Abuse of Rights (STANFILCO) DOLE PHILIPPINES, INC., petitione , !s. RE"NALDO #. RODRI$%E& 'n( LI#ORIO AFRICA, espon(ents. $.R.

No. )*+,+, - August .., ./). - Pe '0t', 1. N'tu e2 PETITION for review on certiorari of the decision and resolution of the Court of Appeals. F'3ts2 Issue2 Ru0ing2 4hethe the p in3ip0e of ('5nu5 'bs6ue in7u i' 7ustifies the petitione 8s ight to e5o!e the i5p o!e5ents on the sub7e3t p0'nt'tion9 1. Under the principle of damnum abs ue in!uria" the le#itimate e$ercise of a person%s ri#hts" even if it causes loss to another" does not automaticall& result in an actionable in!ur&. '. Under the principle of damnum abs ue in!uria" the le#itimate e$ercise of a person%s ri#hts" even if it causes loss to another" does not automaticall& result in an actionable in!ur&. The law does not prescribe a remed& for the loss. This principle" however" does not appl& when there is an abuse of a person%s ri#ht as in this case. (hile we reco#ni)e petitioner%s ri#ht to remove the improvements on the sub!ect plantation" it" however" e$ercised such ri#ht arbitraril&" un!ustl& and e$cessivel& resultin# in dama#e to respondents% plantation. The e$ercise of a ri#ht" thou#h le#al b& itself" must nonetheless be in accordance with the proper norm. (hen the ri#ht is e$ercised arbitraril&" un!ustl& or e$cessivel& and results in dama#e to another" a le#al wron# is committed for which the wron#doer must be held responsible. *. In the sphere of our law on human relations" the victim of a wron#ful act or omission" whether done willfull& or ne#li#entl&" is not left without an& remed& or recourse to obtain relief for the dama#e or in!ur& he sustained. Incorporated into our civil law are not onl& principles of e uit& but also universal moral precepts which are desi#ned to indicate certain norms that sprin# from the fountain of #ood conscience and which are meant to serve as #uides for human conduct. +. (hen a ri#ht is e$ercised in a manner which does not conform with the norms enshrined in Article 1, and results in dama#e to another" a le#al wron# is thereb& committed for which the wron#doer must be held responsible. One is not allowed to e$ercise his ri#ht in a manner which would cause unnecessar& pre!udice to another or if he would thereb& offend morals or #ood customs. Thus" a person should be protected onl& when he acts in the le#itimate e$ercise of his ri#ht" that is when he acts with prudence and #ood faithbut not when he acts with ne#li#ence or abuse. The e$ercise of a ri#ht must be in accordance with the purpose for which it was established" and must not be e$cessive or undul& harsh- there must be no intention to in!ure another. .. /oral dama#es ma& be awarded in cases referred to in the chapter on human relations of the Civil Code without need of proof that the wron#ful act complained of had caused

an& ph&sical in!ur& upon the complainant.0Under Article ''1, of the New Civil Code" moral dama#es ma& be recovered" amon# others" in acts and actions referred to in Article '1. /oral dama#es ma& be awarded in cases referred to in the chapter on human relations of the Civil Code without need of proof that the wron#ful act complained of had caused an& ph&sical in!ur& upon the complainant. Anent the award of e$emplar& dama#es" Article ''', allows it b& wa& of e$ample or correction for the public #ood. E$emplar& dama#es are an antidote so that the poison of wic1edness ma& not run throu#h the bod& politic. On the matter of attorne&%s fees and liti#ation e$penses" Article ''23 of the same Code provides" amon# others" that attorne&%s fees and e$penses of liti#ation should be recovered" as in this case. (e" therefore" sustain the awards made b& the CA. Assailed in this petition for review on certiorari under 4ule +. of the 4ules of Court are the Court of Appeals 5CA6 7ecision1 dated 8une 1" '229 and 4esolution' dated :eptember 9" '229 in CA;<.4. C= No. .39*'. The CA decision modified the 4e#ional Trial Court 54TC6* 7ecision+ dated :eptember 1*" 1,,9 in Civil Case No. ,';,91" while the CA resolution partiall& #ranted the motion for reconsideration filed b& petitioners :tandard 5Philippines6 >ruit Corporation or :tanfilco" a division of 7ole Philippines" Inc. 57ole6" Orlando ?ulaun 5?ulaun6" /ario /urillo 5/urillo6" and (ilhelm Epelepsia 5Epelepsia6. The case stemmed from the followin# factual and procedural antecedents@ F'3ts2 1. 4espondent Aiborio Africa 5Africa6 is the re#istered owner of a banana plantation in <eneral :antos Cit&. '. Africa entered into a >arm /ana#ement Contract9 5>/C6 with his >arm /ana#er Alfonso Buchen#co 5Buchen#co6 for the development" cultivation" improvement" administration" and #eneral mana#ement of the banana plantation as an a#ricultural development pro!ect *. The contract was established for a period of ten 5126 &ears from the date of e$ecution thereof. The same was e$tended for a total period of '. &ears or up to November 1" 1,,1. +. On October '" 1,9C" the parties amended the >/C b& #ivin# Buchen#co the ri#ht to assi#n" conve&" or transfer its ri#hts under the contract to an& person or entit&" provided due notice is #iven to Africa. .. On 7ecember +" 1,9C" Buchen#co assi#ned his ri#hts as farm mana#er to Chec1ered >arms" Inc. 5Chec1ered >arms6. 9. On 8anuar& 3" 1,93" Chec1ered >arms entered into an E$clusive Purchasin# A#reement with petitioner which bound itself to purchase all the acceptable bananas that would be produced b& the former on the lot sub!ect of the >/C. Chec1ered >arms" for its part" undertoo1 to allow petitioner to introduce installations and improvements on the land and to dismantle and remove all non;permanent installations and improvements it has introduced upon the e$piration of the period of the contract" provided that petitioner has the option to leave them on the land without cost to Chec1ered >arms.

C. It appears that over the &ears" petitioner introduced on the sub!ect parcel of land several improvements consistin# of" amon# others" plantation roads and canals" footbrid#es" irri#ation pumps" pipelines" hoses" and overhead cable proppin#s. 3. 1. On /a& *2" 1,,1" Chec1ered >arms re uested for a ten 5126;&ear e$tension of the contract due to e$pire on November 1" 1,,1" but the re uest was not acted upon b& Africa. ,. On October 1." 1,,1" Africa e$ecuted a Dee( of P':5ent b: Cession 'n( ;uit30'i5 wherein Africa ceded and assi#ned the 1C;hectare sub!ect land to 4e&naldo 4odri#ue) 54odri#ue)6 as pa&ment and in full satisfaction of the former%s obli#ation to the latter amountin# to P* million. In a letter'2 dated 7ecember +" 1,,1" 4odri#ue) introduced himself to Chec1ered >arms as Africa%s successor;in;interest and informed it that he was ta1in# over complete possession and absolute control of the sub!ect land effective immediatel& without pre!udice to whatever acceptable new business arran#ements that ma& be a#reed upon. On even date" 4odri#ue) manifested his interest in petitioner%s banana #rower%s pro#ram. :ince he was interested in petitioner%s corporate #rower%s contract" 4odri#ue) allowed petitioner to assume temporaril& the continued operation and mana#ement of the banana plantation" includin# the harvestin# and mar1etin# of all produce pendin# the approval of the contract. 12. On 7ecember ." 1,,1" Chec1ered >arms as1ed 4odri#ue) that it be allowed to operate the banana plantation until >ebruar& 1,,' to full& wind up the operational activities in the area.'' In a letter'* dated 7ecember 11" 1,,1" 4odri#ue) denied the re uest as he alread& authori)ed petitioner to mana#e the plantation under an interim arran#ement pendin# final resolution of their ne#otiation. In the same letter" 4odri#ue) demanded for the accountin# of fruits harvested from the e$piration of their contract. On 7ecember 1'" 1,,1" Chec1ered >arms claimed that the plantation produced *3' bo$es of e$portable fruits e uivalent to P3".9+.++ and incurred e$penses of P,1",C*.+3.'+ On 7ecember '2" 1,,1"'. petitioner re!ected 4odri#ue)%s proposal for the compan&%s contract #rowin# arran#ement on the same terms as Chec1ered >arms. Instead" petitioner offered to #rant the same terms and conditions as those #iven to independent small #rowers in <eneral :antos Cit&. 4odri#ue) was also re uested to inform petitioner of his decision as there was a need to finali)e the wor1 plan to dismantle the irri#ation s&stem and overhead cable proppin# s&stem should no a#reement be reached.'9 On 8anuar& '" 1,,'" 4odri#ue) e$pressed his doubt on Chec1ered >arms% accountin# of the fruits harvested from the sub!ect land as well as the e$penses incurred in its operations. De" thus" billed Chec1ered >arms the amount of P1"122"922.22 for the fruits harvested" and if no pa&ment is made" to return all the harvest.'C On 8anuar& 11" 1,,'" 4odri#ue) re uested for reconsideration of the denial of his application for the compan&%s contract #rowin# arran#ement and as1ed petitioner to desist from dismantlin# the improvements thereon.'3 As no a#reement was reached between petitioner and 4odri#ue)" the latter demanded from the former an accountin# of what was harvested durin# the interim period and a statement of the char#es due him.', In its repl&" petitioner stated that it was able to produce onl& C.* bo$es of bananas valued at P1C"C*9.+3.*2 Petitioner eventuall& dismantled and removed the improvements in the plantation.*1

On >ebruar& 12" 1,,'" 4odri#ue) sent a letter to petitioner demandin# the pa&ment of the bananas harvested durin# the interim administration of petitioner and protestin# the Eunwarranted and wanton destruction of the farm.F*' Petitioner" however" refused to heed the demand. Instead" it uestioned 4odri#ue)%s ownership of the sub!ect land" denied the li uidated price support of P1' per 1ilo or restitution of the harvest in e uivalent volume and ualit&" and denied the accusation of ille#al destruction in the plantation.** On April 9" 1,,'" respondents filed a Complaint for 4ecover& of :um of /one& and 7ama#es*+ a#ainst petitioner and its officials ?ulaun" /urillo and Epelepsia. 4espondents claimed that despite repeated demands" petitioner and its officials refused and failed" without valid" !ust" reasonable or lawful #round" to pa& the amount of P12C"+3+.22 with interest at the le#al rate until full pa&ment" or to #ive an accountin# of the entire harvest actuall& made b& them durin# the period that it was #iven such interim authorit& to harvest.*. 4espondents also alle#ed that petitioner%s staff" actin# under the direct supervision of Epelepsia who has been wor1in# directl& with the instructions of ?ulaun" all performin# under the administrative and operational responsibilit& of /urillo" stealthil&" treacherousl& and ruthlessl& raided the sub!ect plantation destro&in# the facilities therein which ma1es them liable for dama#es.*9 These acts" which are contrar& to morals" #ood customs or public polic&" alle#edl& made petitioner liable for dama#es.*C 4espondents also demanded indemnit& for dama#es suffered from petitioner%s act of deprivin# the former from usin# the water facilities installed in the plantation that resulted in the spoila#e of respondents% plants.*3 4espondent li1ewise accused petitioner of 1nowin#l& and fraudulentl& operatin# and harvestin# within respondents% premises" ma1in# it liable for dama#es.*, Aastl&" respondents pra&ed for the pa&ment of moral" e$emplar& and nominal dama#es plus liti#ation e$penses.+2 In their Answer with Compulsor& Counterclaims"+1 petitioner admitted its contractual relationship with Africa but alle#ed that 4odri#ue) duped and fraudulentl& misled petitioner into believin# that he was the owner of the sub!ect plantation where in fact it was owned b& Africa.+' Petitioner alle#ed that he was the owner of the irri#ation s&stem on the sub!ect plantation. Thus" it has the ri#ht to remove them after the e$piration of its contract with Africa.+* It added that the removal of the irri#ation s&stem from the sub!ect plantation was a valid e$ercise of its ri#hts as owner of the irri#ation s&stem and an e$ercise of the ri#ht to dismantle and remove the same under the E$clusive Purchasin# A#reement with Chec1ered >arms. It denied respondents% accusation that the dismantlin# too1 place at ni#httime and with the aid of armed men. Petitioner also denied causin# the destruction of standin# crops or the canals.++ In its counterclaim" petitioner demanded from respondents the pa&ment of P.3".9'.11 representin# the e$penses it incurred durin# the interim mana#ement of the plantation after deductin# the farm revenue. Petitioner also pra&ed for the pa&ment of moral and e$emplar& dama#es plus attorne&%s fees.+. On :eptember 1*" 1,,9" the 4TC rendered a 7ecision+9 in favor of respondents and a#ainst petitioner" the dispositive portion of which reads@ (DE4E>O4E" in view of all the fore#oin#" !ud#ment is hereb& rendered in favor of the plaintiffs and a#ainst defendant corporation orderin# the latter to pa& to the former the sum of P1C"C39.+3" representin# the value of the banana fruits harvested durin# the interim

arran#ement- the amount of P.22"222.22 for the destruction of the banana plants and for the rehabilitation of the plantation- the sum of P.2"222.22 as liti#ation e$penses and P.2"222.22 as attorne&%s fees" and the costs of suit. The complaint" as a#ainst defendants Orlando ?ulaun" (ilhelm Epelepsia and /ario /urillo" is hereb& 7ismissed. 7efendant%s counterclaim is 7ENIE7. :O O47E4E7.+C GGGGGGGGGGGGGGG +* Id." at p. .,. ++ Id." at p. 93. +. Id." at pp. 93;C2. +9 Penned b& Actin# Presidin# 8ud#e Paul T. Arcan#el- id." at pp. 12+9;12.9. +C 4ecords" p. 12.9. 992

992 :UP4E/E COU4T 4EPO4T: ANNOTATE7 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) (ith the admission of petitioner that it harvested C.* bo$es of banana fruits valued at P1C"C39.22 from the sub!ect plantation but were not turned over to respondents" the trial court found the latter entitled to said amount as owners of the propert&.+3 The trial court further found respondents entitled to P.22"222.22 actual dama#es for the destro&ed banana plants caused b& petitioner when it e$ercised its ri#ht to remove the improvements it introduced on the plantation.+, The 4TC" however" found that respondents do not have the ri#ht to use the improvements owned b& petitioner. Thus" when petitioner removed said improvements" respondents cannot insist that the& be awarded dama#es for the deprivation of the use thereof. Neither can the& insist that petitioner leave said improvements on the sub!ect plantation..2 The trial court also did not award respondents% claim for the value of the crops harvested on the two;hectare propert& of respondents ad!oinin# the Aparente propert&" because such portion was believed to belon# to the Aparente famil&..1 4espondents% pra&er for moral" e$emplar& and nominal dama#es were denied because petitioner did not act in bad faith but onl& e$ercised its ri#ht to dismantle the improvements in accordance with the terms of the E$clusive Purchasin# A#reement..' In view of the destruction of the plantation and respondents% efforts to protect their interest" the 4TC awarded P.2"222.22 liti#ation e$penses and the same amount as attorne&%s fees..* The trial court further absolved ?ulaun" /urillo and Epelepsia from liabilit& and made petitioner solel& liable. As to petitioner%s counterclaim" the court found no reason to award the

GGGGGGGGGGGGGGG +3 Id." at p. 12.+. +, Id. .2 Id. at p. 12... .1 Id. .' Id. .* Id." at pp. 12..;12.9. 991

=OA. 9C3" AU<U:T ''" '21' 991 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) same as respondents% acts were not meant to harass them but were underta1en to protect their interest..+ Petitioner and respondents interposed separate appeals. On 8une 1" '229" the CA modified the 4TC decision. The dispositive portion of the decision is uoted below for eas& reference@ (DE4E>O4E" in the li#ht of the fore#oin# premises" the decision sub!ect of this appeal is hereb& /O7I>IE7. The defendant;appellant :TAN>IACO is hereb& ordered to pa& plaintiff; appellant 4odri#ue) the followin# amounts@ 5a6HP'22"222.22 as temperate dama#es for the banana plants that were felled and for the dama#e done on the #round5b6HP.2"222 b& wa& of moral dama#es5c6HP.2"222 b& wa& of e$emplar& dama#es5d6HP.2"222 b& wa& of liti#ation e$penses5e6HP.2"222 b& wa& of attorne&%s fees. :O O47E4E7... The CA first settled the le#al standin# of Africa and 4odri#ue) to institute the action before the lower court. As re#istered owner of the propert&" the appellate court considered Africa an indispensable part&. As assi#nee of Africa" the CA li1ewise upheld 4odri#ue)%s le#al standin#. Contrar& to petitioner%s protestation" the CA considered petitioner estopped from impu#nin# the e uitable ownership of 4odri#ue) of the sub!ect plantation considerin# that it was 4odri#ue) who #ave petitioner the authorit& to supervise and operate the plantation

awaitin# the results of 4odri#ue)%s application for corporate #rower%s contract with petitioner..9 GGGGGGGGGGGGGGG .+ Id." at p. 12.9. .. 4ollo" p. 1+*. .9 Id." at pp. 1'2;1'1. 99'

99' :UP4E/E COU4T 4EPO4T: ANNOTATE7 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) The CA affirmed the 4TC%s conclusion that durin# the interim period when it was #iven the authorit& to operate the plantation" petitioner harvested C.* bo$es of bananas valued at P1C"C39.+3. Dowever" durin# the same period" petitioner incurred e$penses of PC9"*+3..C. Thus" respondents still owe petitioner P.3".9'.11..C As to the nature of the facilities and improvements installed b& petitioner" the appellate court refused to consider them immovable as the& were installed not b& the owner but b& a tenant. Pursuant" therefore" to the E$clusive Purchasin# A#reement" the appellate court upheld petitioner%s ri#ht to dismantle the facilities and improvements..3 /oreover" the CA echoed the 4TC conclusion that respondents are not entitled to the crops harvested from the two;hectare propert& believed to belon# to the Aparente famil& as the& were indeed cultivated for the benefit of said famil& and not for respondents.., The court further sustained the 4TC%s conclusion to e$empt petitioners% officers from liabilit& as the& merel& followed the orders of their superiors.92 (hile sustainin# respondents% claim for the dama#es sustained when petitioner e$ercised its ri#ht to dismantle the improvements and facilities introduced on the sub!ect plantation" the appellate court deemed it proper to reduce the amount awarded b& the 4TC from P.22"222.22 to P'22"222.22 as temperate dama#es.91 In addition to liti#ation e$penses and attorne&%s fees" the CA awarded P.2"222.22 moral dama#es and P.2"222.22 e$emplar& dama#es.9' The appellate court further modified the decision in a 4esolution dated :eptember 9" '229 b& includin# the statement that the sum of P.3".9'.11 representin# the e$penses incurred durin# the GGGGGGGGGGGGGGG .C Id." at p. 1'.. .3 Id." at pp. 1*';1**. ., Id." at p. 1**. 92 Id." at p. 1*9.

91 Id." at pp. 1+1;1+'. 9' Id." at pp. 1+';1+*. 99*

=OA. 9C3" AU<U:T ''" '21' 99* 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) interim period be deducted from the award #iven to respondents.9* A##rieved" petitioner comes before the Court in this petition for review on certiorari with the followin# assi#ned errors@ I.HTDE COU4T O> APPEAA: E44E7 IN NOT APPABIN< TDE AE<AA P4INCIPAE O> 7A/NU/ A?:IUE IN8U4IA TO 4EN7E4 8U7</ENT 4E=E4:IN< AN7 :ETTIN< A:I7E TDE 7ECI:ION O> TDE AO(E4 COU4T AN7 7I:/I::IN< TDE CO/PAAINT ?EAO(" CON:I7E4IN< TDAT IT >OUN7 TDE 4E/O=AA AN7 7I:/ANTAIN< O> TDE 7OAE IN:TAAAATION: AN7 I/P4O=E/ENT: TO ?E IN /E4E 7I:CDA4<E O> A CONT4ACTUAA 4I<DT. II.HTDE COU4T O> APPEAA: E44E7 IN A(A47IN< TE/PE4ATE" /O4AA AN7 EJE/PAA4B 7A/A<E: AN7" A: (EAA" ATTO4NEB%: >EE: TO TDE 4E:PON7ENT:" TDE4E ?EIN< NO >ACTUAA AN7 AE<AA ?A:E: TDE4E>O4" A: TDE CONCAU:ION TDAT TDE A>4ICA >A4/ (A: 7E:T4OBE7 ON ACCOUNT O> PETITIONE4 :TAN>IACO 7OAE%s AAAE<E7 AACK O> P4ECAUTION IN 4E/O=IN< AN7 7I:/ANTAIN< TDE IN:TAAAATION: AN7LO4 I/P4O=E/ENT: INT4O7UCE7 ON TDE :AI7 >A4/@ A.HI: IN >ACT CONT4A4B TO >ACTUAA >IN7IN<: ?B TDE COU4T O> APPEAA:?.HDA: NOT ?EEN :U>>ICIENTAB E:TA?AI:DE7 ?B :U?:TANTIAA" 7I4ECT AN7 PO:ITI=E E=I7ENCE- AN7 C.HI: AA:O CONT4A4B TO TDE E:TA?AI:DE7 E=I7ENCE. III.HTDE COU4T O> APPEAA: E44E7 IN NOT <4ANTIN< PETITIONE4 :TAN>IACO 7OAE%: COUNTE4CAAI/:" IT ?EIN< E:TA?AI:DE7 TDAT 4E:PON7ENT: ACTE7 GGGGGGGGGGGGGGG 9* Id." at pp. 1+9;1+,. 99+

99+ :UP4E/E COU4T 4EPO4T: ANNOTATE7

5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) TO(A47: IT IN A /ANNE4 (ITD /AAICE A>O4ETDOU<DT AN7 ATTEN7E7 ?B ?A7 >AITD.9+ Petitioner submits that the CA erred in failin# to reco#ni)e that the case at bar is a clear case of damnum abs ue in!uria" warrantin# the reversal of the 4TC%s decision and the dismissal of the complaint below.9. Petitioner adds that there are no factual and le#al bases for the #rant of temperate" moral" and e$emplar& dama#es.99 It e$plains that the resultin# in!ur& to respondents arisin# from the removal and dismantlin# of improvements that petitioner undertoo1 pursuant to the provisions of the E$clusive Purchasin# A#reement with Chec1ered >arms is damnum abs ue in!uria.9C It points out that it removed onl& the removable irri#ation facilities refrainin# from e$ercisin# said le#al ri#ht with respect to the draina#e canals" the roads and the overhead proppin#s which covered the entire len#th of the farm.93 Petitioner also claims that the CA was uncertain as to the pro$imate cause of the alle#ed destruction resultin# in dama#es to respondents. Thus" the appellate court alle#edl& erred in char#in# petitioner with actin# wron#full&" wantonl&" and in bad faith a#ainst respondents warrantin# the award of temperate" moral" and e$emplar& dama#es.9, Aastl&" petitioner asserts that the lower court erred in not awardin# its counterclaims it bein# established that respondents filed the complaint below with malice and attended b& bad faith.C2 The petition is without merit. GGGGGGGGGGGGGGG 9+ 4ollo" p. C1. 9. Id." at p. C'. 99 Id." at p. C+. 9C Id. 93 Id." at p. 32. 9, Id." at p. 3,. C2 Id." at p. ,+. 99.

=OA. 9C3" AU<U:T ''" '21' 99. 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) :tated in simple terms" the principal uestions for resolution are whether petitioner is liable to respondents for dama#es and if so" the amount of such liabilit&.

At the outset" we would li1e to specif& the claims made b& respondents a#ainst petitioner brou#ht about b& the contractual relations previousl& entered into b& the parties. >irst" the pa&ment of the value of the bananas harvested b& petitioner when it was #iven the authorit& to temporaril& mana#e the plantation- second" pa&ment of the value of the bananas harvested in the two;hectare propert& ad!oinin# the Aparente propert&- third" indemnit& for dama#es caused to the plantation in the course of removin# the irri#ation facilities owned b& petitioner- fourth" indemnit& for dama#es brou#ht about b& the deprivation of petitioner%s ri#ht to use the irri#ation facilities in uestion- and fifth" the pa&ment of moral" e$emplar& and other forms of dama#es. The CA correctl& denied respondents% second and fourth claims and aptl& #ranted 5with ualification6 respondents% first" third and fifth claims. As to the value of the bananas harvested durin# petitioner%s interim mana#ement of the plantation" we find no reason to disturb the 4TC and CA%s findin#s that indeed" respondents are entitled to said claim. Dowever" as petitioner incurred e$penses" the correspondin# value should in turn be deducted from the total harvests made. Thus" while respondents are entitled to the value of C.* bo$es of bananas amountin# to P1C"C39.+3" the& cannot be #iven said amount as petitioner%s total e$penses of P,1",C*.+3 should be deducted. Conse uentl&" respondents" not petitioners" are indebted to the latter in the total amount of P.3".9'.11 as reflected in the CA%s assailed resolution modif&in# its earlier assailed decision. As to the bananas harvested on the portion which was mista1enl& believed to belon# to the Aparente famil& but eventuall& ad!ud#ed in favor of respondents" petitioner cannot be made to answer for the value thereof considerin# that the proceeds inured not to its benefit but to the Aparente famil&. 999

999 :UP4E/E COU4T 4EPO4T: ANNOTATE7 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) Now on the dama#es resultin# from the dismantlin# and removal of the facilities and improvements introduced b& petitioner on the sub!ect plantation" we find a co#ent reason to sustain the CA%s conclusions on respondents% entitlement to such claims but find sufficient #round to modif& the amounts awarded. It is settled that petitioner was #iven the ri#ht to dismantle the improvements introduced on the sub!ect plantation as clearl& provided for in its contract with Chec1ered >arms" thus@ The PAANTE4 MChec1ered >armsN shall" amon# other thin#s" underta1e and perform the followin#@ $$$$ f. HAllow the CO/PANB MpetitionerN to dismantle and remove all non;permanent installations and improvements it has introduced on the land upon the e$piration of the period of this

A#reement provided" that MpetitionerN at its option ma& leave them on the land" without cost to MChec1ered >armsN.C1 On the basis of the above contractual provision" petitioner insists that it cannot be held liable for dama#es alle#edl& suffered b& respondents based on the principle of damnum abs ue in!uria. (e do not a#ree. Under the principle of damnum abs ue in!uria" the le#itimate e$ercise of a person%s ri#hts" even if it causes loss to another" does not automaticall& result in an actionable in!ur&. The law does not prescribe a remed& for the loss. This principle" however" does not appl& when there is an abuse of a person%s ri#ht as in this case.C' (hile we reco#ni)e petitioner%s ri#ht to remove the improvements on the sub!ect plantation" it" however" e$ercised such ri#ht arbitraril&" un!ustl& and GGGGGGGGGGGGGGG C1 4ecords" pp. ,+;,.. C' Amono& v. :pouses <utierre)" +2+ Phil. .39" .3,- *.1 :C4A C*1" C*' 5'2216. 99C

=OA. 9C3" AU<U:T ''" '21' 99C 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) e$cessivel& resultin# in dama#e to respondents% plantation. The e$ercise of a ri#ht" thou#h le#al b& itself" must nonetheless be in accordance with the proper norm. (hen the ri#ht is e$ercised arbitraril&" un!ustl& or e$cessivel& and results in dama#e to another" a le#al wron# is committed for which the wron#doer must be held responsible.C* As aptl& e$plained b& the Court in <> E uit&" Inc. v. =alen)onaC+0 The e$ercise of a ri#ht ends when the ri#ht disappears" and it disappears when it is abused" especiall& to the pre!udice of others. The mas1 of a ri#ht without the spirit of !ustice which #ives it life is repu#nant to the modern concept of social law. It cannot be said that a person e$ercises a ri#ht when he unnecessaril& pre!udices another or offends morals or #ood customs. Over and above the specific precepts of positive law are the supreme norms of !ustice which the law develops and which are e$pressed in three principles@ honeste vivere" alterum non laedere and !us suum ui ue tribuere- and he who violates them violates the law. >or this reason" it is not permissible to abuse our ri#hts to pre!udice others.C. In the sphere of our law on human relations" the victim of a wron#ful act or omission" whether done willfull& or ne#li#entl&" is not left without an& remed& or recourse to obtain relief for the dama#e or in!ur& he sustained. Incorporated into our civil law are not onl& principles of e uit& but also universal moral precepts which are desi#ned to indicate certain

norms that sprin# from the fountain of #ood conscience and which are meant to serve as #uides for human conduct.C9 GGGGGGGGGGGGGGG C* Cebu Countr& Club" Inc. v. Eli)a#a ue" <.4. No. 192'C*" 8anuar& 13" '223" .+' :C4A 9." C+;C.. C+ <.4. No. 1.93+1" 8une *2" '22." +9' :C4A +99. C. <> E uit&" Inc. v. =alen)ona" supra" at pp. +C3;+C," citin# 7e <u)man v. National Aabor 4elations Commission" <.4. No. ,23.9" 8ul& '*" 1,,'" '11 :C4A C'*. C9 Carpio v. =almonte" +31 Phil. *.'" *91- +*3 :C4A *3" +9 5'22+6 993

993 :UP4E/E COU4T 4EPO4T: ANNOTATE7 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) Abuse of ri#ht under Article 1, of the New Civil Code provides@ Art. 1,.HEver& person must" in the e$ercise of his ri#hts and in the performance of his duties" act with !ustice" #ive ever&one his due" and observe honest& and #ood faith. The above provision sets the standards which ma& be observed not onl& in the e$ercise of one%s ri#hts but also in the performance of one%s duties. (hen a ri#ht is e$ercised in a manner which does not conform with the norms enshrined in Article 1, and results in dama#e to another" a le#al wron# is thereb& committed for which the wron#doer must be held responsible.CC One is not allowed to e$ercise his ri#ht in a manner which would cause unnecessar& pre!udice to another or if he would thereb& offend morals or #ood customs. Thus" a person should be protected onl& when he acts in the le#itimate e$ercise of his ri#ht" that is when he acts with prudence and #ood faith- but not when he acts with ne#li#ence or abuse.C3 The e$ercise of a ri#ht must be in accordance with the purpose for which it was established" and must not be e$cessive or undul& harsh- there must be no intention to in!ure another.C, In this case" evidence presented b& respondents shows that as a result of the di##in#s made b& petitioner in order to remove the pipes" banana plants were uprooted. :ome of these plants in fact had fruits &et to be harvested causin# loss to respondents. After the removal of said pipes" petitioner failed to restore the plantation to its ori#inal condition b& its failure to cover the di##in#s with soil. As found b& the CA" the 7am; GGGGGGGGGGGGGGG CC Deirs of Purisima Nala v. Cabansa#" <.4. No. 191133" 8une 1*" '223" ..+ :C4A +*C" ++'Cebu Countr& Club" Inc. v. Eli)a#a ue" supra note C*" at p. C*.

C3 Carpio v. =almonte" supra note C9" at p. *9'- p. +C. C, Deirs of Purisima Nala v. Cabansa#" supra note CC" at pp. ++';++*. 99,

=OA. 9C3" AU<U:T ''" '21' 99, 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) a#e 4eport submitted b& An#el >lores stated that there was #round destruction because di##in#s were done indiscriminatel& without concern for the standin# banana plants. De even added that the destruction of the #round was e$tensive.32 The witnesses for petitioner li1ewise admitted that the& had the responsibilit& to cover the di##in#s made but failed to do so after the pipelines had been retrieved. (itnesses and pictures also showed that indeed" banana plants were uprooted and scattered around the plantation.31 It is noteworth& that petitioner was #iven the ri#ht to remove onl& the improvements and facilities that were Enon;permanentF instead of #ivin# it the un ualified ri#ht to remove ever&thin# that it introduced to the plantation. Thou#h not specificall& stated in the contract" the reason for said ualification on petitioner%s ri#ht of removal is the imperative need to protect the plantation from unnecessar& destruction that ma& be caused b& the e$ercise of the ri#ht. If permanent structures were allowed to be removed" dama#e to the plantation would not be avoided. This ualified ri#ht should have #iven petitioner the necessar& warnin# to e$ercise its ri#ht with caution with due re#ard to the other structures in the plantation and most especiall& the banana plants and fruits therein. If petitioner was able to consider cuttin# the pipes underneath the roads within the plantation so as not to destro& said roads" wh& did it not ta1e into consideration the banana plants and fruits that would be destro&ed b& reason thereofO Petitioner would not have been undul& pre!udiced had it waited for the bananas to be harvested before removin# the pipes. Clearl&" petitioner abused its ri#ht. (hile Article 1, la&s down a rule of conduct for the #overnment of human relations and for the maintenance of social GGGGGGGGGGGGGGG 32 4ecords" pp. +19;+1C. 31 4ollo" pp. *3;+'. 9C2

9C2 :UP4E/E COU4T 4EPO4T: ANNOTATE7

5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) order" it does not provide a remed& for its violation.3' Complementin# the principle of abuse of ri#hts are the provisions of Articles '2 and '1 of the Civil Code which read@ ArticleP'2.HEver& person who" contrar& to law" willfull& or ne#li#entl& causes dama#e to another" shall indemnif& the latter for the same. ArticleP'1.HAn& person who willfull& causes loss or in!ur& to another in a manner that is contrar& to morals" #ood customs" or public polic& shall compensate the latter for the dama#e. The fore#oin# rules provide the le#al bedroc1 for the award of dama#es to a part& who suffers dama#e whenever one commits an act in violation of some le#al provision" or an act which thou#h not constitutin# a trans#ression of positive law" nevertheless violates certain rudimentar& ri#hts of the part& a##rieved.3* Article '2 pertains to dama#es arisin# from a violation of law which does not obtain here3+ as petitioner was perfectl& within its ri#ht to remove the improvements introduced in the sub!ect plantation. Article '1" on the other hand" refers to acts contra bonus mores.3. The act is within the article onl& when it is done willfull&. The act is willful if it is done with 1nowled#e of its in!urious effect- it is not re uired that the act be done purposel& to produce the in!ur&.39 Undoubtedl&" petitioner removed the pipes with 1nowled#e of its in!urious effect which is the destruction of the banana plants and fruits- and failed to cover the di##in#s which caused #round destruction. Petitioner should" therefore" be liable for dama#es. GGGGGGGGGGGGGGG 3' Cebu Countr& Club" Inc. v. Eli)a#a ue" supra note C*" at p. C*. 3* Carpio v. =almonte" supra note C9" at pp. *9';*9*- pp. +C;+3. 3+ Ni11o Dotel /anila <arden v. 4e&es" <.4. No. 1.+'.," >ebruar& '3" '22." +.' :C4A .*'" .+C. 3. Id. 39 Tolentino" Commentaries and 8urisprudence on the Civil Code of the Philippines" =ol. I" p. 93. 9C1

=OA. 9C3" AU<U:T ''" '21' 9C1 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) >or the dama#es sustained b& reason of the uprooted and felled banana plants" the 4TC awarded respondents P.22"222.22. The CA" however" reduced the amount to P'22"222.22. Under Article '''+ of the Civil Code" temperate or moderate dama#es are more than

nominal but less than compensator&3C which are #iven in the absence of competent proof on the actual dama#es suffered.33 In view of the CA observations which we will uote below" we deem it proper to further reduce the above amount to P122"222.22 as temperate dama#es@ The above observation notwithstandin#" (e are not about to sustain to its full e$tent the award #iven b& the court a uo. >ran1l&" (e are of the impression that the #rant of P.22"222 calls for the temperin# hand of this Court" especiall& since the pictures show that while there were felled banana plants" a #reater number were still left standin# and unharmed. Obviousl&" the number of felled plants as shown in the picture was ver& minimal" missin# the claimed number of 3".22 b& uite a lon# shot. Also in the testimon& of plaintiff;appellant 4odri#ue)" he admitted that he cannot sa& for sure whether the felled banana plants as shown in the pictures were those that were harvested. $$$$ Thus" while it is possible that the banana plants shown in the pictures were felled when the irri#ation pipes were removed" (e cannot also discount the possibilit& that some of the fallen plants shown in the pictures fell even earlier durin# the occasion of the recent harvest that was conducted on the farm on the third wee1 of 8anuar& 1,,'" or a wee1 before the dismantlin# operations be#an. GGGGGGGGGGGGGGG 3C (uerth Philippines" Inc. v. 4odante Bnson" <.4. No. 1C.,*'" >ebruar& 1." '21'" 999 :C4A 1.1. 33 Ori$ /etro Aeasin# and >inance Corporation 5>ormerl& Consolidated Ori$ Aeasin# and >inance Corporation6 v. /inors@ 7ennis" /&lene" /elanie and /ari1ris" all surnamed /an#alinao B 7i)on" /anuel /. On#" Aoreto Aucilo" :onn& Ai" and Antonio delos :antos" <.4. No. 1C+23," 8anuar& '." '21'" 99+ :C4A 3C. 9C'

9C' :UP4E/E COU4T 4EPO4T: ANNOTATE7 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) :uffice it to sa& that no solid evidence e$ists that could sustain the 3".22 banana plants alle#ed to have been dama#ed. Perhaps" this hu#e number could be attributed to the fact that around the time that the said dama#e report was prepared 5>ebruar& 12" 1,,' or almost a wee1 after removal of the irri#ation facilities be#an6" man& of the plants were alread& wiltin# due to the ver& dr& weather in the area which was further a##ravated b& the absence of irri#ation. $ $ $

?ut then a#ain" it is not for this Court to define e$actl& how man& plants were felled in the process of removin# the pipes. >or this reason" (e are poised to #rant temperate dama#es in the amount of Two Dundred Thousand 5P'22"222.226 pesos.3, Under Article ''1, of the New Civil Code" moral dama#es ma& be recovered" amon# others" in acts and actions referred to in Article '1.,2 /oral dama#es ma& be awarded in cases referred to in the chapter on human relations of the Civil Code without need of proof that the wron#ful act complained of had caused an& ph&sical in!ur& upon the complainant.,1 Anent the award of e$emplar& dama#es" Article ''', allows it b& wa& of e$ample or correction for the public #ood.,' E$emplar& dama#es are an antidote so that the poison of wic1edness ma& not run throu#h the bod& politic.,* On the matter of attorne&%s fees and liti#ation e$penses" Article ''23 of the same Code provides" amon# others" that attorne&%s fees and e$penses of liti#ation should be recovered" as in this case.,+ (e" therefore" sustain the awards made b& the CA. One final note. The responsibilit& arisin# from abuse of ri#hts has a mi$ed character because it implies a reconcilia; GGGGGGGGGGGGGGG 3, 4ollo" pp. 1+1;1+'. ,2 Cebu Countr& Club" Inc. v. Eli)a#a ue" supra note C*" at p. C.. ,1 7e <u)man v. National Aabor 4elations Commission" supra note C." at p. C*'. ,' Cebu Countr& Club" Inc. v. Eli)a#a ue" supra note C*" at p. C.. ,* 7e <u)man v. National Aabor 4elations Commission" supra note C." at p. C*'. ,+ Cebu Countr& Club" Inc. v. Eli)a#a ue" supra note C*" at p. C9. 9C*

=OA. 9C3" AU<U:T ''" '21' 9C* 5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue) tion between an act" which is the result of an individual !uridical will" and the social function of ri#ht. The e$ercise of a ri#ht" which is reco#ni)ed b& some specific provision of law" ma& nevertheless be contrar& to law in the #eneral and more abstract sense. The theor& is simpl& a step in the process of temperin# law with e uit&.,. (DE4E>O4E" premises considered" the petition is 7ENIE7. The Court of Appeals 7ecision dated 8une 1" '229 and 4esolution dated :eptember 9" '229 in CA;<.4. C= No. .39*'" are A>>I4/E7 with /O7I>ICATION b& reducin# the temperate dama#es from P'22"222.22 to P122"222.22.

:O O47E4E7. =elasco" 8r. 5Chairperson6" Abad" /endo)a and Perlas;?ernabe" 88." concur. Petition denied" !ud#ment and resolution affirmed with modification. Notes.0(ell;settled is the rule that the commencement of an action does not per se ma1e the action wron#ful and sub!ect the action to dama#es" for the law could not have meant to impose a penalt& on the ri#ht to liti#ate- If dama#es result from a part&%s e$ercise of a ri#ht" it is damnum abs ue in!uria. 58apan Airlines vs. :iman#an" ..' :C4A *+1 M'223N6 >or an action for dama#es under Article 1, of the Civil Code to prosper" the complainant must prove that@ 5a6 defendant has a le#al ri#ht or dut&- 5b6 he e$ercised his ri#ht or performed his dut& with bad faith and 5c6 complainant was pre!udiced or in!ured as a result of the said e$ercise or performance b& defendant. 57evelopment ?an1 of the Philippines vs. 7o&on" .3' :C4A +2* M'22,N6 00o2o00 GGGGGGGGGGGGGGG ,. Tolentino" Commentaries and 8urisprudence on the Civil Code of the Philippines" =ol. I" p. .3. M5:tanfilco6 7ole Philippines" Inc. vs. 4odri#ue)" 9C3 :C4A 9.15'21'6N