InterPhil vs. OEP Philippines

INTERPHIL VS.
OEP PHILIPPINES
Res Ipsa Loquitur
G.R. No. 203697|March 20, 2019| J. Reyes A, JR
Nature of Case: Petition for review on certiorari of the decision and resolution
of the Court of Appeals
Digest maker: Judge M.A. Lazaro
SUMMARY: OEP and Interphil entered into a Manufacturing agreement

whereby Interphil would process and package 90 and 120 mg Diltelan capsules
for OEP. One day, OEP’s customers in Taiwan complained about 90-mg
capsules being placed in 120-mg foils. OEP ended up having to destroy the
capsules and charged Interphil for the cost. The court held that Interphil is
guilty of negligence on the basis of res ipsa loquitur because the packaging was
under its exclusive management and it despite it charging OEP for inspecting
the materials, it still committed the error.
DOCTRINE: In order for a fortuitous event(unforeseeable and unavoidable) to

exempt one from liability, it is necessary that one has committed no negligence
or misconduct that may have occasioned the loss. When the effect is found to
be partly the result of a person’s participation (active intervention, neglect or
failure to act) the whole act is humanized.
Doctrine: Where it is shown that the thing or instrumentality which caused the
injury complained of was under the control or management of the defendant,
and that the occurrence resulting in the injury was such as in the ordinary
course of things would not happen if those who had its control or management
used proper care, there is sufficient evidence, or, as sometimes stated,
reasonable evidence, in the absence of explanation by the defendant, that the
injury arose from or was caused by the defendant's want of care.
FACTS:
 In 1998, OEP and Interphil entered into a Manufacturing Agreement
whereby Interphil undertook to process and package 90 and 120 mg
Diltelan capsules for OEP under the ff pertinent conditions:
o All products processed by Interphil shall be prepared and packed
strictly in accordance with the formulae, processes, standards,
techniques, and designs furnished by OEP to Interphil from time to
time.
o Interphil shall conduct quality control and other tests as OEP shall
specify for each of the products at OEP’s cost and expense
o Should a batch of any of the products fail to meet the processing or
packaging standards specified by OEP, Interphil shall either correct
the deficiency or destroy the batch under OEP’s instructions.
Expenses occurred shouldered by OEP unless Interphil was negligent.
 The parties issued a letter to the Bureau of Food and Drugs safety stating
that if there was problem in the packaging or manufacturing process,
Interphil would be liable
 On August 8, 2000, OEP received urgent phone calls from Taiwan
regarding a defect in the packaging of 90mg Diltelan capsules, stating that
several 90-mg Diltelan capsules were wrapped in foiled meant for 120-mg
Diltelan capsules and placed in boxes labeled for 90-mg Diltelan capsules
 OEP immediately informed Interphil and they found out the defective ones
belonges to a single batch. OEP had no choice but to recall and destroy all
the capsules since the necessary reworking might put the public in danger.
This cost OEP P5,183,525.05
 Interphil refused to pay
 RTC of Makati- Interphil was negligent on the basis of res ipsa loquitur and
OEP did not breach the agreement by not following the procedure for
destruction
 CA affirmed – proximate cause was the fact that Interphil erroneously
packed the 90-mg Diltelan capsules in the 120-mg capsules which was in
the exclusive hands and control of Interphil
ISSUE:
W/N Interphil is guilty of negligence on the basis of res ipsa loquitur? - YES
RATIO:
1. While negligence is not ordinarily inferred or presumed, and while the mere
happening of an accident or injury will not generally give rise to an inference
or presumption that it was due to negligence on defendant's part, under the
doctrine of res ipsa loquitur, which means, literally, the thing or transaction
speaks for itself, or in one jurisdiction, that the thing or instrumentality
speaks for itself, the facts or circumstances accompanying an injury may be
such as to raise a presumption, or at least permit an inference of negligence
on the part of the defendant, or some other person who is charged with
negligence.
Where it is shown that the thing or instrumentality which caused the injury
complained of was under the control or management of the defendant, and
that the occurrence resulting in the injury was such as in the ordinary
course of things would not happen if those who had its control or
management used proper care, there is sufficient evidence, or, as sometimes
stated, reasonable evidence, in the absence of explanation by the defendant,
that the injury arose from or was caused by the defendant's want of care.
The res ipsa loquitur doctrine is based in part upon the theory that the
defendant in charge of the instrumentality which causes the injury either
knows the cause of the accident or has the best opportunity of ascertaining
it and that the plaintiff has no such knowledge, and therefore is compelled
to allege negligence in general terms and to rely upon the proof of the
happening of the accident in order to establish negligence. The inference
which the doctrine permits is grounded upon the fact that the chief evidence
of the true cause, whether culpable or innocent, is practically accessible to
the defendant but inaccessible to the injured person.
2. Elements of Res ipsa Loquitur:
 The accident is of such character as to warrant an inference that it
would not have happened except for the defendant’s negligence
 The accident must have been caused by an agency or instrumentalilty
within the exclusive management or control of the person charged with
the negligence complained of
 The accident must not have been due to voluntary action or contribution
by the part of the person injured
3. Interphil had exclusive control in the packaging of the materials before the
company delivered them to OEP. The agreement placed Interphil’s
responsibilities and the diligence to abide by. Interphil itself said its people
inspected it.
4. Interphil had exclusive management and control at the time of the
packaging. Though Interphil claimed that 90-mg foils were mis-spliced with
the 120-mg foils. There was no evidence to the same.
5. There is no contributory fault on the part of OEP. Interphil claims that OEP
was at fault for delivering reels of foils which are similar in appearance and
not distinctly labeled with colored tape. This fault is, however not the
proximate and immediate cause of the damage.

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INTERPHIL VS.

Digest maker: Judge M.A. Lazaro

SUMMARY: OEP and Interphil entered into a Manufacturing agreement

DOCTRINE: In order for a fortuitous event(unforeseeable and unavoidable) to

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