Cases on DAMAGES

Torts and Damages

Contents
VISAYAN SAWMILL VS. CA.....................................................................................................................2
[G.R. No. 83851. March 3, 1993.]..........................................................................................................2
SYLLABUS...........................................................................................................................................4
BAGUMBAYAN v. IAC.............................................................................................................................5
[G.R. No. L-66274. September 30, 1984.]...............................................................................................5
SYLLABUS...........................................................................................................................................9
Expertravel & Tours Inc. vs Court of Appeals G.R. No. 130030  June 25, 1999....................................11
SYLLABUS.........................................................................................................................................12
Filipinas Broadcasting Networks, Inc. vs. AGO Medical & Educational Center,...................................14
G.R. No. 141994, January 17, 2005......................................................................................................14
PEOPLE VS. CALONGUI........................................................................................................................16
[G.R. No. 170566. March 3, 2006.]......................................................................................................16
MIJARES VS. CA....................................................................................................................................18
[G.R. No. 113558. April 18, 1997.].......................................................................................................18
SYLLABUS.........................................................................................................................................19
FRANCISCO v. FERRER..........................................................................................................................20
[G.R. No. 142029. February 28, 2001.].................................................................................................20
SEVEN BROTHERS SHIPPING CORP., vs. DMC-CONSTRUCTION RESOURCES, INC................................25
[G.R. No. 193914. November 26, 2014.]..............................................................................................25
PHILIPPINE NATIONAL BANK vs. COURT OF APPEALS and LORETO TAN..............................................27
G.R. No. 108630. April 2, 1996.............................................................................................................27
TAN V. OMC.........................................................................................................................................30
(G.R. NO. 190521; JANUARY 12, 2011)................................................................................................30

[1]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

VISAYAN SAWMILL VS. CA

[G.R. No. 83851. March 3, 1993.]

VISAYAN SAWMILL COMPANY, INC., and ANG TAY, petitioners, vs.

THE HONORABLE COURT OF APPEALS and RJH TRADING,
represented by RAMON J. HIBIONADA, proprietor, respondents .

Rule Synopsis: Non-fulfillment of a condition imposed on the perfection of the

contract prevents the obligation to have a binding effect. Rescission will lie. Delivery
without accompanying intent is ineffectual.
Case Summary

Visayan and RJH entered into a contract for the sale of scrap iron
located at Visayan’s stockyard. This is subject to the condition that
RJH “will open, make or indorse an irrevocable and unconditional
letter of credit (LC) not later than May 15, 1983 at the Consolidated
Bank and Trust Company, Dumaguete City Branch” for P250,000.

On May 17, RJH, through its man and with Visayan’s consent, started
to dig and gather scrap iron at Visayan’s premises until the latter
ordered its stoppage on account of, among others, RJH’s failure to
open the said LC.

On May 26, via a letter, BPI advised Visayan of the opening of a LC in

its favor. The LC is on the account of Amarco Steel Corporation,
expiring on July 24, 1983 and provided conditions for the shipment.
- RJH then demanded that Visayan comply with their contract by
delivering to him the scrap iron subject thereof but the latter
refused.

Thus, the buyer filed a complaint for performance and damages

As defense, Visayan said that the cancellation of the contract was

justified on ground of RJH’s non-compliance with essential pre-
conditions of the contract, among which is the opening of an
irrevocable and unconditional letter of credit not later than May 15.

The RTC ruled in favor of RJH ordering Visayan to pay it

damages.
The CA affirmed with modifications as to the award of damages.
The Supreme Court reversed. (meaning not awarded damages)

[2]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

Return To Contents
ISSUE: W/N RJH is entitled to damages – NO.

In contracts, such as in the instant case, moral damages may be

recovered if defendants acted fraudulently and in bad faith, while
exemplary damages may only be awarded if defendants acted in a
wanton, fraudulent, reckless, oppressive or malevolent manner.

- In the instant case, the refusal of the petitioners to deliver the

scrap iron was founded on the non-fulfillment by the private
respondent of a suspensive condition.

- It cannot, therefore, be said that the herein petitioners had acted

fraudulently and in bad faith or in a wanton, reckless,
oppressive or malevolent manner

W/N Visayan Sawmill may rescind the contract?

HELD – YES.

Where the goods have not been delivered to the buyer, and the buyer
has repudiated the contract of sale, or has manifested his inability to
perform his obligations, thereunder, or has committed a breach
thereof, the seller may totally rescind the contract of sale by giving
notice of his election so to do to the buyer. (Art. 1597)

In this case, there was no implied delivery of the scrap metals when
Visayan consented to the digging and gathering of scrap iron in its
premises, as contended by RJH and found by the CA.

The permission cannot be construed as delivery. Art. 1497 cited by CA

to support its finding is premised on an existing obligation to deliver
the subject of the contract. There is no such obligation in this case for
RJH’s failure to comply with the condition as aforestated.

Secondly, the permission was given merely as accommodation to

expedite the weighing and hauling of the iron, in case the sale should
materialize. It did not give RJH control and possession over the scrap
[Link], Visayan did not waive the condition, rather, it demanded
its fulfillment and eventually cancelled the contract upon RJH’s failure
to do so.

[3]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

Return To Contents

DISPOSITIVE PORTION:

WHEREFORE, the instant petition is GRANTED. The decision of

public respondent Court of Appeals in C.A.-G.R. CV No. 08807 is
REVERSED and Civil Case No. 15128 of the Regional Trial Court of
Iloilo is ordered DISMISSED. Costs against the private respondent. SO
ORDERED.

SYLLABUS

CONTRACTS; DAMAGES; MORAL DAMAGES; PURPOSE OF AWARD

THEREOF; EXEMPLARY DAMAGES. — In contracts, such as in the
instant case, moral damages may be recovered if defendants acted
fraudulently and in bad faith, while exemplary damages may only be
awarded if defendants acted in a wanton, fraudulent, reckless,
oppressive or malevolent manner.

- In the instant case, the refusal of the petitioners to deliver the

scrap iron was founded on the non-fulfillment by the private
respondent of a suspensive condition.

- It cannot, therefore, be said that the herein petitioners had acted

fraudulently and in bad faith or in a wanton, reckless,
oppressive or malevolent manner.

BAGUMBAYAN v. IAC
[G.R. No. L-66274. September 30, 1984.]
BAGUMBAYAN CORPORATION, petitioner , vs. INTERMEDIATE
APPELLATE COURT, LELISA SEÑA and ARTURO SEÑA,
respondents.

This case is about the customer's claim for moral and exemplary
damages due to the alleged NEGLIGENCE OF A WAITER.

Relevant Facts: The spouses Lelisa Seña and Arturo Seña and their
four children went to the Tropical Palace Hotel, Parañaque, Metro
Manila in the evening of December 20, 1976 to see the Reycard Duet
Show. They occupied a table and ordered drinks before the show
started. The hall was crowded and, as anyone who attended such

[4]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

show can attest, excitement and confusion prevailed (8, 40-41 tsn,
January 19, 1978).

Return To Contents

- Lelisa's version was that when a waiter named Baez was going
to serve them, the tray containing the drinks was
OVERTURNED AND FELL ON HER.

o She was drenched. Later, she felt some chill.

o The drinks and the splinters from the BROKEN GLASSES

ALLEGEDLY DESTROYED HER DRESS which, with her
handbag and shoes, cost one thousand pesos (32-33 tsn
November 29, 1977).

- She was shocked. She sensed that some persons were

laughing at or pitying her. Lawyer Francisco Gatchalian, who
was at the same table, commented that it was one of those
unavoidable things (24 tsn November 29, 1977).

A waitress took Lelisa to the ladies' room. She had to remove her
dress and underwear which were wet.

- She WAS NOT GIVEN ANY TOWEL to cover herself. She

remained standing as there was no chair (27-28 tsn). Two of her
daughters followed her to the ladies' room (31 tsn). She
returned to the hall after about thirty minutes later when
the show had started (28, 51-52 tsn).

Lelisa testified that she was claiming MORAL DAMAGES of

P100,000 for herself and her husband

- due to EMBARRASSMENT; and

- the fact that the management DID NOT EVEN OFFER ANY
APOLOGY on that night (34-37 tsn).

She was claiming EXEMPLARY DAMAGES in the same amount to

teach the management a lesson. The husband, Arturo Seña,
testified that the incident infuriated him. There was no apology from
the management.

[5]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

Return To Contents

Rudy Tanchanco, the food and beverage manager, was one of three
persons in charge of the show.

 The food and beverage manager, Rudy Tanchanco, in charge

of the show testified that the admission was on a "first
come, first served" basis.

o All the waiters were extras performing under twelve

supervisors. In open court, Tanchanco APOLOGIZED to
the plaintiffs in behalf of the management for the
inconvenience caused to them, meaning that the
management was sorry for what happened to Mrs. Seña
(38-39 February 27, 1978).
The Señas Family SUED the CORPORATION, as employer of the
waiter,
- for actual damages of P200,000
- plus attorney's fees of P10,000 and
- such moral and exemplary damages as might be fixed by the
court.
- The action involves a quasi-delict. It was based on articles 2176
and 2180 of the Civil Code.

The corporation in its answer alleged that it CAME TO KNOW OF

THE INCIDENT only when it was SERVED WITH SUMMONS.

- Had the incident been brought to its attention on that same

night, it would have apologized immediately to the plaintiffs,
made appropriate amends and taken steps to discipline the
waiter and his supervisor. Which means that they were not
informed of the incident on the night it happened;

In fact, in its answer IT APOLOGIZED to the plaintiffs.

- It labelled the incident as a FORTUITOUS EVENT.

- It alleged that it observed diligentissimi patris familias to prevent
the damage.
- It reiterated that it was sorry for what had happened.

[6]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

- It manifested its DESIRE to make the PROPER AMENDS in

any reasonable manner or form.

Return To Contents

RTC Ruling: After hearing, the trial court ruled IN FAVOR OF THE
SEÑAS and awarded them:

o P1,540 as ACTUAL DAMAGES consisting of the value of

Mrs. Seña's outfit and
o P540, the cost of the six TICKETS used by the Seña
family
 which was considered a loss because of their
alleged failure to enjoy the show.
o P50,000 as MORAL damages, P10,000 as EXEMPLARY
damages and P5,000 as attorney's fees.
The CORPORATION APPEALED.
IAC Ruling:

- The Intermediate Appellate Court AFFIRMED THE JUDGMENT

- with the modification: that the moral (50k) and exemplary (10k)
damages were REDUCED to P15,000 and P5,000, respectively.

Hence, this appeal.

The trial court sensibly noted that court action could have been avoided
had the matter been taken up directly with the corporation before the
action was filed. No extrajudicial demand preceded the action.

Issue Held

Whether or not the corporation is SC Ruling:

liable for moral and exemplary
damages No. While the award for
actual damages has some basis,
the grant of m oral and
exemplary damages is DEVOID
OF LEGAL JUSTIFICATION

[7]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

because it was not predicated

upon any of the cases
enumerated in the Civil Code
(Ventanilla vs. Centeno, 110 Phil.
811, 816).

Return To Contents

The Civil Code provides:

"ART. 2217. Moral damages include physical suffering, mental

anguish, fright, serious anxiety, besmirched reputation, wounded
feelings, moral shock, social humiliation, and similar injury. Though
incapable of pecuniary computation, moral damages may be recovered
if they are the proximate result of the defendant's wrongful act or
omission."

"ART. 2219. Moral damages may be recovered in the following and

analogous cases:
"(1) A criminal offense resulting in physical injuries;
(2) Quasi-delicts causing physical injuries;
(3) Seduction, abduction, rape, or other lascivious acts;
(4) Adultery or concubinage;
(5) Illegal or arbitrary detention or arrest;
(6) Illegal search;
(7) Libel, slander or any other form of defamation;
(8) Malicious prosecution;
(9) Acts mentioned in article 309;
(10) Acts and actions referred to in articles 21, 26, 27, 28, 29, 30, 32,
34, and 35.

"The parents of the female seduced, abducted, raped, or abused,

referred to in No. 3 of this article, may also recover moral damages.

"The spouse, descendants, ascendants, and brothers and sisters may

bring the action mentioned in No. 9 of this article, in the order
named."

[8]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

"ART. 2220. Willful injury to property may be a legal ground for

awarding moral damages if the court should find that under the
circumstances, such damages are justly due. The same rule applies to
breaches of contract where the defendant acted fraudulently or in bad
faith."

Return To Contents

SYLLABUS
The instant case IS NOT SPECIFICALLY MENTIONED in article
2219 which refers to quasi-delicts causing physical injuries.

- The Appellate Court erred in considering it as analogous to

the cases mentioned therein WITHOUT INDICATING WHAT
SPECIFIC CASE the instant case resembles or is analogous to.

- For example, an unfounded complaint with a baseless

imputation of forgery is analogous to defamation mentioned in
article 2219(7). It justified an award of P2,000 as moral damages
(Justiva vs. Gustilo, 117 Phil. 71).

GENERALLY, there can be no recovery of moral damages if the case is

not mentioned in articles 2219 and 2220 (Malonzo vs. Galang, 109
Phil. 16; Ventanilla vs. Centeno, 110 Phil. 811).

MENTAL ANGUISH, DEFINED. — What we call moral damages are

treated in American jurisprudence as compensatory damages awarded
for mental pain and suffering or mental anguish resulting from a
wrong (25 C.J.S. 815).

- "Generally, damages for mental anguish are limited to cases in

which there has been a personally physical injury or where the
defendant willfully, wantonly, recklessly, or intentionally caused
the mental anguish" (22 Am Jur 2nd 275).

- "Nor will damages generally be awarded for mental anguish

which is not accompanied by a physical injury, at least where
maliciousness, wantonness, or intentional conduct is not
involved" (22 Am Jur 2nd 276).

[9]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

- "Damages for mental anguish and suffering have been held

recoverable where the act complained of was done with such
gross carelessness or recklessness as to show an utter
indifference to the consequences" (25 C.J.S. 820).

Return To Contents

RESPONDENTS NOT ENTITLED TO AWARD OF MORAL AND

EXEMPLARY DAMAGES.

- We hold that the "embarrassment" to which Mrs. Seña was

exposed by the incident is not the mental anguish contemplated
in Article 2217 for which moral damages can be recovered.
- In this case, it would not be just and proper to include moral
damages in the corporation's vicarious liability as employer.
- The award of P5,000 as exemplary or corrective damages cannot
also be sustained because there was NO GROSS NEGLIGENCE
in this case.

DISPOSITIVE PORTION

WHEREFORE, the decision of the Appellate Court is modified. The

petitioner is ordered to pay Lelisa Seña the sum of P5,000 to cover her
ACTUAL DAMAGES, litigation expenses and attorney's fees. The
award of moral and exemplary damages is ELIMINATED. No costs.
SO ORDERED.

SUMMARY
- Negligence of waiter
- Seña asked for moral and exemplary damages
o For embarrassment
o To teach management a lesson
- Trial awarded M & E damages
- Petitioner appealed, questioned the award of M&E
- Appellate court in favor Seña family but REDUCED the amount
of the M & E
- SC ruling: in favor of petitioner, no award of M&E, only actual
damages
o Not among the instances contemplated in Art. 2217
o No gross negligence to grant exemplary damages

[10]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

Expertravel & Tours Inc. vs Court of Appeals

G.R. No. 130030  June 25, 1999

Lessons Applicable: Cases where Moral Damage is allowed (Torts and damages)

Laws Applicable:  Article 2219, Article 1764, Article 2206

Return To Contents
SYNOPSIS
As culled from the records, petitioner Expertravel and Tours, Inc. filed a suit for
recovery of a sum of money plus damages against private respondent Ricardo Lo for
four round-trip plane tickets for Hongkong petitioner issued to respondent Lo, together
with hotel accommodations and transfers, for a total cost of P39,677.20 which
respondent Lo failed to pay. Respondent Lo in his answer alleged that his account with
petitioner had already been fully paid. The trial court rendered judgment dismissing
the suit and ordering petitioner to pay moral damages. According to said court,
payment made by the private respondent to petitioner's chairperson was valid and
binding on petitioner. The
Court of Appeals affirmed the judgment in toto. Hence, this petition for review
on certiorari , wherein Expertravel sought for the deletion of the moral damages
awarded the respondent.

Petition granted. Moral damages are not punitive in nature but are designed to
compensate and alleviate in some way the physical suffering, mental anguish, social
humiliation and similar injury unjustly caused to a person.

Although the institution of a clearly unfounded civil suit can at times be a legal
justification for an award of attorney's fees, such filing, however, has almost invariably
been held not to be a ground for an award of moral damages.

The law could not have meant to impose a penalty on the right to litigate.

FACTS:

 October 7, 1987: Expert travel & Tours, Inc. issued to Ricardo Lo 4

round-trip plane tickets for Hongkong with hotel accommodations
and transfers for P39,677.20
 Failing to pay the amount due, Expert filed a complaint for
recovery plus damages
 CA affirmed RTC: Lo remitted the Monte de Piedad Check for
P42,175.20 to Expert's chairperson Ms. Ma. Rocio de Vega who in
turn issued City Trust Check of P50,000

ISSUE:

W/N moral damages for negligence or quasi-delict that did not result

to physical injury be awarded to Lo

[11]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

HELD: NO. Petition is GRANTED and the award of moral damages to

respondent Ricardo Lo under the assailed decision is DELETED

 An award of moral damages would require certain conditions to be

met; to wit:
(1) First, there must be an injury, whether physical, mental or
psychological, clearly sustained by the claimant;
(2) second, there must be a culpable act or omission factually
established;

Return To Contents
(3) third, the wrongful act or omission of the defendant is the
proximate cause of the injury sustained by the claimant; and
(4) fourth, the award of damages is predicated on any of the
cases stated in Article 2219

SYLLABUS

CIVIL LAW; DAMAGES; MORAL DAMAGES; BASIS OF AWARD. —

Moral damages are not punitive in nature but are designed to

compensate and alleviate in some way the physical suffering, mental
anguish, fright, serious anxiety, besmirched reputation, wounded
feelings, moral shock, social humiliation, and similar injury unjustly
caused to a person. Although incapable of pecuniary computation,
moral damages, nevertheless, must somehow be proportional to and in
approximation of the suffering inflicted. Such damages, to be
recoverable, must be the proximate result of a wrongful act or
omission the factual basis for which is satisfactorily established by the
aggrieved party.

ID.; ID.; ID.; LEGAL PROVISIONS MANDATING AWARD. —

Under the provisions of this law, in culpa contractual or breach

of contract, moral damages may be recovered when the defendant
acted in bad faith or was guilty of gross negligence (amounting to bad
faith) or in wanton disregard of his contractual obligation and,
exceptionally, when the act of breach of contract itself is constitutive
of tort resulting in physical injuries.

By special rule in Article 1764, in relation to Article 2206, of

the Civil Code, moral damages may also be awarded in case the death
of a passenger results from a breach of carriage.

[12]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

In culpa aquiliana, or quasi-delict , (a) when an act or omission

causes physical injuries, or (b) where the defendant is guilty of
intentional tort, moral damages may aptly be recovered. This rule
also applies, as aforestated, to contracts when breached by tort.

Return To Contents

In culpa criminal, moral damages could be lawfully due when

the accused is found guilty of physical injuries, lascivious acts,
adultery or concubinage, illegal or arbitrary detention, illegal arrest,
illegal search, or defamation. The term "analogous cases," referred to
in Article 2219, following the ejusdem generis rule, must be held
similar to those expressly enumerated by the law.

ID.; ID.; ID.; NOT RECOVERABLE ON CLEARLY UNFOUNDED SUIT;

RATIONALE. — Although the institution of a clearly unfounded

civil suit can at times be a legal justification for an award of attorney's
fees, such filing, however, has almost invariably been held not to be a
ground for an award of moral damages. The rationale for the rule is
that the law could not have meant to impose a penalty on the right to
litigate. The anguish suffered by a person for having been made a
defendant in a civil suit would be no different from the usual worry
and anxiety suffered by anyone who is haled to court, a situation that
cannot by itself be a cogent reason for the award of moral damages. If
the rule were otherwise, then moral damages must every time be
awarded in favor of the prevailing defendant against an unsuccessful
plaintiff.

Filipinas Broadcasting Networks, Inc. vs. AGO

Medical & Educational Center,
G.R. No. 141994, January 17, 2005
Petitioner: Filipinas Broadcasting Network, Inc.
Respondent: Ago Medical And Educational Center-Bicol Christian College Of
Medicine, (Amec-Bccm) And Angelita F. Ago

[13]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

Doctrine:
Facts: "Exposé" is a radio documentary program hosted by Carmelo 'Mel' Rima
("Rima") and Hermogenes ‘Jun' Alegre ("Alegre"). Exposé is aired every morning over
DZRC-AM which is owned by Filipinas Broadcasting Network, Inc. ("FBNI").
"Exposé" is heard over Legazpi City, the Albay municipalities and other Bicol areas.
In the morning of 14 and 15 December 1989, Rima and Alegre exposed various
alleged complaints from students, teachers and parents against Ago Medical
and Educational Center-Bicol Christian College of Medicine ("AMEC") and its
administrators.

Return To Contents
Claiming that the broadcasts were defamatory, AMEC and Angelita Ago
("Ago"), as Dean of AMEC's College of Medicine, filed a complaint for damages
against FBNI, Rima and Alegre on 27 February 1990.
The complaint further alleged that AMEC is a reputable learning institution.
With the supposed exposés, FBNI, Rima and Alegre "transmitted malicious
imputations, and as such, destroyed plaintiffs' (AMEC and Ago) reputation." AMEC
and Ago included FBNI as defendant for allegedly failing to exercise due
diligence in the selection and supervision of its employees, particularly Rima and
Alegre.
RTC Ruling: the trial court rendered a Decision finding FBNI and Alegre liable for
libel except Rima.

- The trial court held that the broadcasts are libelous per se. The trial court
rejected the broadcasters' claim that their utterances were the result of
straight reporting because it had no factual basis. The broadcasters did not
even verify their reports before airing them to show good faith.

- In holding FBNI liable for libel, the trial court found that FBNI failed to
exercise diligence in the selection and supervision of its employees.

- In absolving Rima from the charge, the trial court ruled that Rima's only
participation was when he agreed with Alegre's exposé. The trial court found
Rima's statement within the "bounds of freedom of speech, expression, and
of the press."

CA Ruling: The Court of Appeals armed the trial court's judgment with
modification.

- The appellate court made Rima solidarily liable with FBNI and Alegre. The
appellate court denied Ago's claim for damages and attorney's fees because
the broadcasts were directed against AMEC, and not against her.

Issue:

[14]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

1) Whether or not AMEC is entitled to moral damages

2) Whether or not FBNI is solidarily liable with Rima and Alegre for payment of
moral damages, attorney's fees and costs of suit

Ruling:
1) Yes, AMEC is entitled to moral damages.
FBNI contends that AMEC is not entitled to moral damages because it is a
Corporation.
A juridical person is generally not entitled to moral damages because, unlike a
natural person, it cannot experience physical suffering or such sentiments as
wounded feelings, serious anxiety, mental anguish or moral shock.
Nevertheless, AMEC's claim for moral damages falls under item 7 of Article 2219 of
the Civil Code. This provision expressly authorizes the recovery of moral damages
in cases of libel, slander or any other form of defamation. Article 2219(7) does not
qualify whether the plaintiff is a natural or juridical person. Therefore, a
juridical person such as a corporation can validly complain for libel or any other
form of defamation and claim for moral damages.
Moreover, where the broadcast is libelous per se, the law implies damages. In such
a case, evidence of an honest mistake or the want of character or reputation of the
party libeled goes only in mitigation of damages. Neither in such a case is the
plaintiff required to introduce evidence of actual damages as a condition precedent
to the recovery of some damages. In this case, the broadcasts are libelous per se.
Thus, AMEC is entitled to moral damages.
2) Yes, FBNI is solidarily liable to pay damages together with Rima and Alegre.
Circumstances show FBNI's lack of diligence in selecting and supervising Rima and
Alegre. In this case, Rima and Alegre were clearly performing their social duties as
hosts of FBNI's radio program Exposé when they aired the broadcasts. FBNI neither
alleged nor proved that Rima and Alegre went beyond the scope of their work at
that time.
Statements:
Alegre: if you have children taking medical course at AMEC-BCCM,
advise them to pass all subjects because if they fail in any subject they will
repeat their year level, taking up all subjects including those they have
passed already.
Earlier AMEC students in Physical Therapy had complained that the
course is not recognized by DECS. . . .
Students are required to take and pay for the subject even if the
subject does not have an instructor — such greed for money on the part of
AMEC's administration.
The administrators of AMEC-BCCM, AMEC Science High School and
the AMEC-Institute of Mass Communication in their effort to minimize
expenses in terms of salary are absorbing or continues to accept "rejects”.

[15]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

I will prove to you my friends, that AMEC is a dumping ground,

garbage, not merely of moral and physical misfits.
Rima: When they become members of society outside of campus will
be liabilities rather than assets.

Return To Contents

PEOPLE VS. CALONGUI

[G.R. No. 170566. March 3, 2006.]

PEOPLE OF THE PHILIPPINES, appellee, vs. ALEJANDRO

CALONGUI y LOPEZ, appellant.

FACTS: In 1998, Alejandro Calongui raped his minor cousin

Marinel Calongui twice. First in January and the second in
September. Both incidents were witnessed by Noel Calongui, the
brother of Marinel. During trial, Calongui denied the first incident
but admitted the second one as he averred that he and Marinel are
sweethearts.

The trial court convicted Calongui. Apart from his sentence of

reclusion perpetua, he was ordered to pay civil indemnity, moral
damages, and exemplary damages. No aggravating circumstances
were considered by the court as there were none alleged in the
Information.

On automatic review, the Supreme Court determined, among

others, if the award of exemplary damages is proper.

ISSUE: 

Whether or not the award of exemplary damages is proper.

HELD: No. As a rule, exemplary damages in criminal cases are only

awarded if there are aggravating circumstances attendant to the
[16]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

case. In this case, no aggravating circumstances were alleged in the

Informations filed against Calonqui and none were proven in Court.

This case was filed prior to the effectivity of the Revised Rules of
Criminal Procedure which became effective on 01 December 2000.
The 2000 Rules provide that all aggravating circumstances must be
alleged in the Information. Otherwise, they cannot be considered for
any purpose even if they are proven in court. However, since this
case was filed prior to the 2000 Rules, the Supreme Court reviewed
the record to determine if Marinel is entitled to exemplary damages.
This is because under the old rules, aggravating circumstances,
alleged in the Information or not, may be appreciated for purposes
of determining exemplary damages. This right has already vested in
Marinel.

Return To Contents

Thus: a review of the records shows that there are no aggravating

circumstances present in the case at bar. Dwelling cannot be
appreciated because Marinel and Calongui lived in the same house
at the time of the rape incidents. The rationale for considering
dwelling as an aggravating circumstance, i.e., the violation by the
offender of the sanctity of the home of the victim by trespassing
therein to commit a crime, is absent. Night time cannot likewise be
appreciated because there is no proof that Calongui deliberately
sought the cover of darkness to facilitate the commission of the
crime. Relationship is not aggravating because the relationship
between Marinel and the appellant as first cousins is not within the
concept contemplated in Article 15 of the Revised Penal
Code. Abuse of confidence is likewise absent because the
prosecution did not establish that it facilitated the attainment of the
rape. Finally, use of a deadly weapon cannot be appreciated as an
aggravating circumstance because Marinel’s belated assertion on
cross-examination that Calongui used a knife to perpetrate the two
rapes raised doubts as to the knife’s existence.

NOTE: Art. 2230 of the Civil Code provides: In criminal offenses,

exemplary damages as a part of the civil liability may be imposed
when the crime was committed with one or more aggravating
circumstances. Such damages are separate and distinct from fines
and shall be paid to the offended party.

[17]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

MIJARES VS. CA
[G.R. No. 113558. April 18, 1997.]

EDITHA M. MIJARES and GLICERIO T. MIJARES , petitioners, vs.

COURT OF APPEALS and METRO DRUG, INC., respondents.
FACTS:

Spouses Editha Mijares and Glicerio [Link] under the business

name Aklan Drug purchased various products of P32,034.42 from Metro
Drug, Inc.

- Editha Mijares, aside from being the operator of Aklan Drug, was also
an officer of the Ospital Ng Maynila Consumers Cooperative, Inc.  The
Cooperative was subsequently dissolved and operations stopped.

Return To Contents

- Solomon Silverio was the new lessee of the store at Ospital ng

Maynila who and received delivery  through Luz Espares and Hilda
Rodrigona  totalling P32,034.42 from Metro through Dioscoro
Lamenta

- Solomon Silverio, Jr. draw a check for Metro but it was dishonored for
insufficient fund

Metro demanded payment from Aklan Drug but Editha referred Lamenta
to Silverio who manages the store at Ospital ng Maynila. Lamenta never
checked the owner of the store he was delivering to and always perceived
Editha as the owner. 

- Metro Drug, Inc. filed with the RTC for P32,034.42, 25% attorney's
fees and cost of suit

RTC: dismissed Metro Drug, Inc. to pay P30,000 for moral

damages, P10,000 as attorney's fees and cost of suit since not delivered to
Mijares

CA: reversed.

ISSUE:
W/N RTC made an error in awarding moral damages to Mijares

[18]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

HELD: YES. RTC REINSTATED but only insofar as it dismisses Metro Drug's

complaint

 failed to show motivated by bad faith when it instituted the action

for collection 
 Malicious prosecution, both in criminal and civil cases, requires
the presence of two elements, to wit: a) malice; and b) absence of
probable cause. Moreover, there must be proof that the
prosecution was prompted by a sinister design to vex and
humiliate a person, and that it was initiated deliberately knowing
that the charge was false and baseless
 For the same reasons, the award for attorney's fees and expenses
of litigation must likewise be deleted 

DISPOSITIVE PORTION
WHEREFORE, the petition is hereby GRANTED, and the Decision of
August 31, 1992 and the Resolution of January 10, 1994 of the Court of
Appeals are REVERSED and SET ASIDE. The Decision of the Regional Trial
Court of Manila dated March 8, 1991 is hereby REINSTATED but only
insofar as it dismisses Metro Drug's complaint. SO ORDERED.

Return To Contents

SYLLABUS
CIVIL, LAW; TORTS AND DAMAGES; MALICIOUS PROSECUTION;

ELEMENTS. — In China Banking Corporation vs. Court of

Appeals, [231 SCRA 472 (1994)] we held that: . . . Malicious
prosecution, both in criminal and civil cases, requires the presence of
two elements, to wit: a) malice; b) absence of probable cause.
Moreover, there must be proof that the prosecution was prompted by a
sinister design to vex and humiliate a person, and that it was initiated
deliberately knowing that the charge was false and baseless (Manila
Gas Corporation vs. Court of Appeals, 100 SCRA 602 [1980]).

Hence, mere filing of a suit does not render a person liable for
malicious prosecution should he be unsuccessful, for the law could
not have meant to impose a penalty on the right to litigate (Ponce vs .
Legaspi, 208 SCRA 377 [1992]; Saba vs . Court of Appeals, 189 SCRA
50 [1990]); Rubio vs . Court of Appeals, 141 SCRA 488 [1986]).

Settled in our jurisprudence is the rule that moral damages

cannot be recovered from a person who has filed a complaint against

[19]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

another in good faith, or without malice or bad faith (Philippine

National Bank vs . Court of Appeals, 159 SCRA 433 [1988]. R & B
Surety and Insurance vs . Intermediate Appellate Court, 129 SCRA
736 [1984]). If damage results from the filing of the complaint, it is
damnum absque injuria (Ilocos Norte Electrical Company vs . Court of
Appeals, 179 SCRA 5 [1989]).

Return To Contents

FRANCISCO v. FERRER
[G.R. No. 142029. February 28, 2001.]

ERLINDA FRANCISCO, doing business in the name and style of

Cebu Fountainhead Bakeshop and JULIANA PAMAONG ,
petitioners, vs. RICARDO FERRER, JR., ANNETTE FERRER,
ERNESTO LO AND REBECCA LO, respondents.

Appeal via certiorari 1 taken by petitioners from the decision of the

Court of Appeals 2 increasing the trial court's award of moral damages
to Ricardo Ferrer, Jr., Annette Ferrer, Ernesto Lo and Rebecca Lo to
two hundred fifty thousand pesos (P250,000.00) and awarding
exemplary damages in the amount of one hundred thousand pesos
(P100,000.00), in addition to the following:
"1. The cost of the wedding cake in the amount of P3,175.00;
"2. Attorney's fees in the amount of P10,000.00; and
"3. Cost of litigation."

APPEAL BY Petitioner FRANCISCO on the CA RULING

 CA increased the RTC’s award of moral damages (P30k
to P250k)

[20]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

 CA to award exemplary damages

RELEVANT FACTS

"On November 19, 1992 (Respondents) Mrs. Rebecca Lo and her

daughter Annette Ferrer ORDERED A THREE-LAYERED CAKE
from Fountainhead Bakeshop, (the business of the petitioner) Mango
Avenue Branch.

- It was then agreed that the wedding cake shall be delivered at

5:00 o'clock in the afternoon at the Cebu Country Club, Cebu
City, stating clearly that the wedding is scheduled on December
14, 1992.

- "Plaintiffs (Ferrer) made their first deposit in the amount of

P1,000.00 on November 19, 1992 (the same date the wedding
cake was ordered) and two weeks thereafter made a full payment
on the remaining balance.

Return To Contents

"On the DAY OF THE WEDDING, December 14, 1992, plaintiffs

arrived at the Cebu Country Club around 6:00 o'clock in the evening.
They immediately notice the ABSENCE of the wedding cake.
- An hour after respondents Ferrer arrived, "At 7:00 o'clock in the
evening they made a follow-up call to Fountainhead Bakeshop
and was informed that it was probably LATE BECAUSE OF
THE TRAFFIC. (1st excuse/reason of petitioner Francisco)

- THEN, At 8:00 o'clock they were informed that NO WEDDING

CAKE will be delivered because the ORDER SLIP GOT LOST.
(2nd excuse/reason of petitioner Francisco)
 Plaintiffs were then COMPELLED TO BUY THE ONLY
AVAILABLE CAKE at the Cebu Country Club which
was a sans rival. Even though they felt that it was a
poor substitute to a wedding cake, the cutting of the
cake is always a part of the ceremony.

- "At 10:00 o'clock in the evening, the wedding cake ARRIVED

but plaintiffs DECLINED to accept it, besides their order was a
three-layered cake and what was actually delivered was a
TWO-LAYERED one.

[21]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

"Subsequently, defendant Erlinda Francisco sent a LETTER OF

APOLOGY accompanied with a P5,000.00 check, however, the same
was declined by plaintiffs because they felt it was inadequate.
- "Two weeks after the wedding, defendant Erlinda Francisco
called Mrs. Rebecca Lo and apologized.

"Ricardo Ferrer, son-in-law of Rebecca Lo corroborated the latter's

testimony, stating that two weeks after the wedding, as a result of
the non-delivery of the wedding cake, Ramon Montinola, the son-in-
law of Erlinda Francisco, went to Rebecca Lo's residence and
offered the sum of P5,000.00 to indemnify for the damage done,
but it was rejected."

RTC
On March 12, 1993, respondents (FERRER) filed with the
Regional Trial Court, Cebu City an action for BREACH OF
CONTRACT WITH DAMAGES against petitioners.
- After due trial, on May 19, 1995, the trial court rendered a
decision in favor of plaintiffs (FERRER) and AGAINST
ERLINDA FRANCISCO;

Return To Contents

- "Directing the latter to pay the former the following:

"1. The cost of the wedding cake in the amount of P3,175.00;
"2. Moral damages in the amount of P30,000.00;
"3. Attorney's fees in the amount of P10,000.00; and
"4. Cost of litigation.
CA
On May 25, 1995, petitioners FRANCISCO appealed to the Court of
Appeals.
- After due proceedings, on July 05, 1999, the Court of Appeals
promulgated its decision modifying the appealed decision as
set out in the opening paragraph of this opinion.
- The CA modified the RTC ruling
 Increasing the award of moral damages from P30k to P250k
 Awarding exemplary damages

ISSUES
(1) whether the Court of Appeals erred in affirming the trial
court's award of moral damages and increasing the amount from
thirty thousand (P30,000.00) to two hundred fifty thousand pesos
(P250,000.00); and  YES, CA was wrong.

[22]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

(2) whether the Court of Appeals was justified in awarding in

addition to moral
damages, exemplary damages of one hundred thousand pesos
(P100,000.00).--> NO.

Petitioner’s Contentions
- Petitioners submit that the Court of Appeals and the trial court
erred in awarding moral damages in favor of respondents
because moral damages are recoverable in breach of contract
cases only where the breach was palpably wanton, reckless,
malicious, in bad faith, oppressive or abusive.

RULING: The Court agrees. "To recover moral damages in an action for
breach of contract, the breach must be palpably wanton, reckless,
malicious, in bad faith, oppressive or abusive."

- "Under the provisions of this law, in culpa contractual or

breach of contract, MORAL DAMAGES MAY BE RECOVERED
WHEN THE DEFENDANT ACTED IN BAD FAITH or was guilty
of gross negligence (amounting to bad faith) or in wanton
disregard of his contractual obligation and, exceptionally,
when the act of breach of contract itself is constitutive of tort
resulting in physical injuries."
Return To Contents
- "Moral damages may be awarded in breaches of contracts where
the defendant acted fraudulently or in bad faith."

- "Bad faith does not simply connote bad judgment or negligence,

it imports a DISHONEST PURPOSE or some moral obliquity
and CONSCIOUS DOING OF A WRONG, a breach of known duty
through some motive or interest or ill will that partakes of the
nature of fraud."
In this case, "[W]E THE COURT FOUND NO SUCH FRAUD OR BAD
FAITH."

 "Moral damages are in the category of an award designed to

compensate the claimant for actual injury suffered and not to
impose a penalty on the wrongdoer."
 "The person claiming moral damages must prove the
existence of bad faith by clear and convincing evidence for
the law always presumes good faith. It is not enough that one
merely suffered sleepless nights, mental anguish, serious anxiety
as the result of the actuation of the other party. Invariably such
action must be shown to have been willfully done in bad faith or
with ill motive." "Mere allegations of besmirched reputation,

[23]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

embarrassment and sleepless nights are insufficient to warrant

an award for moral damages. It must be shown that the
proximate cause thereof was the unlawful act or omission of
the [private respondent] petitioners."

"An award of moral damages would require certain CONDITIONS

to be met, to wit:
(1) first, there must be an injury, whether physical, mental or
psychological, clearly sustained by the claimant;
(2) second , there must be culpable act or omission factually
established;
(3) third, the wrongful act or omission of the defendant is the
proximate cause of the injury sustained by the claimant; and
(4) fourth , the award of damages is predicated on any of the
cases stated in Article 2219" of the Civil Code.

AS TO THE AWARD OF EXEMPLARY DAMAGES

To warrant the award of exemplary damages, the wrongful act
must be accompanied by bad faith, and an award of damages would
be allowed only if the guilty party acted in a wanton, fraudulent,
reckless or malevolent manner."

Return To Contents

"The REQUIREMENTS of an award of exemplary damages are:

(1) they may be imposed by way of example in addition to
compensatory damages, and only after the claimant's right to them
has been established;
(2) that they cannot be recovered as a matter of right, their
determination depending upon the amount of compensatory damages
that may be awarded to the claimant;
(3) the act must be accompanied by bad faith or done in a
wanton, fraudulent, oppressive or malevolent manner."

Nevertheless, the facts show that when confronted with their failure to
deliver on the wedding day the wedding cake ordered and paid for,
petitioners gave the lame excuse that delivery was probably
delayed because of the traffic, when in truth, no cake could be
delivered because the order slip got lost. For such prevarication
(the deliberate act of deviating from the truth), petitioners must be
held liable FOR NOMINAL DAMAGES for insensitivity,
inadvertence or inattention to their customer's anxiety and need
of the hour.

[24]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

 "Nominal damages are 'recoverable where a LEGAL RIGHT is

technically VIOLATED and must be vindicated against an
invasion that has produced no actual present loss of any
kind or where there has been a breach of contract and no
substantial injury or actual damages whatsoever have been or
can be shown.'"
 Nominal damages may be awarded "to a plaintiff whose right
has been violated or invaded by the defendant, for the purpose
of vindicating or recognizing that right, not for indemnifying the
plaintiff for any loss suffered."

DISPOSITIVE PORTION
WHEREFORE, the Court GRANTS the petition. The Court
REVERSES the decision of the Court of Appeals in CA-G. R. CV No.
50894, and in lieu thereof, sentences petitioners to pay respondents,
as follows:
1. The cost of the wedding cake in the amount of P3,175.00;
2. Nominal damages in the amount of P10,000.00;
3. Attorney's fees in the amount of P10,000.00; and
4. Costs of litigation.
No costs in this instance.
SO ORDERED.

Return To Contents

SUMMARY OF RULING
- No award for moral damages and exemplary damages because
no fraud or bad faith is present
- Only an award of NOMINAL DAMAGES for failure to deliver the
ordered 3-layered cake

SEVEN BROTHERS SHIPPING CORP., vs. DMC-

CONSTRUCTION RESOURCES, INC.
[G.R. No. 193914. November 26, 2014.]

SEVEN BROTHERS SHIPPING CORPORATION, petitioner , vs.

DMC-CONSTRUCTION RESOURCES, INC., respondent.

FACTS: On February 23, 1996, the cargo ship M/V “Diamond Rabbit”
(the Vessel) owned and operated by Petitioner Seven Brothers Shipping
Corporation, was anchored at the causeway of the port of Bislig.

[25]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

The Master of the Vessel, however, decided to go to PICOP Pier in

Surigao Del Sur to dock there. Due to the bad weather that day, the
vessel, while sailing to PICOP Pier, experienced some difficulties in
maneuvering and controlling its engine. Thus, in order to stop the vessel
from drifting and swinging, its Master decided to drop the starboard
anchor. However, the uncontrollable and unmaneuverable vessel drifted
and dragged its anchor until it hit several structures ate the pier. One of
the structures it hit was the coal conveyor facility owned by respondent
DMC.

Thereafter, DMC sent a formal demand letter to petitioner Seven

Brothers claiming damages for the destruction of its vessel. Petitioner
Seven Brothers, however, failed to pay DMC prompting the latter to file a
complaint for damages against it before the RTC.

Finding negligence on the part of the vessel’s captain, the RTC

ruled in favor of DMC and awarded it actual damages in the amount
P3,523,175.92. On appeal, the CA affirmed the decision of the RTC but
modified the nature of the damages awarded, from actual to nominal, on
the premise that actual damages had not been proved.
Hence, the instant petition wherein petitioner Seven Brothers
argues that under Articles 2221 and 2223 of the Civil Code, nominal
damages are awarded only to vindicate or recognize a right that has been
violated, and not to indemnify a party for any loss suffered by the latter.
They are not awarded as a simple replacement for actual damages that
were not duly proven during trial.

Return To Contents

Petitioner further contends that assuming that nominal damages

were properly awarded by the CA, petitioner Seven Brothers is of the
belief that the amount thereof must be equal or at least commensurate to
the injury sustained by the claimant. Considering that respondent DMC
failed to substantiate its actual loss, it was therefore improper for the CA
to award nominal damages which was based on DMC’s “highly
speculative claims.”

ISSUE:
Whether or not the CA erred in awarding nominal damages to
DMC

RULING: Yes. The Court ruled that temperate, and not nominal,
damages should be awarded to DMC in the amount of P3,523,175.92.

[26]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

In this case, two facts have been established by the appellate and trial
courts: that respondent suffered a loss caused by petitioner; and that
respondent failed to sufficiently establish the amount due to him, as
no actual receipt was presented.

Temperate or moderate damages may be recovered when the

court finds that some pecuniary loss has been suffered but its
amount cannot, from the nature of the case, be provided with
certainty.

Under the Civil Code, when an injury has been sustained, actual
damages may be awarded under the following condition:

Art. 2199. Except as provided by law or by stipulation, one is entitled

to an adequate compensation only for such pecuniary loss suffered by
him as he has duly proved. Such compensation is referred to as
actual or compensatory damages.

Jurisprudence has consistently held that "[t]o justify an award of

actual damages . . . credence can be given only to claims which are
duly supported by receipts." We take this to mean by credible
evidence. Otherwise, the law mandates that other forms of damages
must be awarded, to wit:

Return To Contents
Art. 2216. No proof of pecuniary loss is necessary in order that moral,
nominal, temperate, liquidated or exemplary damages, may be
adjudicated. The assessment of such damages, except liquidated ones,
is left to the discretion of the court, according to the circumstances of
each case.

Under Article 2221 of the Civil Code, nominal damages may be

awarded in order that the plaintiff's right, which has been violated or
invaded by the defendant, may be vindicated or recognized, and not
for the purpose of indemnifying the plaintiff for any loss suffered. We
have laid down the concept of nominal damages in the following wise:

Nominal damages are 'recoverable where a legal right is technically

violated and must be vindicated against an invasion that has
produced no actual present loss of any kind or where there has been a
breach of contract and no substantial injury or actual damages
whatsoever have been or can be shown.'

[27]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

In contrast, under Article 2224, temperate or moderate damages may

be recovered when the court finds that some pecuniary loss has been
suffered but its amount cannot, from the nature of the case, be
provided with certainty. This principle was thoroughly explained in
Araneta v. Bank of America, 38 which cited the Code Commission, to
wit:

The Code Commission, in explaining the concept of temperate

damages under Article 2224, makes the following comment:
In some States of the American Union, temperate damages are
allowed. There are cases where from the nature of the case,
definite proof of pecuniary loss cannot be offered, although the
court is convinced that there has been such loss. For instance,
injury to one's commercial credit or to the goodwill of a business firm
is often hard to show with certainty in terms of money. Should
damages be denied for that reason? The judge should be empowered
to calculate moderate damages in such cases, rather than that the
plaintiff should suffer, without redress from the defendant's wrongful
act.

Given these findings, we are of the belief that temperate and not
nominal damages should have been awarded, considering that it has
been established that respondent herein suffered a loss, even if the
amount thereof cannot be proven with certainty.

Return To Contents

PHILIPPINE NATIONAL BANK vs. COURT OF APPEALS

and LORETO TAN
G.R. No. 108630. April 2, 1996

FACTS
Private respondent Loreto Tan (Tan) is the owner of a parcel of
land abutting the national highway in Mandalagan, Bacolod City.
Expropriation proceedings were instituted by the government against
private respondent Tan and other property owners before the then
Court of First Instance of Negros Occidental, Branch IV.

- Tan filed a motion dated May 10, 1978 requesting issuance of an

order for the release to him of the expropriation price of P3
2,480.00. On May 22, 1978, petitioner PNB (Bacolod Branch)

[28]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

was required by the trial court to release to Tan the amount of

P32,480.00 deposited with it by the government.
- On May 24, 1978, petitioner, through its Assistant Branch
Manager Juan Tagamolila, issued a managers check for P3
2,480.00 and delivered the same to one Sonia Gonzaga without
Tans knowledge, consent or authority.

- Sonia Gonzaga deposited it in her account with Far East Bank

and Trust Co. (FEBTC) and later on withdrew the said amount.

Private respondent Tan subsequently demanded payment in the

amount of P32,480.00 from petitioner, but the same was refused

- on the ground that petitioner had already paid and delivered the
amount to Sonia Gonzaga on the strength of a Special Power of
Attorney (SPA) allegedly executed in her favor by Tan.

- When he failed to recover the amount from PNB, private

respondent filed a motion with the court to require PNB to pay
the same to him. Petitioner filed an opposition contending that
Sonia Gonzaga presented to it a copy of the May 22, 1978 order
and a special power of attorney by virtue of which petitioner
delivered the check to her.

Return To Contents

The matter was set for hearing on July 21, 1978 and petitioner was
directed by the court to produce the said special power of attorney
thereat. However, petitioner failed to do so. The court decided that
there was need for the matter to be ventilated in a separate civil action
and thus private respondent filed a complaint with the Regional Trial
Court in Bacolod City (Branch 44) against petitioner and Juan
Tagamolila, PNBs Assistant Branch Manager, to recover the said
amount.

In its defense, petitioner contended that private respondent had duly

authorized Sonia Gonzaga to act as his agent.

Tagamolila, in his answer, stated that Sonia Gonzaga presented a

Special Power of Attorney to him but borrowed it later with the
promise to return it, claiming that she needed it to encash the check.

[29]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

RTC
The  trial court rendered judgment ordering petitioner and
Tagamolila to pay private respondent jointly and severally the amount
of P32,480.00 with legal interest, damages and attorneys fees.

CA
Court of Appeals affirmed the decision of the trial court against
petitioner, with the modification that the award of P5,000.00 for
exemplary damages and P5,000.00 for attorneys fees by the trial court
was deleted.

ISSUE
Whether CA erred in deleting exemplary damages in this case.

RULING
No. As for the award of exemplary damages, the court agree with the
appellate court that the same should be deleted.
 
Under Art. 2232 of the Civil Code, exemplary damages may be
awarded if a party acted in a wanton, fraudulent, reckless, oppressive,
or malevolent manner. However, they cannot be recovered as a matter
of right; the court has yet to decide whether or not they should be
adjudicated.
 

Return To Contents

Jurisprudence has set down the requirements for exemplary damages

to be awarded:
1. they may be imposed by way of example in addition to
compensatory damages, and only after the claimants right to
them has been established;
2. they cannot be recovered as a matter of right, their
determination depending upon the amount of compensatory
damages that may be awarded to the claimant;
3. the act must be accompanied by bad faith or done in a wanton,
fraudulent, oppressive or malevolent manner.9
 
In the case at bench, while there is a clear breach of petitioners
obligation to pay private respondents, there is no evidence that it
acted in a fraudulent, wanton, reckless or oppressive manner.

[30]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

Furthermore, there is no award to compensatory damages which is a

prerequisite before exemplary damages may be awarded. Therefore,
the award by the trial court of P5,000.00 as exemplary damages is
baseless.
 
WHEREFORE, the decision of the Court of Appeals is AFFIRMED with
the modification that the award by the Regional Trial Court of
P5,000.00 as attorneys fees is REINSTATED.

TAN V. OMC
(G.R. NO. 190521; JANUARY 12, 2011)

FACTS: Respondent OMC Carriers owned a truck, driven by respondent

Arambala, which crashed into the home of petitioners Tan when its braking
mechanism failed. This caused the death of the head of the family, Celedonio
Tan. The Tans went to court to demand damages due to the negligence of
OMC. OMC counters that the truck went out of control because of motor oil
spilled on the road. The RTC found OMC to be liable, that the brake of the
truck malfunctioned, and that there was no motor oil which caused the
accident. The driver, Aramballa, abandoned the truck when the brakes did not
work which caused the truck to slam into the home of the Tans. The RTC
awarded actual damages, both on the loss of property and earning capacity of
Celedonio. Exemplary damages were also awarded.

Return To Contents
Upon appeal to the Court of Appeals, the actual damages for loss of
property was reduced as they were insufficiently substantiated. The damages
for loss of earning capacity was deleted for being totally unsubstantiated. The
Tans were unable to present documents to ascertain the amount of earning
capacity lost. Exemplary damages were also reduced.

ISSUES: 
Was the reduction of actual damages for loss of property proper?

Was the removal of actual damages for loss of earning capacity proper?

Was whether or not the reduction of exemplary damages proper?

[31]
TMCL Sejane, JD3C
Cases on DAMAGES
Torts and Damages

HELD: Temperate damages are awarded when the exact amount of damages

is unknown. The petitioners clearly suffered damages. Their home and
property were damaged. The provider of the family passed away. It is clear and
undisputed that they did suffer losses. However, since the value of the
properties damaged could not be determined with certainty because of the
nature of the property, temperate damages are in order. Also, even if there are
no documents supporting the earning capacity of the deceased, the damage
caused is still undisputed. Temperate damages must be awarded. The
reduction of exemplary damages are proper as exemplary damages are not
meant to enrich or reduce another party to poverty.

Return To Contents

[32]
TMCL Sejane, JD3C