Joint and several liability makes all parties in a lawsuit responsible for damages up to the entire amount awarded

NAGUIAT V. NLRC be held jointly and severally liable for the obligations of CFTI. And similarly, Sergio F.
G.R. No. 116123 Naguiat and Antolin Naguiat were merely officers and stockholders of CFTI and, thus,
March 13, 1997 could not be held personally accountable for corporate debts.
Topic: Part 1
Petitioners: SERGIO F. NAGUIAT, doing business under the name and style SERGIO F. ISSUE: W/N Sergio Naguiat is solidarily liable.
NAGUIAT ENT., INC., & CLARK FIELD TAXI, INC.
Respondents: NATIONAL LABOR RELATIONS COMMISSION (THIRD DIVISION), NATIONAL HELD: YES
ORGANIZATION OF WORKINGMEN and its members, LEONARDO T. GALANG, Et Al.
Ponente: PANGANIBAN, J Sergio F. Naguiat, in his capacity as president of CFTI, cannot be exonerated from joint and
several liability in the payment of separation pay to individual respondents. The Labor Code
DOCTRINE: Essentially, "tort" consists in the violation of a right given or the omission of a duty
provides that an ‘Employer’ includes any person acting in the interest of an employer, directly
imposed by law. Simply stated, tort is a breach of a legal duty.
or indirectly. The term shall not include any labor organization or any of its officers or agents
except when acting as employer. As a corporation is an artificial person, it must have an officer
FACTS:
who can be presumed to be the employer, being the ‘person acting in the interest of the
● Petitioner CFTI held a concessionaire’s contract with the Army Air Force Exchange
‘employer corporation’. The corporation, only in the technical sense, is the employer. The
Services ("AAFES") for the operation of taxi services within Clark Air Base. Sergio F.
responsible officer of an employer corporation can be held personally liable.
Naguiat was CFTI’s president, while Antolin T. Naguiat was its vice-president. Like
Sergio F. Naguiat Enterprises, Incorporated ("Naguiat Enterprises" or “NE”), a trading
Sergio F. Naguiat, admittedly, was the president of CFTI who actively managed the business.
firm, it was a family-owned corporation. Respondents were previously employed by
Thus, he falls under the definition of the word ‘employer’. Petitioners conceded that CFTI and
CFTI as taxicab drivers.
NE were close family corporations. According to the Corp Code, stockholders of close family
● Due to the phase-out of the US military bases in the Philippines, the AAFES was
corporations shall be personally liable for corporate torts. Essentially, "tort" consists in the
dissolved, and the services of individual respondents were officially terminated.
violation of a right given or the omission of a duty imposed by law. Simply stated, tort is a
Thus, the AAFES Taxi Drivers Association ("drivers’ union") and CFTI held
breach of a legal duty. The Labor Code mandates the employer to grant separation pay to
negotiations as regards separation benefits that should be awarded in favor of the
employees in case of closure or cessation of operations of establishment or undertaking not
drivers. The parties agreed that the separated drivers will be given severance pay.
due to serious business losses or financial reverses, which is the condition obtaining at bar.
Most of the drivers accepted said amount, but the respondents herein refused to
CFTI failed to comply with this law-imposed duty or obligation. Consequently, its stockholder
accept theirs.
who was actively engaged in the management or operation of the business should be held
● The respondents, after disaffiliating themselves from the driver’s union and joining
personally liable. In the present case, Sergio Naguiat is held solidarily liable for corporate tort
a new labor organization (National Organization of Workingmen or “NOWM”), filed
because he had actively engaged in the management and operation of CFTI, a close
a complaint against the petitioners for payment of separation pay due to
corporation.
termination/phase-out. The respondents alleged that they were regular employees
of Naguiat Enterprises, although their individual applications for employment were
WHEREFORE, the foregoing premises considered, the petition is PARTLY GRANTED. The
approved by CFTI. They claimed to have been assigned to Naguiat Enterprises after
assailed February 28, 1994 Resolution of the NLRC is hereby MODIFIED as follows:
having been hired by CFTI, and that the former managed, controlled, and supervised
their employment; that they were entitled to separation pay. On the other hand,
(1) Petitioner Clark Field Taxi, Incorporated, and Sergio F. Naguiat, president and co-
petitioners claimed that the cessation of business of CFTI was due to "great financial
owner thereof, are ORDERED to pay, jointly and severally, the individual respondents their
losses and lost business opportunity" resulting from the phase-out of Clark Air Base
separation pay computed at US$120.00 for every year of service, or its peso equivalent at the
brought about by the Mt. Pinatubo eruption and the expiration of the RP-US military
time of payment or satisfaction of the judgment;
bases agreement.
● The labor arbiter, finding the individual complainants to be regular workers of CFTI,
XXX
ordered the latter to pay them P1,200.00 for every year of service "for humanitarian
consideration”(they weren’t granted separation pay, to do so would be unjust to the
employer whose business was brought down by force majeure). Thus, respondents
appealed to the NLRC. In its Resolution, the NLRC modified the decision of the labor
arbiter by granting separation pay to the private respondents. In discharging the
above obligations, Sergio F. Naguiat Enterprises should be joined as indispensable
party whose liability is joint and several.
● Petitioners submitted additional issues by way of supplement, the pertinent issue
being Naguiat Enterprises, Inc. is a separate and distinct juridical entity which cannot
 LIWAYWAY VINZONS-CHATO, petitioner,
vs.
FORTUNE TOBACCO CORPORATION, respondent.

G.R. No. 141309, June 19, 2007

FACTS:
Petitioner Liwayway Vinzons-Chato was then the Commissioner of Internal Revenue while respondent Fortune Tobacco Corporation is an entity engaged in the
manufacture of different brands of cigarettes, among which are "Champion," "Hope," and "More" cigarettes.
This is a case for damages under Article 32 of the Civil Code filed by Fortune against
Liwayway as CIR.

On June 10, 1993, the legislature enacted RA 7654, which provided that locally
manufactured cigarettes which are currently classified and taxed at 55% shall be
charged an ad valorem tax of “55% provided that the maximum tax shall not be
less than Five Pesos per pack.” Prior to effectivity of RA 7654, Liwayway issued a
rule, reclassifying “Champion,” “Hope,” and “More” (all manufactured by Fortune)
as locally manufactured cigarettes bearing foreign brand subject to the 55% ad
valorem tax. Thus, when RA 7654 was passed, these cigarette brands were already
covered.

In a case filed against Liwayway with the RTC, Fortune contended that the issuance
of the rule violated its constitutional right against deprivation of property without
due process of law and the right to equal protection of the laws.
Revenue Memorandum Circular
For her part, Liwayway contended in her motion to dismiss that respondent has no
cause of action against her because she issued RMC 37-93 in the performance of
her official function and within the scope of her authority. She claimed that she
acted merely as an agent of the Republic and therefore the latter is the one
responsible for her acts. She also contended that the complaint states no cause of
action for lack of allegation of malice or bad faith.

The order denying the motion to dismiss was elevated to the CA, who dismissed the
case on the ground that under Article 32, liability may arise even if the defendant
did not act with malice or bad faith.

Hence this appeal.

ISSUES:

Whether or not a public officer may be validly sued in his/her private capacity for
acts done in connection with the discharge of the functions of his/her office -it depends, GR and EXP
Whether or not Article 32, NCC, should be applied instead of Sec. 38, Book I,
Administrative Code -Art 32 being special law prevails

HELD:

On the first issue, the general rule is that a public officer is not liable for damages
which a person may suffer arising from the just performance of his official duties
and within the scope of his assigned tasks. An officer who acts within his authority
to administer the affairs of the office which he/she heads is not liable for damages
that may have been caused to another, as it would virtually be a charge against the
Republic, which is not amenable to judgment for monetary claims without its
consent. However, a public officer is by law not immune from damages in his/her
personal capacity for acts done in bad faith which, being outside the scope of his
authority, are no longer protected by the mantle of immunity for official actions.

Specifically, under Sec. 38, Book I, Administrative Code, civil liability may arise
where there is bad faith, malice, or gross negligence on the part of a superior public
officer. And, under Sec. 39 of the same Book, civil liability may arise where the
subordinate public officer’s act is characterized by willfulness or negligence. In
Cojuangco, Jr. V. CA, a public officer who directly or indirectly violates the
constitutional rights of another, may be validly sued for damages under Article 32 of
the Civil Code even if his acts were not so tainted with malice or bad faith.

Thus, the rule in this jurisdiction is that a public officer may be validly sued in
his/her private capacity for acts done in the course of the performance of the
functions of the office, where said public officer: (1) acted with malice, bad faith, or
negligence; or (2) where the public officer violated a constitutional right of the
plaintiff.

On the second issue, SC ruled that the decisive provision is Article 32, it being a
special law, which prevails over a general law (the Administrative Code).

Article 32 was patterned after the “tort” in American law. A tort is a wrong, a
tortious act which has been defined as the commission or omission of an act by one,
without right, whereby another receives some injury, directly or indirectly, in
person, property or reputation. There are cases in which it has been stated that civil
liability in tort is determined by the conduct and not by the mental state of the
tortfeasor, and there are circumstances under which the motive of the defendant
has been rendered immaterial. The reason sometimes given for the rule is that
otherwise, the mental attitude of the alleged wrongdoer, and not the act itself,
would determine whether the act was wrongful. Presence of good motive, or rather,
the absence of an evil motive, does not render lawful an act which is otherwise an
invasion of another’s legal right; that is, liability in tort in not precluded by the fact
that defendant acted without evil intent.

WHEREFORE, in view of the foregoing, the petition is DENIED. The Decision of the Court of Appeals dated May
7, 1999 which affirmed the Order of the Regional Trial Court of Marikina, Branch 272, denying petitioner’s motion
to dismiss, is AFFIRMED.
BARREDO v. GARCIA
G.R. No. L-48006

Date of Promulgation: July 8, 1942

Facts:
At about 1:30 am on May 3, 1986, there was a head-on collision between a Malate Taxicab car
driven by Pedro Fontanilla and a carretela (carriage) on which was riding 16-year-old Faustino
Garcia. Two days later, Garcia died from injuries sustained from the crash. The Court of First
Instance of Rizal convicted Fontanilla and reserved the right to bring a separate civil action.
Respondents Severino Garcia and Timotea Almario, the boy’s parents, brought an action in the
Court of First Instance of Manila against Fausto Barredo as proprietor of Malate Taxicab and
Fontanilla’s employer. The defense contends that Barredo’s liability is governed by the Revised
Penal Code and is only subsidiary, and since there has been no civil action against Fontanilla,
Barredo cannot be held responsible.

Issue/Held:
WON respondents may bring a separate civil action against petitioner Barredo, making him
primarily responsible under Art. 1903 of the old Civil Code - YES

Doctrines:
o
1. Art. 1157, CC. Art. 1157. Obligations arise from:
Moreover, the court held that Barredo was negligent in hiring his employees and has
1) Laws; not exercised a diligence of a good father to prevent damage. Fontanilla had had
multiple traffic infractions already before Barredo hired him – a failure which was
2) Contracts; attributed to Barredo as an employer. Had Garcia not reserved his right to file a
3) Quasi-contracts; separate civil action, Barredo would have only been subsidiarily liable.
4) Acts and ommissionso punished by law; and
5) Note that Barredo is not being sued for damages arising from a criminal act (his
Quasi-delicts. (1089a)
driver’s negligence) but rather for his own negligence in selecting his employee
(Article 1903).
2. Art. 1161, CC. Civil obligations arising from criminal offenses shall be governed by the
penal laws, subject to the provisions of Article 2177, and of the pertinent provisions of
Chapter 2, Preliminary Title, on Human Relations, and of Title XVIII of this Book,
regulating damages. (1092a)

3. Art. 2176, CC. Whoever by act or omission causes damage to another, there being fault
or negligence, is obliged to pay for the damage done. Such fault or negligence, if there is
no pre-existing contractual relation between the parties, is called a quasi-delict and is
governed by the provisions of this Chapter. (1902a)

4. Art. 2180(1), CC. The obligation imposed by article 2176 is demandable not only for
one's own acts or omissions, but also for those of persons for whom one is responsible.
(1903a)
Ratio:
1. On the distinction and overlap between quasi-delicts and delicts

Authorities hold that a quasi-delict or culpa aquiliana is a separate legal institution with a
substantivity and individuality independent from delict or crime. In fact, the same negligent
act may produce civil liability arising from a crime under Article 100 of the RPC, or
create an action for culpa aquiliana under Articles 1902-1910 of the old CC.

The differences between crimes under the RPC and quasi-delicts under the CC are:

a. Crimes affect the public interest, while quasi-delicts are only of private concern.
b. The RPC punishes and corrects the criminal act, while the CC repairs damage by
indemnification.
c. Delicts are not as broad as quasi-delicts, which include all acts in which “any kind of
fault or negligence intervenes”.

In his analysis of a Spanish case involving a train collision, Maura stated that the action for
reparation cannot be confused with the civil responsibilities arising from a crime. Montero
also wrote that civil responsibility without criminal responsibility is separate from penal
liability. Indeed, the distinctive character of quasi-delicts traces back to the Roman Lex
Aquilia, from which the term culpa aquiliana originates.

However, given that Article 365 of the RPC punishes both reckless and simple negligence, it
would seem that very few acts or omissions fall under Article 1902. The Court addressed this
by saying, as previously mentioned, that the same act may give rise to civil liability arising
from a crime or an action for culpa aquiliana. The Court also gave the following grounds for
this doctrine:

a. If Articles 1902-1910 of the old CC were to be restricted to negligence or fault not

2. On defendant Barredo’s liability

Aside from the above discussion, the Court also cited a similar Spanish case where a widow
sought damages for the death of her husband, who was run over by a street car. This case is
significant for the following reasons:

a. Like the instant case, the conductor in the former was not sued in a civil case.
b. Unlike in the Spanish case, the plaintiffs here chose to sue Barredo for his primarily
liability as an employer, not subsidiary.
 c. In the Spanish case, the employer was held liable civilly despite his conductor’s
acquittal; with greater reason should Barredo be held liable since Fontanilla was
convicted.

Decision:
Decision is affirmed.