Branch 6, dated July 30,
1981 is REINSTATED.

SO ORDERED.
[G.R. No. 98275. November 13, 1992.] the actual owner is. How would the public or third
persons know against whom to enforce their rights in
BA FINANCE CORPORATION, Petitioner, v. HON. case of subsequent transfers of the vehicles? We do not
COURT OF APPEALS, REGIONAL TRIAL COURT OF imply by this doctrine, however, that the registered
ANGELES CITY, BRANCH LVI, CARLOS OCAMPO, owner may not recover whatever amount he had paid by
INOCENCIO TURLA, SPOUSES MOISES AGAPITO virtue of his liability to third persons from the person to
AND SOCORRO M. AGAPITO AND NICOLAS whom he had actually sold, assigned or conveyed the
CRUZ, Respondents. vehicle. "Under the same principle the registered owner
of any vehicle, even if not used for a public service,
Agbayani, Leal, Ebarle and Venturanza for Petitioner. should primarily be responsible to the public or to third
persons for injuries caused the latter while the vehicle is
Ocampo, Sicat, Ayson, Pangilinan & Associates Law being driven on the highways or streets. The members
Office for Private Respondent. of the Court are in agreement that the defendant-
appellant should be held liable to plaintiff-appellee for
the injuries occasioned to the latter because of the
negligence of the driver, even if the defendant-appellant
SYLLABUS
was no longer the owner of the vehicle at the time of the
damage because he had previously sold it to another.
What is the legal basis for his (defendant-appellant’s)
1. COMMERCIAL LAW; LAND TRANSPORTATION liability? "There is a presumption that the owner of the
AND TRAFFIC CODE; REGISTRATION OF MOTOR guilty vehicle is the defendant-appellant as he is the
VEHICLES; PRINCIPAL PURPOSES; REGISTERED registered owner in the Motor Vehicles Office. Should he
OWNER PRIMARILY RESPONSIBLE TO THIRD not be allowed to prove the truth, that he had sold it to
PERSONS FOR INJURIES AND DAMAGES CAUSED another and thus shift the responsibility for the injury to
BY OPERATION OF MOTOR VEHICLE SOLD OR the real and actual owner? The defendant holds the
LEASED TO ANOTHER; REASON THEREFOR; affirmative of this proposition, the trial court held the
RECOURSE AVAILABLE TO REGISTERED OWNER; negative. "The Revised Motor Vehicles Law (Act No.
CASE AT BAR. — Petitioner asseverates that it should 3992, as amended) provides that no vehicle may be
not have been haled to court and ordered to respond for used or operated upon any public highway unless the
the damage in the manner arrived at by both the trial and same is properly registered. It has been stated that the
appellate courts since paragraph 5 of the complaint system of licensing and the requirement that each
lodged by the plaintiffs below would indicate that machine must carry a registration number,
petitioner was not the employer of the negligent driver conspicuously displayed, is one of the precautions taken
who was under the control and supervision of Lino to reduce the danger of injury to pedestrians and other
Castro at the time of the accident, apart from the fact travellers from the careless management of automobiles,
that the Isuzu truck was in the physical possession of and to furnish a means of ascertaining the identity of
Rock Component Philippines by virtue of the lease persons violating the laws and ordinances, regulating the
agreement. Aside from casting clouds of doubt on the speed and operation of machines upon the highways (2
propriety of invoking the Perez and Erezo doctrines, R. C. L. 1176). Not only are vehicles to be registered
petitioner continues to persist with the idea that the and that no motor vehicles are to be used or operated
pronouncements of this Court in Duavit v. Court of without being properly registered for the current year, but
Appeals (173 SCRA 490 [1989]) and Duquillo v. Bayot that dealers in motor vehicles shall furnish the Motor
(67 Phil 131 [1939]) dovetail with the factual and legal Vehicles Office a report showing the name and address
scenario of the case at hand. Furthermore, petitioner of each purchaser of motor vehicle during the previous
assumes, given the so-called hiatus on the basis for the month and the manufacturer’s serial number and motor
award of damages as decreed by the lower and number. (Section 5[c], Act No. 3992, as amended.).
appellate courts, that Article 2180 of the new Civil Code "Registration is required not to make said registration the
on vicarious liability will divest petitioner of any operative act by which ownership in vehicles is
responsibility absent as there is any employer-employee transferred, as in land registration cases, because the
relationship between petitioner and the driver. Contrary administrative proceeding of registration does not bear
to petitioner’s expectations, the recourse instituted from any essential relation to the contract of sale between the
the rebuffs it encountered may not constitute a sufficient parties (Chinchilla v. Rafael and Verdaguer, 39 Phil.
foundation for reversal of the impugned judgment of 888), but to permit the use and operation of the vehicle
respondent court. Petitioner is of the impression that the upon any public highway (section 5 [a], Act No. 3992, as
Perez and Erezo cases are inapplicable due to the amended). The main aim of motor vehicle registration is
variance of the generative facts in said cases as against to identify the owner so that if any accident happens, or
those obtaining in the controversy at bar. A contrario, the that any damage or injury is caused by the vehicle on
lesson imparted by Justice Labrador in Erezo is still the public highways, responsibility therefor can be fixed
good law, thus: ". . . In previous decisions, We already on a definite individual, the registered owner. Instances
have held that the registered owner of a certificate of are numerous where vehicles running on public
public convenience is liable to the public for the injuries highways caused accidents or injuries to pedestrians or
or damages suffered by passengers or third persons other vehicles without positive identification of the owner
caused by the operation of said vehicle, even though the or drivers, or with very scant means of identification. It is
same had been transferred to a third person. (Montoya to forestall these circumstances, so inconvenient or
v. Ignacio, 94 Phil., 182, 50 Off. Gaz., 108; Roque v. prejudicial to the public, that the motor vehicle
Malibay Transit, Inc., G.R. No. L-8561, November 18, registration is primarily ordained, in the interest of the
1955; Vda. de Medina v. Cresencia, 99 Phil., 506, 52 determination of persons responsible for damages or
Off. Gaz., [10], 4606.) The principle upon which this injuries caused on public highways.’One of the principal
doctrine is based is that in dealing with vehicles purposes of motor vehicles legislation is identification of
registered under the Public Service Law, the public has the vehicle and of the operator, in case of accident; and
the right to assume or presume that the registered owner another is that the knowledge that means of detection
is the actual owner thereof, for it would be difficult for the are always available may act as a deterrent from lax
public to enforce the actions that they may have for observance of the law and of the rules of conservative
injuries caused to them by the vehicles being negligently and safe operation. Whatever purpose there may be in
operated if the public should be required to prove who these statutes, it is subordinate at the last to the primary
purpose of rendering it certain that the violator of the law Petitioner’s reliance on the rulings of this Court in Duavit
or of the rules of safety shall not escape because of lack v. Court of Appeals and in Duquillo v. Bayot (supra) is
of means to discover him.’ The purpose of the statute is legally unpalatable for the purpose of the present
thwarted, and the displayed number becomes a ‘snare discourse. The vehicles adverted to in the two cases
and delusion,’ if courts would entertain such defenses as shared a common thread, so to speak, in that the jeep
that put forward by appellee in this case. No responsible and the truck were driven in reckless fashion without the
person or corporation could be held liable for the most consent or knowledge of the respective owners.
outrageous acts of negligence, if they should be allowed Cognizant of the inculpatory testimony spewed by
to pace a "middleman" between them and the public, defendant Sabiniano when he admitted that he took the
and escape liability by the manner in which they jeep from the garage of defendant Duavit without the
recompense their servants.’ (King v. Brenham consent or authority of the latter, Justice Gutierrez, Jr. in
Automobile Co., Inc. 145 S. W. 278, 279.). "With the Duavit remarked: ". . . Herein petitioner does not deny
above policy in mind, the question that defendant- ownership of the vehicle involved in the mishap but
appellant poses is: should not the registered owner be completely denies having employed the driver Sabiniano
allowed at the trial to prove who the actual and real or even having authorized the latter to drive his jeep.
owner is, and in accordance with such proof escape or The jeep was virtually stolen from the petitioner’s
evade responsibility and lay the same on the person garage. To hold, therefore, the petitioner liable for the
actually owning the vehicle? We hold with the trial court accident caused by the negligence of Sabiniano who
that the law does not allow him to do so; the law, with its was neither his driver nor employee would be absurd as
aim and policy in mind, does not relieve him directly of it would be like holding liable the owner of a stolen
the responsibility that the law fixes and places upon him vehicle for an accident caused by the person who stole
as an incident or consequence of registration. Were a such vehicle. In this regard, we cannot ignore the many
registered owner allowed to evade responsibility by cases of vehicles forcibly taken from their owners at
proving who the supposed transferee or owner is, it gunpoint or stolen from garages and parking areas and
would be easy for him, by collusion with others or the instances of service station attendants or mechanics
otherwise, to escape said responsibility and transfer the of auto repair shops using, without the owner’s consent,
same to an indefinite person, or to one who possesses vehicles entrusted to them for servicing or repair." In the
no property with which to respond financially for the Duquillo case, the defendant therein cannot, according
damage or injury done. A victim of recklessness on the to Justice Diaz, be held liable for anything because of
public highways is usually without means to discover or circumstances which indicated that the truck was driven
identify the person actually causing the injury or without the consent or knowledge of the owner thereof.
damage. He has no means other than by a recourse to
the registration in the Motor Vehicles Office to determine
who is the owner. The protection that the law aims to
extend to him would become illusory were the registered DECISION
owner given the opportunity to escape liability by
disproving his ownership. If the policy of the law is to be
enforced and carried out, the registered owner should MELO, J.:
not be allowed to prove the contrary to the prejudice of
the person injured, that is, to prove that a third person or
another has become the owner, so that he may thereby The question of petitioner’s responsibility for damages
be relieved of the responsibility to the injured person. when on March 6, 1983, an accident occurred involving
"The above policy and application of the law may appear petitioner’s Isuzu ten-wheeler truck then driven by an
quite harsh and would seem to conflict with truth and employee of Lino Castro is the thrust of the petition for
justice. We do not think it is so. A registered owner who review on certiorari now before Us considering that
has already sold or transferred a vehicle has the neither the driver nor Lino Castro appears to be
recourse to a third-party complaint, in the same action connected with petitioner.
brought against him to recover for the damage or injury
done, against the vendee or transferee of the vehicle. On October 13, 1988, the disputed decision in the suit
The inconvenience of the suit is no justification for below was rendered by the court of origin in this
relieving him of liability; said inconvenience is the price manner:chanrobles law library
he pays for failure to comply with the registration that the
law demands and requires. "In synthesis, we hold that "1. Ordering Rock, B.A. and Rogelio Villar y Amare
the registered owner, the defendant-appellant herein, is jointly and severally to pay the plaintiffs as
primarily responsible for the damage caused to the follow:chanrob1es virtual 1aw library
vehicle of the plaintiff-appellee, but he (defendant-
appellant) has a right to be indemnified by the real or a) To the plaintiff Carlos Ocampo — P121,650.00;
actual owner of the amount that he may be required to
pay as damage for the injury caused to the plaintiff- b) to the plaintiff Moises Ocampo — P298,500.00
appellant." If the foregoing words of wisdom were
applied in solving the circumstance whereof the vehicle c) To the plaintiff Nicolas Cruz — P154,740.00
had been alienated or sold to another, there certainly
can be no serious exception against utilizing the same d) To the plaintiff Inocencio Turla, Sr. — 48,000.00.
rationale to the antecedents of this case where the
subject vehicle was merely leased by petitioner to Rock 2. Dismissing the case against Lino Castro
Component Philippines, Inc., with petitioner retaining
ownership over the vehicle. 3. Dismissing the third-party complaint against
STRONGHOLD
2. CIVIL LAW; QUASI-DELICTS; LIABILITY OF THE
EMPLOYERS FOR DAMAGES CAUSED BY THEIR 4. Dismissing all the counterclaims of the defendants
EMPLOYEES ACTING WITHIN THE SCOPE OF and third party defendants.
ASSIGNED TASKS; DOCTRINE ENUNCIATED IN
DUAVIT VS. COURT OF APPEALS (173 SCRA 490 5. Ordering ROCK to reimburse B.A. the total amount of
[1989]) And DUQUILLO VS. BAYOT (67 PHIL. 131 P622,890.00 which the latter is adjudged to pay to the
[1939] NOT APPLICABLE TO CASE AT BAR. —
plaintiffs." (p. 46, Rollo)chanrobles.com : virtual law constitute a sufficient foundation for reversal of the
library impugned judgment of respondent court. Petitioner is of
the impression that the Perez and Erezo cases are
Respondent Court of Appeals affirmed the appealed inapplicable due to the variance of the generative facts
disposition in toto through Justice Rasul, with Justices in said cases as against those obtaining in the
De Pano, Jr. and Imperial concurring, on practically the controversy at bar. A contrario, the lesson imparted by
same grounds arrived at by the court a quo (p. 28, Justice Labrador in Erezo is still good law, thus:
Rollo). Efforts exerted towards re-evaluation of the
adverse judgment were futile (p. 37, Rollo). Hence, the ". . . In previous decisions, We already have held that the
instant petition. registered owner of a certificate of public
convenience is liable to the public for the injuries or
The lower court ascertained after due trial that Rogelio damages suffered by passengers or third persons
Villar y Amare, the driver of the Isuzu truck, was at fault caused by the operation of said vehicle, even though
when the mishap occurred in as much as he was found the same had been transferred to a third person.
guilty beyond reasonable doubt of reckless imprudence (Montoya v. Ignacio, 94 Phil., 182, 50 Off. Gaz., 108;
resulting in triple homicide with multiple physical injuries Roque v. Malibay Transit, Inc., G.R. No. L-8561,
with damage to property in a decision rendered on November 18, 1955; Vda. de Medina v. Cresencia, 99
February 16, 1984 by the Presiding Judge of Branch 6 of Phil., 506, 52 Off. Gaz., [10], 4606.) The principle upon
the Regional Trial Court stationed at Malolos, Bulacan. which this doctrine is based is that in dealing with
Petitioner was adjudged liable far damages in as much vehicles registered under the Public Service Law,
as the truck was registered in its name during the the public has the right to assume or presume that
incident in question, following the doctrines laid down by the registered owner is the actual owner thereof, for
this Court in Perez v. Gutierrez (53 SCRA 149 [1973]) it would be difficult for the public to enforce the
and Erezo, Et. Al. v. Jepte (102 Phil. 103 [1957]). In the actions that they may have for injuries caused to
same breadth, Rock Component Philippines, Inc. was them by the vehicles being negligently operated if
ordered to reimburse petitioner for any amount that the the public should be required to prove who the
latter may be adjudged liable to pay herein private actual owner is. How would the public or third persons
respondents as expressly stipulated in the contract of know against whom to enforce their rights in case of
lease between petitioner and Rock Component subsequent transfers of the vehicles? We do not imply
Philippines, Inc. Moreover, the trial court applied Article by this doctrine, however, that the registered owner may
2194 of the new Civil Code on solidary accountability of not recover whatever amount he had paid by virtue of his
joint tortfeasors insofar as the liability of the driver, liability to third persons from the person to whom he had
herein petitioner and Rock Component Philippines was actually sold, assigned or conveyed the vehicle.
concerned (pp. 6-7, Decision; pp. 44-45, Rollo).
"Under the same principle the registered owner of any
To the question of whether petitioner can be held vehicle, even if not used for a public service, should
responsible to the victims albeit the truck was primarily be responsible to the public or to third persons
leased to Rock Component Philippines when the for injuries caused the latter while the vehicle is being
incident occurred, the appellate court answered in driven on the highways or streets. The members of the
the affirmative on the basis of the jurisprudential Court are in agreement that the defendant-appellant
dogmas which, as aforesaid, were relied upon by the should be held liable to plaintiff-appellee for the injuries
trial court although respondent court was quick to add occasioned to the latter because of the negligence of the
the caveat embodied in the lease covenant between driver, even if the defendant-appellant was no longer the
petitioner and Rock Component Philippines relative to owner of the vehicle at the time of the damage because
the latter’s duty to reimburse any amount which may be he had previously sold it to another. What is the legal
adjudged against petitioner (pp. 32-33, Rollo). basis for his (defendant-appellant’s) liability?

Petitioner asseverates that it should not have been haled "There is a presumption that the owner of the guilty
to court and ordered to respond for the damage in the vehicle is the defendant-appellant as he is the registered
manner arrived at by both the trial and appellate courts owner in the Motor Vehicles Office. Should he not be
since paragraph 5 of the complaint lodged by the allowed to prove the truth, that he had sold it to another
plaintiffs below would indicate that petitioner was not the and thus shift the responsibility for the injury to the real
employer of the negligent driver who was under the and actual owner? The defendant holds the affirmative
control and supervision of Lino Castro at the time of the of this proposition, the trial court held the negative.
accident, apart from the fact that the Isuzu truck was in
the physical possession of Rock Component Philippines "The Revised Motor vehicles Law (Act No. 3992, as
by virtue of the lease amended) provides that no vehicle may be used or
agreement.chanrobles.com:cralaw:red operated upon any public highway unless the same is
properly registered. It has been stated that the system of
Aside from casting clouds of doubt on the propriety of licensing and the requirement that each machine must
invoking the Perez and Erezo doctrines, petitioner carry a registration number, conspicuously displayed, is
continues to persist with the idea that the one of the precautions taken to reduce the danger of
pronouncements of this Court in Duavit v. Court of injury to pedestrians and other travellers from the
Appeals (173 SCRA 490 [1989]) and Duquillo v. Bayot careless management of automobiles, and to furnish a
(67 Phil 131 [1939]) dovetail with the factual and legal means of ascertaining the identity of persons violating
scenario of the case at hand. Furthermore, petitioner the laws and ordinances, regulating the speed and
assumes, given the so-called hiatus on the basis for the operation of machines upon the highways (2 R. C. L.
award of damages as decreed by the lower and 1176). Not only are vehicles to be registered and that no
appellate courts, that Article 2180 of the new Civil Code motor vehicles are to be used or operated without being
on vicarious liability will divest petitioner of any properly registered for the current year, but that dealers
responsibility absent as there is any employer-employee in motor vehicles shall furnish the Motor Vehicles Office
relationship between petitioner and the driver. a report showing the name and address of each
purchaser of motor vehicle during the previous month
Contrary to petitioner’s expectations, the recourse and the manufacturer’s serial number and motor
instituted from the rebuffs it encountered may not number. (Section 5[c], Act No. 3992, as amended.).
 be relieved of the responsibility to the injured person.
"Registration is required not to make said registration
the operative act by which ownership in vehicles is "The above policy and application of the law may appear
transferred, as in land registration cases, because the quite harsh and would seem to conflict with truth and
administrative proceeding of registration does not bear justice. We do not think it is so. A registered owner who
any essential relation to the contract of sale between the has already sold or transferred a vehicle has the
parties (Chinchilla v. Rafael and Verdaguer, 39 Phil. recourse to a third-party complaint, in the same action
888), but to permit the use and operation of the brought against him to recover for the damage or injury
vehicle upon any public highway (section 5 [a], Act done, against the vendee or transferee of the vehicle.
No. 3992, as amended). The main aim of motor vehicle The inconvenience of the suit is no justification for
registration is to identify the owner so that if any accident relieving him of liability; said inconvenience is the price
happens, or that any damage or injury is caused by the he pays for failure to comply with the registration that the
vehicle on the public highways, responsibility therefor law demands and requires.
can be fixed on a definite individual, the registered
owner. Instances are numerous where vehicles running "In synthesis, we hold that the registered owner, the
on public highways caused accidents or injuries to defendant-appellant herein, is primarily responsible for
pedestrians or other vehicles without positive the damage caused to the vehicle of the plaintiff-
identification of the owner or drivers, or with very scant appellee, but he (defendant-appellant) has a right to be
means of identification. It is to forestall these indemnified by the real or actual owner of the amount
circumstances, so inconvenient or prejudicial to the that he may be required to pay as damage for the injury
public, that the motor vehicle registration is caused to the plaintiff-appellant." (at pp. 106-110.).
primarily ordained, in the interest of the
determination of persons responsible for damages If the foregoing words of wisdom were applied in solving
or injuries caused on public highways. the circumstance whereof the vehicle had been
alienated or sold to another, there certainly can be no
‘One of the principal purposes of motor vehicles serious exception against utilizing the same rationale to
legislation is identification of the vehicle and of the the antecedents of this case where the subject vehicle
operator, in case of accident; and another is that the was merely leased by petitioner to Rock Component
knowledge that means of detection are always Philippines, Inc., with petitioner retaining ownership over
available may act as a deterrent from lax observance the vehicle.chanrobles virtual lawlibrary
of the law and of the rules of conservative and safe
operation. Whatever purpose there may be in these Petitioner’s reliance on the rulings of this Court in Duavit
statutes, it is subordinate at the last to the primary v. Court of Appeals and in Duquillo v. Bayot (supra) is
purpose of rendering it certain that the violator of the law legally unpalatable for the purpose of the present
or of the rules of safety shall not escape because of lack discourse. The vehicles adverted to in the two cases
of means to discover him.’ The purpose of the statute is shared a common thread, so to speak, in that the jeep
thwarted, and the displayed number becomes a ‘snare and the truck were driven in reckless fashion without the
and delusion,’ if courts would entertain such defenses as consent or knowledge of the respective owners.
that put forward by appellee in this case. No responsible Cognizant of the inculpatory testimony spewed by
person or corporation could be held liable for the most defendant Sabiniano when he admitted that he took the
outrageous acts of negligence, if they should be allowed jeep from the garage of defendant Duavit without the
to pace a "middleman" between them and the public, consent or authority of the latter, Justice Gutierrez, Jr. in
and escape liability by the manner in which they Duavit remarked:jgc:chanrobles.com.ph
recompense their servants.’ (King v. Brenham
Automobile Co., Inc. 145 S. W. 278, 279.). ". . . Herein petitioner does not deny ownership of the
vehicle involved in the mishap but completely denies
"With the above policy in mind, the question that having employed the driver Sabiniano or even having
defendant-appellant poses is: should not the registered authorized the latter to drive his jeep. The jeep was
owner be allowed at the trial to prove who the actual and virtually stolen from the petitioner’s garage. To hold,
real owner is, and in accordance with such proof escape therefore, the petitioner liable for the accident caused by
or evade responsibility and lay the same on the person the negligence of Sabiniano who was neither his driver
actually owning the vehicle? We hold with the trial court nor employee would be absurd as it would be like
that the law does not allow him to do so; the law, with its holding liable the owner of a stolen vehicle for an
aim and policy in mind, does not relieve him directly of accident caused by the person who stole such vehicle.
the responsibility that the law fixes and places upon him In this regard, we cannot ignore the many cases of
as an incident or consequence of registration. Were a vehicles forcibly taken from their owners at gunpoint or
registered owner allowed to evade responsibility by stolen from garages and parking areas and the
proving who the supposed transferee or owner is, it instances of service station attendants or mechanics of
would be easy for him, by collusion with others or auto repair shops using, without the owner’s consent,
otherwise, to escape said responsibility and transfer the vehicles entrusted to them for servicing or repair." (at p.
same to an indefinite person, or to one who possesses 496.).
no property with which to respond financially for the
damage or injury done. A victim of recklessness on the In the Duquillo case, the defendant therein cannot,
public highways is usually without means to discover or according to Justice Diaz, be held liable for anything
identify the person actually causing the injury or because of circumstances which indicated that the truck
damage. He has no means other than by a recourse to was driven without the consent or knowledge of the
the registration in the Motor Vehicles Office to determine owner thereof.
who is the owner. The protection that the law aims to
extend to him would become illusory were the registered Consequently, there is no need for Us to discuss the
owner given the opportunity to escape liability by matter of imputed negligence because petitioner
disproving his ownership. If the policy of the law is to be merely presumed, erroneously, however, that
enforced and carried out, the registered owner should judgment was rendered against it on the basis of
not be allowed to prove the contrary to the prejudice of such doctrine embodied under Article 2180 of the
the person injured, that is, to prove that a third person or new Civil Code.
another has become the owner, so that he may thereby
WHEREFORE, the petition is hereby DISMISSED and
decision under review AFFIRMED without special
pronouncement as to costs.

SO ORDERED.

Gutierrez, Jr., Bidin, Davide, Jr. and Romero, JJ.,

concur.
G.R. No. 118889. March 23, 1998 negligence, if there is no pre-existing contractual relation
between the parties, is called a quasi-delict x x x x"
FGU INSURANCE CORPORATION, Petitioner, v. ,
COURT OF APPEALS, FILCAR TRANSPORT, INC., To sustain a claim based thereon, the following
and FORTUNE INSURANCE requisites must concur: (a) damage suffered by the
CORPORATION, Respondents. plaintiff; (b) fault or negligence of the defendant; and, (c)
connection of cause and effect between the fault or
DECISION negligence of the defendant and the damage incurred by
the plaintiff.[6cräläwvirtualibräry
BELLOSILLO, J.:
We agree with respondent court that petitioner failed to
prove the existence of the second requisite, i.e., fault
For damages suffered by a third party, may an action
or negligence of defendant FILCAR, because only
based on quasi-delict prosper against a rent-a-car
the fault or negligence of Dahl-Jensen was
company and, consequently, its insurer for fault or
sufficiently established, not that of FILCAR. It should
negligence of the car lessee in driving the rented
be noted that the damage caused on the vehicle of
vehicle?
Soriano was brought about by the circumstance that
Dahl-Jensen swerved to the right while the vehicle that
This was a two-car collision at dawn. At around 3 he was driving was at the center lane. It is plain that the
o'clock of 21 April 1987, two (2) vehicles, both negligence was solely attributable to Dahl-Jensen thus
Mitsubishi Colt Lancers, cruising northward along making the damage suffered by the other vehicle his
Epifanio de los Santos Avenue, Mandaluyong City, personal liability. Respondent FILCAR did not have any
figured in a traffic accident. The car bearing Plate No. participation therein.
PDG 435 owned by Lydia F. Soriano was being driven at
the outer lane of the highway by Benjamin Jacildone,
Article 2180 of the same Code which deals also
while the other car, with Plate No. PCT 792, owned by
with quasi-delict provides:
respondent FILCAR Transport, Inc. (FILCAR), and
driven by Peter Dahl-Jensen as lessee, was at the
center lane, left of the other vehicle. Upon approaching The obligation imposed by article 2176 is demandable
the corner of Pioneer Street, the car owned by FILCAR not only for one's own acts or omissions, but also for
swerved to the right hitting the left side of the car of those of persons for whom one is responsible.
Soriano. At that time Dahl-Jensen, a Danish tourist, did
not possess a Philippine driver's The father and, in case of his death or incapacity, the
license.1cräläwvirtualibräry mother, are responsible for the damages caused by the
minor children who live in their company.
As a consequence, petitioner FGU Insurance
Corporation, in view of its insurance contract with Guardians are liable for damages caused by the minors
Soriano, paid the latter P25,382.20. By way of or incapacitated persons who are under their authority
subrogation,2 it sued Dahl-Jensen and respondent and live in their company.
FILCAR as well as respondent Fortune Insurance
Corporation (FORTUNE) as insurer of FILCAR for quasi- The owners and managers of an establishment or
delict before the Regional Trial Court of Makati City. enterprise are likewise responsible for damages caused
by their employees in the service of the branches in
Unfortunately, summons was not served on Dahl-Jensen which the latter are employed or on the occasion of their
since he was no longer staying at his given address; in functions.
fact, upon motion of petitioner, he was dropped from the
complaint. Employers shall be liable for the damages caused by
their employees and household helpers acting within the
On 30 July 1991 the trial court dismissed the case for scope of their assigned tasks, even though the former
failure of petitioner to substantiate its claim of are not engaged in any business or industry.
subrogation.3cräläwvirtualibräry
The State is responsible in like manner when it acts
On 31 January 1995 respondent Court of Appeals through a special agent; but not when the damage has
affirmed the ruling of the trial court although based on been caused by the official to whom the task done
another ground, i.e., only the fault or negligence of Dahl- properly pertains, in which case what is provided in
Jensen was sufficiently proved but not that of article 2176 shall be applicable.
respondent FILCAR.[4 In other words, petitioner failed to
establish its cause of action for sum of money based Lastly, teachers or heads of establishments of arts and
on quasi-delict. trades shall be liable for damages caused by their pupils
and students or apprentices, so long as they remain in
In this appeal, petitioner insists that respondents are their custody.
liable on the strength of the ruling in MYC-Agro-Industrial
Corporation v. Vda. de Caldo[5 that the registered owner The responsibility treated of in this article shall
of a vehicle is liable for damages suffered by third cease when the persons herein mentioned prove
persons although the vehicle is leased to another. that they observed all the diligence of a good father
of a family to prevent damage.
We find no reversible error committed by respondent
court in upholding the dismissal of petitioner's complaint. The liability imposed by Art. 2180 arises by virtue of a
The pertinent provision is Art. 2176 of the Civil Code presumption juris tantum of negligence on the part of the
which states: "Whoever by act or omission causes persons made responsible thereunder, derived from their
damage to another, there being fault or negligence, is failure to exercise due care and vigilance over the acts
obliged to pay for the damage done. Such fault or of subordinates to prevent them from causing damage.
[7 Yet, as correctly observed by respondent court, Art.
2180 is hardly applicable because none of the
circumstances mentioned therein obtains in the
case under consideration. Respondent FILCAR
being engaged in a rent-a-car business was only the
owner of the car leased to Dahl-Jensen. As such,
there was no vinculum juris between them as
employer and employee. Respondent FILCAR
cannot in any way be responsible for the negligent
act of Dahl-Jensen, the former not being an
employer of the latter.

We now correlate par. 5 of Art. 2180 with Art. 2184 of

the same Code which provides: "In motor vehicle
mishap, the owner is solidarily liable with his driver, if the
former, who was in the vehicle, could have by the use of
due diligence, prevented the misfortune x x x x If the
owner was not in the motor vehicle, the provisions of
article 2180 are applicable." Obviously, this provision
of Art. 2184 is neither applicable because of the
absence of master-driver relationship between
respondent FILCAR and Dahl-Jensen. Clearly,
petitioner has no cause of action against respondent
FILCAR on the basis of quasi-delict; logically, its
claim against respondent FORTUNE can neither
prosper.

Petitioner's insistence on MYC-Agro-Industrial

Corporation is rooted in a misapprehension of our ruling
therein. In that case, the negligent and reckless
operation of the truck owned by petitioner corporation
caused injuries to several persons and damage to
property. Intending to exculpate itself from liability, the
corporation raised the defense that at the time of the
collision it had no more control over the vehicle as it was
leased to another; and, that the driver was not its
employee but of the lessee. The trial court was not
persuaded as it found that the true nature of the
alleged lease contract was nothing more than a
disguise effected by the corporation to relieve itself
of the burdens and responsibilities of an employer.
We upheld this finding and affirmed the declaration of
joint and several liability of the corporation with its driver.

WHEREFORE , the petition is DENIED. The decision of

respondent Court of Appeals dated 31 January 1995
sustaining the dismissal of petitioner's complaint by the
trial court is AFFIRMED. Costs against petitioner.

SO ORDERED.

Davide, Jr.,(Chairman), Vitug, Panganiban and

Quisumbing,  JJ., concur.
G.R. No. 162267             July 4, 2008 After trial, the RTC rendered its Decision dated April 15,
1999,7 the dispositive portion of which reads:
PCI LEASING AND FINANCE, INC., petitioner,
vs. WHEREFORE, premises considered, judgment
UCPB GENERAL INSURANCE CO., INC., respondent. is hereby rendered in favor of plaintiff UCPB
General Insurance [respondent], ordering the
DECISION defendants PCI Leasing and Finance, Inc.,
[petitioner] and Renato Gonzaga, to pay jointly
and severally the former the following amounts:
AUSTRIA-MARTINEZ, J.:
the principal amount of P244,500.00 with 12%
interest as of the filing of this complaint until the
Before the Court is a Petition for Review same is paid; P50,000.00 as attorney's fees;
on Certiorari under Rule 45 of the Rules of Court, and P20,000.00 as costs of suit.
seeking a reversal of the Decision1 of the Court of
Appeals (CA) dated December 12, 2003 affirming with
SO ORDERED.8
modification the Decision of the Regional Trial Court
(RTC) of Makati City which ordered petitioner and
Renato Gonzaga (Gonzaga) to pay, jointly and severally, Aggrieved by the decision of the trial court, petitioner
respondent the amount of P244,500.00 plus interest; appealed to the CA.
and the CA Resolution2 dated February 18, 2004
denying petitioner's Motion for Reconsideration. In its Decision dated December 12, 2003, the CA
affirmed the RTC's decision, with certain modifications,
The facts, as found by the CA, are undisputed: as follows:

On October 19, 1990 at about 10:30 p.m., a WHEREFORE, the appealed decision dated
Mitsubishi Lancer car with Plate Number PHD- April 15, 1999 is hereby AFFIRMED with
206 owned by United Coconut Planters Bank modification that the award of attorney's fees is
was traversing the Laurel Highway, Barangay hereby deleted and the rate of interest shall be
Balintawak, Lipa City. The car was insured with six percent (6%) per annum computed from the
plantiff-appellee [UCPB General Insurance Inc.], time of the filing of the complaint in the trial court
then driven by Flaviano Isaac with Conrado until the finality of the judgment. If the adjudged
Geronimo, the Asst. Manager of said bank, was principal and the interest remain unpaid
hit and bumped by an 18-wheeler Fuso thereafter, the interest rate shall be twelve
Tanker Truck with Plate No. PJE-737 and percent (12%) per annum computed from the
Trailer Plate No. NVM-133, owned by time the judgment becomes final and executory
defendants-appellants PCI Leasing & until it is fully satisfied.
Finance, Inc. allegedly leased to and
operated by defendant-appellant Superior SO ORDERED.9
Gas & Equitable Co., Inc. (SUGECO) and
driven by its employee, defendant appellant Petitioner filed a Motion for Reconsideration which the
Renato Gonzaga. CA denied in its Resolution dated February 18, 2004.

The impact caused heavy damage to the Hence, herein Petition for Review.
Mitsubishi Lancer car resulting in an explosion of
the rear part of the car. The driver and The issues raised by petitioner are purely legal:
passenger suffered physical injuries. However,
the driver defendant-appellant Gonzaga
continued on its [sic] way to its [sic] destination Whether petitioner, as registered owner of a
and did not bother to bring his victims to the motor vehicle that figured in a quasi-delict may
hospital. be held liable, jointly and severally, with the
driver thereof, for the damages caused to third
parties.
Plaintiff-appellee paid the assured UCPB the
amount of P244,500.00 representing the
insurance coverage of the damaged car. Whether petitioner, as a financing company, is
absolved from liability by the enactment of
Republic Act (R.A.) No. 8556, or the Financing
As the 18-wheeler truck is registered under the Company Act of 1998.
name of PCI Leasing, repeated demands were
made by plaintiff-appellee for the payment of the
aforesaid amounts. However, no payment was Anent the first issue, the CA found petitioner liable for
made. Thus, plaintiff-appellee filed the instant the damage caused by the collision since under the
case on March 13, 1991.3 Public Service Act, if the property covered by a franchise
is transferred or leased to another without obtaining the
requisite approval, the transfer is not binding on the
PCI Leasing and Finance, Inc., (petitioner) interposed Public Service Commission and, in contemplation of law,
the defense that it could not be held liable for the the grantee continues to be responsible under the
collision, since the driver of the truck, Gonzaga, was not franchise in relation to the operation of the vehicle, such
its employee, but that of its co-defendant Superior Gas & as damage or injury to third parties due to collisions.10
Equitable Co., Inc. (SUGECO).4 In fact, it was SUGECO,
and not petitioner, that was the actual operator of the
truck, pursuant to a Contract of Lease signed by Petitioner claims that the CA's reliance on the Public
petitioner and SUGECO.5 Petitioner, however, admitted Service Act is misplaced, since the said law applies only
that it was the owner of the truck in question.6 to cases involving common carriers, or those which have
franchises to operate as public utilities. In contrast, the
case before this Court involves a private commercial
vehicle for business use, which is not offered for service servants." (King vs. Brenham
to the general public.11 Automobile Co., 145 S.W. 278, 279.)

Petitioner's contention has partial merit, as indeed, the With the above policy in mind, the question that
vehicles involved in the case at bar are not common defendant-appellant poses is: should not the
carriers, which makes the Public Service Act registered owner be allowed at the trial to prove
inapplicable. who the actual and real owner is, and in
accordance with such proof escape or evade
However, the registered owner of the vehicle driven by a responsibility and lay the same on the person
negligent driver may still be held liable under applicable actually owning the vehicle? We hold with the
jurisprudence involving laws on compulsory motor trial court that the law does not allow him to do
vehicle registration and the liabilities of employers so; the law, with its aim and policy in mind, does
for quasi-delicts under the Civil Code. not relieve him directly of the responsibility that
the law fixes and places upon him as an incident
or consequence of registration. Were a
The principle of holding the registered owner of a
registered owner allowed to evade responsibility
vehicle liable for quasi-delicts resulting from its use is
by proving who the supposed transferee or
well-established in jurisprudence. Erezo v. Jepte,12 with
owner is, it would be easy for him, by collusion
Justice Labrador as ponente, wisely explained the
with others or otherwise, to escape said
reason behind this principle, thus:
responsibility and transfer the same to an
indefinite person, or to one who possesses no
Registration is required not to make said property with which to respond financially for the
registration the operative act by which damage or injury done. A victim of recklessness
ownership in vehicles is transferred, as in land on the public highways is usually without means
registration cases, because the administrative to discover or identify the person actually
proceeding of registration does not bear any causing the injury or damage. He has no means
essential relation to the contract of sale between other than by a recourse to the registration in the
the parties (Chinchilla vs. Rafael and Verdaguer, Motor Vehicles Office to determine who is the
39 Phil. 888), but to permit the use and owner. The protection that the law aims to
operation of the vehicle upon any public highway extend to him would become illusory were the
(section 5 [a], Act No. 3992, as amended.) The registered owner given the opportunity to
main aim of motor vehicle registration is to escape liability by disproving his ownership. If
identify the owner so that if any accident the policy of the law is to be enforced and
happens, or that any damage or injury is caused carried out, the registered owner should not be
by the vehicle on the public highways, allowed to prove the contrary to the prejudice of
responsibility therefor can be fixed on a definite the person injured, that is, to prove that a third
individual, the registered owner. Instances are person or another has become the owner, so
numerous where vehicles running on public that he may thereby be relieved of the
highways caused accidents or injuries to responsibility to the injured person.
pedestrians or other vehicles without positive
identification of the owner or drivers, or with very
The above policy and application of the law may
scant means of identification. It is to forestall
appear quite harsh and would seem to conflict
these circumstances, so inconvenient or
with truth and justice. We do not think it is so. A
prejudicial to the public, that the motor vehicle
registered owner who has already sold or
registration is primarily ordained, in the interest
transferred a vehicle has the recourse to a third-
of the determination of persons responsible for
party complaint, in the same action brought
damages or injuries caused on public highways.
against him to recover for the damage or injury
done, against the vendee or transferee of the
"'One of the principal purposes of motor vehicle. The inconvenience of the suit is no
vehicles legislation is identification of the justification for relieving him of liability; said
vehicle and of the operator, in case of inconvenience is the price he pays for failure to
accident; and another is that the comply with the registration that the law
knowledge that means of detection are demands and requires.
always available may act as a deterrent
from lax observance of the law and of
In synthesis, we hold that the registered owner,
the rules of conservative and safe
the defendant-appellant herein, is primarily
operation. Whatever purpose there may
responsible for the damage caused to the
be in these statutes, it is subordinate at
vehicle of the plaintiff-appellee, but he
the last to the primary purpose of
(defendant-appellant) has a right to be
rendering it certain that the violator of
indemnified by the real or actual owner of the
the law or of the rules of safety shall not
amount that he may be required to pay as
escape because of lack of means to
damage for the injury caused to the plaintiff-
discover him.' The purpose of the
appellant.13
statute is thwarted, and the displayed
number becomes a 'snare and delusion,'
if courts would entertain such defenses The case is still good law and has been consistently
as that put forward by appellee in this cited in subsequent cases.14 Thus, there is no good
case. No responsible person or reason to depart from its tenets.
corporation could be held liable for the
most outrageous acts of negligence, if For damage or injuries arising out of
they should be allowed to place a negligence in the operation of a motor
'middleman' between them and the
public, and escape liability by the vehicle, the registered owner may be held
manner in which they recompense their civilly liable with the negligent driver either
1) subsidiarily, if the aggrieved party seeks
relief based on a delict or crime under leased property from the owner-lessor at the end
Articles 100 and 103 of the Revised Penal of the lease contract. 26
Code; or 2) solidarily, if the complainant
Petitioner presented a lengthy discussion of the
seeks relief based on a quasi-delict under purported trend in other jurisdictions, which apparently
Articles 2176 and 2180 of the Civil Code. It is tends to favor absolving financing companies from
the option of the plaintiff whether to waive completely the liability for the consequences of quasi-delictual acts or
filing of the civil action, or institute it with the criminal omissions involving financially leased property.27 The
action, or file it separately or independently of a criminal petition adds that these developments have been
action;15 his only limitation is that he cannot recover legislated in our jurisdiction in Republic Act (R.A.) No.
damages twice for the same act or omission of the 8556,28 which provides:
defendant.16
Section 12. Liability of lessors. - Financing
In case a separate civil action is filed, the long- companies shall not be liable for loss, damage
standing principle is that the registered owner of a or injury caused by a motor vehicle, aircraft,
motor vehicle is primarily and directly responsible vessel, equipment, machinery or other property
for the consequences of its operation, including the leased to a third person or entity except when
negligence of the driver, with respect to the public the motor vehicle, aircraft, vessel, equipment or
and all third persons.17 In contemplation of law, the other property is operated by the financing
registered owner of a motor vehicle is the employer of its company, its employees or agents at the time of
driver, with the actual operator and employer, such as a the loss, damage or injury.1avvphi1
lessee, being considered as merely the owner's
agent.18 This being the case, even if a sale has been Petitioner's argument that the enactment of R.A. No.
executed before a tortious incident, the sale, if 8556, especially its addition of the new Sec. 12 to the old
unregistered, has no effect as to the right of the public law, is deemed to have absolved petitioner from liability,
and third persons to recover from the registered fails to convince the Court.
owner.19 The public has the right to conclusively
presume that the registered owner is the real owner, and
may sue accordingly.20 These developments, indeed, point to a seeming
emancipation of financing companies from the obligation
to compensate claimants for losses suffered from the
In the case now before the Court, there is not even a operation of vehicles covered by their lease. Such,
sale of the vehicle involved, but a mere lease, which however, are not applicable to petitioner and do not
remained unregistered up to the time of the exonerate it from liability in the present case.
occurrence of the quasi-delict that gave rise to the
case. Since a lease, unlike a sale, does not even
involve a transfer of title or ownership, but the mere The new law, R.A. No. 8556, notwithstanding
use or enjoyment of property, there is more reason, developments in foreign jurisdictions, do not
therefore, in this instance to uphold the policy supersede or repeal the law on compulsory motor
behind the law, which is to protect the unwitting vehicle registration. No part of the law expressly
public and provide it with a definite person to make repeals Section 5(a) and (e) of R.A. No. 4136, as
accountable for losses or injuries suffered in amended, otherwise known as the Land Transportation
vehicular accidents.21 This is and has always been the and Traffic Code, to wit:
rationale behind compulsory motor vehicle registration
under the Land Transportation and Traffic Code and Sec. 5. Compulsory registration of motor
similar laws, which, as early as Erezo, has been guiding vehicles. - (a) All motor vehicles and trailer of
the courts in their disposition of cases involving motor any type used or operated on or upon any
vehicular incidents. It is also important to emphasize that highway of the Philippines must be registered
such principles apply to all vehicles in general, not just with the Bureau of Land Transportation (now the
those offered for public service or utility.22 Land Transportation Office, per Executive Order
No. 125, January 30, 1987, and Executive Order
The Court recognizes that the business of financing No. 125-A, April 13, 1987) for the current year in
companies has a legitimate and commendable accordance with the provisions of this Act.
purpose.23 In earlier cases, it considered a financial
lease or financing lease a legal contract,24 though xxxx
subject to the restrictions of the so-called Recto Law or
Articles 1484 and 1485 of the Civil Code. 25 In previous (e) Encumbrances of motor vehicles. -
cases, the Court adopted the statutory definition of a Mortgages, attachments, and other
financial lease or financing lease, as: encumbrances of motor vehicles, in order to be
valid against third parties must be recorded in
[A] mode of extending credit through a non- the Bureau (now the Land Transportation
cancelable lease contract under which the lessor Office). Voluntary transactions or voluntary
purchases or acquires, at the instance of the encumbrances shall likewise be properly
lessee, machinery, equipment, motor vehicles, recorded on the face of all outstanding copies of
appliances, business and office machines, and the certificates of registration of the vehicle
other movable or immovable property in concerned.
consideration of the periodic payment by the
lessee of a fixed amount of money sufficient to Cancellation or foreclosure of such mortgages,
amortize at least seventy (70%) of the purchase attachments, and other encumbrances shall
price or acquisition cost, including any incidental likewise be recorded, and in the absence of
expenses and a margin of profit over an such cancellation, no certificate of registration
obligatory period of not less than two (2) years shall be issued without the corresponding
during which the lessee has the right to hold and notation of mortgage, attachment and/or other
use the leased property, x x x but with no encumbrances.
obligation or option on his part to purchase the
 x x x x (Emphasis supplied)

Neither is there an implied repeal of R.A. No. 4136. As a

rule, repeal by implication is frowned upon, unless there
is clear showing that the later statute is so irreconcilably
inconsistent and repugnant to the existing law that they
cannot be reconciled and made to stand
together.29 There is nothing in R.A. No. 4136 that is
inconsistent and incapable of reconciliation.

Thus, the rule remains the same: a sale,

lease, or financial lease, for that matter, that
is not registered with the Land
Transportation Office, still does not bind
third persons who are aggrieved in tortious
incidents, for the latter need only to rely on
the public registration of a motor vehicle as
conclusive evidence of ownership .30 A lease
such as the one involved in the instant case is an
encumbrance in contemplation of law, which needs to be
registered in order for it to bind third parties.31 Under this
policy, the evil sought to be avoided is the exacerbation
of the suffering of victims of tragic vehicular accidents in
not being able to identify a guilty party. A contrary ruling
will not serve the ends of justice. The failure to register
a lease, sale, transfer or encumbrance, should not
benefit the parties responsible, to the prejudice of
innocent victims.

The non-registration of the lease contract between

petitioner and its lessee precludes the former from
enjoying the benefits under Section 12 of R.A. No.
8556.

This ruling may appear too severe and unpalatable to

leasing and financing companies, but the Court believes
that petitioner and other companies so situated are not
entirely left without recourse. They may resort to third-
party complaints against their lessees or whoever are
the actual operators of their vehicles. In the case at bar,
there is, in fact, a provision in the lease contract between
petitioner and SUGECO to the effect that the latter shall
indemnify and hold the former free and harmless from
any "liabilities, damages, suits, claims or judgments"
arising from the latter's use of the motor
vehicle.32 Whether petitioner would act against SUGECO
based on this provision is its own option.

The burden of registration of the lease contract is

minuscule compared to the chaos that may result if
registered owners or operators of vehicles are freed from
such responsibility. Petitioner pays the price for its failure
to obey the law on compulsory registration of motor
vehicles for registration is a pre-requisite for any person
to even enjoy the privilege of putting a vehicle on public
roads.

WHEREFORE, the petition is DENIED. The Decision

dated December 12, 2003 and Resolution dated
February 18, 2004 of the Court of Appeals
are AFFIRMED.

Costs against petitioner.

SO ORDERED.
[G.R. No. 132266. December 21, 1999.]
In its decision 3 of 21 May 1997, the Court of Appeals
CASTILEX INDUSTRIAL CORPORATION, Petitioner, affirmed the ruling of the trial court holding ABAD and
v. VICENTE VASQUEZ, JR. and LUISA SO VASQUEZ, CASTILEX liable but held that the liability of the latter is
and CEBU DOCTORS’ HOSPITAL, "only vicarious and not solidary" with the former. It
INC., Respondents. reduced the award of damages representing loss of
earning capacity from P778,752.00 to P214,156.80; and
DECISION the interest on the hospital and medical bills, from 3%
per month to 12% per annum from 5 September 1988
until fully paid.
DAVIDE, JR., C.J.:
Upon CASTILEX’s motion for reconsideration, the Court
of Appeals modified its decision by (1) reducing the
The pivotal issue in this petition is whether an employer award of moral damages from P50,000 to P30,000 in
may be held vicariously liable for the death resulting view of the deceased’s contributory negligence; (b)
from the negligent operation by a managerial employee deleting the award of attorney’s fees for lack of
of a company-issued vehicle.chanroblesvirtualawlibrary evidence; and (c) reducing the interest on hospital and
medical bills to 6% per annum from 5 September 1988
The antecedents, as succinctly summarized by the Court until fully paid. 4
of Appeals, are as follows:chanrob1es virtual 1aw library
Hence, CASTILEX filed the instant petition contending
On 28 August 1988, at around 1:30 to 2:00 in the that the Court of Appeals erred in (1) applying to the
morning, Romeo So Vasquez, was driving a Honda case the fifth paragraph of Article 2180 of the Civil Code,
motorcycle around Fuente Osmeña Rotunda. He was instead of the fourth paragraph thereof; (2) that as a
traveling counter-clockwise, (the normal flow of traffic in managerial employee, ABAD was deemed to have been
a rotunda) but without any protective helmet or goggles. always acting within the scope of his assigned task even
He was also only carrying a Student’s Permit to Drive at outside office hours because he was using a vehicle
the time. Upon the other hand, Benjamin Abad [was a] issued to him by petitioner; and (3) ruling that petitioner
manager of Appellant Castilex Industrial Corporation, had the burden to prove that the employee was not
registered owner [of] a Toyota Hi-Lux Pick-up with plate acting within the scope of his assigned task.chanrobles
no. GBW-794. On the same date and time, Abad law library
drove the said company car out of a parking lot but
instead of going around the Osmeña rotunda he Jose Benjamin ABAD merely adopted the statement of
made a short cut against [the] flow of the traffic in facts of petitioner which holds fast on the theory of
proceeding to his route to General Maxilom St. or to negligence on the part of the deceased.
Belvic St.
On the other hand, respondents Spouses Vasquez
In the process, the motorcycle of Vasquez and the pick- argue that their son’s death was caused by the
up of Abad collided with each other causing severe negligence of petitioner’s employee who was driving a
injuries to the former. Abad stopped his vehicle and vehicle issued by petitioner and who was on his way
brought Vasquez to the Southern Islands Hospital and home from overtime work for petitioner; and that
later to the Cebu Doctor’s Hospital. petitioner is thus liable for the resulting injury and
subsequent death of their son on the basis of the fifth
On September 5, 1988, Vasquez died at the Cebu paragraph of Article 2180. Even if the fourth paragraph
Doctor’s Hospital. It was there that Abad signed an of Article 2180 were applied, petitioner cannot escape
acknowledgment of Responsible Party (Exhibit K) liability therefor. They moreover argue that the Court of
wherein he agreed to pay whatever hospital bills, Appeals erred in reducing the amount of compensatory
professional fees and other incidental charges Vasquez damages when the award made by the trial court was
may incur.chanrobles virtual lawlibrary borne both by evidence adduced during the trial
regarding deceased’s wages and by jurisprudence on
After the police authorities had conducted the life expectancy. Moreover, they point out that the petition
investigation of the accident, a Criminal Case was filed is procedurally not acceptable on the following grounds:
against Abad but which was subsequently dismissed for (1) lack of an explanation for serving the petition upon
failure to prosecute. So, the present action for damages the Court of Appeals by registered mail, as required
was commenced by Vicente Vasquez, Jr. and Luisa So under Section 11, Rule 13 of the Rules of Civil
Vasquez, parents of the deceased Romeo So Vasquez, Procedure; and (2) lack of a statement of the dates of
against Jose Benjamin Abad and Castilex Industrial the expiration of the original reglementary period and of
Corporation. In the same action, Cebu Doctor’s Hospital the filing of the motion for extension of time to file a
intervened to collect unpaid balance for the medical petition for review.
expense given to Romeo So Vasquez. 1
For its part, respondent Cebu Doctor’s Hospital
The trial court ruled in favor of private respondents maintains that petitioner CASTILEX is indeed vicariously
Vicente and Luisa Vasquez and ordered Jose Benjamin liable for the injuries and subsequent death of Romeo
Abad (hereafter ABAD) and petitioner Castilex Industrial Vasquez caused by ABAD, who was on his way home
Corporation (hereafter CASTILEX) to pay jointly and from taking snacks after doing overtime work for
solidarily (1) Spouses Vasquez, the amounts of petitioner. Although the incident occurred when ABAD
P8,000.00 for burial expenses; P50,000.00 as moral was not working anymore "the inescapable fact remains
damages; P10,000.00 as attorney’s fees; and that said employee would not have been situated at such
P778,752.00 for loss of earning capacity; and (2) Cebu time and place had he not been required by petitioner to
Doctor’s Hospital, the sum of P50,927.83 for unpaid do overtime work." Moreover, since petitioner adopted
medical and hospital bills at 3% monthly interest from 27 the evidence adduced by ABAD, it cannot, as the latter’s
July 1989 until fully paid, plus the costs of litigation. 2 employer, inveigle itself from the ambit of liability, and is
thus estopped by the records of the case, which it failed
CASTILEX and ABAD separately appealed the decision. to refute.
We shall first address the issue raised by the private paragraph encompasses negligent acts of
respondents regarding some alleged procedural lapses employees acting within the scope of their assigned
in the petition. task. The latter is an expansion of the former in both
employer coverage and acts included. Negligent
Private respondent’s contention of petitioner’s violation acts of employees, whether or not the employer is
of Section 11 of Rule 13 and Section 4 of Rule 45 of the engaged in a business or industry, are covered so
1997 Rules of Civil Procedure holds no water.chanrobles long as they were acting within the scope of their
virtual lawlibrary assigned task, even though committed neither in the
service of the branches nor on the occasion of their
Section 11 of Rule 13 provides:chanrob1es virtual 1aw functions. For, admittedly, employees oftentimes
library wear different hats. They perform functions which
are beyond their office, title or designation but
SECTION 11. Priorities in modes of service and filing. — which, nevertheless, are still within the call of
Whenever practicable, the service and filing of pleadings duty.gb
and other papers shall be done personally. Except with
respect to papers emanating from the court, a resort to This court has applied the fifth paragraph to cases where
other modes must be accompanied by a written the employer was engaged in a business or industry
explanation why the service or filing was not done such as truck operators 6 and banks. 7 The Court of
personally. A violation of this Rule may be cause to Appeals cannot, therefore, be faulted in applying the
consider the paper as not filed. said paragraph of Article 2180 of the Civil Code to this
case.
The explanation why service of a copy of the petition
upon the Court of Appeals was done by registered mail Under the fifth paragraph of Article 2180, whether or
is found on Page 28 of the petition. Thus, there has been not engaged in any business or industry, an
compliance with the aforequoted provision. employer is liable for the torts committed by
employees within the scope of his assigned tasks.
As regards the allegation of violation of the material data But it is necessary to establish the employer-employee
rule under Section 4 of Rule 45, the same is unfounded. relationship; once this is done, the plaintiff must show, to
The material dates required to be stated in the petition hold the employer liable, that the employee was acting
are the following: (1) the date of receipt of the judgment within the scope of his assigned task when the tort
or final order or resolution subject of the petition; (2) the complained of was committed. It is only then that the
date of filing of a motion for new trial or reconsideration, employer may find it necessary to interpose the
if any; and (3) the date of receipt of the notice of the defense of due diligence in the selection and
denial of the motion. Contrary to private respondent’s supervision of the employee. 8
claim, the petition need not indicate the dates of the
expiration of the original reglementary period and the It is undisputed that ABAD was a Production Manager of
filing of a motion for extension of time to file the petition. petitioner CASTILEX at the time of the tort occurrence.
At any rate, aside from the material dates required under As to whether he was acting within the scope of his
Section 4 of Rule 45, petitioner CASTILEX also stated in assigned task is a question of fact, which the court a quo
the first page of the petition the date it filed the motion and the Court of Appeals resolved in the affirmative.
for extension of time to file the petition.
Well-entrenched in our jurisprudence is the rule that the
Now on the merits of the case. factual findings of the Court of Appeals are entitled to
great respect, and even finality at times. This rule is,
The negligence of ABAD is not an issue at this instance. however, subject to exceptions such as when the
Petitioner CASTILEX presumes said negligence but conclusion is grounded on speculations, surmises, or
claims that it is not vicariously liable for the injuries and conjectures. 9 Such exception obtain in the present case
subsequent death caused by ABAD. to warrant review by this Court of the finding of the Court
of Appeals that since ABAD was driving petitioner’s
Petitioner contends that the fifth paragraph of Article vehicle he was acting within the scope of his duties as a
2180 of the Civil Code should only apply to instances manager.
where the employer is not engaged in business or
industry. Since it is engaged in the business of Before we pass upon the issue of whether ABAD was
manufacturing and selling furniture it is therefore not performing acts within the range of his employment, we
covered by said provision. Instead, the fourth paragraph shall first take up the other reason invoked by the Court
should apply.chanroblesvirtuallawlibrary of Appeals in holding petitioner CASTILEX vicariously
liable for ABAD’s negligence, i.e., that the petitioner did
Petitioner’s interpretation of the fifth paragraph is not not present evidence that ABAD was not acting within
accurate. The phrase "even though the former are not the scope of his assigned tasks at the time of the motor
engaged in any business or industry" found in the fifth vehicle mishap. Contrary to the ruling of the Court of
paragraph should be interpreted to mean that it is not Appeals, it was not incumbent upon the petitioner to
necessary for the employer to be engaged in any prove the same. It was enough for petitioner CASTILEX
business or industry to be liable for the negligence of his to deny that ABAD was acting within the scope of his
employee who is acting within the scope of his assigned duties; petitioner was not under obligation to prove this
task. 5 negative averment. Ei incumbit probatio qui dicit, non qui
negat (He who asserts, not he who denies, must prove).
A distinction must be made between the two provisions The Court has consistently applied the ancient rule that if
to determine what is applicable. Both provisions apply to the plaintiff, upon whom rests the burden of proving his
employers: the fourth paragraph, to owners and cause of action, fails to show in a satisfactory manner
managers of an establishment or enterprise; and the facts which he bases his claim, the defendant is under
fifth paragraph, to employers in general, whether or no obligation to prove his exception or defense. 10
not engaged in any business or industry. The fourth
paragraph covers negligent acts of employees Now on the issue of whether the private respondents
committed either in the service of the branches or have sufficiently established that ABAD was acting
on the occasion of their functions, while the fifth within the scope of his assigned tasks.chanrobles
lawlibrary : rednad home in the employer’s vehicle as when the employer
benefits from having the employee at work earlier and,
ABAD, who was presented as a hostile witness, testified presumably, spending more time at his actual duties.
that at the time of the incident, he was driving a Where the employee’s duties require him to circulate in a
company-issued vehicle, registered under the name of general area with no fixed place or hours of work, or to
petitioner. He was then leaving the restaurant where he go to and from his home to various outside places of
had some snacks and had a chat with his friends after work, and his employer furnishes him with a vehicle to
having done overtime work for the petitioner. use in his work, the courts have frequently applied what
has been called the "special errand" or "roving
No absolutely hard and fast rule can be stated which will commission" rule, under which it can be found that the
furnish the complete answer to the problem of whether employee continues in the service of his employer until
at a given moment, an employee is engaged in his he actually reaches home. However, even if the
employer’s business in the operation of a motor vehicle, employee be deemed to be acting within the scope
so as to fix liability upon the employer because of the of his employment in going to or from work in his
employee’s action or inaction; but rather, the result employer’s vehicle, the employer is not liable for his
varies with each state of facts. 11 negligence where at the time of the accident, the
employee has left the direct route to his work or
In Filamer Christian Institute v. Intermediate Appellate back home and is pursuing a personal errand of his
Court, 12 this Court had the occasion to hold that acts own.
done within the scope of the employee’s assigned
tasks includes "any act done by an employee in III. Use of Employer’s Vehicle Outside Regular Working
furtherance of the interests of the employer or for Hours
the account of the employer at the time of the
infliction of the injury or damages."cralaw virtua1aw An employer who loans his motor vehicle to an
library employee for the latter’s personal use outside of regular
working hours is generally not liable for the employee’s
The court a quo and the Court of Appeals were one in negligent operation of the vehicle during the period of
holding that the driving by a manager of a company- permissive use, even where the employer contemplates
issued vehicle is within the scope of his assigned tasks that a regularly assigned motor vehicle will be used by
regardless of the time and circumstances. the employee for personal as well as business purposes
and there is some incidental benefit to the employer.
We do not agree. The mere fact that ABAD was Even where the employee’s personal purpose in using
using a service vehicle at the time of the injurious the vehicle has been accomplished and he has started
incident is not of itself sufficient to charge petitioner the return trip to his house where the vehicle is normally
with liability for the negligent operation of said kept, it has been held that he has not resumed his
vehicle unless it appears that he was operating the employment, and the employer is not liable for the
vehicle within the course or scope of his employee’s negligent operation of the vehicle during the
employment. return trip. 15

The following are principles in American Jurisprudence The foregoing principles and jurisprudence are
on the employer’s liability for the injuries inflicted by the applicable in our jurisdiction albeit based on the
negligence of an employee in the use of an employer’s doctrine of respondeat superior, not on the principle
motor vehicle:chanrob1es virtual 1aw library of bonus pater familias as in ours. Whether the fault or
negligence of the employee is conclusive on his
I. Operation of Employer’s Motor Vehicle in Going to or employer as in American law or jurisprudence, or
from Meals merely gives rise to the presumption juris tantum of
negligence on the part of the employer as in ours, it
It has been held that an employee who uses his is indispensable that the employee was acting in his
employer’s vehicle in going from his work to a place employer’s business or within the scope of his
where he intends to eat or in returning to work from a assigned task. 16
meal is not ordinarily acting within the scope of his
employment in the absence of evidence of some special In the case at bar, it is undisputed that ABAD did some
business benefit to the employer. Evidence that by using overtime work at the petitioner’s office, which was
the employer’s vehicle to go to and from meals, an located in Cabangcalan, Mandaue City. Thereafter, he
employee is enabled to reduce his time-off and so went to Goldie’s Restaurant in Fuente Osmeña, Cebu
devote more time to the performance of his duties City, which is about seven kilometers away from
supports the findings that an employee is acting within petitioner’s place of business. 17 A witness for the
the scope of his employment while so driving the vehicle. private respondents, a sidewalk vendor, testified that
13 Fuente Osmeña is a "lively place" even at dawn because
Goldie’s Restaurant and Back Street were still open and
II. Operation of Employer’s Vehicle in Going to or from people were drinking thereat. Moreover, prostitutes,
Work pimps, and drug addicts littered the place. 18

In the same vein, traveling to and from the place of work At the Goldie’s Restaurant, ABAD took some snacks and
is ordinarily a personal problem or concern of the had a chat with friends. It was when ABAD was leaving
employee, and not a part of his services to his employer. the restaurant that the incident in question occurred.
Hence, in the absence of some special benefit to the That same witness for the private respondents testified
employer other than the mere performance of the that at the time of the vehicular accident, ABAD was with
services available at the place where he is needed, the a woman in his car, who then shouted: "Daddy, Daddy!"
employee is not acting within the scope of his 19 This woman could not have been ABAD’s daughter,
employment even though he uses his employer’s motor for ABAD was only 29 years old at the time.
vehicle. 14chanroblesvirtuallawlibrary:red
To the mind of this Court, ABAD was engaged in affairs
The employer may, however, be liable where he derives of his own or was carrying out a personal purpose not in
some special benefit from having the employee drive line with his duties at the time he figured in a vehicular
accident. It was then about 2:00 a.m. of 28 August 1988,
way beyond the normal working hours. ABAD’s working
day had ended; his overtime work had already been
completed. His being at a place which, as petitioner put
it, was known as a "haven for prostitutes, pimps, and
drug pushers and addicts," had no connection to
petitioner’s business; neither had it any relation to his
duties as a manager. Rather, using his service vehicle
even for personal purposes was a form of a fringe
benefit or one of the perks attached to his
position.chanroblesvirtual|awlibrary

Since there is paucity of evidence that ABAD was acting

within the scope of the functions entrusted to him,
petitioner CASTILEX had no duty to show that it
exercised the diligence of a good father of a family in
providing ABAD with a service vehicle. Thus, justice and
equity require that petitioner be relieved of vicarious
liability for the consequences of the negligence of ABAD
in driving its vehicle. 20

WHEREFORE, the petition is GRANTED, and the

appealed decision and resolution of the Court of Appeals
is AFFIRMED with the modification that petitioner
Castilex Industrial Corporation be absolved of any
liability for the damages caused by its employee, Jose
Benjamin Abad.

SO ORDERED.
[G.R. No. 128705. June 29, 2001.] Defendant bank’s counterclaim is ordered DISMISSED
for lack of merit.
CONRADO AGUILAR, SR., Petitioner, v.
COMMERCIAL SAVINGS BANK and FERDINAND On the cross-claim of the defendant bank, the cross-
BORJA, Respondents. defendant Ferdinand Borja is hereby ordered to pay the
cross-claimant Comsavings Bank whatever amount the
DECISION latter may have paid or is required to pay to the plaintiff
by virtue of this decision.chanrob1es virtua1 1aw 1ibrary

QUISUMBING, J.: SO ORDERED. 2

The trial court declared that Borja’s negligence,

This petition 1 seeks to annul and set aside the decision carelessness and imprudence caused the victim’s death.
dated October 16, 1996, of the Court of Appeals in CA- It also found that Borja was an assistant vice president
G.R. CV No. 48793, reversing the decision of the of respondent bank at the time of the incident. It held
Regional Trial Court of Makati, Branch 59, and that under Art. 2180 3 of the Civil Code, the negligence
dismissing the complaint insofar as respondent of the employee is presumed to be that of the employer,
Commercial Savings Bank is concerned. whose liability is primary and direct; and that respondent
bank failed to exercise due diligence in the selection of
The facts in this case are uncomplicated. its employees.

Petitioner Conrado Aguilar, Sr. is the father of Conrado Respondent bank appealed to the Court of Appeals.
Aguilar, Jr., the victim in a vehicular accident
involving a Lancer car registered in the name of The Court of Appeals found the appeal meritorious. It
respondent bank, but driven by co-respondent said that before it can apply Art. 2180 on which private
Ferdinand G. Borja. respondent anchored its claim of the bank’s negligence,
petitioner must first establish that Borja acted on the
On September 8, 1984, at around 11:15 P.M., Aguilar, occasion or by reason of the functions entrusted to him
Jr. and his companions, among them Nestor Semella, by his employer. The appellate court found no evidence
had just finished their snack at the Uncle Watt’s Bakery that Borja had acted as respondent bank’s assistant
along Zapote-Alabang Road. As they crossed the road, vice-president at the time of the mishap. The Court of
a Lancer with plate no. NNP 349 and driven by Appeals reversed the trial court’s decision,
Ferdinand Borja, overtook a passenger jeepney. In so thus:chanrob1es virtual 1aw library
doing, the Lancer hit Aguilar and Semella. Aguilar was
thrown upwards and smashed against the windshield of WHEREFORE, the appealed decision is reversed only
the Lancer, which did not stop. Aguilar and Semella insofar as defendant-appellant bank is concerned. The
were then brought to the Perpetual Help Hospital at complaint against it is DISMISSED. No award of
Pamplona, Las Piñas, where Aguilar was pronounced damages on said appellant’s counterclaim.chanrob1es
dead on arrival.chanrob1es virtua1 1aw 1ibrary virtua1 1aw 1ibrary

On July 29, 1985, petitioner filed a complaint for No costs.

damages against respondents in the Regional Trial
Court of Makati, Branch 59. Borja did not file his answer SO ORDERED. 4
within the reglementary period, hence, he was declared
in default by the trial court. Petitioner’s motion for reconsideration was denied.
Hence, this petition where petitioner avers
At the trial, respondent bank admitted that the Lancer that:chanrob1es virtual 1aw library
was registered in its name at the time of the incident.
Petitioner’s counsel also showed that Borja was THE COURT OF APPEALS ERRED IN FINDING THAT
negligent in driving the car. RESPONDENT COMSAVINGS IS NOT LIABLE FOR
DAMAGES DESPITE THE ESTABLISHED FACT THAT
On June 14, 1991, the trial court held defendants (herein RESPONDENT COMSAVINGS IS THE REGISTERED
respondents) liable for Aguilar’s death, in its decision OWNER OF THE CAR THAT HIT AND KILLED
that reads:chanrob1es virtual 1aw library PETITIONER’S SON WHICH FINDING, COUPLED
WITH THE DISMISSAL OF THE COMPLAINT AGAINST
Premises considered, judgment is hereby rendered RESPONDENT COMSAVINGS, IS CONTRARY TO
ordering the defendants, jointly and severally, to pay to LAW AND EXISTING JURISPRUDENCE. 5
the plaintiff the following:chanrob1es virtual 1aw library
The sole issue is whether or not respondent bank, as
1. The amount of P18,900.00 representing actual the Lancer’s registered owner, is liable for damages.
expenses incurred by the plaintiff;
Petitioner states that the Court of Appeals erred when it
2. The amount of P50,000.00 representing moral disregarded the fact that respondent bank was the
damages; registered owner of the car and concluded that the bank
was not liable since there was "no iota of evidence that
3. The amount of P100,000.00 representing loss of Borja was performing his assigned task at the time of the
earning capacity of the deceased victim, Conrado incident." 6 He insists that the existence or absence of
Aguilar, Jr. employer-employee relationship between the bank and
Borja is immaterial in this case for the registered owner
4. The sum of P20,000.00 representing attorney’s fees; of a motor vehicle is legally liable for the damages
and incurred by third persons for injuries sustained in the
operation of said vehicle.
5. With costs against the defendants.
Respondent bank counters that the appellate court’s
decision is well supported by law and jurisprudence.
According to respondent bank, under Article 2180 of the thwarted, and the displayed number becomes a ‘snare
Civil Code, when the negligent employee commits the and delusion,’ if courts would entertain such defenses as
act outside the actual performance of his assigned tasks that put forward by appellee in this case. No responsible
or duties, the employer has no vicarious liability. Further, person or corporation could be held liable for the most
the bank insists that it is not liable since at the time of outrageous acts of negligence, if they should be allowed
the accident, Borja was driving the Lancer in his private to place a ‘middleman’ between them and the public,
capacity and was not performing functions in furtherance and escape liability by the manner in which they
of the interest of Comsavings Bank. Additionally, recompense their servants." (King v. Brenham
according to the bank, Borja already bought the car on Automobile Co., 145 S.W. 278, 279.)
installment basis. Hence, at the time of the incident, the
bank concluded it was no longer the owner of the car. 7 With the above policy in mind, the question that
defendant-appellant poses is: should not the registered
We are, however, unimpressed by respondent bank’s owner be allowed at the trial to prove who the actual and
disquisition. It goes against established real owner is, and in accordance with such proof escape
jurisprudence.chanrob1es virtua1 1aw 1ibrary or evade responsibility and lay the same on the person
actually owning the vehicle? We hold with the trial court
In BA Finance Corporation v. Court of Appeals, 215 that the law does not allow him to do so; the law, with its
SCRA 715, we had already held that the registered aim and policy in mind, does not relieve him directly of
owner of any vehicle, even if not for public service, is the responsibility that the law fixes and places upon him
primarily responsible to third persons for deaths, injuries as an incident or consequence of registration. Were a
and damages it caused. This is true even if the vehicle is registered owner allowed to evade responsibility by
leased to third persons. In that case, petitioner’s Isuzu proving who the supposed transferee or owner is, it
ten-wheeler truck driven by an employee of a certain would be easy for him, by collusion with others or
Lino Castro met an accident. Neither the driver nor Lino otherwise, to escape said responsibility and transfer the
Castro was connected to petitioner, for at the time of the same to an indefinite person, or to one who possesses
incident, the truck was on lease to Rock Component no property with which to respond financially for the
Philippines, Inc. The Court held petitioner liable as the damage or injury done. A victim of recklessness on the
truck’s registered owner, despite the absence of public highways is usually without means to discover or
employer-employee relationship between petitioner and identify the person actually causing the injury or
the driver. Though petitioner in said case had a right of damage. He has no means other than by a recourse to
reimbursement against Rock Component for the total the registration in the Motor Vehicles Office to determine
amount of its liability, the Court per Melo, J. made clear who is the owner. The protection that the law aims to
petitioner remained legally responsible to the victim of extend to him would become illusory were the registered
vehicular mishap on the basis of jurisprudential dogmas. owner given the opportunity to escape liability by
disproving his ownership. If the policy of the law is to be
As early as Erezo, v. Jepte, 102 Phil. 103, the Court enforced and carried out, the registered owner should
through Labrador, J. had synthesized the rationale for not be allowed to prove the contrary to the prejudice of
holding the registered owner of a vehicle directly liable. the person injured, that is, to prove that a third person or
There we said:chanrob1es virtual 1aw library another has become the owner, so that he may thereby
be relieved of the responsibility to the injured
Registration is required not to make said registration the person.chanrob1es virtua1 1aw 1ibrary
operative act by which ownership in vehicles is
transferred, as in land registration cases, because the The above policy and application of the law may appear
administrative proceeding of registration does not bear quite harsh and would seem to conflict with truth and
any essential relation to the contract of sale between the justice. We do not think it is so. A registered owner who
parties (Chinchilla v. Rafael and Verdaguer, 39 Phil. has already sold or transferred a vehicle has the
888), but to permit the use and operation of the vehicle recourse to a third-party complaint, in the same action
upon any public highway (section 5 [a], Act No. 3992, as brought against him to recover for the damage or injury
amended.) The main aim of motor vehicle registration is done, against the vendee or transferee of the vehicle.
to identify the owner so that if any accident happens, or The inconvenience of the suit is no justification for
that any damage or injury is caused by the vehicle on relieving him of liability; said inconvenience is the price
the public highways, responsibility therefor can be fixed he pays for failure to comply with the registration that the
on a definite individual, the registered owner. Instances law demands and requires.
are numerous where vehicles running on public
highways caused accidents or injuries to pedestrians or In synthesis, we hold that the registered owner, the
other vehicles without positive identification of the owner defendant-appellant herein, is primarily responsible for
or drivers, or with very scant means of identification. It is the damage caused to the vehicle of the plaintiff-
to forestall these circumstances, so inconvenient or appellee, but he (defendant-appellant) has a right to be
prejudicial to the public, that the motor vehicle indemnified by the real or actual owner of the amount
registration is primarily ordained, in the interest of the that he may be required to pay as damage for the injury
determination of persons responsible for damages or caused to the plaintiff-appellant. 8
injuries caused on public highways.chanrob1es virtua1
1aw 1ibrary The rationale well postulated in Erezo applies in the
present case. Thus far no change in jurisprudence
"‘One of the principal purposes of motor vehicles has been brought to our attention. In our view,
legislation is identification of the vehicle and of the respondent bank, as the registered owner of the
operator, in case of accident; and another is that the vehicle, is primarily liable for Aguilar, Jr.’s death.
knowledge that means of detection are always available The Court of Appeals eared when it concluded that the
may act as a deterrent from law observance of the law bank was not liable simply because (a) petitioner did not
and of the rules of conservative and safe operation. prove that Borja was acting as the bank’s vice president
Whatever purpose there may be in these statutes, it is at the time of the accident; and (b) Borja had, according
subordinate at the last to the primary purpose of to respondent bank, already bought the car at the time of
rendering it certain that the violator of the law or of the the mishap. For as long as the respondent bank
rules of safety shall not escape because of lack of remained the registered owner of the car involved in
means to discover him.’ The purpose of the statute is the vehicular accident, it could not escape primary
liability for the death of petitioner’s son.

WHEREFORE, the petition is GRANTED. The assailed

decision of the Court of Appeals dated October 16, 1996
in CA-G.R. CV No. 48793 is REVERSED. The judgment
of the Regional Trial Court of Makati, Branch 59 in Civil
Case No. 11231 is UPHELD. Costs against respondent
bank.chanrob1es virtua1 1aw 1ibrary

SO ORDERED.
G.R. No. 174156               June 20, 2012 The MeTC Decision

FILCAR TRANSPORT SERVICES, Petitioner, The MeTC, in its decision dated January 20, 2004,4 ruled
vs. in favor of Espinas, and ordered Filcar and Carmen Flor,
JOSE A. ESPINAS, Respondent. jointly and severally, to pay Espinas ₱97,910.00 as
actual damages, representing the cost of repair, with
DECISION interest at 6% per annum from the date the complaint
was filed; ₱50,000.00 as moral damages; ₱20,000.00 as
exemplary damages; and ₱20,000.00 as attorney’s fees.
BRION, J.:
The MeTC ruled that Filcar, as the registered owner of
the vehicle, is primarily responsible for damages
We resolve the present petition for review on resulting from the vehicle’s operation.
certiorari1 filed by petitioner Filcar Transport Services
(Filcar), challenging the decision2 and the resolution3 of
The RTC Decision
the Court of Appeals (CA) in CA-G.R. SP No. 86603.

The Regional Trial Court (RTC) of Manila, Branch 20, in

The facts of the case, gathered from the records, are
the exercise of its appellate jurisdiction, affirmed the
briefly summarized below.
MeTC decision.5 The RTC ruled that Filcar failed to
prove that Floresca was not its employee as no proof
On November 22, 1998, at around 6:30 p.m., respondent was adduced that Floresca was personally hired by Atty.
Jose A. Espinas was driving his car along Leon Guinto Flor. The RTC agreed with the MeTC that the registered
Street in Manila. Upon reaching the intersection of Leon owner of a vehicle is directly and primarily liable for the
Guinto and President Quirino Streets, Espinas stopped damages sustained by third persons as a consequence
his car. When the signal light turned green, he of the negligent or careless operation of a vehicle
proceeded to cross the intersection. He was already in registered in its name. The RTC added that the victim of
the middle of the intersection when another car, recklessness on the public highways is without means to
traversing President Quirino Street and going to discover or identify the person actually causing the injury
Roxas Boulevard, suddenly hit and bumped his car. or damage. Thus, the only recourse is to determine the
As a result of the impact, Espinas’ car turned owner, through the vehicle’s registration, and to hold him
clockwise. The other car escaped from the scene of responsible for the damages.
the incident, but Espinas was able to get its plate
number.
The CA Decision
After verifying with the Land Transportation Office,
On appeal, the CA partly granted the petition in CA-G.R.
Espinas learned that the owner of the other car, with
SP No. 86603; it modified the RTC decision by ruling
plate number UCF-545, is Filcar.
that Carmen Flor, President and General Manager of
Filcar, is not personally liable to Espinas. The appellate
Espinas sent several letters to Filcar and to its President court pointed out that, subject to recognized exceptions,
and General Manager Carmen Flor, demanding payment the liability of a corporation is not the liability of its
for the damages sustained by his car. On May 31, 2001, corporate officers because a corporate entity – subject to
Espinas filed a complaint for damages against Filcar and well-recognized exceptions – has a separate and distinct
Carmen Flor before the Metropolitan Trial Court (MeTC) personality from its officers and shareholders. Since the
of Manila, and the case was raffled to Branch 13. In the circumstances in the case at bar do not fall under the
complaint, Espinas demanded that Filcar and Carmen exceptions recognized by law, the CA concluded that the
Flor pay the amount of ₱97,910.00, representing actual liability for damages cannot attach to Carmen Flor.
damages sustained by his car.
The CA, however, affirmed the liability of Filcar to pay
Filcar argued that while it is the registered owner of the Espinas damages. According to the CA, even assuming
car that hit and bumped Espinas’ car, the car was that there had been no employer-employee relationship
assigned to its Corporate Secretary Atty. Candido Flor, between Filcar and the driver of the vehicle, Floresca,
the husband of Carmen Flor. Filcar further stated that the former can be held liable under the registered owner
when the incident happened, the car was being rule.
driven by Atty. Flor’s personal driver, Timoteo
Floresca.
The CA relied on the rule that the registered owner of a
vehicle is directly and primarily responsible to the public
Atty. Flor, for his part, alleged that when the incident and to third persons while the vehicle is being operated.
occurred, he was attending a birthday celebration at a Citing Erezo, et al. v. Jepte,6 the CA said that the
nearby hotel, and it was only later that night when he rationale behind the rule is to avoid circumstances where
noticed a small dent on and the cracked signal light of vehicles running on public highways cause accidents or
the car. On seeing the dent and the crack, Atty. Flor injuries to pedestrians or other vehicles without positive
allegedly asked Floresca what happened, and the driver identification of the owner or drivers, or with very scant
replied that it was a result of a "hit and run" while the car means of identification. In Erezo, the Court said that the
was parked in front of Bogota on Pedro Gil Avenue, main aim of motor vehicle registration is to identify the
Manila. owner, so that if a vehicle causes damage or injury to
pedestrians or other vehicles, responsibility can be
Filcar denied any liability to Espinas and claimed that the traced to a definite individual and that individual is the
incident was not due to its fault or negligence since registered owner of the vehicle.7
Floresca was not its employee but that of Atty. Flor.
Filcar and Carmen Flor both said that they always The CA did not accept Filcar’s argument that it cannot
exercised the due diligence required of a good father of be held liable for damages because the driver of the
a family in leasing or assigning their vehicles to third vehicle was not its employee. In so ruling, the CA cited
parties. the case of Villanueva v. Domingo8 where the Court said
that the question of whether the driver was authorized by The responsibility treated of in this article shall cease
the actual owner is irrelevant in determining the primary when the persons herein mentioned prove that they
and direct responsibility of the registered owner of a observed all the diligence of a good father of a family to
vehicle for accidents, injuries and deaths caused by the prevent damage.
operation of his vehicle.
Under Article 2176, in relation with Article 2180, of the
Filcar filed a motion for reconsideration which the CA Civil Code, an action predicated on an employee’s act or
denied in its Resolution dated July 6, 2006. omission may be instituted against the employer who is
held liable for the negligent act or omission committed by
Hence, the present petition. his employee.

The Issue Although the employer is not the actual tortfeasor,

the law makes him vicariously liable on the basis of
the civil law principle of pater familias for failure to
Simply stated, the issue for the consideration of this
exercise due care and vigilance over the acts of
Court is: whether Filcar, as registered owner of the
one’s subordinates to prevent damage to
motor vehicle which figured in an accident, may be
another.10 In the last paragraph of Article 2180 of the
held liable for the damages caused to Espinas.
Civil Code, the employer may invoke the defense that he
observed all the diligence of a good father of a family to
Our Ruling prevent damage.

The petition is without merit. As its core defense, Filcar contends that Article 2176, in
relation with Article 2180, of the Civil Code is
Filcar, as registered owner, is deemed the employer inapplicable because it presupposes the existence of an
of the driver, Floresca, and is thus vicariously liable employer-employee relationship. According to Filcar, it
under Article 2176 in relation with Article 2180 of the cannot be held liable under the subject provisions
Civil Code because the driver of its vehicle at the time of the
accident, Floresca, is not its employee but that of its
It is undisputed that Filcar is the registered owner of the Corporate Secretary, Atty. Flor.
motor vehicle which hit and caused damage to Espinas’
car; and it is on the basis of this fact that we hold Filcar We cannot agree. It is well settled that in case of
primarily and directly liable to Espinas for damages. motor vehicle mishaps, the registered owner of the
motor vehicle is considered as the employer of the
As a general rule, one is only responsible for his own act tortfeasor-driver, and is made primarily liable for the
or omission.9 Thus, a person will generally be held liable tort committed by the latter under Article 2176, in
only for the torts committed by himself and not by relation with Article 2180, of the Civil Code.
another. This general rule is laid down in Article 2176 of
the Civil Code, which provides to wit: In Equitable Leasing Corporation v. Suyom,11 we ruled
that in so far as third persons are concerned, the
Article 2176. Whoever by act or omission causes registered owner of the motor vehicle is the employer of
damage to another, there being fault or negligence, is the negligent driver, and the actual employer is
obliged to pay for the damage done. Such fault or considered merely as an agent of such owner.
negligence, if there is no pre-existing contractual relation
between the parties, is called a quasi-delict and is In that case, a tractor registered in the name of Equitable
governed by the provisions of this Chapter. Leasing Corporation (Equitable) figured in an accident,
killing and seriously injuring several persons. As part of
Based on the above-cited article, the obligation to its defense, Equitable claimed that the tractor was
indemnify another for damage caused by one’s act or initially leased to Mr. Edwin Lim under a Lease
omission is imposed upon the tortfeasor himself, i.e., the Agreement, which agreement has been overtaken by a
person who committed the negligent act or omission. Deed of Sale entered into by Equitable and Ecatine
The law, however, provides for exceptions when it Corporation (Ecatine). Equitable argued that it cannot be
makes certain persons liable for the act or omission of held liable for damages because the tractor had already
another. been sold to Ecatine at the time of the accident and the
negligent driver was not its employee but of Ecatine.
One exception is an employer who is made vicariously
liable for the tort committed by his employee. Article In upholding the liability of Equitable, as registered
2180 of the Civil Code states: owner of the tractor, this Court said that "regardless of
sales made of a motor vehicle, the registered owner is
Article 2180. The obligation imposed by Article 2176 is the lawful operator insofar as the public and third
demandable not only for one’s own acts or omissions, persons are concerned; consequently, it is directly and
but also for those of persons for whom one is primarily responsible for the consequences of its
responsible. operation."12 The Court further stated that "[i]n
contemplation of law, the owner/operator of record is the
employer of the driver, the actual operator and employer
xxxx
being considered as merely its agent."13 Thus, Equitable,
as the registered owner of the tractor, was considered
Employers shall be liable for the damages caused by under the law on quasi delict to be the employer of the
their employees and household helpers acting within the driver, Raul Tutor; Ecatine, Tutor’s actual employer, was
scope of their assigned tasks, even though the former deemed merely as an agent of Equitable.
are not engaged in any business or industry.
Thus, it is clear that for the purpose of holding the
xxxx registered owner of the motor vehicle primarily and
directly liable for damages under Article 2176, in
relation with Article 2180, of the Civil Code, the Neither can Filcar use the defenses available under
existence of an employer-employee relationship, as Article 2180 of the Civil Code - that the employee acts
it is understood in labor relations law, is not beyond the scope of his assigned task or that it
required. It is sufficient to establish that Filcar is the exercised the due diligence of a good father of a family
registered owner of the motor vehicle causing to prevent damage - because the motor vehicle
damage in order that it may be held vicariously liable registration law, to a certain extent, modified Article 2180
under Article 2180 of the Civil Code. of the Civil Code by making these defenses unavailable
to the registered owner of the motor vehicle.1awp+
Rationale for holding the registered owner vicariously +i1 Thus, for as long as Filcar is the registered owner of
liable the car involved in the vehicular accident, it could not
escape primary liability for the damages caused to
Espinas.
The rationale for the rule that a registered owner is
vicariously liable for damages caused by the operation of
his motor vehicle is explained by the principle behind The public interest involved in this case must not be
motor vehicle registration, which has been discussed by underestimated. Road safety is one of the most common
this Court in Erezo, and cited by the CA in its decision: problems that must be addressed in this country. We are
not unaware of news of road accidents involving
reckless drivers victimizing our citizens. Just recently,
The main aim of motor vehicle registration is to identify
such pervasive recklessness among most drivers took
the owner so that if any accident happens, or that any
the life of a professor of our state university.14 What is
damage or injury is caused by the vehicle on the public
most disturbing is that our existing laws do not seem to
highways, responsibility therefor can be fixed on a
deter these road malefactors from committing acts of
definite individual, the registered owner. Instances are
recklessness.
numerous where vehicles running on public highways
caused accidents or injuries to pedestrians or other
vehicles without positive identification of the owner or We understand that the solution to the problem does not
drivers, or with very scant means of identification. It is to stop with legislation. An effective administration and
forestall these circumstances, so inconvenient or enforcement of the laws must be ensured to reinforce
prejudicial to the public, that the motor vehicle discipline among drivers and to remind owners of motor
registration is primarily ordained, in the interest of the vehicles to exercise due diligence and vigilance over the
determination of persons responsible for damages or acts of their drivers to prevent damage to others.
injuries caused on public highways. [emphasis ours]
Thus, whether the driver of the motor vehicle,
Thus, whether there is an employer-employee Floresca, is an employee of Filcar is irrelevant in
relationship between the registered owner and the driver arriving at the conclusion that Filcar is primarily and
is irrelevant in determining the liability of the registered directly liable for the damages sustained by Espinas.
owner who the law holds primarily and directly While Republic Act No. 4136 or the Land Transportation
responsible for any accident, injury or death caused by and Traffic Code does not contain any provision on the
the operation of the vehicle in the streets and highways. liability of registered owners in case of motor vehicle
mishaps, Article 2176, in relation with Article 2180, of the
Civil Code imposes an obligation upon Filcar, as
As explained by this Court in Erezo, the general public
registered owner, to answer for the damages caused to
policy involved in motor vehicle registration is the
Espinas’ car. This interpretation is consistent with the
protection of innocent third persons who may have no
strong public policy of maintaining road safety, thereby
means of identifying public road malefactors and,
reinforcing the aim of the State to promote the
therefore, would find it difficult – if not impossible – to
responsible operation of motor vehicles by its citizens.
seek redress for damages they may sustain in accidents
resulting in deaths, injuries and other damages; by fixing
the person held primarily and directly liable for the This does not mean, however, that Filcar is left without
damages sustained by victims of road mishaps, the law any recourse against the actual employer of the driver
ensures that relief will always be available to them. and the driver himself. Under the civil law principle of
unjust enrichment, the registered owner of the motor
vehicle has a right to be indemnified by the actual
To identify the person primarily and directly responsible
employer of the driver of the amount that he may be
for the damages would also prevent a situation where a
required to pay as damages for the injury caused to
registered owner of a motor vehicle can easily escape
another.
liability by passing on the blame to another who may
have no means to answer for the damages caused,
thereby defeating the claims of victims of road accidents. The set-up may be inconvenient for the registered owner
We take note that some motor vehicles running on our of the motor vehicle, but the inconvenience cannot
roads are driven not by their registered owners, but by outweigh the more important public policy being
employed drivers who, in most instances, do not have advanced by the law in this case which is the protection
the financial means to pay for the damages caused in of innocent persons who may be victims of reckless
case of accidents. drivers and irresponsible motor vehicle owners.

These same principles apply by analogy to the case at WHEREFORE, the petition is DENIED. The decision
bar. Filcar should not be permitted to evade its liability dated February 16, 2006 and the resolution dated July 6,
for damages by conveniently passing on the blame to 2006 of the Court of Appeals are AFFIRMED. Costs
another party; in this case, its Corporate Secretary, Atty. against petitioner Filcar Transport Services.
Flor and his alleged driver, Floresca. Following our
reasoning in Equitable, the agreement between Filcar
and Atty. Flor to assign the motor vehicle to the latter
does not bind Espinas who was not a party to and has
no knowledge of the agreement, and whose only
recourse is to the motor vehicle registration.
G.R. No. 170631, February 10, 2016 damages in favor of Abejar, as follows:
chanRoblesvirtualLawlibrary
CARAVAN TRAVEL AND TOURS INTERNATIONAL,
INC., Petitioner, v. ERMILINDA R. WHEREFORE, considering that the [respondent] was
ABEJAR, Respondent. able to provide by preponderance of evidence her cause
of action against the defendants, judgment is hereby
DECISION rendered ordering defendants JIMMY BAUTISTA and
CARAVAN TRAVEL and TOURS[,] INC., to jointly and
solidarity pay the plaintiff, the following, to wit:
LEONEN, J.:
chanRoblesvirtualLawlibrary
1. The amount of P35,000.00 representing actual
The plaintiff may first prove the employer's ownership of damages;
the vehicle involved in a mishap by presenting the
vehicle's registration in evidence. Thereafter, a 2. The amount of P300,000.00 as moral damages;
disputable presumption that the requirements for an
employer's liability under Article 21801 of the Civil Code 3. The amount of P30,000.00 as exemplary damages;
have been satisfied will arise. The burden of evidence
then shifts to the defendant to show that no liability 4. The amount of P50,000.00 as and by way of
under Article 2180 has ensued. This case, thus, attorney's fees; and
harmonizes the requirements of Article 2180, in relation
to Article 21762 of the Civil Code, and the so-called 5. The cost of suit.
registered-owner rule as established in this court's SO ORDERED.31ChanRoblesVirtualawlibrary
rulings in Aguilar, Sr. v. Commercial Savings Bank,3Del
Carmen, Jr. v. Bacoy,4Filcar Transport Services v. Caravan's Motion for Reconsideration32 was denied
Espinas,5 and Mendoza v. Spouses Gomez.6 through the October 20, 2003 Order33 of the Regional
Trial Court.
Through this Petition for Review on Certiorari,7 Caravel
Travel and Tours International, Inc. (Caravan) prays that The Court of Appeals affirmed with modification the
the Decision8 dated October 3, 2005 and the Regional Trial Court's July 31, 2003 Decision and
Resolution9 dated November 29, 2005 of the Court of October 20, 2003 Order, as follows:
Appeals Twelfth Division be reversed and set aside.10 chanRoblesvirtualLawlibrary
WHEREFORE, premises considered, the instant appeal
On July 13, 2000, Jesmariane R. Reyes (Reyes) was is DENIED for lack of merit. The assailed Decision dated
walking along the west-bound lane of Sampaguita 31 July 2003 and Order dated 20 October 2003 of the
Street, United Parañaque Subdivision IV, Parañaque Regional Trial Court, City of Para[ñ]aque, Branch 258, in
City.11 A Mitsubishi L-300 van with plate number PKM Civil Case No. 00-0447 are AFFIRMED with the
19512 was travelling along the east-bound lane, opposite following MODIFICATIONS:
Reyes.13 To avoid an incoming vehicle, the van swerved
to its left and hit Reyes.14 Alex Espinosa (Espinosa), a 1. Moral Damages is REDUCED to Php
witness to the accident, went to her aid and loaded her 200,000.00;
in the back of the van.15 Espinosa told the driver of the
van, Jimmy Bautista (Bautista), to bring Reyes to the 2. Death Indemnity of Php 50,000.00 is awarded;
hospital.16 Instead of doing so, Bautista appeared to
have left the van parked inside a nearby subdivision with 3. The Php 35,000.00 actual damages, Php
Reyes still in the van.17 Fortunately for Reyes, an 200,000.00 moral damages, Php 30,000.00
unidentified civilian came to help and drove Reyes to the exemplary damages and Php 50,000.00
hospital.18 attorney's fees shall earn interest at the rate of
6% per annum computed from 31 July 2003, the
Upon investigation, it was found that the registered date of the [Regional Trial Court's] decision; and
owner of the van was Caravan.19 Caravan is a upon finality of this Decision, all the amounts
corporation engaged in the business of organizing due shall earn interest at the rate of 12% per
travels and tours.20 Bautista was Caravan's annum, in lieu of 6% per annum, until full
employee assigned to drive the van as its service payment; and
driver.21
4. The Php 50,000.00 death indemnity shall earn
Caravan shouldered the hospitalization expenses of interest at the rate of 6% per annum computed
Reyes.22 Despite medical attendance, Reyes died two from the date of promulgation of this Decision;
(2) days after the accident.23 and upon finality of this Decision, the amount
due shall earn interest at the rate of 12% per
Respondent Ermilinda R. Abejar (Abejar), Reyes' annum, in lieu of 6% per annum, until full
paternal aunt and the person who raised her since she payment.
was nine (9) years old,24 filed before the Regional Trial
Court of Parañaque a Complaint25 for damages against Costs against [Caravan].
Bautista and Caravan. In her Complaint, Abejar alleged
that Bautista was an employee of Caravan and that SO ORDERED.34ChanRoblesVirtualawlibrary
Caravan is the registered owner of the van that hit Caravan filed a Motion for Reconsideration, but it was
Reyes.26 denied in the Court of Appeals' assailed November 29,
2005 Resolution.35
Summons could not be served on Bautista.27 Thus,
Abejar moved to drop Bautista as a defendant.28 The Hence, this Petition was filed.
Regional Trial Court granted her Motion.29
Caravan argues that Abejar has no personality to bring
After trial, the Regional Trial Court found that Bautista this suit because she is not a real party in interest.
was grossly negligent in driving the vehicle.30 It awarded
According to Caravan, Abejar does not exercise legal or Reyes' death was caused by the negligence of petitioner
substitute parental authority. She is also not the judicially and its driver; and that Reyes' death caused her
appointed guardian or the only living relative of the damage.54 Respondent properly filed an action based on
deceased.36 She is also not "the executor or quasi-delict. She is a real party in interest.
administrator of the estate of the deceased."37 According
to Caravan, only the victim herself or her heirs can Rule 3, Section 2 of the 1997 Rules of Civil Procedure
enforce an action based on culpa aquiliana such as defines a real party in interest:
Abejar's action for damages.38 chanRoblesvirtualLawlibrary
RULE 3. Parties to Civil Actions
Caravan adds that Abejar offered no documentary or
testimonial evidence to prove that Bautista, the driver, . . . .
acted "within the scope of his assigned tasks"39 when the
accident occurred.40 According to Caravan, Bautista's SECTION 2. Parties in Interest. — A real party in interest
tasks only pertained to the transport of company is the party who stands to be benefited or injured by the
personnel or products, and when the accident occurred, judgment in the suit, or the party entitled to the avails of
he had not been transporting personnel or delivering the suit. Unless otherwise authorized by law or these
products of and for the company.41 Rules, every action must be prosecuted or defended in
the name of the real party in interest.
Caravan also argues that "it exercised the diligence of a "To qualify a person to be a real party in interest in
good father of a family in the selection and supervision whose name an action must be prosecuted, he [or she]
of its employees."42 must appear to be the present real owner of the right
sought to be enforced."55 Respondent's capacity to file a
Caravan further claims that Abejar should not have been complaint against petitioner stems from her having
awarded moral damages, actual damages, death exercised substitute parental authority over Reyes.
indemnity, exemplary damages, and attorney's fees.43 It
questions the Certificate provided by Abejar as proof of Article 216 of the Family Code identifies the persons
expenses since its signatory, a certain Julian Peñaloza who exercise substitute parental authority:
(Peñaloza), was not presented in court, and Caravan chanRoblesvirtualLawlibrary
was denied the right to cross-examine him.44 Caravan Art. 216. In default of parents or a judicially appointed
argues that the statements in the Certification constitute guardian, the following persons shall exercise substitute
hearsay.45 It also contends that based on Article parental authority over the child in the order indicated:
2206(3)46 of the Civil Code, Abejar is not entitled to
moral damages.47 It insists that moral and exemplary (1) The surviving grandparent, as provided in Art. 214;56
damages should not have been awarded to Abejar
because Caravan acted in good faith.48 Considering that (2) The oldest brother or sister, over twenty-one years of
moral and exemplary damages are unwarranted, age, unless unfit or disqualified; and
Caravan claims that the award of attorney's fees should
have also been removed.49 (3) The child's actual custodian, over twenty-one years
of age, unless unfit or disqualified.
Lastly, Caravan argues that it should not be held
solidarily liable with Bautista since Bautista was already Whenever the appointment or a judicial guardian over
dropped as a party.50 the property of the child becomes necessary, the same
order of preference shall be observed. (Emphasis
Abejar counters that Caravan failed to provide proof that supplied)
it exercised the requisite diligence in the selection and
supervision of Bautista.51 She adds that the Court of Article 233 of the Family Code provides for the extent of
Appeals' ruling that Caravan is solidarily liable with authority of persons exercising substitute parental
Bautista for moral damages, exemplary damages, civil authority, that is, the same as those of actual parents:
indemnity ex delicto, and attorney's fees should be
upheld.52 Abejar argues that since Caravan is the Art. 233. The person exercising substitute parental
registered owner of the van, it is directly, primarily, and authority shall have the same authority over the person
solidarity liable for the tortious acts of its driver.53 of the child as the parents. (Emphasis supplied)
Both of Reyes' parents are already deceased.57 Reyes'
For resolution are the following issues: paternal grandparents are also both deceased.58 The
whereabouts of Reyes' maternal grandparents are
First, whether respondent Ermilinda R. Abejar is a real unknown.59 There is also no record that Reyes has
party in interest who may bring an action for damages brothers or sisters. It was under these circumstances
against petitioner Caravan Travel and Tours that respondent took custody of Reyes when she was a
International, Inc. on account of Jesmariane R. Reyes' child, assumed the role of Reyes' parents, and thus,
death; and exercised substitute parental authority over her.60 As
Reyes' custodian, respondent exercised the full extent of
Second, whether petitioner should be held liable as an the statutorily recognized rights and duties of a parent.
employer, pursuant to Article 2180 of the Civil Code. Consistent with Article 22061 of the Family Code,
respondent supported Reyes' education62 and provided
We deny the Petition. for her personal needs.63 To echo respondent's words in
her Complaint, she treated Reyes as if she were her own
I daughter.64

Having exercised substitute parental authority, Respondent's right to proceed against petitioner,
respondent suffered actual loss and is, thus, a real therefore, is based on two grounds.
party in interest in this case.
First, respondent suffered actual personal loss. With her
In her Complaint, respondent made allegations that affinity for Reyes, it stands to reason that when Reyes
would sustain her action for damages: that she died, respondent suffered the same anguish that a
exercised substitute parental authority over Reyes; that
natural parent would have felt upon the loss of one's and 2180 read:
child. It is for this injury — as authentic and personal as chanRoblesvirtualLawlibrary
that of a natural parent — that respondent seeks to be ARTICLE 2176. Whoever by act or omission causes
indemnified. damage to another, there being fault or negligence, is
obliged to pay for the damage done. Such fault or
Second, respondent is capacitated to do what Reyes' negligence, if there is no pre-existing contractual relation
actual parents would have been capacitated to do. between the parties, is called a quasi-delict and is
governed by the provisions of this Chapter.
In Metro Manila Transit Corporation v. Court of
Appeals,65Tapdasan, Jr. v. People,66 and Aguilar, Sr. v. . . . . .
Commercial Savings Bank,67 this court allowed natural
parents of victims to recover damages for the death of ARTICLE 2180. The obligation imposed by article 2176
their children. Inasmuch as persons exercising substitute is demandable not only for one's own acts or omissions,
parental authority have the full range of competencies of but also for those of persons for whom one is
a child's actual parents, nothing prevents persons responsible.
exercising substitute parental authority from similarly
possessing the right to be indemnified for their ward's The father and, in case of his death or incapacity, the
death. mother, are responsible for the damages caused by the
minor children who live in their company.
We note that Reyes was already 18 years old when she
died. Having reached the age of majority, she was Guardians are liable for damages caused by the minors
already emancipated upon her death. While parental or incapacitated persons who are under their authority
authority is terminated upon emancipation,68 respondent and live in their company.
continued to support and care for Reyes even after she
turned 18.69 Except for the legal technicality of Reyes' The owners and managers of an establishment or
emancipation, her relationship with respondent remained enterprise are likewise responsible for damages caused
the same. The anguish and damage caused to by their employees in the service of the branches in
respondent by Reyes' death was no different because of which the latter are employed or on the occasion of their
Reyes' emancipation. functions.

In any case, the termination of respondent's parental Employers shall be liable for the damages caused
authority is not an insurmountable legal bar that by their employees and household helpers acting
precludes the filing of her Complaint. In interpreting within the scope of their assigned tasks, even
Article 190270 of the old Civil Code, which is substantially though the former are not engaged in any business
similar to the first sentence of Article 217671 of the Civil or industry.
Code, this court in The Receiver For North Negros
Sugar Company, Inc. v. Ybañez, et al. 72 ruled that The State is responsible in like manner when it acts
brothers and sisters may recover damages, except through a special agent; but not when the damage has
moral damages, for the death of their sibling. 73 This court been caused by the official to whom the task done
declared that Article 1902 of the old Civil Code (now properly pertains, in which case what is provided in
Article 2176) is broad enough to accommodate even article 2176 shall be applicable.
plaintiffs who are not relatives of the deceased, thus:74
This Court said: "Article 1902 of the Civil Code declares Lastly, teachers or heads of establishments of arts and
that any person who by an act or omission, trades shall be liable for damages caused by their pupils
characterized by fault or negligence, causes damage to and students or apprentices, so long as they remain in
another shall be liable for the damage done ... a person their custody.
is liable for damage done to another by any culpable act;
and by any culpable act is meant any act which is The responsibility treated of in this article shall cease
blameworthy when judged by accepted legal standards. when the persons herein mentioned prove that they
The idea thus expressed is undoubtedly broad enough observed all the diligence of a good father of a family to
to include any rational conception of liability for the prevent damage. (Emphasis supplied)
tortious acts likely to be developed in any society." The
word "damage" in said article, comprehending as it does Contrary to petitioner's position, it was not fatal to
all that are embraced in its meaning, includes any and all respondent's cause that she herself did not adduce
damages that a human being may suffer in any and all proof that Bautista acted within the scope of his
the manifestations of his life: physical or material, moral authority. It was sufficient that Abejar proved that
or psychological, mental or spiritual, financial, economic, petitioner was the registered owner of the van that
social, political, and religious. hit Reyes.

It is particularly noticeable that Article 1902 stresses the The resolution of this case must consider two (2) rules.
passive subject of the obligation to pay damages caused First, Article 2180's specification that "[e]mployers shall
by his fault or negligence. The article does not limit or be liable for the damages caused by their
specify the active subjects, much less the relation that employees . . . acting within the scope of their assigned
must exist between the victim of the culpa aquiliana and tasks[.]" Second, the operation of the registered-owner
the person who may recover damages, thus warranting rule that registered owners are liable for death or injuries
the inference that, in principle, anybody who suffers any caused by the operation of their vehicles.76
damage from culpa aquiliana,  whether a relative or not
of the victim, may recover damages from the person These rules appear to be in conflict when it comes to
responsible therefor[.]75 (Emphasis supplied, citations cases in which the employer is also the registered owner
omitted) of a vehicle. Article 2180 requires proof of two things:
II first, an employment relationship between the driver
and the owner; and second, that the driver acted
Respondent's Complaint is anchored on an employer's within the scope of his or her assigned tasks. On the
liability for quasi-delict provided in Article 2180, in other hand, applying the registered-owner rule only
relation to Article 2176 of the Civil Code. Articles 2176 requires the plaintiff to prove that the defendant-
employer is the registered owner of the vehicle. bank's assistant vice-president Ferdinand Borja, hit
Conrado Aguilar, Jr. The impact killed Conrado Aguilar,
The registered-owner rule was articulated as early as Jr. His father, Conrado Aguilar, Sr. filed a case for
1957 in Erezo, et al. v. Jepte,77 where this court damages against Ferdinand Borja and Commercial
explained that the registration of motor vehicles, as Savings Bank. The Regional Trial Court found
required by Section 5(a)78 of Republic Act No. 4136, Commercial Savings Bank solidarity liable with
the Land Transportation and Traffic Code, was Ferdinand Borja.89
necessary "not to make said registration the
operative act by which ownership in vehicles is However, the Court of Appeals disagreed with the trial
transferred, . . . but to permit the use and operation court's Decision and dismissed the complaint against the
of the vehicle upon any public highway[.]"79 Its bank. The Court of Appeals reasoned that Article 2180
"main aim . . . is to identify the owner so that if any requires the plaintiff to prove that at the time of the
accident happens, or that any damage or injury is accident, the employee was acting within the scope of
caused by the vehicle on the public highways, his or her assigned tasks. The Court of Appeals found
responsibility therefor can be fixed on a definite no evidence that Ferdinand Borja was acting as the
individual, the registered owner."80 bank's assistant vice-president at the time of the
accident.90
Erezo notwithstanding, Castilex Industrial Corporation v.
Vasquez, Jr.81 relied on Article 2180 of the Civil Code The Court of Appeals' ruling was reversed by this
even though the employer was also the registered owner court.91Aguilar, Sr. reiterated the following
of the vehicle.82 The registered-owner rule was not pronouncements made in Erezo in ruling that the
mentioned. bank, as the registered owner of the vehicle, was
primarily liable to the plaintiff:92
In Castilex, Benjamin Abad (Abad) was a manager of The main aim of motor vehicle registration is to identify
Castilex Industrial Corporation (Castilex). Castilex was the owner so that if any accident happens, or that any
also the registered owner of a Toyota Hi-Lux pick-up damage or injury is caused by the vehicle on the public
truck. While Abad was driving the pick-up truck, it highways, responsibility therefor can be fixed on a
collided with a motorcycle driven by Romeo Vasquez definite individual, the registered owner....
(Vasquez). Vasquez died a few days after. Vasquez's
parents filed a case for damages against Abad and ....
Castilex.83 Castilex denied liability, arguing that Abad
was acting in his private capacity at the time of the A victim of recklessness on the public highways is
accident.84 usually without means to discover or identify the person
actually causing the injury or damage. He has no means
This court absolved Castilex of liability, reasoning that it other than by a recourse to the registration in the Motor
was incumbent upon the plaintiff to prove that the Vehicles Office to determine who is the owner. The
negligent employee was acting within the scope of his protection that the law aims to extend to him would
assigned tasks.85 Vasquez's parents failed to prove become illusory were the registered owner given the
this.86 This court outlined the process necessary for an opportunity to escape liability by disproving his
employer to be held liable for the acts of its employees ownership.93ChanRoblesVirtualawlibrary
and applied the process to the case: Thus, Aguilar, Sr. concluded:
chanRoblesvirtualLawlibrary
Under the fifth paragraph of Article 2180, whether or In our view, respondent bank, as the registered owner of
not engaged in any business or industry, an the vehicle, is primarily liable for Aguilar, Jr.'s death. The
employer is liable for the torts committed by Court of Appeals erred when it concluded that the bank
employees within the scope of his assigned tasks. was not liable simply because (a) petitioner did not
But it is necessary to establish the employer- prove that Borja was acting as the bank's vice president
employee relationship; once this is done, the at the time of the accident; and (b) Borja had, according
plaintiff must show, to hold the employer liable, that to respondent bank, already bought the car at the time of
the employee was acting within the scope of his the mishap. For as long as the respondent bank
assigned task when the tort complained of was remained the registered owner of the car involved in the
committed. It is only then that the employer may find vehicular accident, it could not escape primary liability
it necessary to interpose the defense of due for the death of petitioner's son.94 (Emphasis supplied)
diligence in the selection and supervision of the Preference for the registered-owner rule became more
employee. pronounced in Del Carmen, Jr. v. Bacoy:95
Without disputing the factual finding of the [Court of
. . . . Appeals] that Allan was still his employee at the time of
the accident, a finding which we see no reason to
Since there is paucity of evidence that ABAD was acting disturb, Oscar Jr. contends that Allan drove the jeep in
within the scope of the functions entrusted to him, his private capacity and thus, an employer's vicarious
petitioner CASTILEX had no duty to show that it liability for the employee's fault under Article 2180 of the
exercised the diligence of a good father of a family in Civil Code cannot apply to him.
providing ABAD with a service vehicle. Thus, justice and
equity require that petitioner be relieved of vicarious The contention is no longer novel. In Aguilar Sr. v.
liability for the consequences of the negligence of ABAD Commercial Savings Bank, the car of therein respondent
in driving its vehicle. (Emphasis supplied, citations bank caused the death of Conrado Aguilar, Jr. while
omitted)87ChanRoblesVirtualawlibrary being driven by its assistant vice president. Despite
Article 2180, we still held the bank liable for damages for
Aguilar, Sr. v. Commercial Savings Bank recognized the the accident as  said provision should defer to the
seeming conflict between Article 2180 and the settled doctrine concerning accidents involving
registered-owner rule and applied the latter.88 registered motor vehicles, i.e., that the registered
owner of any vehicle, even if not used for public service,
In Aguilar, Sr., a Mitsubishi Lancer, registered in the would primarily be responsible to the public or to third
name of Commercial Savings Bank and driven by the persons for injuries caused the latter while the vehicle
was being driven on the highways or streets. We have
already ratiocinated that: 2180 have been proven. As a consequence, the burden
chanRoblesvirtualLawlibrary of proof shifts to the defendant to show that no liability
The main aim of motor vehicle registration is to identify under Article 2180 has arisen.
the owner so that if any accident happens, or that any
damage or injury is caused by the vehicle on the public This disputable presumption, insofar as the registered
highways, responsibility therefor can be fixed on a owner of the vehicle in relation to the actual driver is
definite individual, the registered owner. Instances are concerned, recognizes that between the owner and the
numerous where vehicles running on public highways victim, it is the former that should carry the costs of
caused accidents or injuries to pedestrians or other moving forward with the evidence. The victim is, in many
vehicles without positive identification of the owner or cases, a hapless pedestrian or motorist with hardly any
drivers, or with very scant means of identification. It is to means to uncover the employment relationship of the
forestall these circumstances, so inconvenient or owner and the driver, or any act that the owner may
prejudicial to the public, that the motor vehicle have done in relation to that employment.
registration is primarily ordained, in the interest of the
determination of persons responsible for damages or The registration of the vehicle, on the other hand, is
injuries caused on public highways.96 (Emphasis accessible to the public.
supplied, citations omitted)
Here, respondent presented a copy of the Certificate
Filcar Transport Services v. Espinas 97 stated that the of Registration105 of the van that hit Reyes. 106 The
registered owner of a vehicle can no longer use the Certificate attests to petitioner's ownership of the
defenses found in Article 2180:98 van. Petitioner itself did not dispute its ownership of
the van. Consistent with the rule we have just stated,
Neither can Filcar use the defenses available under a presumption that the requirements of Article 2180
Article 2180 of the Civil Code - that the employee acts have been satisfied arises. It is now up to petitioner
beyond the scope of his assigned task or that it to establish that it incurred no liability under Article
exercised the due diligence of a good father of a family 2180. This it can do by presenting proof of any of the
to prevent damage - because the motor vehicle following: first, that it had no employment
registration law, to a certain extent, modified Article 2180 relationship with Bautista; second, that Bautista
of the Civil Code by making these defenses unavailable acted outside the scope of his assigned tasks; or
to the registered owner of the motor vehicle. Thus, for as third, that it exercised the diligence of a good father
long as Filcar is the registered owner of the car involved of a family in the selection and supervision of
in the vehicular accident, it could not escape primary Bautista.107
liability for the damages caused to
Espinas.99ChanRoblesVirtualawlibrary On the first, petitioner admitted that Bautista was its
Mendoza v. Spouses Gomez100 reiterated this doctrine. employee at the time of the accident.108

However, Aguilar, Sr., Del Carmen, Filcar, On the second, petitioner was unable to prove that
and Mendoza should not be taken to mean that Article Bautista was not acting within the scope of his assigned
2180 of the Civil Code should be completely discarded in tasks at the time of the accident. When asked by the
cases where the registered-owner rule finds application. court why Bautista was at the place of the accident when
it occurred, Sally Bellido, petitioner's accountant and
As acknowledged in Filcar, there is no categorical supervisor,109 testified that she did not "have the
statutory pronouncement in the Land Transportation and personal capacity to answer [the question]"110 and that
Traffic Code stipulating the liability of a registered she had no knowledge to answer it:
owner.101 The source of a registered owner's liability is chanRoblesvirtualLawlibrary
not a distinct statutory provision, but remains to be COURT : Madam Witness, do you know the reason
Articles 2176 and 2180 of the Civil Code: why your driver, Jimmy Bautista, at
chanRoblesvirtualLawlibrary\ around 10:00 o' clock in the morning of
July 13, 2000 was in the vicinity of
While Republic Act No. 4136 or the Land Barangay Marcelo Green, United
Transportation and Traffic Code does not contain Parañaque Subdivision 4?
any provision on the liability of registered owners in
case of motor vehicle mishaps, Article 2176, in WITNESS : I don't have the personal capacity to
relation with Article 2180, of the Civil Code imposes answer that, Sir.
an obligation upon Filcar, as registered owner, to
answer for the damages caused to Espinas' Q : So you don't have any knowledge why he
car.102ChanRoblesVirtualawlibrary was there?
A : Yes, Sir.111 (Emphasis supplied)
Thus, it is imperative to apply the registered-owner rule
in a manner that harmonizes it with Articles 2176 and Sally Bellido's testimony does not affect the presumption
2180 of the Civil Code. Rules must be construed in a that Article 2180's requirements have been satisfied.
manner that will harmonize them with other rules so as Mere disavowals are not proof that suffice to overturn a
to form a uniform and consistent system of presumption. To this end, evidence must be adduced.
jurisprudence.103 In light of this, the words used in Del However, petitioner presented no positive evidence to
Carmen are particularly notable. There, this court show that Bautista was acting in his private capacity at
stated that Article 2180 "should defer to"104 the the time of the incident.
registered-owner rule. It never stated that Article
2180 should be totally abandoned. On the third, petitioner likewise failed to prove that it
exercised the requisite diligence in the selection and
Therefore, the appropriate approach is that in cases supervision of Bautista.
where both the registered-owner rule and Article 2180
apply, the plaintiff must first establish that the employer In its selection of Bautista as a service driver, petitioner
is the registered owner of the vehicle in question. Once contented itself with Bautista's submission of a non-
the plaintiff successfully proves ownership, there arises professional driver's license.112 Hence, in Sally Balledo's
a disputable presumption that the requirements of Article
cross-examination: and supervision of employees may be deemed sufficient
chanRoblesvirtualLawlibrary and plausible, it is not enough to emptily invoke the
Q : . . . when he was promoted as service existence of said company guidelines and policies
driver, of course, there were certain on hiring and supervision. As the negligence of the
requirements and among other else, you employee gives rise to the presumption of negligence on
made mention about a driver's license. the part of the employer, the latter has the burden of
proving that it has been diligent not only in the selection
A : Yes, Sir. of employees but also in the actual supervision of their
work. The mere allegation of the existence of hiring
Q : Would you be able to show to this procedures and supervisory policies, without anything
Honorable Court whether indeed this person more, is decidedly not sufficient to overcome
did submit a driver's license to your presumption.
company?
A : Yes, Sir. We emphatically reiterate our holding, as a warning to all
employers, that "(t)he mere formulation of various
.... company policies on safety without showing that they
were being complied with is not sufficient to exempt
Q : Do you recall what kind of driver's license is petitioner from liability arising from negligence of its
this? employees. It is incumbent upon petitioner to show that
A : The Land Transportation Office. in recruiting and employing the erring driver the
recruitment procedures and company policies on
Q : Is it a professional driver's license or non- efficiency and safety were followed." Paying lip-service
proffesional [sic] driver's license? to these injunctions or merely going through the motions
of compliance therewith will warrant stern sanctions from
A : Non-professional.
the Court.116 (Emphasis supplied, citations omitted)
Q : You are not sure? For failing to overturn the presumption that the
requirements of Article 2180 have been satisfied,
COURT : Non professional, professional? petitioner must be held liable.
A : It's a non-professional.113 (Emphasis
III
supplied)
Employing a person holding a non-professional driver's Petitioner's argument that it should be excused from
license to operate another's motor vehicle violates liability because Bautista was already dropped as a party
Section 24 of the Land Transportation and Traffic Code, is equally unmeritorious. The liability imposed on the
which provides: registered owner is direct and primary.117 It does not
chanRoblesvirtualLawlibrary depend on the inclusion of the negligent driver in
SEC. 24. Use of driver's license and badge. — ... the action. Agreeing to petitioner's assertion would
render impotent the rationale of the motor
. . . . registration law in fixing liability on a definite
person.
No owner of a motor vehicle shall engage, employ, or
hire any person to operate such motor vehicle, unless Bautista, the driver, was not an indispensable party
the person sought to be employed is a duly licensed under Rule 3, Section 7118 of the 1997 Rules of Civil
professional driver. Procedure. Rather, he was a necessary party under
Evidently, petitioner did not only fail to exercise due Rule 3, Section 8.119 Instead of insisting that Bautista —
diligence when it selected Bautista as service driver; it who was nothing more than a necessary party — should
also committed an actual violation of law. not have been dropped as a defendant, or that
petitioner, along with Bautista, should have been
To prove that it exercised the required diligence in dropped, petitioner (as a co-defendant insisting that the
supervising Bautista, petitioner presented copies of action must proceed with Bautista as party) could have
several memoranda and company rules.114 These, opted to file a cross-claim against Bautista as its
however, are insufficient because petitioner failed to remedy.
prove actual compliance. Metro Manila Transit
Corporation v. Court of Appeals115 emphasized that to The 1997 Rules of Civil Procedure spell out the rules on
establish diligence in the supervision of employees, the joinder of indispensable and necessary parties. These
issuance of company policies must be coupled with are intended to afford "a complete determination of all
proof of compliance: possible issues, not only between the parties themselves
chanRoblesvirtualLawlibrary but also as regards to other persons who may be
Due diligence in the supervision of employees, on the affected by the judgment."120
other hand, includes the formulation of suitable rules
and regulations for the guidance of employees and the However, while an exhaustive resolution of disputes is
issuance of proper instructions intended for the desired in every case, the distinction between
protection of the public and persons with whom the indispensable parties and necessary parties delineates a
employer has relations through his or its employees and court's capacity to render effective judgment. As defined
the imposition of necessary disciplinary measures upon by Rule 3, Section 7, indispensable parties are "[p]arties
employees in case of breach or as may be warranted to in interest without whom no final determination can be
ensure the performance of acts indispensable to the had of an action[.]" Thus, their non-inclusion is
business of and beneficial to their employer. To this, we debilitating: "the presence of indispensable parties is a
add that actual implementation and monitoring condition for the exercise of juridical power and when an
of consistent compliance with said rules should be the indispensable party is not before the court, the action
constant concern of the employer, acting through should be dismissed."121
dependable supervisors who should regularly report on
their supervisory functions. In contrast, a necessary party's presence is not
imperative, and his or her absence is not debilitating.
In order that the defense of due diligence in the selection Nevertheless, it is preferred that they be included in
order that relief may be complete. It was respondent herself who identified the Certificate.
She testified that she incurred funeral expenses
The concept of indispensable parties, as against parties amounting to P35,000.00, that she paid this amount to
whose inclusion only allows complete relief, was Peñaloza, and that she was present when Peñaloza
explained in Arcelona v. Court of Appeals:122 signed the Certificate:
An indispensable party is a party who has such an chanRoblesvirtualLawlibrary
interest in the controversy or subject matter that a final [ATTY. Did you incur any expenses?
adjudication cannot be made, in his absence, without LIM] :
injuring or affecting that interest, a party who has not
only an interest in the subject matter of the controversy, A: Meron po.
but also has an interest of such nature that a final decree
cannot be made without affecting his interest or leaving Q: How much did you spend for the death of
the controversy in such a condition that its final Jesmarian [sic] Reyes?
determination may be wholly inconsistent with equity and A: 'Yun pong P35,000.00 na pagpapalibing at
good conscience. It has also been considered that an saka...
indispensable party is a person in whose absence there
cannot be a determination between the parties already Q: You said that you spent P35,000.00. Do you
before the court which is effective, complete, or have any evidence or proof that you spent that
equitable. Further, an indispensable party is one who amount?
must be included in an action before it may properly go
forward. A: Meron po.
Q: Showing to you this sort of certification. What
A person is not an indispensable party, however, if his relation has this...
interest in the controversy or subject matter is separable
from the interest of the other parties, so that it will not A: 'Yan po' yung contractor nagumawa.
necessarily be directly or injuriously affected by a decree
Q: Contractor of what?
which does complete justice between them. Also, a
person is not an indispensable party if his presence A: 'Yan po' yung mismong binilhan ko ng lupa at
would merely permit complete relief between him and nitso.
those already parties to the action, or if he has no
interest in the subject matter of the action. It is not a ....
sufficient reason to declare a person to be an
ATTY. There is a signature at the top of the printed
indispensable party that his presence will avoid multiple
LIM : name Julian Penalosa [sic]. Whose signature
litigation.123ChanRoblesVirtualawlibrary
is this?
Petitioner's interest and liability is distinct from that of its
driver. Regardless of petitioner's employer-employee A: 'Yan po' yung mismong contractor.
relationship with Bautista, liability attaches to petitioner
on account of its being the registered owner of a vehicle ....
that figures in a mishap. This alone suffices. A
Q: Did you see him sign this?
determination of its liability as owner can proceed
independently of a consideration of how Bautista A: Opo.128 (Emphasis supplied)
conducted himself as a driver. While certainly it is Respondent had personal knowledge of the facts sought
desirable that a determination of Bautista's liability be to be proved by the Certificate, i.e. that she spent
made alongside that of the owner of the van he was P35,000.00 for the funeral expenses of Reyes. Thus, the
driving, his non-inclusion in these proceedings does not Certificate that she identified and testified to is not
absolutely hamper a judicious resolution of respondent's hearsay. It was not an error to admit this Certificate as
plea for relief. evidence and basis for awarding P35,000.00 as actual
damages to respondent.
IV
The Court of Appeals likewise did not err in awarding
The Court of Appeals committed no reversible error civil indemnity and exemplary damages.
when it awarded actual damages to respondent.
Respondent's claim for actual damages was based on Article 2206 of the Civil Code provides:
the Certificate124 issued and signed by a certain chanRoblesvirtualLawlibrary
Peñaloza showing that respondent paid Peñaloza ARTICLE 2206. The amount of damages for death
P35,000.00 for funeral expenses. caused by a crime or quasi-delict shall be at least three
thousand pesos, even though there may have been
Contrary to petitioner's claim, this Certificate is not mitigating circumstances[.]
hearsay. Evidence is hearsay when its probative value is Further, Article 2231 of the Civil Code provides:
based on the personal knowledge of a person other than chanRoblesvirtualLawlibrary
the person actually testifying.125 Here, the Certificate ARTICLE 2231. In quasi-delicts, exemplary damages
sought to establish that respondent herself paid may be granted if the defendant acted with gross
Peñaloza P35,000.00 as funeral expenses for Reyes' negligence.
death:126 Both the Court of Appeals and the Regional Trial Court
found Bautista grossly negligent in driving the van and
3. Na ang aking kontrata ay nagkakahalaga ng concluded that Bautista's gross negligence was the
P35,000-00 [sic] sa lahat ng nagamit na proximate cause of Reyes' death. Negligence and
materiales at labor nito kasama ang lote na causation are factual issues.129 Findings of fact, when
ibinayad sa akin ni Gng. ERMILINDA REYES established by the trial court and affirmed by the Court of
ABEJAR na siyang aking kakontrata sa Appeals, are binding on this court unless they are
pagsasagawa ng naturang patently unsupported by evidence or unless the
paglilibingan.127 (Emphasis supplied) judgment is grounded on a misapprehension of
facts.130 Considering that petitioner has not presented
any evidence disputing the findings of the lower courts
regarding Bautista's negligence, these findings cannot of 6% per annum. No interest, however, shall be
be disturbed in this appeal. The evidentiary bases for the adjudged on unliquidated claims or damages,
award of civil indemnity and exemplary damages stand. except when or until the demand can be
As such, petitioner must pay the exemplary damages established with reasonable certainty.
arising from the negligence of its driver.131 For the same Accordingly, where the demand is established
reasons, the award of P50,000.00 by way of civil with reasonable certainty, the interest shall
indemnity is justified.132 begin to run from the time the claim is made
judicially or extrajudicially (Art. 1169, Civil
The award of moral damages is likewise proper. Code), but when such certainty cannot be so
reasonably established at the time the demand
Article 2206(3) of the Civil Code provides: is made, the interest shall begin to run only from
chanRoblesvirtualLawlibrary the date the judgment of the court is made (at
ARTICLE 2206. The amount of damages which time the quantification of damages may
for death caused by a crime or quasi-delict shall be at be deemed to have been reasonably
least three thousand pesos, even though there may ascertained). The actual base for the
have been mitigating circumstances. In addition: computation of legal interest shall, in any case,
be on the amount finally adjudged.
. . . .
  3. When the judgment of the court awarding a sum
(3) The spouse, legitimate and illegitimate descendants of money becomes final and executory, the rate
and ascendants of the deceased may demand moral of legal interest, whether the case falls under
damages for mental anguish by reason of the death paragraph 1 or paragraph 2, above, shall be 6%
of the deceased. (Emphasis supplied) per annum from such finality until its satisfaction,
this interim period being deemed to be by then
For deaths caused by quasi-delict, the recovery of moral an equivalent to a forbearance of
damages is limited to the spouse, legitimate and credit.146 (Emphasis supplied)
illegitimate descendants, and ascendants of the
deceased.133
WHEREFORE, the Decision of the Court of Appeals
Persons exercising substitute parental authority are to dated October 3, 2005 is AFFIRMED with the
be considered ascendants for the purpose of awarding following MODIFICATIONS: (a) actual damages in the
moral damages. Persons exercising substitute parental amount of P35,000.00 shall earn interest at the rate of
authority are intended to stand in place of a child's 6% per annum from the time it was judicially or
parents in order to ensure the well-being and welfare of extrajudicially demanded from petitioner Caravan Travel
a child.134 Like natural parents, persons exercising and Tours International, Inc. until full satisfaction; (b)
substitute parental authority are required to, among moral damages, exemplary damages, and attorney's
others, keep their wards in their company,135 provide for fees shall earn interest at the rate of 6% per annum from
their upbringing,136 show them love and affection,137 give the date of the Regional Trial Court Decision until full
them advice and counsel,138 and provide them with satisfaction; and (c) civil indemnity shall earn interest at
companionship and understanding.139 For their part, the rate of 6% per annum from the date of the Court of
wards shall always observe respect and obedience Appeals Decision until full satisfaction.
towards the person exercising parental authority.140 The
law forges a relationship between the ward and the SO ORDERED.cralawlawlibrary
person exercising substitute parental authority such that
the death or injury of one results in the damage or
prejudice of the other.

Moral damages are awarded to compensate the

claimant for his or her actual injury, and not to penalize
the wrongdoer.141 Moral damages enable the injured
party to alleviate the moral suffering resulting from the
defendant's actions.142 It aims to restore — to the extent
possible — "the spiritual status quo ante[.]"143

Given the policy underlying Articles 216 and 220 of the

Family Code as well as the purposes for awarding moral
damages, a person exercising substitute parental
authority is rightly considered an ascendant of the
deceased, within the meaning of Article 2206(3) of the
Civil Code. Hence, respondent is entitled to moral
damages.

As exemplary damages have been awarded and as

respondent was compelled to litigate in order to protect
her interests, she is rightly entitled to attorney's fees.144

However, the award of interest should be modified. This

modification must be consistent with Nacar v. Gallery
Frames,145 in which we ruled:
chanRoblesvirtualLawlibrary

2. When an obligation, not constituting a loan or

forbearance of money, is breached, an interest
on the amount of damages awarded may be
imposed at the discretion of the court at the rate
G.R. No. 205090, October 17, 2016
x x x x
GREENSTAR EXPRESS, INC. AND FRUTO L.
SAYSON, JR., Petitioners, v. UNIVERSAL ROBINA Plaintiff Fruto Sayson testified that on that fateful day, he
CORPORATION AND NISSIN UNIVERSAL ROBINA was driving the plaintiff passenger bus from Lucena City
CORPORATION, Respondent. going to Manila at a speed of more or less 60 kilometers
per hour when he met a vehicular accident at Barangay
San Agustin, Alaminos, Laguna. He saw from afar an L-
DECISION
300 UV coming from the shoulder going on the opposite
direction to Lucena City. Said vehicle was already near
DEL CASTILLO, J.: his bus when it (UV) managed to return to ifs proper
lane, then hit and swerved his vehicle.- "He tried to
This Petition for Review on Certiorari1 seeks to set aside; prevent the collision by swerving to the right but it was
a) the September 26, 2012 Decision2 of the Court of too late. As a result, the left front portion of the bus was
Appeals (CA) in CA-G.R. CV No, 96961 affirming the damaged while the front portion of the L-300 UV was
April 4, 2011 Decision3 of the Regional Trial Court (RTC) totally wrecked- He and his conductor, one.Mendoza,
of San Pedro, Laguna, Branch 31 in Civil Case No. SPL- managed to get but of the bug by forcibly opening the
0969; and b) the CA's December 28, 2012 automatic door which was also damaged due to the
Resolution4 denying herein petitioners' Motion for impact After getting out of the bus, he looked for the
Reconsideration.5chanrobleslaw driver of the L300 UV but he was informed by a
bystander that he was thrown in a canal arid already
Factual Antecedents dead. For fear of possible reprisals from bystanders as
experienced by most drivers involved in an accident, he
Petitioner Greenstar Express, Inc. (Grepistar) is a boarded smother bug owned by bis employer. Before he
domestic corporation engaged in the business of public left, he indorsed the matter to hip conductor and line
transportation, while petitioner Fruto L. Sayson, Jr. inspector. Thereafter, he reported to their office at San
(Sayson) is one of its bus drivers, Pedro, Laguna. He executed a statement on the same
day x x x and submitted the same to their operations
Respondents Universal Robina Corporation (URC) and department. He likewise testified that before the incident,
Nissin Universal Robina Corporation (NURC) are he was earning P700.00 to P900,00 a day on
domestic corporations engaged in the food business. commission basis and he drives 25 days in a month.
NURC is a subsidiary of URC. However, after the incident, he was not able to drive for
almost two months.
URC is the registered owner of a Mitsubishi L-300 van
with plate number WRN 403 (URC van).6chanrobleslaw On cross-examination, it was established that the
incident happened along the Maharlika Highway along
At about 6:50 a.m. on February 25, 2003, which was Kilometer 72. There were no structures near the site of
then a declared national holiday,7 petitioner's bus, the incident, The highway ha§ two lanes which can
which was then being driven toward the direction of accommodate the size of the bus about 3 meters wide
Manila by Sayson, collided head-on with the URC and a. light vehicle. He was bound for Manila and had
van, which was then being driven Quezon province- about ten passengers. He saw the L-300 UV on the
bound by NURC's Operations Manager, Renante shoulder of the opposite lane about 250 meters away
Bicomong (Bicomong). The incident occurred along Km. from, his bus while he was driving [at] a speed of 60
76, Maharlika Highway, Brgy. San Agustin, Alaminos, kilometers per hour. He did not sense any danger when
Laguna. Bicomong died on the spot, while the colliding he saw the vehicle from afar. He cannot drive fast as
vehicles sustained considerable damage. there were five vehicles ahead of his bus. When the L-
300 UV managed to return to it? proper lane coming
On September 23, 2003, petitioners filed a from the shoulder, it was heading directly towards his
Complaint8 against NURC to recover damages sustained direction, at a distance of more or less five, meters away
during the collision, premised on negligence. The case from his bus, He noticed that the L-300 UV was running
was docketed as Civil Case No. SPL-0969 and assigned at full speed as he saw dust clouds. "The point of impact
to Branch 31 of the RTC of San Pedro, Laguna, An happened on his lane. He tried to swerve his bus to
Amended Complaint9 was later filed, wherein URC was prevent the impact but lie admitted that at his speed, it
impleaded as additional defendant. was difficult for him to maneuver his vehicle

URC and NURC filed their respective Answers,10 where Investigator SPO3 Ernesto Marfori of the Alaminos
they particularly alleged and claimed lack of negligence Police Station testified that at about 7:00 in the morning,
on their part and on the part of Bicomong. he received a report from the Barangay Chairman of a
vehicular accident that occurred at Brgy. §an Agustin,
After the issues were joined, trial proceeded. During trial, Alaminos, Laguna. He proceeded to the site with SPO2
only Sayson was presented by petitioners as eyewitness Rolando Alias. Upon arrival at the scene of the accident,
to the collision. he attended to the victim, but found him dead inside the
L- 300 UV. He came to know later that he was Renante
Riding of the Regional Trial Court Bicomong. He immediately called up his office and
requested that funeral services for the dead man. be
On April 4, 2011, the RTC issued its Decision, which arranged. Thereafter, he photographed the damaged
decreed thus: vehicles (Exhibits "F" and sub-markings) and interviewed
some witnesses. He made a sketch depicting the
chanRoblesvirtualLawlibrary damages suffered by both vehicles (Exhibit "D-2"), the L-
300 IV at the front portion (Exhibit "D-4") while the bus at
During the trial on the merits, plaintiffs 11 presented five the left side of its front portion (Exhibit "D-3"). Based on
witnesses namely Josephine Gadiaza, Miguel Galvan, the sketch he prepared, the impact happened almost at
SPO3 Ernesto Marfori, Fruto Sayson and Lilia Morales. the right lane which was the bus lane (Exhibit "D-6"). He
likewise noticed some debris also found at the bus lane. going home to Calendaria (sic), Quezon on February 25,
He was able to interview the bus conductor and a fruit 2003 because he informed their daughter. He was on his
store owner in [sic] the names of Apolinar Devilla and way home when he met a vehicular-accident in
Virgilio Adao, He did not see the driver of the bus at the Alaminos. Laguna which claimed his life. She was
scene of the accident and he was told that he had left informed about the accident involving her husband by a
the place. Based on, his investigation, the possible high school friend who was also traveling to Quezon at
cause of the accident was the swerving to the left lane that time, She filed a criminal complaint at Alaminos,
[by] the driver of the L-300 UV which resulted in me Laguna but it was dismissed for reasons unknown to
encroaching of the bus' lane. He reduced bis findings her. She likewise filed a civil complaint for damages
into writing in a Report dated February 28, 2003 before the Regional Trial Court of Lucena City docketed
(Exhibits "D" and sub-markings). as Civil Case No. 2.103-135.

On cross-examination, the witness admitted that he was On cross-examination, she narrated that aside from the
not present when the vehicles collided. The entries he Toyota Corolla service of her husband, he would use the
made in the blotter report were mainly based on the L-300 UV whenever he had to bring bulky things home.
accounts of the witnesses he was able to interview who As far as she can recall, he used the L-300 UV about 5
however did not give their written statements. When he times.
arrived at the scene of the accident, the L-300 UV was
already on the shoulder of the road and it was totally After an evaluation of the foregoing testimonies and
wrecked. According to reports, the van spun around documentary evidence of the parties, the court had [sic]
when it was bit causing the metal scar found on the arrived at the following findings and conclusions:
road.
chanRoblesvirtualLawlibraryPlaintiff has no cause of
On the other hand, the defendants12 presented three action and cannot recover from the defendants even
witnesses: its employees Alexander Caoleng and John assuming that the direct and proximate cause of the
Legaspi and deceased Renante Bicomong's widow, accident was the negligence of the defendant's
Gloria Bicomgng, These witnesses were presented to employee Renato Bicomong.
prove that deceased Bicomong was acting in his
personal capacity when the mishap happened on Pursuant to Article 2184 of the New Civil Code, the
February 25, 2003 as that day had been declared an owner of a motor vehicle is solidarily liable with his driver
official holiday and the L-300 UV he was driving had not if at the time of the mishap, the owner was in the vehicle
been issued to him, among others. and by the use of due diligence could have presented
(sic) the misfortune; if the owner is not in the motor
Alexander Caoleng, HR. Manager of defendant NURC, vehicle, the provision of Article 2180 is applicable. The
testified that deceased Bicomong worked as the defendants being juridical persons, the first paragraph of
Operations Manager of defendant NURC until his death Article 2184 is obviously not applicable.
as evidenced by a Certificate of Employment dated
December 9, 2008 (Exhibit "I"), His last assignment was Under Article 2180, "employers shall be liable tor the
in First Cavite Industrial Estate (FCEB). He died in a damages caused by their employees and household
vehicular accident in Alaminos, Laguna on February 25, helpers acting within the scope of their assigned tasks,
2003 which was declared a holiday by virtue of even though the former are not engaged in any business
Proclamation No. 331 (Exhibit "2"). Despite having been or industry. "In other words, for the employer to be liable
issued his own service vehicle (Exhibits "3", "4" and "5"), for the damages caused by his employee, the latter must
he used the L-300 UV which was not officially issued to have caused the damage in the course of doing his
him but in the name of Florante Soro-Soro, defendant assigned tasks or in the-performance of his duties"
NURC's Logistics Manager at that time (Exhibits "7" and (Yambao vs. Zuñiga, G.R. No: 146173, December 11,
"B"). The said vehicle was used mainly to transport items 2003)
coming from their office at Pasig to Cavite and vice
versa (Exhibit "9"). In this case, it is beyond cavil that the deceased
Renante Bicong [sic] was not in the performance of his
John Legaspi, Project Manager of defendant NURC, duty on that fateful day of February 25, 2003. In the first
testified that he was first assigned in its Cavite Plant in place that day was a holiday; there was no work and it
1999 with deceased Bicomaog as his immediate was not shown that he was working as indeed his work
supervisor being the Production Manager then. He last assignment is operations manager of the company's
saw him in the afternoon of February 24, 2003 at about plant m, Cavite while the accident happened while he
6:00 pm when they had a short chat He (Bicomong) was was in Alaminos, Laguna on his way home to
then transferring his things from his executive vehicle Candelaria, Quezon. Secondly, as an operations
which was a Toyota Corolla to the L-300 UY which was manager, he was issued an executive car for. Ms own
a company vehicle. He (Bicomong) shared that he would use, a Toyota Corolla vehicle and he merely preferred to
go home to Quezon Province the following day use the L-300 UV when going home to his family in
(February 25) to give money to his daughter. He knew Quezon. Even assuming that the company allowed or
that his trip to Quezon was not work-related as February tolerated this, by itself, the tolerance did not make, the
25, 2003 was declared a holiday. Besides, there exists employer liable in the absence of showing that he was
no plant owned by defendant NURC in the provinces of using the vehicle in the performance of a duty or within
Quezon, Laguna or Bicol as attested to by the General the scope of his assigned tasks. But as clearly relayed
Manager of defendant NURC in a Certification to that by defendant's witnesses, defendants have no business
effect (Exhibit "11"). or plant in Quezen. The L-300 vehicle was for the
hauling of items between their Pasig and Cavite offices
On cross-examination, he distinguished the use of an and was merely borrowed by Bicomong in going to
executive vehicle assigned to an executive officer for his Candelaria, Quezon on that day.
personal use and the company vehicle which was
supposed to be for official use only. The accident having occurred outside Remnte
Bicomong's assigned tasks, defendant employers cannot
Finally, Gloria Bicomong, widow of deceased Reynante be held liable to the plaintiffs, even assuming that it is
Bicomong testified that she knew that her husband was the fault of defendants' employee that was the direct and
proximate cause of their damages. evidence that the direct and proximate cause of the
collision was the fault of plaintiffs driver. Hence, they
However, the question of whose fault or negligence was cannot hold plaintiffs liable for the logs of their L-300 UV.
the direct and proximate cause of the mishap is material As both parties failed to prove by their respective
to the resolution of defendants' counterclaim. evidence where the fault that occasioned their losses lie,
they must bear their respective losses.
The rule is that the burden of proof lies on him who
claims a fact (Federico Ledesina vs. NLRC, G.R. No. Anent defendants' counterclaim for attorney's fees and
175585, October 19,2007). Therefore, to be able to exemplary damages, there is no evidence to show that
recover in their counterclaim, the defendants must prove the filing, of this suit was motivated [by] malice. It cannot
by preponderance of evidence that the direct and be denied that plaintiffs suffered damages. The court
proximate cause of their losses was the fault of the mainly, dismissed the complaint for lack of cause of
plaintiff-driver. action as Renante Bicomong was not performing his
assigned tasks at the time of the incident. Besides, to
Defendants were not able to present any witness as to hold them liable to defendants for attorney's fees and
how the mishap occurred Their witnesses were limited to exemplary damages simply because they failed to come
proving that Renante Bicomong was not in the up with sufficient evidence will be tantamount to putting
performance of his assigned task when the incident a price on one's right to sue.
happened.
WHEREFORE, judgment is hereby rendered dismissing
A reading of their answer would reveal, that their the complaint as well as the counterclaim.
attribution of fault to the plaintiff-driver is based only on
the point of impact of the two vehicles. Thus: No costs.

chanRoblesvirtualLawlibrary SO ORDERED.13
'4.3 Based on the damage sustained by the passenger Ruling of the Court of Appeals
bus, plaintiffs' claim that Renante Bicomong swerved on
the left lane and encroached on the path of the said bus Petitioners filed an appeal before the CA, docketed as
moments before the accident could not have been true. CA-G.R. CV No. 96961. They argued that Bicomong's
Such claim would have resulted to a head-on collision negligence was the proximate cause of the collision, as
between the vehicle driven by Mr. Bicomong and the the van he was 4rjvmg swerved to the opposite lane and
bus; the latter would have sustained damage on its front hit the bus which was then traveling along its proper
side. However, based on Annexes "B" and "C" of the lane; that Bicomong's act of occupying the bus's lane
Complaint, the. said bus sustained damage on its left was illegal and thus constituted a traffic violation; that
side. Clearly, it was the passenger bus that swerved on respondents are liable for damages as the registered
the left lane, which was being traversed by Renante owner of the van and failing to exercise due diligence in
Bicomong, and while returning to the right lane, said bus the selection and supervision of its employee, Bicomong,
hit the vehicle being driven by Mr. Bicomong. Thus, Respondents, countered that the bus driven by Sayson
explaining the damage sustained by the said bus on its was running at high speed when the, collision occurred,
left side just below the driver's seat.' thus indicating that Sayson was in violation of traffic
rules; and that Say-son had the last clear chance to
The foregoing however is a mere interpretation or avert collision but he failed to take the necessary
speculation and not supported by any account, either by precaution under the circumstances, by reducing his
an eyewitness [or by] a explanation tracing the relative speed and applying the brakes on time to avoid collision.
positions of the two vehicles in relation to the road at the
time of impact and the movements of the two vehicles On September 26, 2012, the CA rendered the assailed
after the impact. For this reason, it will be unfair to make Decision containing the following pronouncement:
an interpretation of the events based alone on the point
of impact [on] the vehicles. The points of impact by chanRoblesvirtualLawlibrary
themselves cannot explain the positions of the vehicles The present case involving an action for damages based
on the road. on quasi-delict is governed by Articles 2176 and 2180 of
the New Civil Code, pertinent provisions of which read:
Defendants Memorandum attributed the cause of the
mishap to the excessive speed of the bus. In their chanRoblesvirtualLawlibrary
Memorandum, the defendants content [sic] that if the 'ART. 2176, Whoever by act or omission causes damage
driver had seen the L-3G0 UV meters away in front of to another, there being fault or negligence, is obliged to
him running along the shoulder and negotiating back to pay for the damage done. Such fault or negligence, if
its lane, the bus driver would have watched out and there is no pre-existing contractual relation between the
slackened his speed. Considering the damage to both parties, is called a quasi-delict and is governed by the
the vehicles and the fact that the L-300,UV span [sic] provisions of this Chapter.
and w,as thrown 40 feet away from the point of impact
and its driver was thrown 14 feet away from his vehicle, ART. 2180. The obligation imposed by Article 2176 is
defendant argued that the bus could not be running at 60 demandable not only for one's own acts or omission also
kilometers only. But assuming the bus indeed was for those of persons for whom one is responsible.
running at high speed that alone does not mean that the
negligence of the driver was the direct and proximate
xxx xxx xxx
cause, If it is true that the L-300 UV ran from the right
shoulder, climbed up to the right lane but overshoot [sic]
Employers shall be liable for the damages caused by
it and occupied the bus' lane, the speed of the bus
their employees and household helpers acting within the
cannot be considered the proximate and direct cause of
scope of their assigned tasks even though the former
the collision; But as stated earlier, this were [sic] merely
are not engaged in any business or industry.'
conjectures and surmises of the defendants and not
Under Article 2180 of the New Civil Code, employers
proven by competent evidence.
shall be held primarily and solidarily liable for damages
caused by their employees acting within the scope of
All told, defendants were not able to prove by their own
their assigned tasks. To hold the employer liable under of the employee is conclusive on his employer as in
this provision, it must be shown that an employer- American law or jurisprudence, or merely gives rise to
employee relationship exists, and that the employee was the presumption juris tantum of negligence on the part of
acting within the scope of his assigned task when the act the employer as in ours, it is indispensable that the
complained of was committed. employee was acting in his employer's business or
within the scope of his assigned task.
Records bear that the vehicular collision occurred on
February 25, 2003 which was declared by former In the case at bar, it is undisputed that ABAD did some
Executive Secretary Alberto G. Romulo, by order of overtime work at Hie petitioner's office, which was
former President Gloria Macapagal-Arroyo, as a special located in Cabangcalan, Mandaue City. Thereafter, he
national holiday, per Proclamation No. 331 dated went to Goldie's Restaurant in Fuente Osmefia, Cebu
February 19, 2003. Renante Bicomong had no work on City, which is about seven kilometers away from
that day and at the time the accident occurred, he was petitioner's place of business. A witness for the private
on his way home to Candelaria, Quezon. There was no respondents, a sidewalk vendor, testified that Fuente
showing that on that day, Renante Bicomong was given Osmeña is a lively place even at dawn because Goldie's
by defendants-appellees14 an assigned task, much less Restaurant and Back Street were still open and people
instructed to go to Quezon. As testified to by Renante were drinking thereat Moreover, prostitutes, pimps, and
Bicomong's widow Gloria Bicomong, Renante Bicomong drug addicts littered the place.
was on the road that day because he was going home to
Candelaria, Quezon. Thus, he was then carrying out a xxx  xxx  xxx
personal purpose and not performing work for
defendants-appellees. To the mind of this Court, ABAD was engaged in affairs
of his own or was carrying out a personal purpose not in
Apropos is Castilex Industrial Corp. vs. Vicente line with his duties at the time he figured in a vehicular
Vasquez, Jr.,15 wherein the Supreme Court held that the accident. It was then about 2:00 a.m. of 28 August 1988,
mere fact that an employee was using a service vehicle way beyond the normal working hours. ABAD's working
at the time of the injurious incident is not of itself day had ended; his overtime work had already been
sufficient to charge his employer with liability for the completed. His being at a place which, as petitioner put
operation of said vehicle unless it appeared that he was it, was known as a haven for prostitutes, pimps, and
operating the vehicle within the course or scope of bis drug pushers and addicts, had no connection to
employment. Thus:ChanRoblesVirtualawlibrary petitioner's business; neither had it any relation to his
xxxx duties as a manager. Rather, using his service vehicle
even for personal purposes was a form of a fringe
'The court a quo and the Court of Appeals were one in benefit or one of the perks attached to his position.
holding that the driving by a messenger of a company-
issued vehicle is within the scope of his assigned tasks Since there is paucity of evidence that ABAD was acting
regardless of the time and circumstances. within the scope of the functions entrusted to him,
petitioner CASTILEX had no duty to show that it
We do not agree. The mere fact that ABAD was using a exercised the diligence of a good father of a family in
service vehicle at the time of the injurious incident is not providing ABAD with a service vehicle. Thus, justice and
of itself sufficient to charge petitioner with liability for the equity require that petitioner be relieved of vicarious
negligent operation of said vehicle unless it appears mat liability for the consequences of the negligence of ABAD
he was operating the vehicle within the course or scope in driving its vehicle.
of his employment. Accordingly, in the absence of showing that Renante
Bicomong was acting within the scope of his assigned
The following are principles in American Jurisprudence task at the time of the vehicular collision, defendants-
on the employer's liability for the injuries inflicted by the appellees had no duty to show that they exercised the
negligence of an employee in the use of an employer's diligence of a good father of a family in providing
motor vehicle. Renante Bicomong with a service vehicle. Thus, the trial
court did not err in holding that:
xxxx
chanRoblesvirtualLawlibrary
III. Use of Employer's Vehicle Outside Regular Working 'Under Article 2180, 'employers shall be liable for the
Hours damages caused by their employees and household
helpers acting within the scope of their assigned tasks,
An employer who loans his motor vehicle to an even though the former are not engaged in any business
employee for the latter's personal use outside of regular or industry. 'In other words, for the employer to be liable
working hours is generally not liable for the employees for the damages caused by his employee, the latter must
negligent operation of the vehicle during the period of have caused the damage in the course of doing his
permissive use, even where the employer contemplates assigned tasks or. in the performance of his duties.'
that a regularly assigned motor vehicle will be used by (Yambao vs. Zuñiga, G.R. No. 146173, December 11,
the employee for personal as well as business purposes 2003.)
and there is some incidental benefit to the employer.
Even where the employee's personal purpose in using In this case, it is.beyond cavil that the deceased
the vehicle has been accomplished and he has started Renante Bicong [sic] was not in the performance of his
the return trip to his house where the vehicle is normally duty on that fateful day of February 25, 2003. In the first
kept, it has been held that he has not resumed his place that day was a holiday; there was no work and it
employment, and the employer is not liable for the was not shown that he was working as indeed his work
employees negligent operation of the vehicle during the assignment [was as] operations manager of the
return trip. company's plant in Cavite while the accident happened
while he was in Alaminos, Laguna on his way home to
The foregoing principles and jurisprudence are Candelaria, Quezon. Secondly, as an operations
applicable in our jurisdiction albeit based on the doctrine manager, he was issued an executive car for his own
of respondent superior, not on the principle of bonus use, a Toyota Corolla vehicle and. he merely preferred
pater familias as in ours. Whether the fault or negligence to use the L-300 UV when going home to his family in
Quezon. Even assuming that the company allowed or supervision of their employees; that in their respective
tolerated this, by itself, the tolerance did not make the answers and motion to dismiss, respondents did not
employer liable in the absence of showing that he was allege the defense, which they tackled only during trial,
using the vehicle in the performance of a duty or within that since February 25, 2003 was a declared national
the scope of his assigned tasks. But as clearly relayed holiday, then Bicomong was not acting within the scope
by defendant's witnesses, defendants have no business of his assigned tasks at the time of the collision; that for
or plant in Quezon. The L-300 vehicle was for the failure to plead this defense or allegation in their
hauling of items between their Pasig and Cavite offices respective answers and pleadings, it is deemed waived
and was merely borrowed by Bicomong in going to pursuant to Section 1, Rule 9 of the 1997 Rules of Civil
Candelaria, Quezon on that day. Procedure20 (1997 Rules); that just the same,
respondents failed to prove that Bicomong was not in the
The accident having occurred outside Renante official performance of his duties or that the URC van
Bicomong's assigned tasks, defendant employers cannot was not officially issued to him at the time of the accident
be held liable to the plaintiffs, even assuming that it is - and for this reason, the presumption of negligence was
the fault of defendants' employee that was the direct and not overturned; and that URC should be held liable as
proximate cause of their damages.' the registered owner of the van.
In sum, squarely applicable in this case is the well-
entrenched doctrine that the assessment of the trial In their Reply,21 petitioners add that while some of the
judge as to the issue of credibility binds the appellate issues raised in the Petition are factual in nature, this
court because he is in a better position to decide the Court must review the case as the CA gravely erred in
issue, having heard the witnesses and observed their its appreciation of the evidence and in concluding that
deportment and manner of testifying during the trial, respondents are not liable. Finally, they argue that URC
except when the trial court has plainly overlooked certain should be held liable for allowing "a non-employee to
facts of substance and value, that, if considered, might use for his personal use the vehicle owned" by it.
affect the result of the case, or where the assessment is
clearly shown to be arbitrary. Plaintiffs-appellants have Respondents' Arguments
not shown this case to fall under the exception.
Pleading affirmance, respondents argue in their
WHEREFORE, the trial court's Decision dated April 4, Comment22 that the issues raised in the Petition are
2011 is affirmed. factual in nature; that the collision occurred on a holiday
and while Bicomong was. using the URC van for a
SO ORDERED.16chanroblesvirtuallawlibrary purely personal purpose, it should be. sufficient to
absolve respondents of liability as evidently, Bicomong
Petitioners filed a Motion for Reconsideration, which the was not performing his official duties on that day; that
CA denied in its subsequent December 28, 2012 the totality of the evidence indicates that it was Sayson
Resolution. Hence, the present Petition. who was negligent in the operation of Greenstar's bus
when the collision occurred; that Bicomong was not
Issues negligent in driving the URC van; that petitioners'
objection - pertaining to their defense that the collision
In a July 14, 2014 Resolution,17 this Court resolved to occurred on a holiday, when Bicomong was not
give due course to the Petition, which contains the considered to be at work - was belatedly raised; and that
following assignment of errors: in any case, under Section 5, Rule 10 of the 1997
Rules,23 their pleadings should be deemed amended to
chanRoblesvirtualLawlibrary conform to the evidence presented at the trial, which
I. includes proof that the accident occurred on a holiday
and while Bicomong was not in the performance of his
THE HONORABLE COURT OF APPEALS ERRED IN official tasks and instead going home to his family in
ISSUING THE ASSAILED DECISION AND Quezon province.
RESOLUTION THAT RESPONDENTS ARE NOT
LIABLE TO PETITIONERS FOR THE DAMAGES THEY Our Ruling
SUSTAINED CONSIDERING THAT THE ACCIDENT
WAS ATTRIBUTED TO THE NEGLIGENCE OF The Court denies the Petition.
RENANTE BICOMONG.
In Caravan Travel and Tours International, Inc. v.
II. Abejar,24 the Court made the following relevant
pronouncement:
THE HONORABLE COURT OF APPEALS ERRED IN
ADMITTING DEFENSES NOT PLEADED IN THE chanRoblesvirtualLawlibrary
MOTION TO DISMISS OR IN RESPONDENTS' The resolution of this case must consider two (2)
ANSWER.18chanroblesvirtuallawlibrary rules. First, Article 2180's specification that
'[e]mployers shall be liable for the damages caused
Petitioners' Arguments by their employees ... acting within the scope of their
assigned tasks [.]' Second, the operation of the
Petitioners insist that respondents should be held liable registered-owner rule that registered owners are
for Bicomong's negligence under Articles 2176, 2180, liable for death or injuries caused by the operation
and 2185 of the Civil Code;19 that Bicomong's negligence of their Vehicles.
was the direct and proximate eause of the accident, in
that he unduly occupied the opposite lane which the bus These rules appear to be in conflict when it comes to
was lawfully traversing, thus resulting in the collision with cases in which the employer is also the registered owner
Greenstar's bus; that Bicomong's driving on the opposite of a vehicle. Article 2180 requires proof of two things:
lane constituted a traffic violation, therefore giving rise to first, an employment relationship between the driver and
the presumption of negligence on his part; that in view of the owner; and second, that the driver acted within the
this presumption, it became incumbent upon scope of his or her assigned tasks. On the other hand,
respondents to rebut the same by proving that they applying the registered-owner rule only requires the
exercised care and diligence in the selection and plaintiff to prove that the defendant-employer is the
registered owner of the vehicle. that the requirements of Article 2180 have been
proven. As a consequence, the burden of proof
The registered-owner rule was articulated as early as shifts to the defendant to show that no liability under
1957 in Erezo, et al. v. Jepte,25cralawred where this Article 2180 has arisen.
court explained that the registration of motor vehicles, as
required by Section 5(a) of Republic Act No. 41365 the  This disputable presumption, insofar as the registered
and Transportation and Traffic Code, was necessary 'not owner of the vehicle in relation to the actual driver is
to make said registration the operative act by which concerned, recognizes that between the owner and the
ownership in vehicles is transferred, ... but to permit the victim, it is the former that should carry the costs of
use and operation of the vehicle upon any public moving forward with the evidence. The victim is, in many
highway[.]' Its 'main aim ... is to identify the owner so that cases, a hapless pedestrian or motorist with hardly any
if any accident happens, or that any damage or injury is means to uncover the employment relationship of the
caused by the vehicle on the public highways, owner and the driver, or any act that the owner may
responsibility therefor can be fixed on a definite have done in relation to that employment.
individual, the registered owner.'
The registration of the vehicle, on the other hand, is
x x x x accessible to the public.

Aguilar, Sr. v. Commercial Savings Bank 26 recognized Here, respondent presented a copy of the Certificate of
the seeming conflict between Article 2180 and the Registration of the van that hit Reyes. The Certificate
registered-owner rule and applied the latter. attests to petitioner's ownership of the van. Petitioner
itself did not dispute its ownership of the van. Consistent
x x x x with the rule we have just stated, a presumption that the
requirements of Article 2180 have been satisfied arises.
Preference for the registered-owner rule became more It is now up to petitioner to establish that it incurred no
pronounced in Del Carmen, Jr. v. Bacoy:27chanrobleslaw liability under Article 2180. This it can do by
presenting proof of any of the following: first, that it
x x x x had no employment relationship with Bautista;
second, that Bautista acted outside the scope of his
Filcar Transport Services v. Espinas 28 stated that the assigned tasks; or third, that it exercised the
registered owner of a vehicle can no longer use the diligence of a good father of a family in the selection
defenses found in Article 2180: and supervision of Bautista. (Emphasis supplied)

chanRoblesvirtualLawlibraryx x x x In the present case, it has been established that on the

day of the collision -or on February 25, 2003 - URC was
Mendoza v. Spouses Gomez29 reiterated this doctrine. the registered owner of the URC van, although it
appears that it was designated for use by NURC, as it
However, Aguilar, Sr., Del Carmen, was officially assigned to the latter's Logistics Manager,
Filcar, and Mendoza should not be taken to mean that Florante Soro-Soro (Soro-Soro); that Bicomong was the
Article 2180 of the Civil Code should be completely Operations Manager of NURC and assigned to the First
discarded in cases where the registered-owner rule finds Cavite Industrial Estate; that there was no work as the
application. day was declared a national holiday; that Bicomong was
on his way home to his family in Quezon province; that
As acknowledged in Filcar, there is no categorical the URC van was not assigned to Bicompng as well, but
statutory pronouncement in the Land Transportation and solely for Soro-Soro's official use; that the company
Traffic Code stipulating the liability of a registered owner. service vehicle officially assigned to Bicomong was a
The source of a registered owner's liability is not a Toyota Corolla, which he left at the Cavite plant and
distinct statutory provision, but remains to be Articles instead, he used the URC van; and that other than the
2176 and 2180 of the Civil Code: Cavite plant, there is no other NURC plant in the
provinces of Quezon, Laguna or Bicol.
chanRoblesvirtualLawlibrary
While Republic Act No. 4136 or the Land Transportation Applying the above pronouncement in the Caravan
and Traffic Code does not contain any provision on the Travel and Tours case, it must be said that when by
liability of registered owners in case of motor vehicle evidence the ownership of the van and Bicomong's
mishaps, Article 2176, in relation with Article 2180, of the employment were proved, the presumption of negligence
Civil Code imposes an obligation upon Filcar, as on respondents' part attached, as the registered owner
registered owner, to answer for the damages caused to of the van. and as Bicomong's employer. Hie burden of
Espinas' car. proof then shifted to respondents to show that no liability
Thus, it is imperative to apply the registered-owner under Article 2180 arose. This may be done by proof
rule in a manner that harmonizes it with Articles of any of the following:
2176 and 2180 of the Civil Code. Rules must be
construed in a manner that will harmonize them with chanRoblesvirtualLawlibrary
other rules so as to form a uniform and consistent 1. That they had no employment relationship with
system of jurisprudence. In light of this, the words Bicomong; or
used in Del Carmen are particularly notable. There,
this court stated that Article 2180 'should defer to' 2. That Bicomong acted outside the scope of his
the registered-owner rule. It never stated that Article assigned tasks; or
2180 should be totally abandoned.
3. That they exercised the diligence of a good father of a
Therefore, the appropriate approach is that in cases family in the selection and supervision of Bicomong.
where both the registered-owner rule and Article
2180 apply, the plaintiff must first establish that the In denying liability, respondents claimed in their
employer is the registered owner of the vehicle in respective answers the defense of absence of
question. Once the plaintiff successfully proves negligence on their part. During trial, they presented
ownership, there arises a disputable presumption evidence to the effect that on the day of the collision,
which was a declared national non-working holiday,
Bicomong was not perforating Ms work, but was on his From the foregoing facts, one might think that from the
way home to Quezon on a personal undertaking, that is, way he was driving immediately before the collision took
to give money to his daughter and spend the holiday place, Bicomong could have fallen asleep or ill at the
with his family; and that the vehicle he was driving was wheel, which led him to gradually steer the URC van
not an NURC vehicle, nor was it assigned to him, but toward the shoulder of the highway; and to get back to
was registered to URC and assigned to its Logistics the road after realizing his mistake, Bicomong must have
Manager, Soro-Soro, Petitioners object to this, claiming overreacted, thus overcompensating or oversteering to
that this defense was not alleged in the respondents' the left, or toward the opposite lane and right into
respective answers. The Court disagrees, The failure to Sayson's bus. Given the premise of dozing off or falling
allege these facts in the answers does not preclude, ill, this explanation is not far-fetched. The collision
respondents from proving them during trial; these facts occurred very early in the morning in Alaminos, Laguna.
are precisely illustrative of their defense of absence of Sayson himself testified that he found Bicomong driving
negligence. Just the same, petitioners' failure to object to on the service road or shoulder of the highway 250
the respondents' presentation of such evidence below is meters away, which must have been unpaved, as it
tantamount to a waiver; Section 5, Rule 10 of the 1997 caused dust clouds to rise on the heels of the URC van.
Rules - on amendments to conform to or authorize And these dust clouds stole Sayson's attention, leading
presentation of evidence - will have to apply, but the him to conclude that the van was running at high speed.
failure to amend the pleadings does not affect the result At any rate, the evidence places the point of impact very
of the trial of these issues. near the middle of the road or just within Sayson's lane.
In other words, the collision took place with Bicomong
The failure of a party to amend a pleading to conform to barely encroaching on Sayson's lane. This means that
the evidence adduced during trial does not preclude an prior to and at the time of collision, Sayson did not take
adjudication by the court on the basis of such evidence any defensive maneuver to prevent the accident and
which may embody new issues not raised in the minimize the impending damage to life and property,
pleadings, or serve as a basis for a higher award of which resulted in the collision in the middle of the
damages. Although the pleading may not have been highway, where a vehicle would normally be traversing.
amended to conform to the evidence submitted during If Sayson took defensive measures, the point of impact
trial, judgment may nonetheless be rendered, not simply should have occurred further inside his lane or not at the
on the basis of the issues alleged but also on the basis front of the bus - but at its side, which should have
of issues discussed and the assertions of fact proved in shown that Sayson either slowed down or swerved to
the course of trial. The court may treat the pleading as if the right to avoid a collision.
it had been amended to conform to the evidence,
although it had not been actually so amended, x x x30 Despite having seen Bicomong drive the URC van in a
precarious manner while the same was still a good 250
Respondents succeeded in overcoming the meters away from his bus, Sayson did not take the
presumption of negligence, having shown that when necessary precautions, as by reducing speed and
the collision took place, Bicomong was not in the adopting a defensive stance to avert any untoward
performance of his work; that he was in possession incident that may occur from Bicomong's manner of
of a service vehicle that did not belong to his driving. This is precisely his testimony during trial. When
employer NURC, but to URC, and which vehicle was the van began to swerve toward his bus, he did not
not officially assigned to him, but to another reduce speed nor swerve his bus to avoid collision.
employee; that his use of the URC van was Instead, he maintained his current speed and course,
unauthorized - even if he had used the same vehicle and for this reason., the inevitable took place: An
in furtherance of a personal undertaking in the experienced driver who is. presented with the same facts
past,31 this does not amount to implied permission; would have adopted an attitude consistent with a desire
that the accident occurred on a holiday and while to preserve life and property; for common carriers, the
Bicomong was on his way home to his family in diligence demanded is of the highest degree.
Quezon province; and that Bicomong had no official
business whatsoever in his hometown in Quezon, or The law exacts from common carriers (i.e., those
in Laguna where the collision occurred, his area of persons, corporations, firms, or associations engaged in
operations being limited to the Cavite area. the business of carrying or transporting passengers or
goods or both, by land, water, or air, for compensation,
On the other hand, the evidence suggests that the offering their services to the public) the highest degree of
collision could have been avoided if Sayson exercised diligence (i.e., extraordinary diligence) in ensuring the
care and prudence, given the circumstances and safety of its passengers. Articles 1733 and 1755 of the
information that he had immediately prior to the accident. Civil Code state:ChanRoblesVirtualawlibrary
From the trial court's findings and evidence on record, it Art. 1733. Common carriers, from the nature of their
would appear that immediately prior to the collision, business and for reasons of public policy, are bound to
which took place very early in the morning - or at around observe extraordinary, diligence in the vigilance over the
6:50 a.m., Sayson saw that the URC van was traveling goods and for the safety of the passengers transported
fast Quezon-bound on the shoulder of the opposite lane by them, according to all the circumstances of each
about 250 meters away from him; that at this point, case.
Sayson was driving the Greenstar bus Manila-bound at
60 kilometers per hour; that Sayson knew that the URC Art. 1755. A common carrier is bound to carry the
van was traveling fast as it was creating dust clouds passengers safely as far as human care arid foresight
from traversing the shoulder of the opposite lane; that can provide, using the utmost diligence of very cautious
Sayson saw the URC van get back into its proper lane persons, with a due regard for all the circumstances.
but directly toward him; that despite being apprised of In this relation, Article 1756 of the Civil Code provides
the foregoing information, Sayson, instead of slowing that '[i]n case of death of or injuries to passengers,
down, maintained his speed and tried to swerve the common carriers are presumed to have been at fault or
Greenstar bus, but found it difficult to do so at his speed; to have acted negligently, unless they prove that they
that the collision or point of impact occurred right in the observed extraordinary diligence as prescribed in
middle of the road;32 and that Sayson absconded from Articles 1733 and 1755. xxx'33chanroblesvirtuallawlibrary
the scene immediately after the collision.
However, Sayson took no defensive maneuver
whatsoever in spite of the fact that he saw Bicomong
drive his van in a precarious manner, as far as 250
meters away - or at a point in time and space where
Sayson had all the opportunity to prepare and avert a
possible collision. The collision was certainly foreseen
and avoidable but Sayson took no measures to avoid it.
Rather than exhibit concern for the welfare of his
passengers and the driver of the oncoming vehicle, who
might have fallen asleep or suddenly fallen ill at the
wheel, Sayson coldly and uncaringly stood his ground^
closed his eyes, and left everything to fate, without due
regard for the consequences. Such a suicidal mindset
cannot be tolerated, for the grave danger it poses to the
public and passengers availing of petitioners' services.
To add insult to injury, Sayson hastily fled the scene of
the collision instead of rendering assistance to the
victims - thus exhibiting a selfish, cold-blooded attitude
and utter lack of concern motivated by the self-centered
desire to escape liability, inconvenience, and possible
detention by the authorities, rather than secure the well-
being of the victims of his own negligent act.

x x x The doctrine of last clear chance provides that

where both parties are negligent but the negligent act of
one is appreciably later in point of time than that of the
other, or where it is impossible to determine whose fault
or negligence brought about the occurrence of the
incident, the one who had the last clear opportunity to
avoid the impending harm but failed to do so, is
chargeable with the consequences arising therefrom.
Stated differently, the rule is that the antecedent
negligence of a person does not preclude recovery of
damages caused by the supervening negligence of the
latter, who had the last fair chance to prevent the
impending harm by the exercise of due diligence, x x x34

Petitioners might object to the treatment of their case in

the foregoing manner, what with the additional finding
that Sayson was negligent under the circumstances. But
their Petition,  "once accepted by this Court, throws the
entire case open to review, and xxx this Court has the
authority to review matters not specifically raised or
assigned as error by the parties, if their consideration is
necessary in arriving at a just resolution of the
case."35chanrobleslaw

WHEREFORE, the Petition is DENIED. The September

26, 2012 Decision and December 28, 2012 Resolution of
the Court of Appeals in CA-G.R. CV No. 96961
are AFFIRMED in toto.

SO ORDERED.chanRoblesvirtualLawlibrary