G.R. No. L-20089 December 26, 1964 On August 23, 1955 defendant failed to appear before court.
On August 23, 1955 defendant failed to appear before court. Instead, on the following
BEATRIZ P. WASSMER, plaintiff-appellee, vs.FRANCISCO X. VELEZ, defendant-
appellant.
BENGZON, J.P., J.:
The facts that culminated in this case started with dreams and hopes, followed by
appropriate planning and serious endeavors, but terminated in frustration and, what is
worse, complete public humiliation.
Francisco X. Velez and Beatriz P. Wassmer, following their mutual promise of love,
decided to get married and set September 4, 1954 as the big day. On September 2, 1954
Velez left this note for his bride-to-be:
Dear Bet —
Will have to postpone wedding — My mother opposes it. Am leaving on the Convair
today.
Please do not ask too many people about the reason why — That would only create
a scandal.
Paquing
But the next day, September 3, he sent her the following telegram:
NOTHING CHANGED REST ASSURED RETURNING VERY SOON APOLOGIZE
MAMA PAPA LOVE .
PAKING
Thereafter Velez did not appear nor was he heard from again.
Sued by Beatriz for damages, Velez filed no answer and was declared in default. Plaintiff
adduced evidence before the clerk of court as commissioner, and on April 29, 1955,
judgment was rendered ordering defendant to pay plaintiff P2,000.00 as actual damages;
P25,000.00 as moral and exemplary damages; P2,500.00 as attorney's fees; and the costs.
On June 21, 1955 defendant filed a "petition for relief from orders, judgment and
proceedings and motion for new trial and reconsideration." Plaintiff moved to strike it
cut. But the court, on August 2, 1955, ordered the parties and their attorneys to appear
before it on August 23, 1955 "to explore at this stage of the proceedings the possibility of
arriving at an amicable settlement." It added that should any of them fail to appear "the
petition for relief and the opposition thereto will be deemed submitted for resolution."
1
day his counsel filed a motion to defer for two weeks the resolution on defendants
petition for relief. The counsel stated that he would confer with defendant in Cagayan
de Oro City — the latter's residence — on the possibility of an amicable element. The
court granted two weeks counted from August 25, 1955.
Plaintiff manifested on June 15, 1956 that the two weeks given by the court had expired
on September 8, 1955 but that defendant and his counsel had failed to appear.
Another chance for amicable settlement was given by the court in its order of July 6,
1956 calling the parties and their attorneys to appear on July 13, 1956. This time.
however, defendant's counsel informed the court that chances of settling the case
amicably were nil.
On July 20, 1956 the court issued an order denying defendant's aforesaid petition.
Defendant has appealed to this Court. In his petition of June 21, 1955 in the court a
quo defendant alleged excusable negligence as ground to set aside the judgment by
default. Specifically, it was stated that defendant filed no answer in the belief that an
amicable settlement was being negotiated.
A petition for relief from judgment on grounds of fraud, accident, mistake or excusable
negligence, must be duly supported by an affidavit of merits stating facts constituting a
valid defense. (Sec. 3, Rule 38, Rules of Court.) Defendant's affidavit of merits attached
to his petition of June 21, 1955 stated: "That he has a good and valid defense against
plaintiff's cause of action, his failure to marry the plaintiff as scheduled having been due
to fortuitous event and/or circumstances beyond his control." An affidavit of merits like
this stating mere conclusions or opinions instead of facts is not valid. (Cortes vs. Co Bun
Kim, L-3926, Oct. 10, 1951; Vaswani vs. P. Tarrachand Bros., L-15800, December 29,
1960.)
Defendant, however, would contend that the affidavit of merits was in fact unnecessary,
or a mere surplusage, because the judgment sought to be set aside was null and void, it
having been based on evidence adduced before the clerk of court. In Province
of Pangasinan vs. Palisoc, L-16519, October 30, 1962, this Court pointed out that the
procedure of designating the clerk of court as commissioner to receive evidence is
sanctioned by Rule 34 (now Rule 33) of the Rules of Court. Now as to defendant's
consent to said procedure, the same did not have to be obtained for he was declared in
default and thus had no standing in court (Velez vs. Ramas, 40 Phil. 787; Alano vs. Court
of First Instance, L-14557, October 30, 1959).
In support of his "motion for new trial and reconsideration," defendant asserts that the
judgment is contrary to law. The reason given is that "there is no provision of the Civil
Code authorizing" an action for breach of promise to marry. Indeed, our ruling
in Hermosisima vs. Court of Appeals (L-14628, Sept. 30, 1960), as reiterated in Estopa vs.
Biansay (L-14733, Sept. 30, 1960), is that "mere breach of a promise to marry" is not an
actionable wrong. We pointed out that Congress deliberately eliminated from the draft
of the new Civil Code the provisions that would have it so.
It must not be overlooked, however, that the extent to which acts not contrary to law
may be perpetrated with impunity, is not limitless for Article 21 of said Code provides
that "any person who wilfully causes loss or injury to another in a manner that is
contrary to morals, good customs or public policy shall compensate the latter for the
damage."
The record reveals that on August 23, 1954 plaintiff and defendant applied for a license
to contract marriage, which was subsequently issued (Exhs. A, A-1). Their wedding was
set for September 4, 1954. Invitations were printed and distributed to relatives, friends
and acquaintances (Tsn., 5; Exh. C). The bride-to-be's trousseau, party drsrses and other
apparel for the important occasion were purchased (Tsn., 7-8). Dresses for the maid of
honor and the flower girl were prepared. A matrimonial bed, with accessories, was
bought. Bridal showers were given and gifts received (Tsn., 6; Exh. E). And then, with
but two days before the wedding, defendant, who was then 28 years old,: simply left a
note for plaintiff stating: "Will have to postpone wedding — My mother opposes it ... "
He enplaned to his home city in Mindanao, and the next day, the day before the
wedding, he wired plaintiff: "Nothing changed rest assured returning soon." But he
never returned and was never heard from again.
Surely this is not a case of mere breach of promise to marry. As stated, mere breach of
promise to marry is not an actionable wrong. But to formally set a wedding and go
through all the above-described preparation and publicity, only to walk out of it when
the matrimony is about to be solemnized, is quite different. This is palpably and
unjustifiably contrary to good customs for which defendant must be held answerable in
damages in accordance with Article 21 aforesaid.
Defendant urges in his afore-stated petition that the damages awarded were excessive.
No question is raised as to the award of actual damages. What defendant would really
assert hereunder is that the award of moral and exemplary damages, in the amount of
P25,000.00, should be totally eliminated.
Per express provision of Article 2219 (10) of the New Civil Code, moral damages are
recoverable in the cases mentioned in Article 21 of said Code. As to exemplary damages,
defendant contends that the same could not be adjudged against him because under
Article 2232 of the New Civil Code the condition precedent is that "the defendant acted
in a wanton, fraudulent, reckless, oppressive, or malevolent manner." The argument is
devoid of merit as under the above-narrated circumstances of this case defendant clearly
acted in a "wanton ... , reckless [and] oppressive manner." This Court's opinion,
however, is that considering the particular circumstances of this case, P15,000.00 as
moral and exemplary damages is deemed to be a reasonable award.
PREMISES CONSIDERED, with the above-indicated modification, the lower court's
judgment is hereby affirmed, with costs.
2
G.R. No. L-18630 December 17, 1966
APOLONIO TANJANCO, petitioner, vs. HON. COURT OF APPEALS and
ARACELI SANTOS, respondents.
REYES, J.B.L., J.:
Appeal from a decision of the Court of Appeals (in its Case No. 27210-R) revoking an
order of the Court of First Instance of Rizal (in Civil Case No. Q-4797) dismissing
appellant's action for support and damages.
The essential allegations of the complaint are to the effect that, from December, 1957, the
defendant (appellee herein), Apolonio Tanjanco, courted the plaintiff, Araceli Santos,
both being of adult age; that "defendant expressed and professed his undying love and
affection for plaintiff who also in due time reciprocated the tender feelings"; that in
consideration of defendant's promise of marriage plaintiff consented and acceded to
defendant's pleas for carnal knowledge; that regularly until December 1959, through his
protestations of love and promises of marriage, defendant succeeded in having carnal
access to plaintiff, as a result of which the latter conceived a child; that due to her
pregnant condition, to avoid embarrassment and social humiliation, plaintiff had to
resign her job as secretary in IBM Philippines, Inc., where she was receiving P230.00 a
month; that thereby plaintiff became unable to support herself and her baby; that due to
defendant's refusal to marry plaintiff, as promised, the latter suffered mental anguish,
besmirched reputation, wounded feelings, moral shock, and social humiliation. The
prayer was for a decree compelling the defendant to recognize the unborn child that
plaintiff was bearing; to pay her not less than P430.00 a month for her support and that
of her baby, plus P100,000.00 in moral and exemplary damages, plus P10,000.00
attorney's fees.
Upon defendant's motion to dismiss, the court of first instance dismissed the complaint
for failure to state a cause of action.
Plaintiff Santos duly appealed to the Court of Appeals, and the latter ultimately decided
the case, holding with the lower court that no cause of action was shown to compel
recognition of a child as yet unborn, nor for its support, but decreed that the complaint
did state a cause of action for damages, premised on Article 21 of the Civil Code of the
Philippines, prescribing as follows:
ART. 21. Any person who wilfully causes loss or injury to another in a manner
that is contrary to morals, good customs or public policy shall compensate the
latter for the damage.
The Court of Appeals, therefore, entered judgment setting aside the dismissal and
directing the court of origin to proceed with the case.
Defendant, in turn, appealed to this Court, pleading that actions for breach of a promise
to marry are not permissible in this jurisdiction, and invoking the rulings of this Court
in Estopa vs. Piansay, L-14733, September 30, 1960; Hermosisima vs. Court of Appeals, L-
14628, January 29, 1962; and De Jesus vs. SyQuia, 58 Phil. 886.
We find this appeal meritorious.
In holding that the complaint stated a cause of action for damages, under Article 21
above mentioned, the Court of Appeals relied upon and quoted from the memorandum
submitted by the Code Commission to the Legislature in 1949 to support the original
draft of the Civil Code. Referring to Article 23 of the draft (now Article 21 of the Code),
the Commission stated:
But the Code Commission has gone farther than the sphere of wrongs defined
or determined by positive law. Fully sensible that there are countless gaps in
the statutes, which leave so many victims of moral wrongs helpless, even
though they have actually suffered material and moral injury, the Commission
has deemed it necessary, in the interest of justice, to incorporate in the
proposed Civil Code the following rule:
"ART. 23. Any person who wilfully causes loss or injury to another in
a manner that is contrary to morals, good customs or public policy
shall compensate the latter for the damage."
An example will illustrate the purview of the foregoing norm: "A" seduces the
nineteen-year old daughter of "X". A promise of marriage either has not been
made, or can not be proved. The girl becomes pregnant. Under the present
laws, there is no crime, as the girl is above eighteen years of age. Neither can
any civil action for breach of promise of marriage be filed. Therefore, though
the grievous moral wrong has been committed, and though the girl and her
family have suffered incalculable moral damage, she and her parents cannot
bring any action for damages. But under the proposed article, she and her
parents would have such a right of action.
The Court of Appeals seems to have overlooked that the example set forth in the Code
Commission's memorandum refers to a tort upon a minor who has been seduced. The
essential feature is seduction, that in law is more than mere sexual intercourse, or a
breach of a promise of marriage; it connotes essentially the idea of deceit, enticement,
superior power or abuse of confidence on the part of the seducer to which the woman
has yielded (U.S. vs. Buenaventura, 27 Phil. 121; U.S. vs. Arlante, 9 Phil. 595).
It has been ruled in the Buenaventura case (supra) that —
To constitute seduction there must in all cases be some sufficient promise or
inducement and the woman must yield because of the promise or other inducement.
If she consents merely from carnal lust and the intercourse is from mutual
desire, there is no seduction (43 Cent. Dig. tit. Seduction, par. 56). She must be
3
induced to depart from the path of virtue by the use of some species of arts,
persuasions and wiles, which are calculated to have and do have that effect,
and which result in her ultimately submitting her person to the sexual
embraces of her seducer (27 Phil. 123).
And in American Jurisprudence we find:
On the other hand, in an action by the woman, the enticement, persuasion or
deception is the essence of the injury; and a mere proof of intercourse is
insufficient to warrant a recover.
Accordingly it is not seduction where the willingness arises out of sexual desire
or curiosity of the female, and the defendant merely affords her the needed
opportunity for the commission of the act. It has been emphasized that to allow
a recovery in all such cases would tend to the demoralization of the female sex,
and would be a reward for unchastity by which a class of adventuresses would
be swift to profit." (47 Am. Jur. 662)
Bearing these principles in mind, let us examine the complaint. The material allegations
there are as follows:
I. That the plaintiff is of legal age, single, and residing at 56 South E. Diliman,
Quezon City, while defendant is also of legal age, single and residing at 525
Padre Faura, Manila, where he may be served with summons;
II. That the plaintiff and the defendant became acquainted with each other
sometime in December, 1957 and soon thereafter, the defendant started visiting
and courting the plaintiff;
III. That the defendant's visits were regular and frequent and in due time the
defendant expressed and professed his undying love and affection for the
plaintiff who also in due time reciprocated the tender feelings;
IV. That in the course of their engagement, the plaintiff and the defendant as
are wont of young people in love had frequent outings and dates, became very
close and intimate to each other and sometime in July, 1958, in consideration
of the defendant's promises of marriage, the plaintiff consented and acceded to
the former's earnest and repeated pleas to have carnal knowledge with him;
V. That subsequent thereto and regularly until about July, 1959 except for a
short period in December, 1958 when the defendant was out of the country, the
defendant through his protestations of love and promises of marriage
succeeded in having carnal knowledge with the plaintiff;
 VI. That as a result of their intimate relationship, the plaintiff started conceiving
which was confirmed by a doctor sometime in July, 1959;
VII. That upon being certain of her pregnant condition, the plaintiff informed
the defendant and pleaded with him to make good his promises of marriage,
but instead of honoring his promises and righting his wrong, the defendant
stopped and refrained from seeing the plaintiff since about July, 1959 has not
visited the plaintiff and to all intents and purposes has broken their
engagement and his promises.
Over and above the partisan allegations, the facts stand out that for one whole year,
from 1958 to 1959, the plaintiff-appellee, a woman of adult age, maintained intimate
sexual relations with appellant, with repeated acts of intercourse. Such conduct is
incompatible with the idea of seduction. Plainly there is here voluntariness and mutual
passion; for had the appellant been deceived, had she surrendered exclusively because
of the deceit, artful persuasions and wiles of the defendant, she would not have again
yielded to his embraces, much less for one year, without exacting early fulfillment of the
alleged promises of marriage, and would have cut chart all sexual relations upon finding
that defendant did not intend to fulfill his promises. Hence, we conclude that no case is
made under Article 21 of the Civil Code, and no other cause of action being alleged, no
error was committed by the Court of First Instance in dismissing the complaint.
Of course, the dismissal must be understood as without prejudice to whatever actions
may correspond to the child of the plaintiff against the defendant-appellant, if any. On
that point, this Court makes no pronouncement, since the child's own rights are not here
involved.
FOR THE FOREGOING REASONS, the decision of the Court of Appeals is reversed,
and that of the Court of First Instance is affirmed. No costs.
G.R. No. L-39013 February 29,1988
FRANCISCO BUNAG, petitioner, vs.COURT OF APPEALS, ESTRUDES
BAUTISTA Vda. de BITUIN and BRUNO BAUTISTA, respondents.
CORTES, J.:
The trial court decided in favor of petitioner, the dispositive portion of the decision
reading as follows:
The core of the controversy in this case is a thumb-marked. non-notarized and non-
witnessed deed of sale of a parcel of unregistered land, which on its face cannot but
cause a prudent man to doubt its due execution and authenticity.
The facts are briefly summarized in the decision of the Court of Appeals:
The evidence of the plaintiff consisting of the sole testimony of said plaintiff is to the
effect that the property in question was originally owned by his father Apolonio
Bunag Aguas as shown by Tax Declaration Nos. 546 for 1941 and 320 for 1960 (Exhs.
B & E), located at San Nicolas, Betis, Pampanga; that he had been living in their house
thereon with his father until 1920 when they transferred their residence to Tarlac;
4
that in 1925 their house thereon was demolished as it was old; that they planted
bamboos on the land; that Jose Bautista Santiago, a nephew-in-law, erected a house
on said lot and lived therein for sometime until he became a widower when he
transferred to another house; that said Jose Bautista Santiago one day accompanied
his sister Estrudes Bautista to stay in that house; and that Santiago was allowed by
his father to build a house on said lot on condition that he would pay for the land
taxes as compensation for the use of the land. He admitted, however, that be only
learned about this agreement from his father. On September 15,1962, and September
24,1962 he sent written demands to defendant Bruno Bautista, thru his lawyer, to
vacate the lot and remove the houses thereon, (Exhs. A & B). The testimony of the
other witness Juan Bunag was stricken from the records as he failed to return to court
for cross-examination.
On the other hand, the evidence for the defendant consist of the testimony of
defendant Bruno Bautista who testified that he is the owner of the land in question
by virtue of a deed of sale, of January 3, 1941, signed by Apolonio Bunag with his
thumbmark; that Bunag first offered it for sale to his brother Jose Bautista, but as the
latter had no money, he referred the matter to his father; that after he was contacted
in Baguio by his father, he sent the P100.00 as consideration of the sale and so the
sale was consummated between his father and Bunag; that he came down from
Baguio and had the house repaired and he stayed there with his family until
liberation when they left the house and allowed his sister Estrudes Bautista to live
therein; that he planted bananas, chicos, trees, calamansi, eggplants, thereon; that he
had been paying the land taxes thereon (Exhs. 5 to 5-M); that the property is declared
in his name (Exh. 6); and he denies that her sister Estrudes requested Apolonio
Bunag to allow her to stay on the property as her sister had a house of her own then.
Brigida Bautista testified that her brother bought the said property from Apolonio
Bunag and that she was present when Bunag affixed Ms thumbmark on the
document (Exh. 1); that aside from this deed, there were other documents supporting
the sale as the note (Exh. 2) containing the consideration and the parties. Assessor's
Field Sheet of the property (Exh. 3) and the letter of the assessor to Bunag in 1941
informing him of the revision of the assessment. (Rollo, pp. 15-18).
IN VIEW OF THE FOREGOING, judgment is rendered in favor of the plaintiff. The
defendants, Bruno Bautista and Estrudes Bautista vda. de Bituin, are hereby ordered
to vacate the property herein described and to deliver possession thereof to the
plaintiff, Francisco Bunag; ordering the said defendants, jointly and severally, to pay
the land taxes of the property up to and including the year 1968; and to pay the
plaintiff the sum of P15.00 per month as reasonable rentals thereof from the date of
this judgment until the property is delivered to the plaintiff; to pay the plaintiff the
sum of P200.00 as expenses of litigation and costs. For lack of merit, the counterclaim
of the defendants are dismiss (Rollo, pp. 14-15)
The Court of Appeals, finding the deed of sale (Exhibit 1) to have been validly executed
and, thus, concluding that "the preponderance of evidence leans heavily in favor of the
claim of the ownership of defendant Bruno Bautista" [Rollo p. 18], set aside the decision
of the trial court and dismissed the complaint. The motion for reconsideration was
subsequently denied by the Court of Appeals in a minute resolution for lack of merit.
Consequently, resolution of the instant petition primarily revolves around the issue of
the due execution authenticity of the deed of sale (Exhibit 1). The petitioner assigned the
following errors:
I THE COURT OF APPEALS ERRED IN HOLDING THAT THE DEED OF SALE
(EXHIBIT "1") WAS DULY EXECUTED AND AUTHENTICATED.
II THE COURT OF APPEALS ERRED IN MAKING CONCLUSION (SIC) NOT IN
ACCORDANCE WITH THE EVIDENCE ON RECORD.
At the outset, it must be emphasized that the deed of sale (Exhibit 1) was not
acknowledged before a notary public and neither are there any signatures in the blank
spaces for the signatures of attesting witnesses. The document is typewritten in English
and over the similarly typewritten words "APOLONIO BUNIAG" is a thumbprint.
The deed of sale (Exhibit 1) is not notarized and is, therefore, a private writing (U.S. v.
Orera, 11 Phil. 596 (1908)], whose due execution and authenticity must be proved before
it can be received in evidence (Nolan v. Sales, 7 Phil. 1 (1906); U.S. v. Evangelists, 29 Phil.
215 (1915); Antillon v. Barcelon, 37 Phil. 148 (1917)].
Proof of the due execution and authenticity of private writings is required under Section
21, Rule 132 of the Revised Rules of Court, to wit:
Sec. 21. Private writing, its execution and authenticity, how proved. — Before any
private writing may be received in evidence, its due execution and authenticity
must be proved either:
(a) By anyone who saw the writing executed;
(b) By evidence of the genuineness of the handwriting of the maker; or
(c) By a subscribing witness.
To support its conclusion as to the due execution and authenticity of the deed of sale
(Exhibit 1), the Court of Appeals relied on the testimony of Brigida Bautista, a sister of
private respondents. She testified as follows:
Q. Who is the owner of the property?
A My brother Bruno Bautista.
Q. Do you know how your brother, Bruno Bautista, came to own the same property?
A. Yes, sir. He bought it from Apolonio Bunag.
5
Q. Do you know if there is any document evidencing the purchase of the said
property from Apolonio Bunag.?
A. Yes, sir.
Q. Showing to you this document already marked as Exhibit 1, do you recognize
this?
A. Yes, sir, this is the document showing the purchase and sale of the lot in litigation.
Q. At the bottom portion thereof, appears a thumbmark above the typewritten name
Apolonio Bunag, do you know whose thumbmark this is?
A. That is the thumbmark of Apolonio Bunag, sir, and I know that is his because I
saw him affixed (sic) his thumbmark. TSN, March 25,1967, pp. 1-2).
However, the trial court found proof of the due execution and authenticity of the deed
of sale (Exhibit 1) wanting, reasoning that:
The testimony of this witness (Brigida Bautista) has to be received with caution,
coming as it does from a sister of the defendants. The circumstances other alleged
presence during the "execution" of the deed of sale was not related. Neither does she
give any light as to whether Apolonio Bunag understood the document. It should be
noted that (Exhibit "1") was written in English. Since it appears that said document
was merely thumb-marked, it could reasonably be inferred that Apolonio Bunag, the
supposed vendor, was illiterate. Under the stances, the minimum proof necessary to
establish due authenticity should, in the least, include evidence that the document
(Exhibit "1") was duly read, explained and translated to Apolonio Bunag.
Unfortunately, no such evidence was presented. Another fact which compels this
Court to proceed with caution is the fact that there are no instrumental witnesses in
the document. The mischief that lurks behind accepting at face value a document
that is merely thumb-marked. without any witnesses to it, and not acknowledged
before a notary public could be one of the reasons behind the requirement of the
rules on evidence that a private writing must be shown to be duly executed and
authenticated. The probative value of the testimony of Brigida Bautista, who did not
furnish us with any details surrounding the execution of Exhibit "l," coming as it
does from a person whose partisanship can not, and should not, be overlook (sic),
fags short from (sic) the minimum requirements of credibility. Indeed it has been
said that the testimony of an eye-witness as to the execution of a private document
must be positive. He must state that the document was actually executed by the
person whose name is subscribed thereto. It is not sufficient if he states in a general
manner that such person made the writing (Nolan vs. Salas, Bail. More so if the
document was merely thumb-marked.
Regretably, this Court can not accept, for failure of proof as to its due execution and
authenticity, the probative value of Exhibit "1". (Record on Appeal, pp.38-39).
The Court sustains and adopts the trial court's findings and its conclusion that private
respondents have failed to prove the due execution and authenticity of the deed of sale
(Exhibit 1).
The due execution and authenticity of the deed of sale, (Exhibit 1) not having been
satisfactorily proven, such private document should be excluded [Paz v. Santiago, 47
Phil. 334 (1925); Alejandrino v. Reyes, 53 Phil. 973 (1929); Chapman v. Garcia, 64 Phil.
618 (1937); General Enterprises v. Lianga Bay Logging Co., G.R. No. L-18487, August 31,
1964, 11 SCRA 733].
2. Petitioner contends that the Court of Appeals erred in arriving at a conclusion not
supported by the record, when it said:
The pretension of the plaintiff that the defendant bound himself to pay the taxes for
the use of the land is belied by the fact that the defendant paid the taxes in his own
name and not in the name of Bunag, and the defendant kept the receipts of payment
and did not deliver even one of those receipts to Bunag. (Rollo, p. 19.)
Petitioner argues that this finding is grossly erroneous, considering that in the
stipulation of facts submitted by both parties before the trial court, it is expressly
provided:
3. That the parties hereto hereby stipulate and agree that the defendant, Bruno
Bautista, has been paying the land taxes due on the aforesaid property, personally
or thru his wife, Consolacion Capati, for the period from 1940 to 1964, as shown by
the corresponding official land tax receipts duly issued by the Municipal Treasurer
of Guagua, Pampanga; however, under the column NAME OF DECLARED
OWNER thereof, the name Bunag Aguas Apolonio is written.
As this fact was stipulated by the parties, it need not be proven, it cannot be contradicted
by evidence to the contrary, and it is conclusive upon the parties, unless it is shown that
the admission was made through a palpable mistake [Irlanda v. Pitargue, 22 Phil. 383
(1912); Board of Administrators, Philippine Veterans Administration v. Agcaoili, G.R.
No. L-38129, July 23,1974, 58 SCRA 72].
There being no allegation of a palpable mistake that would relieve private respondents
from the stipulation of facts, the stipulated fact above-quoted is conclusive upon the
parties.
The Court of Appeals cannot arbitrarily disregard the statement of facts agreed upon by
the parties [Siping v. Cacob, 10 Phil. 717 (1908)]. It is duty bound to render judgment
strictly in accordance with the stipulation of facts [Cabrera v. Lacson, 71 Phil. 182 (1940)].
It may also be added that, indeed, in the Real Estate Tax Receipts (Exhibits 5-5-M)
covering the years 1947 to 1964 presented by private respondents as their evidence,
under the column entitled "NAME OF DECLARED OWNER" the name "Bunag Aguas
Apolonio" is written. This assumes greater significance considering that the payors in
these receipts were either private respondent Bruno Bautista, his wife Consolacion
Capati or Ambrosio Bautista.
6
Thus, this Court finds merit in petitioner's contention that the Court of Appeals's
conclusion is not supported by the record, for said conclusion is contrary to the
stipulated fact and the evidence offered by private respondents, which support
petitioner's contention that his father did not sen the disputed property to private
respondents' father, but merely allowed their brother to build a house on the land on
the condition that the latter would pay for the realty taxes due.
With the exclusion of the deed of sale (Exhibit 1), the conclusiveness of the stipulation
regarding the payment of realty taxes and the declaration of Apolonio Bunag Aguas as
the owner in the Real Estate Tax Receipts (Exhibits 5-5-M) it becomes apparent that
petitioner's father never ceased to own the disputed property.
At this juncture, it would be opportune to address private respondent's submission that
the questions raised in petitioner's petition for review are questions of fact and not of
law and, therefore, this Court should not disturb the findings of fact of the Court of
Appeals. While the Court agrees with private respondents that, ordinarily, the Supreme
Court should not review questions of fact in appeals of this nature, the Court finds,
however, that an exception obtains in the instant case, for clearly evident is a
misapprehension of facts [De la Cruz v. Sosing, 94 Phil. 26 (1953); Castillo v. Court of
Appeals, G.R. No. 1,48290, September 29, 1983, 124 SCRA 808]. As summarized by the
Court in a recent decision:
The jurisdiction of this Court in cases brought to us from the Court of Appeals (now
Intermediate Appellate Court) is limited to the review of errors of law, said appellate
court's findings of fact being conclusive upon us except (1) when the conclusion is a
finding grounded entirely on speculation, surmises or conjectures; (2) when the
inference made is manifestly absurd, mistaken or impossible; (3) when there is grave
abuse of discretion in the appreciation of facts; (4) when the judgment is premised
on a misapprehension of facts; (5) when the findings of fact are conflicting; and (6)
when the Court of Appeals, in making its findings went beyond the issues of the case
and the same is contrary to the admissions of both appellant and appellee ... [Rizal
Cement Co., Inc. v. Villareal, G.R. No. L-30272, February 28, 1985, 135 SCRA 151].
WHEREFORE, the petition is hereby GRANTED, the decision of the Court of Appeals
is set aside and the decision of the trial court is affirmed in toto. This Decision is
immediately executory.
SO ORDERED.
G.R. No. 57227 May 14, 1992
AMELITA CONSTANTINO and MICHAEL CONSTANTINO, the latter
represented herein by the former, his mother and natural guardian, petitioners, vs.
IVAN MENDEZ and the HONORABLE COURT OF APPEALS, respondents..
BIDIN, J.:
This is a petition for review on certiorari questioning the decision1 dated April 30, 1981
of the Court of Appeals in CA-G.R. No. 61552-R which dismissed petitioner's complaint
and set aside the resolution2 dated October 21, 1976 of the then Court of First Instance
of Davao, 16th Judicial District, amending the dispositive portion of its decision dated
June 21, 1976 and ordering private respondent Ivan Mendez: (1) to acknowledge the
minor Michael Constantino as his illegitimate child; (2) to give a monthly support of
P300.00 to the minor child; (3) to pay complainant Amelita Constantino the sum of
P8,200.00 as actual and moral damages; and (4) to pay attorney's fees in the sum of
P5,000 plus costs.
It appears on record that on June 5, 1975, petitioner Amelita Constantino filed an action
for acknowledgment, support and damages against private respondent Ivan Mendez.
The case was filed with the then CFI of Davao, 10th Judicial District and docketed as
Civil Case No. 8881. In her complaint, Amelita Constantino alleges, among others, that
sometime in the month of August, 1974, she met Ivan Mendez at Tony's Restaurant
located at Sta. Cruz, Manila, where she worked as a waitress; that the day following
their first meeting, Ivan invited Amelita to dine with him at Hotel Enrico where he was
billeted; that while dining, Ivan professed his love and courted Amelita; that Amelita
asked for time to think about Ivan's proposal; that at about 11:00 o'clock in the evening,
Amelita asked Ivan to bring her home to which the latter agreed, that on the pretext of
getting something, Ivan brought Amelita inside his hotel room and through a promise
of marriage succeeded in having sexual intercourse with the latter; that after the sexual
contact, Ivan confessed to Amelita that he is a married man; that they repeated their
sexual contact in the months of September and November, 1974, whenever Ivan is in
Manila, as a result of which Amelita got pregnant; that her pleas for help and support
fell on deaf ears; that Amelita had no sexual relations with any other man except Ivan
who is the father of the child yet to be born at the time of the filing of the complaint; that
because of her pregnancy, Amelita was forced to leave her work as a waitress; that Ivan
is a prosperous businessman of Davao City with a monthly income of P5,000 to P8,000.
As relief, Amelita prayed for the recognition of the unborn child, the payment of actual,
moral and exemplary damages, attorney's fees plus costs.
In his answer dated August 5, 1975, Ivan admitted that he met Amelita at Tony's Cocktail
Lounge but denied having sexual knowledge or illicit relations with her. He prayed for
the dismissal of the complaint for lack of cause of action. By way of counterclaim, he
further prayed for the payment of exemplary damages and litigation expense including
attorney's fees for the filing of the malicious complaint.
On September 1, 1975, Amelita Constantino filed a motion for leave to amend the
complaint impleading as co-plaintiff her son Michael Constantino who was born on
August 3, 1975. In its order dated September 4, 1975, the trial court admitted the
amended complaint.
On September 11, 1975, Ivan Mendez filed his answer to the amended complaint
reiterating his previous answer denying that Michael Constantino is his illegitimate son.
7
After hearing, the trial court rendered a decision dated June 21, 1976, the dispositive
portion of which reads, viz:
WHEREFORE, in view of the foregoing, judgment is hereby rendered in favor of
plaintiff Amelita Constantino and against defendant Ivan Mendez, ordering the
latter to pay Amelita Constantino the sum of P8,000.00 by way of actual and moral
damages; and, the sum of P3,000.00, as and by way of attorney's fees. The defendant
shall pay the costs of this suit.
SO ORDERED.
From the above decision, both parties filed their separate motion for reconsideration.
Ivan Mendez anchored his motion on the ground that the award of damages was not
supported by evidence. Amelita Constantino, on the other hand, sought the recognition
and support of her son Michael Constantino as the illegitimate son of Ivan Mendez.
In its resolution dated October 21, 1976, the trial court granted Amelita Constantino's
motion for reconsideration, and amended the dispositive portion of its decision dated
June 21, 1976 to read as follows, viz:
WHEREFORE, in view of the foregoing, judgment is hereby rendered in favor of
plaintiff Amelita Constantino and plaintiff-minor Michael Constantino, and against
defendant Ivan Mendez ordering the latter to pay Amelita Constantino the sum of
P8,000.00 by way of actual and moral damages and the sum of P200.00 as and by
way of payment of the hospital and medical bills incurred during the delivery of
plaintiff-minor Michael Constantino; to recognize as his own illegitimate child the
plaintiff-minor Michael Constantino who shall be entitled to all the rights, privileges
and benefits appertaining to a child of such status; to give a permanent monthly
support in favor of plaintiff Michael Constantino the amount of P300.00; and the sum
of P5,000.00 as and by way of attorney's fees. The defendant shall pay the costs of
this suit.
Let this Order form part of the decision dated June 21, 1976.
SO ORDERED.
On appeal to the Court of Appeals, the above amended decision was set aside and the
complaint was dismissed. Hence, this petition for review.
Basically, the issue to be resolved in the case at bar is whether or not the Court of Appeals
committed a reversible error in setting aside the decision of the trial court and in
dismissing the complaint.
Petitioners contend that the Court of Appeals erred in reversing the factual findings of
the trial and in not affirming the decision of the trial court. They also pointed out that
the appellate court committed a misapprehension of facts when it concluded that Ivan
did not have sexual access with Amelita during the first or second week of November,
1976 (should be 1974), the time of the conception of the child.
It must be stressed at the outset that factual findings of the trial court have only a
persuasive and not a conclusive effect on the Court of Appeals. In the exercise of its
appellate jurisdiction, it is the duty of the Court of Appeals to review the factual findings
of the trial court and rectify the errors it committed as may have been properly assigned
and as could be established by a re-examination of the evidence on record. It is the
factual findings of the Court of Appeals, not those of the trial court, that as a rule are
considered final and conclusive even on this Court (Hermo v. Hon. Court of Appeals, et
al., 155 SCRA 24 [1987]). This being a petition for certiorari under Rule 45 of the Rules of
Court, this Court will review only errors of law committed by the Court of Appeals. It
is not the function of this Court to re-examine all over again the oral and documentary
evidence submitted by the parties unless the findings of facts of the Court of Appeals is
not supported by the evidence on record or the judgment is based on misapprehension
of facts (Remalante v. Tibe, et al., 158 SCRA 138 [1988]; Hernandez v. Court of Appeals,
et al., 149 SCRA 97 [1987]).
It is the conclusion of the Court of Appeals, based on the evidence on record, that
Amelita Constantino has not proved by clear and convincing evidence her claim that
Ivan Mendez is the father of her son Michael Constantino. Such conclusion based on the
evaluation of the evidence on record is controlling on this Court as the same is supported
by the evidence on record. Even the trial court initially entertained such posture. It
ordered the recognition of Michael as the illegitimate son of Ivan only when acting on
the motions for reconsideration, it reconsidered, on October 21, 1976, its earlier decision
dated June 21, 1976. Amelita's testimony on cross-examination that she had sexual
contact with Ivan in Manila in the first or second week of November, 1974 (TSN,
December 8, 1975, p. 108) is inconsistent with her response that she could not remember
the date of their last sexual intercourse in November, 1974 (Ibid, p. 106). Sexual contact
of Ivan and Amelita in the first or second week of November, 1974 is the crucial point
that was not even established on direct examination as she merely testified that she had
sexual intercourse with Ivan in the months of September, October and November, 1974.
Michael Constantino is a full-term baby born on August 3, 1975 (Exhibit 6) so that as
correctly pointed out by private respondent's counsel, citing medical science (Williams
Obstetrics, Tenth Ed., p. 198) to the effect that "the mean duration of actual pregnancy,
counting from the day of conception must be close to 267 days", the conception of the
child (Michael) must have taken place about 267 days before August 3, 1975 or sometime
in the second week of November, 1974. While Amelita testified that she had sexual
contact with Ivan in November, 1974, nevertheless said testimony is contradicted by her
own evidence (Exh. F), the letter dated February 11, 1975, addressed to Ivan Mendez
requesting for a conference, prepared by her own counsel Atty. Roberto Sarenas to
whom she must have confided the attendant circumstances of her pregnancy while still
fresh in her memory, informing Ivan that Amelita is four (4) months pregnant so that
applying the period of the duration of actual pregnancy, the child was conceived on or
about October 11, 1974.
8
Petitioner's assertion that Ivan is her first and only boyfriend (TSN, December 8, 1975,
p. 65) is belied by Exhibit 2, her own letter addressed to Mrs. Mendez where she revealed
the reason for her attachment to Ivan who possessed certain traits not possessed by her
boyfriend. She also confided that she had a quarrel with her boyfriend because of
gossips so she left her work. An order for recognition and support may create an
unwholesome atmosphere or may be an irritant in the family or lives of the parties so
that it must be issued only if paternity or filiation is established by clear and convincing
evidence. The burden of proof is on Amelita to establish her affirmative allegations that
Ivan is the father of her son. Consequently, in the absence of clear and convincing
evidence establishing paternity or filiation, the complaint must be dismissed.
As regards Amelita's claim for damages which is based on Articles 193 & 214 of the Civil
Code on the theory that through Ivan's promise of marriage, she surrendered her
virginity, we cannot but agree with the Court of Appeals that more sexual intercourse
is not by itself a basis for recovery. Damages could only be awarded if sexual intercourse
is not a product of voluntariness and mutual desire. At the time she met Ivan at Tony's
Restaurant, Amelita was already 28 years old and she admitted that she was attracted
to Ivan (TSN, December 3, 1975, p. 83). Her attraction to Ivan is the reason why she
surrendered her womanhood. Had she been induced or deceived because of a promise
of marriage, she could have immediately severed her relation with Ivan when she was
informed after their first sexual contact sometime in August, 1974, that he was a married
man. Her declaration that in the months of September, October and November, 1974,
they repeated their sexual intercourse only indicates that passion and not the alleged
promise of marriage was the moving force that made her submit herself to Ivan.
WHEREFORE, the instant petition is Dismissed for lack of merit.
THIRD DIVISION
[G.R. No. 47013. February 17, 2000]
ANDRES LAO, petitioner, vs. COURT OF APPEALS, THE ASSOCIATED ANGLO-
AMERICAN TOBACCO CORPORATION and ESTEBAN CO, respondents.
[G.R. No. 60647. February 17, 2000]
ESTEBAN CO, petitioner, vs. COURT OF APPEALS and ANDRES
LAO, respondents. Esmsc
[G.R. No. 60958-59. February 17, 2000]
THE ASSOCIATED ANGLO-AMERICAN TOBACCO CORPORATION, petitioner,
vs. COURT OF APPEALS, ANDRES LAO, JOSE LAO, and TOMAS
LAO, respondents.
DECISION
PURISIMA, J.: PURISIMA
These consolidated petitions for review on certiorari under Rule 45 of the Rules of Court
revolve around discrepant statements of accountability between a principal and its
agent in the sale of cigarettes.
The common factual background at bar follows:
On April 6, 1965, The Associated Anglo-American Tobacco Corporation (Corporation
for brevity) entered into a "Contract of Sales Agent" with Andres Lao. Under the
contract, Lao agreed to sell cigarettes manufactured and shipped by the Corporation to
his business address in Tacloban City. Lao would in turn remit the sales proceeds to the
Corporation. For his services, Lao would receive commission depending on the kind of
cigarettes sold, fixed monthly salary, and operational allowance. As a guarantee to Laos
compliance with his contractual obligations, his brother Jose and his father Tomas
executed a deed of mortgage[1] in favor of the Corporation in the amount of P200,000.00
In compliance with the contract, Lao regularly remitted the proceeds of his sales to the
Corporation, generating, in the process, a great deal of business. Thus, the Corporation
awarded him trophies and plaques in recognition of his outstanding performance from
1966 to 1968. However, in February 1968 and until about seven (7) months later, Lao
failed to accomplish his monthly sales report. In a conference in Cebu, Ching Kiat Kam,
the President of the Corporation, reminded Lao of his enormous accounts and the
difficulty of obtaining a tally thereon despite Laos avowal of regular remittances of his
collections.
Sometime in August and September 1969, Esteban Co, the vice-president and general
manager of the Corporation, summoned Lao to Pasay City for an accounting. It was then
and there established that Laos liability amounted to P525,053.47. And so, Lao and his
brother Lao Y Ka, enlisted the services of the Sycip Gorres and Velayo Accounting Firm
(SGV) to check and reconcile the accounts. Esmmis
Ching Kiat Kam allowed Lao to continue with the sales agency provided Lao would
reduce his accountability to P200,000.00, the amount secured by the mortgage. The
Corporation thereafter credited in favor of Lao the amount of P325,053.47 representing
partial payments he had made but without prejudice to the result of the audit of
accounts. However, the SGV personnel Lao had employed failed to conclude their
services because the Corporation did not honor its commitment to assign two of its
accountants to assist them. Neither did the Corporation allow the SGV men access to its
records.
Subsequently, the Corporation discovered that Lao was engaging in the construction
business so much so that it suspected that Lao was diverting the proceeds of his sales to
finance his business. In the demand letter of April 15, 1979,[2]counsel for the Corporation
sought payment of the obligations of Lao, warning him of the intention of the
Corporation to foreclose the mortgage. Attached to said letter was a statement of account
indicating that Laos total obligations duly supported by receipts amounted to
P248,990.82.
Since Lao appeared to encounter difficulties in complying with his obligations under the
contract of agency, the Corporation sent Ngo Kheng to supervise Laos sales operations
in Leyte and Samar. Ngo Kheng discovered that, contrary to Laos allegation that he still
9
had huge collectibles from his customers, nothing was due the Corporation from Laos
clients. From then on, Lao no longer received shipments from the Corporation which
transferred its vehicles to another compound controlled by Ngo Kheng. Shipments of
cigarettes and the corresponding invoices were also placed in the name of Ngo Kheng.
On May 21, 1970, Andres, Jose and Tomas Lao brought a complaint for accounting and
damages with writ of preliminary injunction[3] against the Corporation, docketed as
Civil Case No. 4452 before the then Court of First Instance of Leyte, Branch I in Tacloban
City, which court[4] came out with its decision[5] on March 26, 1975, disposing as follows:
"IN VIEW OF ALL THE FOREGOING PREMISES, and upon a clear preponderance
of evidence in favor of the plaintiffs, the court hereby renders judgment as
follows: Esmso
1........Ordering both the plaintiffs and defendant corporation to undergo a Court
supervised accounting of their respective account with the view of establishing once
and for all, by a reconciliation of their respective books of accounts, the true and
correct accountability of Andres Lao to the defendant corporation. Pursuant thereto,
both plaintiff Andres Lao and the defendant The Associated Anglo-American
Tobacco Corporation are directed to make available all their records pertainting [sic]
to their business transactions with each other under the contract of sales agent, from
1965 up to the time Andres Lao ceased being the agent of the defendant. A
Committee on Audit is hereby formed to be composed of three (3) members, one
member to be nominated by the plaintiffs, another to be nominated by the defendant
corporation and the third member who shall act as the Committee Chairman to be
appointed by this Court. As Committee Chairman, the Court hereby appoints the
Branch Clerk of Court of this Court, Atty. Victorio Galapon, who shall immediately
convene the Committee upon appointment of the other two members, and
undertake to finish their assigned task under his decision within two (2) months.
2........Ordering the defendant corporation to pay Plaintiffs the amount of P180,000
representing actual loss of earnings.
3........Ordering the defendant to pay plaintiffs moral damages in the amount of
P130,000.00.
4........Ordering the defendant to pay to the plaintiffs, exemplary damages in the
amount of P50,000.00.
5........Ordering the defendant to pay to the plaintiffs, attorneys fees in the amount of
P40,000.00.
6........Ordering the plaintiffs and the defendant to pay the compensation of the
commissioners pro-rata.
 7........Finally ordering the defendant to pay the cost of this suit. On February 28, 1977, the trial court[7] promulgated a supplemental decision wherein it
dismissed Laos claim that he had made an overpayment of P556,444.20. The alleged
SO ORDERED." overpayment was arrived at after deducting the total payment made by Lao in the
amount of P13,686,148.80 from the total volume of shipments made by the Corporation
in the amount of P13,129,704.60, without including the amount of P597,239.40,
The Committee of Audit that was eventually constituted was composed of Atty. Victorio
representing alleged shipments covered by bills of lading and factory consignment
L. Galapon, Jr., as chairman, Wilfredo Madarang, Jr. and Cesar F.P. Corcuera, as
invoices but with no supporting delivery receipts, and the amount of P126,950.00,
representatives of the Corporation, and Lao himself. On September 16, 1976, said
representing shipments with factory consignment invoices but not covered by bills of
committee submitted a report[6] with the following findings: Msesm
lading and delivery receipts. The trial court, in rejecting the claim of overpayment, held
that "when he (referring to Lao) made partial payments amounting to P325,053.47
"Total remittances made by Mr. subsequent to the demand in September, 1969, he is deemed to have admitted his
Andres Lao in favor of Associated liability and his claim of overpayment is not only preposterous but devoid of logic."
from April 10, 1965 to November P13,686,148.8 Therefore, with the sums of P597,239.40 and P126,950.00 included in the total volume of
1969 which are substantially 0 shipments made by the Corporation in the amount of P13,129,704.60, Laos total
supported by official receipt remittances of P13,686,248.80 were short of P167,745.20. Thus, the trial court held:
.....................................................
Shipments by Associated to Mr. "WHEREFORE, judgment is hereby rendered declaring plaintiff
Andres Lao duly supported by bills Andres Laos accountability to defendant Corporation in the amount
of lading, factory consignment 9,110,777.00 of P167,745.20 and ordering him to pay said amount of P167,745.20 to
invoices and delivery defendant The Associated Anglo-American Tobacco
receipts.................................. Corporation." Exsm
Shipments by Associated to Mr.
Andres Lao, covered by bills of
The Corporation appealed the decision, dated March 26, 1975, just as Lao appealed the
lading and factory consignment
supplemental decision, dated February 28, 1977, to the Court of Appeals. Docketed as
invoices but with no supporting
CA-G.R. No. 62532-R, the appeal was resolved in the Decision of the Court of Appeals
delivery receipts purported to have
4,018,927.60 dated October 26, 1981,[8] disposing thus:
been delivered to Mr. Lao on the
basis of sales made by him as
reported in his monthly sales reports "WHEREFORE, in connection with the decision of March 26, 1975, defendant
(except for sales in December, 1968 corporation is hereby ordered to pay plaintiffs P150,000.00 actual damages for loss
and November and December 1968 of earnings, P30,000.00 by way of moral damages and P10,000.00 for exemplary
where the sales reports were not damages. As modified, the decision is AFFIRMED in all other respects.
available to the Audit
Committee)............................................ As for the supplemental decision of February 28, 1977, the same is hereby reversed
... and set aside, and defendant-appellant corporation sentenced to reimburse Andres
Shipments covered by bills of lading Laos overpayment in the amount of P556,444.20. Costs against defendant-appellant
and factory consignment invoices corporation."
but with no supporting delivery 597,239.40
receipts The Corporation presented a motion for reconsideration[9] of the said Decision but the
...................................................... same was denied in a Resolution dated May 18, 1982. [10] A motion for leave to file a
Shipments with covering factory second motion for reconsideration was likewise denied. [11] Kylex
consignment invoices but not
covered by bills of lading and 126,950.00" Meanwhile, on June 24, 1974 and during the pendency of Civil Case No. 4452, Esteban
delivery receipts Co, representing the Corporation as its new vice-president, filed an affidavit of
...................................................... complaint[12] with the Pasay City Fiscals Office under I.S. No. 90994; alleging that Lao
failed to remit the amount of P224,585.82 which he allegedly misappropriated and
converted to his personal use. Although the amount supposedly defalcated was put up
10
as a counterclaim in Civil Case No. 4452 for accounting, the Corporation averred that it
reserved the right to institute a criminal case against Lao.
On July 31, 1974, after finding a prima facie case against Lao, the Pasay City Fiscal filed
an information[13] for estafa against Lao, docketed as Criminal Case No. 2650-P before
the then Court of First Instance of Rizal, Branch XXVII. Lao sought a reinvestigation[14] of
the case, contending that he was never served a subpoena or notice of preliminary
investigation that was considered mandatory in cases cognizable by Court of First
Instance, now Regional Trial Court. Apparently, the preliminary investigation
proceeded ex-parte because Esteban Co made it appear that Lao could not be
located. Kycalr
On December 17, 1974, without awaiting the termination of the criminal case, Lao
lodged a complaint[15] for malicious prosecution against the Corporation and Esteban
Co, praying for an award of damages for violation of Articles 20 and 21 of the Civil Code.
The case was docketed as Civil Case No. 5528 before Branch I of the then Court of First
Instance in Cotabato City.
In his resolution dated January 3, 1975,[16] then Pasay City Fiscal Jose Flaminiano found
merit in the petition for reinvestigation of the estafa case. He opined that Lao had not
committed estafa as his liability was essentially civil in nature. The Fiscal entertained
doubts about the motive of the Corporation in instituting the criminal case against Lao
because of the undue delay in its filing, aside from the fact that the estafa case involved
the same subject matter the Corporation sued upon by way of counterclaim in Civil Case
No. 4452. Eventually, on May 13, 1976, the Court of First Instance of Rizal, Branch XXVII,
in Pasay City, promulgated a decision[17] acquitting Lao of the crime charged and
adopting in toto the said Resolution of Fiscal Flaminiano.
On March 18, 1977, the Court of First Instance of Samar [18]
handed down a decision in
Civil Case No. 5528, the action for damages arising from malicious prosecution,
disposing thus:
"WHEREFORE, the Court declares that the defendants filed Criminal Case No. 2650-
P against the plaintiff for estafa before the Court of First Instance of Rizal, Branch
XXVII, Pasay City, without probable cause and with malice and therefore orders the
defendants Associated Anglo-American Tobacco Corporation and Esteban Co to
jointly and severally pay the plaintiff:
a........P30,000 as actual damages; Calrky
b........P150,000.00 as moral damages;
c........P100,000.00 as exemplary damages;
d........P50,000.00 as attorneys fees and costs.
11
SO ORDERED."
The Corporation and Esteban Co both appealed the aforesaid decision to the Court of
Appeals under CA-G.R. No. 61925-R.
On April 18, 1977, Lao presented a motion for execution pending appeal[19] before the
trial court. The opposition of the Corporation notwithstanding, on June 8, 1977 the trial
court issued a special order granting the motion for execution pending appeal,[20] and
on the following day, the corresponding writ of execution issued. [21]
On June 10, 1977, the Court of Appeals issued a Restraining Order enjoining the
execution of subject judgment.[22] The said order was issued on account of a petition for
certiorari, prohibition and mandamus with preliminary injunction [23]filed by the
Corporation and Esteban Co with the said appellate court. Docketed as CA-G.R. No.
06761, the petition was received by the Court of Appeals on June 9, 1977. A supplemental
to the petition and a "compliance" were also received on the same time and date. [24] On
June 21, 1977, Lao moved to lift the restraining order.
On September 14, 1977, the Court of Appeals resolved in CA-G.R. No. 06761 thus:
"WHEREFORE, the petition for certiorari is hereby granted, the
special order granting execution pending appeal is annulled and the
restraining order heretofore issued is made permanent.
No pronouncement as to costs."
On October 21, 1981, the Court of Appeals likewise rendered a Decision [25] in CA-G.R.
No. 62532-R, affirming the trial courts finding that Criminal Case No. 2650-P was filed
without probable cause and with malice; and held the Corporation and Esteban Co
solidarily liable for damages, attorneys fees and costs.
The Corporation and Esteban Co moved to reconsider [26] the said decision in CA-G.R.
No. 61925-R but to no avail. The motion for reconsideration was denied in a Resolution
promulgated on May 18, 1992. A motion for leave of court to file a second motion for
reconsideration[27] met the same fate. It was likewise denied in a Resolution[28] dated
June 23, 1982.
From the said cases sprung the present petitions which were ordered consolidated in
the Resolutions of December 15, 1982 and November 11, 1985.[29] Subject petitions are to
be passed upon in the order they were filed. Mesm
G.R. No. 47013
A petition for review on certiorari of the Decision of the Court of Appeals in CA-G.R. No.
06761 that Lao filed, contending that:
 1........The Court of Appeals cannot validly give due course to an original action
for certiorari, prohibition and mandamus where the petition is fatally defective for
not being accompanied by a copy of the trial courts questioned process/order.
2........The Court of Appeals, cannot, in a petition for certiorari, prohibition and
mandamus, disregard, disturb and substitute its own judgment for the findings of
facts of the trial court, particularly as in the present case, where the trial court did
not exceed nor abuse its discretion.
3........The Court of Appeals did not act in accordance with established jurisprudence
when it overruled the trial courts holding that the posting of a good and solvent
bond is a good or special reason for execution pending appeal.
For clarity, the petition for review on certiorari questioning the Decision of the Court of
Appeals that nullified the special order granting execution pending appeal is anchored
on the antecedent facts as follows: Slx
"compliance" submitted to the appellate court a copy of the special order bearing the
same time of receipt. He theorized that the writ of execution could have been issued by
the Court of First Instance of Samar at the earliest, at 8:30 a.m. on July 9, 1977. Petitioner
Lao then noted that, the restraining order enjoining execution pending appeal did not
mention the date of issuance of the writ subsequently issued and the names of the special
sheriffs tasked to execute it simply because when the restraining order was issued the
copy of the writ of execution was not yet filed with the Court of Appeals. Petitioner Lao
also averred that because his counsel was furnished a copy of the restraining order
through the mail, he was deprived of the opportunity to take immediate "remedial steps
in connection with the improvident issuance of the restraining order." [36]
In their comment on the petition, respondent Corporation and Co assail petitioner Laos
insinuation of irregularity in the filing of their pleadings. They aver that in view of
petitioner Laos allegation, they, made inquiries in the Docket Section of the Court of
Appeals, and they were informed that the receiving machine of said section was out of
order when the pleadings were received "as the time of receipt appearing therein is
always 8:00 a.m."[37]

After the Court of First Instance of Samar had decided in favor of Lao in the action for
This Court cannot gloss over, as it has never glossed over allegations of irregularity in
damages by reason of malicious prosecution, Lao filed a motion for execution pending
the handling of pleadings filed in the Court. However, in the absence of concrete proof
appeal[30] even as the Corporation and Co had interposed an appeal from the said
that there was malicious intent to derail the propriety of procedure, this Court has no
decision. In that motion, Lao theorized that the appeal had no merit and the judgment
basis on which to arrive at a conclusion thereon. The documentary evidence of
in his favor would be rendered ineffectual on account of losses incurred by the
simultaneous receipt of pleadings that should ordinarily be received one after another
Corporation in the 1972 floods in Luzon and in a fire that cost the Corporation P5
is simply insufficient to warrant any conclusion on irregularity of procedure.
million, as well as the fact that the properties of the Corporation were heavily
encumbered as it had even incurred an overdraft with a bank; for which reasons, Lao
evinced his willingness to post a bond although Section 2, Rule 39 of the Rules of Court All court personnel are enjoined to do their jobs properly and according to law. Should
does not require such bond. Lao thereafter sent in a supplemental motion [31] asserting they notice anything in the performance of their duties that may generate even a mere
that the Corporations properties were mortgaged in the total amount of Seven Million suspicion of irregularity, they are duty-bound to correct the same. In this case, more
(P7,000,000.00) Pesos. The Corporation and Co opposed both motions. diligence on the part of the personnel handling the receiving machine could have
prevented the stamping on the pleadings with erroneous date and time of receipt and
would have averted suspicion of an anomaly in the filing of pleadings. Persons
On June 8, 1977, after hearing and presentation of evidence by both parties, the Court of
responsible for the negligence should be taken to task. However, since this is not the
First Instance of Samar issued a special order granting the motion for execution pending
proper forum for whatever administrative measures may be taken under the premises,
appeal.[32] The following day, June 9, 1977, the corresponding writ of execution pending
the Court opts to discuss the merits of the petition for review on certiorari at bar rather
appeal issued.[33] At 8:00 a.m. on the same day, the Corporation and Co filed a petition
than tarry more on an administrative matter that is fundamentally extraneous to the
for certiorari, prohibition and mandamus with preliminary injunction with the Court of
petition. Slxsc
Appeals, the filling of which petition was followed by the filing of a supplement to the
petition and a "compliance" with each pleading bearing the docket stamp showing that
the Court of Appeals also received the same at 8:00 a.m.[34] Scslx Petitioner Lao maintains that the Court of Appeals should not have been given due
course to the petition for certiorari, prohibition and mandamus considering that it was
fatally defective for failure of the petitioners to attach thereto a copy of the questioned
In the petition under consideration, petitioner Lao contends that the supplemental
writ of execution. On their part, private respondents concede the mandatory character
petition and "compliance" could not have been filed with the Court of Appeals at the
of the requirement of Section 1, Rule 65 of the Rules of Court - that the petition "shall be
same time as the original petition; pointing out that the supplemental petition contains
accompanied by a certified true copy of the judgment or order subject thereof, together
an allegation to the effect that the special order granting execution pending appeal was
with copies of all pleadings and documents relevant and pertinent thereto." However,
then still "being flown to Manila" and would be attached to the petition "as soon as it
private respondents asked that their submission of a certified true copy of the special
arrives in Manila which is expected tomorrow, June 10, 1977 or Saturday." [35] Petitioner
Lao thus expressed incredulity on the fact that both the supplemental petition and the
12
order granting execution pending appeal attached to their "compliance" dated June 9,
1977[38] be taken as substantial compliance with the rule.
The Court gives due consideration to private respondents stance. Strict adherence to
procedural rules must at all times be observed. However, it is not the end-all and be-all
of litigation. As this Court said:
"xxx adjective law is not to be taken lightly for, without it, the enforcement of
substantive law may not remain assured. The Court must add, nevertheless, that
technical rules of procedure are not ends in themselves but primarily devised and
designed to help in the proper and expedient dispensation of justice. In appropriate
cases, therefore, the rules may have to be so construed liberally as to meet and advance
the cause of substantial justice."[39]
Thus, in holding that the Court of Appeals may entertain a second motion for
reconsideration of its decision although the filing of such motion violates a prohibition
thereof, the Court said:
"xxx (I)t is within the power of this Court to temper rigid rules in favor of substantial
justice. While it is desirable that the Rules of Court be faithfully and even
meticulously observed, courts should not be so strict about procedural lapses that
do not really impair the proper administration of justice. If the rules are intended to
ensure the orderly conduct of litigation, it is because of the higher objective they seek
which is the protection of substantive rights of the parties."[40] Slxmis
In the case under consideration, private respondents substantially complied with the
Rules of Court when they submitted a copy of the writ of execution sought to be enjoined
on the same day they filed the petition for certiorari, prohibition and mandamus.
Petitioner Cos allegation of irregularity as to the time of receipt of the "compliance" to
which copy of the writ was attached being unsubstantiated, the presumption of
regularity of its receipt on the day the original petition was filed should prevail.
Petitioner Co argues that the Court of Appeals cannot disturb the factual findings of the
trial court and substitute its own in a petition for certiorari, prohibition and mandamus
where the basic issue is one of jurisdiction or grave abuse of discretion. It is well-settled,
however, that in a petition for certiorari and mandamus, the Court of Appeals, when
inevitable, may examine the factual merits of the case.[41] In the present case, it was
necessary and inevitable for the Court of Appeals to look into the diverse factual
allegations of the parties. It is worthy to note that petitioners motion for execution
pending appeal was premised on his contention that the award of damages in his favor
would be meaningless on account of respondent Corporations precarious financial
status. On the other hand, respondent Corporation countered that it was operating at a
profit, an assurance that at the time, it was a stable business entity that could answer for
its obligations. In the face of these contradictory allegations, the appellate court correctly
opted to make its own finding of facts on the issue of the propriety of the issuance of the
13
writ of execution pending appeal. It should be stressed that what was at issue was not
the award of damages itself but the issuance of said writ.
Petitioner Laos position that the posting of a good and solvent bond is a special reason
for the issuance of the writ of execution pending appeal is utterly barren of merit. Mere
posting of a bond to answer for damages does not suffice as a good reason for the
granting of execution pending appeal, within the context of "good reasons" under
Section 2, Rule 39 of the Rules of Court.[42] In Roxas v. Court of Appeals,[43] the Court
held: Missdaa
"It is not intended obviously that execution pending appeal shall issue as a matter
of course. Good reasons, special, important, pressing reasons must exist to justify
it; otherwise, instead of an instrument of solicitude and justice, it may well become
a tool of oppression and inequity. But to consider the mere posting of a bond a
good reason would precisely make immediate execution of a judgment pending
appeal routinary, the rule rather than the exception. Judgments would be executed
immediately, as a matter of course, once rendered, if all that the prevailing party
needed to do was to post a bond to answer for damages that might result
therefrom. This is a situation, to repeat, neither contemplated nor intended by
law."[44]
G.R. No. 60647
From the decision of the Court of First Instance of Samar in Civil Case No. 5528, finding
that they are liable for malicious prosecution and therefore, they must pay Lao damages,
the Corporation and Co appealed to the Court of Appeals. In affirming the lower courts
decision, the Court of Appeals deduced from the facts established that the Corporation
knew all along that Laos liability was civil in nature. However, after around four (4)
years had elapsed and sensing that Civil Case No. 4452 would result in a decision against
them, they instituted the criminal case for estafa. In awarding damages in the total
amount of P330,000, the Court of Appeals took into account Laos social and business
standing.[45]Sdaadsc
From the Decision of the Court of Appeals in CA-G.R. No. 61925-R, Co filed the instant
petition for review on certiorari; contending that the Court of Appeals erred in affirming
the decision of the Samar Court of First Instance because when the case for malicious
prosecution was commenced there was as yet no cause of action as the criminal case was
still pending decision. Co also asserted that he should not be held jointly and severally
liable with the Corporation because in filing the affidavit-complaint against respondent
Lao, he was acting as the executive vice-president of the Corporation and his action was
within the scope of his authority as such corporate officer.
The issue of whether the Court of Appeals correctly ruled that the Corporation and
petitioner Co should be held liable for damages on account of malicious prosecution
shall be ratiocinated upon and resolved with the issues submitted for resolution in G.R.
Nos. 60958-59. What should concern the Court here is whether petitioner Co should be
held solidarily liable with the Corporation for whatever damages would be imposed
upon them for filing the complaint for malicious prosecution.
Petitioner Co argues that following the dictum in agency, the suit should be against his
principal unless he acted on his own or exceeded the limits of his agency.
A perusal of his affidavit-complaint reveals that at the time he filed the same on June 24,
1974, petitioner Co was the vice-president of the Corporation. As a corporate officer, his
power to bind the Corporation as its agent must be sought from statute, charter, by-
laws, a delegation of authority to a corporate officer, or from the acts of the board of
directors formally expressed or implied from a habit or custom of doing business.[46] In
this case, no such sources of petitioners authority from which to deduce whether or not
he was acting beyond the scope of his responsibilities as corporate vice-president are
mentioned, much less proven. It is thus logical to conclude that the board of directors or
by laws- of the corporation vested petitioner Co with certain executive duties[47]one of
which is a case for the Corporation.
That petitioner Co was authorized to institute the estafa case is buttressed by the fact
that the Corporation failed to make an issue out of his authority to file said case. Upon
well-established principles of pleading, lack of authority of an officer of a corporation to
bind it by contract executed by him in its name, is a defense which should have been
specially pleaded by the Corporation.[48] The Corporations failure to interpose such a
defense could only mean that the filing of the affidavit-complaint by petitioner Co was
with the consent and authority of the Corporation. In the same vein, petitioner Co may
not be held personally liable for acts performed in pursuance of an authority and
therefore, holding him solidarily liable with the Corporation for the damages awarded
to respondent Lao does accord with law and jurisprudence. Rtcspped
G.R. No. 606958-59
In this petition for review on certiorari of the Decisions of the Court of Appeals in CA-
G.R. No. 61925-R, regarding Laos claim for damages on account of malicious
prosecution, and in CA-G.R. No. 62532-R that arose from Laos complaint for accounting
and damages, petitioner Corporation assigns as errors, that:
1........The respondent Court of Appeals erred and/or committed a grave abuse of
discretion in affirming the erroneous decision of the lower court. The civil case for
malicious prosecution was filed during the pendency of the criminal case upon
which the civil suit was based. There is as yet no cause of action. xxx.
2........The respondent Court of Appeals erred and/or committed a grave abuse of
discretion when it reversed or set aside the supplemental decision of the lower court
in Civil Case No. 4452, which reversal was merely based on surmises and
conjectures. xxx.
14
3........The respondent Court of Appeals erred and/or committed grave abuse of
discretion when it awarded moral damages in Civil Case No. 4452 which was not
prayed for because Andres Lao prayed for moral damages and was already awarded
in Civil Case No. 5528. Moral damages must be specifically prayed for. xxx. [49]
Petitioner Corporation contends that the complaint for malicious prosecution brought
by Lao during the pendency of subject criminal case for estafa, states no cause of action
as it was prematurely filed when the criminal case that resulted in the acquittal of Lao
was not yet terminated. On the other hand, respondent Lao countered that the elements
supportive of an action for malicious prosecution are evidentiary in nature and their
existence or non-existence cannot be the subject of evaluation and conclusion upon the
filing of the complaint. For Lao, those elements must be determined at the time the
plaintiff has offered all his evidence and rested his case. Kortex
Malicious prosecution has been defined as an action for damages brought by one against
whom a criminal prosecution, civil suit or other legal proceeding has been instituted
maliciously and without probable cause, after the termination of such prosecution, suit
or other proceeding in favor of the defendant therein.[50] As thus defined, the fact of
termination of the criminal prosecution, civil suit or legal proceeding maliciously filed
and without probable cause, should precede the complaint for malicious prosecution.
Such a complaint states a cause of action if it alleges: (a) that the defendant was himself
the prosecutor or at least instigated the prosecution; (b) that the prosecution finally
terminated in the acquittal of the plaintiff; (c) that in bringing the action the prosecutor
acted without probable cause, and (d) that the prosecutor was actuated by malice, i.e.,
by improper and sinister motives.[51]
Ocamp v. Buenaventura[52] demonstrates the importance of the requirement that the case
maliciously commenced should be terminated before a claim for damages arising from
the filing of such case should be presented. In that case, a complaint for damages arising
from the alleged malicious filing of an administrative case for serious misconduct, grave
abuse of authority and commission of a felony, was held to be premature during the
pendency of said administrative case before the then Police Commission (POLCOM).
Observing that the complaint for damages was based on the claim that the
administrative case brought before the POLCOM was malicious, unfounded and aimed
to harass the respondents, the Court there held:
"xxx. The veracity of this allegation is not for us to determine, for if We rule and
allow the civil case for damages to proceed on that ground, there is the possibility
that the court a quo in deciding said case might declare the respondents victims of
harassment and thereby indirectly interfere with the proceedings before the
POLCOM. The respondents case for damages before the lower court is, therefore,
premature as it was filed during the pendency of the administrative case against the
respondents before the POLCOM. The possibility cannot be overlooked that the
POLCOM may hand down a decision adverse to the respondents, in which case the
damage suit will become unfounded and baseless for wanting in cause of action. Of
 persuasive force is the ruling in William H. Brown vs. Bank of the Philippine Islands
and Santiago Freixas, 101 Phil. 309, 312, where this Court said: Sclaw
"xxx. In effect, plaintiff herein seeks to recover damages upon the ground that the
detainer case has been filed, and is being maintained, maliciously and without
justification; but this pretense affects the merits of said detainer case. Should final
judgment be eventually rendered in that case in favor of the plaintiffs therein, such
as the one rendered in the municipal court, the validity of the cause of action of said
lessors against Brown, would thereby be conclusively established, and necessarily,
his contention in the present case would have to be rejected. Similarly, we cannot
sustain the theory of Brown in the case at bar, without prejudging the issue in the
detainer case, which is still pending. Until final determination of said case, plaintiff
herein cannot, and does not, have, therefore, a cause of action - if any, on which we
do not express our opinion - against the herein defendants. In short, the lower court
has correctly held that the present action is premature, and, that, consequently, the
complain herein does not set forth a cause of action against the defendants."[53]
A similar ruling was laid down in Cabacungan v. Corrales[54] where the Court sustained
the dismissal of an action for damages on the ground of prematurity. The records
disclosed that the alleged false and malicious complaint charging plaintiffs with
malicious mischief was still pending trial when the action for damages based on the
subject complaint was brought.
Premises studiedly viewed in proper perspective, the contention of Lao that the
elements of an action for malicious prosecution are evidentiary in nature and should be
determined at the time the plaintiff offers evidence and rests his case, is untenable. To
rule otherwise would, in effect, sanction the filing of actions without a cause of action.
The existence of a cause of action is determined solely by the facts alleged in the
complaint. Consideration of other facts is proscribed and any attempt to prove
extraneous circumstances is not allowed.[55] As this Court said in Surigao Mine
Exploration Co., Inc. v. Harris,[56] "unless the plaintiff has a valid and subsisting cause of
action at the time his action is commenced, the defect cannot be cured or remedied by
the acquisition or accrual of one while the action is pending, and a supplemental
complaint or an amendment setting up such after-accrued cause of action is not
permissible."[57]Thus, the circumstance that the estafa case concluded in respondent Laos
acquittal during the pendency of the complaint for malicious prosecution did not cure
the defect of lack of cause of action at the time of filing of the complaint. Sclex
Neither does the Court find merit in respondent Laos submission that the complaint for
malicious prosecution is viable inasmuch as it is also anchored on Articles 20 and 21 of
the Civil Code. This may appear to be a persuasive argument since there is no hard and
fast rule which can be applied in the determination of whether or not the principle of
abuse of rights has been violated, resulting in damages under the said articles of the
Civil Code on Human Relations. Indeed, a party injured by the filing of a court case
against him, even if he is later on absolved, may file a case for damages grounded either
on the principle of abuse of rights or on malicious prosecution.[58] However, whether
15
based on the principle of abuse of rights or malicious prosecution, a reading of the
complaint here reveals that it is founded on the mere filing of the estafa charge against
respondent Lao. As such, it was prematurely filed and it failed to allege a cause of action.
Should the action for malicious prosecution be entertained and the estafa charge would
result in respondent Laos conviction during the pendency of the damage suit, even if it
is based on Articles 20 and 21, such suit would nonetheless become groundless and
unfounded. To repeat; that the estafa case, in fact, resulted in respondent Laos acquittal
would not infuse a cause of action on the malicious prosecution case already
commenced and pending resolution.
The complaint for damages based on malicious prosecution and/or on Articles 20 and
21 should have been dismissed for lack of cause of action and therefore, the Court of
Appeals erred in affirming the decision of the trial court of origin. It should be stressed,
however, that the dismissal of subject complaint should not be taken as an adjudication
on the merits, the same being merely grounded on the failure of the complaint to state a
cause of action.[59]
As regards the Decision in CA-G.R. No. 62532-R which was spawned by respondent
Laos complaint for accounting, petitioner contends that the appellate court erred when
it reversed and set aside the supplemental decision in Civil Case No. 4452 and directed
the corporation to reimburse the amount of P556,444.20, representing Laos overpayment
to the Corporation. The Court would normally have restricted itself to questions of law
and shunned away from questions of fact were it not for the conflicting findings of fact
by the trial court and appellate court on the matter. The Court is therefore constrained
to relax the rule on conclusiveness of factual findings of the Court of Appeals and, on
the basis of the facts on record, make its own findings.[60]
It is significant to note that as per decision of the trial court dated March 26, 1975, a court-
supervised accounting was directed so as to ascertain the true and correct accountability
of Andres Lao to the defendant corporation. Thus, a three-man audit committee was
formed with the branch of clerk of court, Atty. Victorio Galapon, as chairman, and two
other certified public accountants respectively nominated by the parties, as members.
On September 16, 1976, the said Audit Committee submitted its report[61] and in the
hearing of November 25, 1976, the parties interposed no objection thereto and
unanimously accepted the Audit Committee Report. The Committee found that Andres
Lao has made a total overpayment to defendant corporation in the amount
of P556,444.20. Xlaw
Trial by commissioners is allowed by the Rules of Court when a) the trial of an issue of
fact requires the examination of a long account on either side, in which case the
commissioner may be directed to hear and report upon the whole issue or any specific
question involved therein; b) when the taking of an account is necessary for the
information of the court before judgment, or for carrying a judgment or order into effect;
and c) when a question of fact, other than upon the pleadings, arises upon motion or
otherwise, at any stage of a case, or for carrying a judgment or order into
effect.[62] Ultimately, the trial court, in the exercise of its sound discretion, may either
adopt, modify, or reject in whole or in part, the commissioners report or it may recommit
the same with instructions, or require the parties to present additional evidence before
the commissioners or before the court.[63]
In the case under consideration, it is thus within the power of the trial court to refer the
accounting to court-appointed commissioners because a true and correct accounting is
necessary for the information of the court before it can render judgment. Moreover, the
technical nature of the audit procedure necessitates the assistance of a certified public
accountant. And since both parties offered no objection to the commissioners report,
they are deemed to have accepted and admitted the findings therein contained.
There is no discernible cause for veering from the findings of the Audit Committee. In
arriving at its conclusion, the Audit Committee subtracted the total remittances of Lao
in the amount of P13,686,148.80 from the entire volume of shipments made by the
corporation. In determining the total volume of shipments made by the corporation, the
Audit Committee did not include the shipments covered by bills of lading and factory
consignment invoices but without the corresponding delivery receipts. These included
shipments in the amount of P597, 239.40 covered by bills of lading and factory
consignment invoices but with no supporting delivery receipts, and shipments
worth P126, 950.00 with factory consignment invoices but not covered by bills of lading
and delivery receipts. However, the Audit Committee considered shipments made by
the corporation to Lao in the amount of P9,110,777.00 covered by bills of lading and
factory invoices but without the corresponding delivery receipts because subject
shipments were duly reported in Laos monthly sales report. Xsc
The Audit Committee correctly excluded the shipments not supported by delivery
receipts, albeit covered by bills of lading and factory consignment invoices. Under
Article 1497 of the Civil Code, a thing sold shall be understood as delivered when it is
placed in the control or possession of the vendee. Unless possession or control has been
transferred to the vendee, the thing or goods sold cannot be considered as delivered.
Thus, in the present case, the Audit Committee was correct when it adopted as guideline
that accountability over the goods shipped was transferred from the corporation to
Andres Lao only upon actual delivery of the goods to him. For it is only when the goods
were actually delivered to and received by Lao, did Lao have control and possession
over subject goods, and only when he had control and possession over said goods could
he sell the same.
Delivery is generally evidenced by a written acknowledgement of a person that he or
she has actually received the thing or the goods, as in delivery receipts. A bill of lading
cannot substitute for a delivery receipt. This is because it is a written acknowledgement
of the receipt of the goods by the carrier and an agreement to transport and deliver them
at a specific place to a person named or upon his order.[64] It does not evidence receipt
of the goods by the consignee or the person named in the bill of lading; rather, it is
evidence of receipt by the carrier of the goods from the shipper for transportation and
delivery.
16
Likewise, a factory consignment invoice is not evidence of actual delivery of the goods.
An invoice is nothing more than a detailed statement of the nature, quantity and cost of
the thing sold.[65] It is not proof that the thing or goods were actually delivered to the
vendee or the consignee. As admitted by the witness for the corporation:
A: Factory consignment invoices represents what the company billed the plaintiff
Mr. Lao and the bill of lading represents the goods which were supposed to have
been shipped.
xxx.......xxx.......xxx
A: Shipments covered by factory consignment invoices simply meant these are
billings made again by the Associated Anglo-American Tobacco Corporation to
plaintiff Andres Lao. (t.s.n., November 25, 1976, pp. 45-47 as cited in Respondent
Laos Comment, Rollo, p. 259)
Thus, in the absence of proof that the goods were actually received by Lao as evidenced
by delivery receipts, the shipments allegedly made by the corporation in the amount
of P597,239.40 and P126,950.00 covered only by bills of lading and factory consignment
invoices cannot be included in Laos accountability. Sc
However, as to the shipments worth P4,018,927.60 likewise covered only by bills of
lading and factory consignment invoices, the Audit Committee correctly considered
them in Laos account because such shipments were reported in the latters sales reports.
The fact that Lao included them in his sales reports is an implied admission that subject
goods were actually delivered to him, and that he received the said goods for resale.
As regards the award of moral damages, petitioner Corporation faults the Court of
Appeals for awarding such damages not specifically prayed for in the complaint for
accounting and damages in Civil Case No. 4452. Petitioner Corporation argues that
moral damages were prayed for and duly awarded in Civil Case No. 5528 and therefore,
it would be unfair and unjust to allow once again, recovery of moral damages on similar
grounds.
Contrary to the allegation of the petitioner Corporation, the award of moral damages
was specifically prayed for in the complaint albeit it left the amount of the same to the
discretion of the court.[66] Moreover, Civil Case Nos. 4452 and 5528 were on varied
causes of action. While the award for moral damages in Civil Case No. 4452 was based
on the evident bad faith of the petitioner Corporation in unilaterally rescinding
respondent Laos sales agency through his immediate replacement by Ngo Kheng, the
claim for moral damages in Civil Case No. 5528 was anchored on the supposed malice
that attended the filing of the criminal case for estafa.
Petitioner Corporation also opposes for being conjectural, the award of P150,000.00 in
Civil Case No. 4452, representing actual damages for loss of earnings. True, damages
cannot be presumed or premised on conjecture or even logic. A party is entitled to
adequate compensation only for duly substantiated pecuniary loss actually suffered by
him or her.[67] In this case, however, the trial court correctly found that an award for
actual damages was justified because several months before their contract of agency was
due to expire in 1969, the petitioner Corporation replaced Lao with Ngo Kheng as sales
agent for the areas of Leyte and Samar. This, despite the fact that they had already
agreed that Lao would continue to act as the corporations sales agent provided that he
would reduce his accountability to P200,000.00, the amount covered by his bond, and
engaged the services of an independent accounting firm to do an audit to establish Laos
true liability. Due to his ouster as sales agent, Lao failed to realize a net income from his
sales agency in the amount of P30,000.00 a year. Scmis
However, the amount of actual damages should be reduced to P30,000.00 only instead
of the P150,000.00 awarded by the appellate court. Since the contract of sales agency was
on a yearly basis, the actual damages Lao suffered should be limited to the annual net
income he failed to realize due to his unjust termination as sales agent prior to the
expiration of his contract in 1969. Unrealized income for the succeeding years cannot be
awarded to Lao because the corporation is deemed to have opted not to renew the
contract with Lao for the succeeding years.
As to the award of exemplary damages, suffice it to state that in contracts and quasi-
contracts, the court may award exemplary damages if the defendant acted in a wanton,
fraudulent, reckless, oppressive, or malevolent manner. [68] In the case under scrutiny,
the Court finds the award of exemplary damages unjustified or unwarranted in the
absence of any proof that the petitioner Corporation acted in a wanton, fraudulent,
reckless, oppressive, and malevolent manner. For the same reasons, the award for
attorneys fees should be deleted.
WHEREFORE,
In G.R. No. L-47013, the petition for review on certiorari is DENIED for lack of merit;
In G.R. No. 60647, the petition is GRANTED and the assailed decision is SET ASIDE;
and the Decision of the Court of Appeals in CA-G.R. No. 61925-R, finding Esteban Co
solidarily liable with the respondent Associated Anglo-American Tobacco Corporation
for damages, is REVERSED AND SET ASIDE. As above ratiocinated, the respondent
corporation cannot be held liable for damages.
In G.R. Nos. 60958-59, the Decision in CA-G.R. No. 61925-R is REVERSED AND SET
ASIDE; the respondent corporation is adjudged not liable for malicious prosecution due
to the prematurity of the action; while the Decision in CA-G.R. No. 62532-R is
AFFIRMED, insofar as it ordered respondent corporation to reimburse Andres Laos
overpayment in the amount of P556,444.20, but MODIFIED, in that only an award
of P30,000.00 for actual damages is GRANTED, and all the other monetary awards are
deleted. No pronouncement as to costs.
17
SO ORDERED.
[G.R. No. 107019. March 20, 1997]
FRANKLIN M. DRILON, AURELIO C. TRAMPE, GREGORIO A. ARIZALA, CESAR
M. SOLIS and FERDINAND R. ABESAMIS, petitioners, vs. COURT OF
APPEALS, HON. GEORGE C. MACLI-ING, in his capacity as Presiding
Judge of Branch 100 of the Regional Trial Court of Quezon City, and
HOMOBONO ADAZA, respondents.
DECISION
HERMOSISIMA, JR., J.:
Petitioners seek the reversal of the Resolutions of respondent Court of Appeals in
CA-G.R. SP No. 25080 dated January 31, 1992 and September 2, 1992 affirming the
Orders, dated February 8, 1991 and May 14, 1991, of respondent Judge George C. Macli-
ing which denied herein petitioners Motion to Dismiss the complaint filed in Civil Case
No. Q-90-6073 by respondent Homobono Adaza.
The facts are not in dispute.
In a letter-complaint to then Secretary of Justice Franklin Drilon[1] dated March 20,
1990, General Renato de Villa,[2] who was then the Chief of Staff of the Armed Forces of
the Philippines, requested the Department of Justice to order the investigation of several
individuals named therein, including herein private respondent Homobono Adaza, for
their alleged participation in the failed December 1989 coup detat. The letter-complaint
was based on the affidavit of Brigadier General Alejandro Galido, Captain Oscarlito
Mapalo, Colonel Juan Mamorno, Colonel Hernani Figueroa and Major Eduardo
Sebastian.
Gen. de Villas letter-complaint with its annexes was referred for preliminary
inquiry to the Special Composite Team of Prosecutors created pursuant to Department
of Justice Order No. 5 dated January 10, 1990. Petitioner then Assistant Chief State
Prosecutor Aurelio Trampe,[3] the Team Leader, finding sufficient basis to continue the
inquiry, issued a subpoena to the individuals named in the letter-complaint, Adaza
included, and assigned the case for preliminary investigation to a panel of investigators
composed of prosecutors George Arizala, as Chairman, and Ferdinand Abesamis and
Cesar Solis as members. The case was docketed as I.S. No. DOJ-SC-90-013.
On April 17, 1990, the panel released its findings, thru a Resolution, which reads:
PREMISES CONSIDERED, we find and so hold that there is probable cause to hold
herein respondents for trial for the crime of REBELLION WITH MURDER AND
FRUSTRATED MURDER. Hence we respectfully recommend the filing of the
corresponding information against them in court.[4]
The above Resolution became the basis for the filing of an Information,[5] dated
April 18, 1990, charging private respondent with the crime of rebellion with murder and
frustrated murder before the Regional Trial Court of Quezon City, with no
recommendation as to bail.[6]
 Feeling aggrieved by the institution of these proceedings against him, private
respondent Adaza filed a complaint for damages,[7] dated July 11, 1990, before Branch
100 of the Regional Trial Court of Quezon City. The complaint was docketed as Civil
Case No. Q-90-6073 entitled, Homobono Adaza, plaintiff versus Franklin Drilon, et al.,
respondents. In his complaint, Adaza charged petitioners with engaging in a deliberate,
willful and malicious experimentation by filing against him a charge of rebellion
complexed with murder and frustrated murder when petitioners, according to Adaza,
were fully aware of the non-existence of such crime in the statute books.
On October 15, 1990, petitioners filed a Motion to Dismiss Adazas complaint on
the ground that said complaint states no actionable wrong constituting a valid cause of
action against petitioners.
On February 8, 1991, public respondent judge issued an Order [8] denying
petitioners Motion to Dismiss. In the same Order, petitioners were required to file their
answer to the complaint within fifteen (15) days from receipt of the Order.
Petitioners moved for a reconsideration of the Order of denial, but the same was
likewise denied by respondent Judge in another Order dated May 14, 1991. [9] The
subsequent Order reiterated that petitioners file their responsive pleading within the
prescribed reglementary period.
Instead of filing their answer as ordered, petitioners filed on June 5, 1991 a petition
for certiorari under Rule 65 before the Court of Appeals, docketed as CA-G.R. No. 25080,
alleging grave abuse of discretion on the part of the respondent Judge in ruling that
sufficient cause of action exists to warrant a full-blown hearing of the case filed by Adaza
and thus denying petitioners Motion to Dismiss.
In its Resolution promulgated on January 31, 1992, the appellate court dismissed
the petition for lack of merit and ordered respondent Judge to proceed with the trial of
Civil Case No. Q-90-6073.[10] A Motion for Reconsideration having been subsequently
filed on February 28, 1992, the court a quo denied the same in a Resolution dated
September 2, 1992.[11]
Hence, this petition, dated October 9, 1992, pleading this Court to exercise its
power of review under Rule 45 of the Revised Rules of Court.
On January 13, 1993, however, this Court, thru the Second Division, dismissed the
petition for failure to comply with Revised Circular No. 1-88, particularly the
requirement on the payment of the prescribed docketing fees. [12]
On March 8, 1993,[13] we reinstated the petition and required the respondents to
comment on the aforesaid petition. In the same Resolution, a temporary restraining
order was issued by this Court enjoining respondent Judge from further proceeding
with Civil Case No. Q-90-6073 until further orders from this Court.
The petition has merit.
In his Comment,[14] dated March 23, 1993, respondent Adaza maintains that his
claim before the trial court was merely a suit for damages based on tort by reason of
petitioners various malfeasance, misfeasance and nonfeasance in office, as well as for
18
violation by the petitioners of Section 3 (e) of Republic Act No. 3019, otherwise known
as the Anti-Graft and Corrupt Practices Act. It was not a suit for malicious prosecution.
Private respondent is taking us for a ride. A cursory perusal of the complaint filed
by Adaza before respondent Judge George Macli-ing reveals that it is one for malicious
prosecution against the petitioners for the latters filing of the charge against him of
rebellion with murder and frustrated murder. An examination of the records would
show that this latest posture as to the nature of his cause of action is only being raised
for the first time on appeal. Nowhere in his complaint filed with the trial court did
respondent Adaza allege that his action is one based on tort or on Section 3 (e) of
Republic Act No. 3019. Such a change of theory cannot be allowed. When a party adopts
a certain theory in the court below, he will not be permitted to change his theory on
appeal, for to permit him to do so would not only be unfair to the other party but it
would also be offensive to the basic rules of fair play, justice and due process. [15] Any
member of the Bar, even if not too schooled in the art of litigation, would easily discern
that Adazas complaint is no doubt a suit for damages for malicious prosecution against
the herein petitioners. Unfortunately, however, his complaint filed with the trial court
suffers from a fatal infirmity -- that of failure to state a cause of action -- and should have
been dismissed right from the start. We shall show why.
The term malicious prosecution has been defined in various ways. In American
jurisdiction, it is defined as:
One begun in malice without probable cause to believe the charges can be sustained
(Eustace v. Dechter, 28 Cal. App. 2d. 706,83 P. 2d. 525). Instituted with intention of
injuring defendant and without probable cause, and which terminates in favor of the
person prosecuted. For this injury an action on the case lies, called the action of
malicious prosecution (Hicks v. Brantley, 29 S.E. 459, 102 Ga. 264; Eggett v. Allen, 96
N.W. 803, 119 Wis. 625).[16]
In Philippine jurisdiction, it has been defined as:
An action for damages brought by one against whom a criminal prosecution, civil suit,
or other legal proceeding has been instituted maliciously and without probable cause,
after the termination of such prosecution, suit, or other proceeding in favor of the
defendant therein. The gist of the action is the putting of legal process in force,
regularly, for the mere purpose of vexation or injury (Cabasaan v. Anota, 14169-R,
November 19, 1956).[17]
The statutory basis for a civil action for damages for malicious prosecution are
found in the provisions of the New Civil Code on Human Relations and on damages
particularly Articles 19, 20, 21, 26, 29, 32, 33, 35, 2217 and 2219 (8). [18] To constitute
malicious prosecution, however, 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
by the defendant knowing that his charges were false and groundless. Concededly, the
mere act of submitting a case to the authorities for prosecution does not make one liable
for malicious prosecution.[19] Thus, in order for a malicious prosecution suit to prosper,
the plaintiff must prove three (3) elements: (1) the fact of the prosecution and the further
fact that the defendant was himself the prosecutor and that the action finally terminated
with an acquittal; (2) that in bringing the action, the prosecutor acted without probable
cause; and (3) that the prosecutor was actuated or impelled by legal malice, that is by
improper or sinister motive.[20] All these requisites must concur.
Judging from the face of the complaint itself filed by Adaza against the herein
petitioners, none of the foregoing requisites have been alleged therein, thus rendering
the complaint dismissible on the ground of failure to state a cause of action under Section
1 (g), Rule 16 of the Revised Rules of Court.
There is nothing in the records which shows, and the complaint does not allege,
that Criminal Case No. Q-90-11855, filed by the petitioners against respondent Adaza
for Rebellion with Murder and Frustrated Murder, has been finally terminated and
therein accused Adaza acquitted of the charge. Not even Adaza himself, thru counsel,
makes any positive asseveration on this aspect that would establish his acquittal. Insofar
as Criminal Case No. Q-90-11855 is concerned, what appears clear from the records only
is that respondent has been discharged on a writ of habeas corpus and granted
bail.[21] This is not, however, considered the termination of the action contemplated
under Philippine jurisdiction to warrant the institution of a malicious prosecution suit
against those responsible for the filing of the informaion against him.
The complaint likewise does not make any allegation that the prosecution acted
without probable cause in filing the criminal information dated April 18, 1990 for
rebellion with murder and frustrated murder. Elementarily defined, probable cause is
the existence of such facts and circumstances as would excite the belief, in a reasonable
mind, acting on the facts within the knowledge of the prosecutor, that the person
charged was guilty of the crime for which he was prosecuted. It is well-settled that one
cannot be held liable for maliciously instituting a prosecution where one has acted with
probable cause. Elsewise stated, a suit for malicious prosecution will lie only in cases
where a legal prosecution has been carried on without probable cause. The reason for
this rule is that it would be a very great discouragement to public justice, if prosecutors,
who had tolerable ground of suspicion, were liable to be sued at law when their
indictment miscarried.[22]
In the case under consideration, the decision of the Special Team of Prosecutors to
file the information for rebellion with murder and frustrated murder against respondent
Adaza, among others, cannot be dismissed as the mere product of whim or caprice on
the part of the prosecutors who conducted the preliminary investigation. Said decision
was fully justified in an eighteen (18)-page Resolution dated April 17, 1990.[23] While it
is true that the petitioners were fully aware of the prevailing jurisprudence enunciated
in People v. Hernandez,[24] which proscribes the complexing of murder and other common
crimes with rebellion, petitioners were of the honest conviction that the Hernandez Case
can be differentiated from the present case. The petitioners thus argued:
Of course we are aware of the ruling in People vs. Hernandez, 99 Phil. 515, which held
that common crimes like murder, arson, etc. are absorbed by rebellion. However, the
Hernandez case is different from the present case before us. In the Hernandez case, the
common crimes of murder, arson, etc. were found by the fiscal to have been committed
19
as a necessary means to commit rebellion, or in furtherance thereof. Thus, the fiscal
filed an information for rebellion alleging those common crimes as a necessary means
of committing the offense charged under the second part of Article 48, RPC.
We, however, find no occasion to apply the Hernandez ruling since as intimated
above, the crimes of murder and frustrated murder in this case were absolutely
unnecessary to commit rebellion although they were the natural consequences of the
unlawful bombing. Hence, the applicable provision is the first part of Article 48 of the
RPC.[25]
While the Supreme Court in the case of Enrile v. Salazar,[26] addressing the issue of
whether or not the Hernandez doctrine is still good law, in a 10-3 vote, did not sustain
the position espoused by the herein petitioners on the matter,three justices[27] felt the
need to re-study the Hernandez ruling in light of present-day developments, among
whom was then Chief Justice Marcelo Fernan who wrote a dissenting opinion in this
wise:
I am constrained to write this separate opinion on what seems to be a rigid adherence
to the 1956 ruling of the Court. The numerous challenges to the doctrine enunciated in
the case of People vs. Hernandez, 99 Phil. 515 (1956), should at once demonstrate the
need to redefine the applicability of said doctrine so as to make it conformable with
accepted and well-settled principles of criminal law and jurisprudence.
To my mind, the Hernandez doctrine should not be interpreted as an all-embracing
authority for the rule that all common crimes committed on the occasion, or in
furtherance of, or in connection with, rebellion are absorbed by the latter. To that
extent, I cannot go along with the view of the majority in the instant case that
Hernandez remains binding doctrine operating to prohibit the complexing of rebellion
with any other offense committed on the occasion thereof, either as a means necessary
to its commission or as an unintended effect of an activity that constitutes rebellion (p.
9, Decision).
The Hernandez doctrine has served the purpose for which it was applied by the Court
in 1956 during the communist-inspired rebellion of the Huks. The changes in our
society in the span of 34 years since then have far-reaching effects on the all-embracing
applicability of the doctrine considering the emergence of alternative modes of seizing
the powers of the duly-constituted Government not contemplated in Articles 134 and
135 of the Revised Penal Code and their consequent effects on the lives of our
people.The doctrine was good law then, but I believe that there is a certain aspect of
the Hernandez doctrine that needs clarification.[28]
Apparently, not even the Supreme Court then was of one mind in debunking the
theory being advanced by the petitioners in this case, some of whom were also the
petitioners in the Enrile case. Nevertheless, we held in Enrile that the Information filed
therein properly charged an offense -- that of simple rebellion --[29] and thereupon
ordered the remand of the case to the trial court for the prosecution of the named
accused[30] in the Information therein. Following this lead, the Information against
Adaza in Criminmal Case No. Q-90-11855 was not quashed, but was instead treated
likewise as charging the crime of simple rebellion.
A doubtful or difficult question of law may become the basis of good faith and, in
this regard, the law always accords to public officials the presumption of good faith and
regularity in the performance of official duties.[31] Any person who seeks to establish
otherwise has the burden of proving bad faith or ill-motive. Here, since the petitioners
were of the honest conviction that there was probable cause to hold respondent Adaza
for trial for the crime of rebellion with murder and frustrated murder, and since Adaza
himself, through counsel, did not allege in his complaint lack of probable cause, we find
that the petitioners cannot be held liable for malicious prosecution. Needless to say,
probable cause was not wanting in the institution of Criminal Case No. Q-90-11855
against Adaza.
As to the requirement that the prosecutor must be impelled by malice in bringing
the unfounded action, suffice it to state that the presence of probable cause signifies, as
a legal consequence, the absence of malice.[32] At the risk of being repetitious, it is evident
in this case that petitioners were not motivated by malicious intent or by a sinister design
to unduly harass private respondent, but only by a well-founded belief that respondent
Adaza can be held for trial for the crime alleged in the information.
All told, the complaint, dated July 11, 1990, filed by Adaza before Branch 100 of
the Regional Trial Court against the petitioners does not allege facts sufficient to
constitute a cause of action for malicious prosecution. Lack of cause of action, as a
ground for a motion to dismiss under Section 1 (g), Rule 16 of the Revised Rules of Court,
must appear on the face of the complaint itself, meaning that it must be determined from
the allegations of the complaint and from none other.[33] The infirmity of the complaint
in this regard is only too obvious to have escaped respondent judges
attention. Paragraph 14 of the complaint which states:
xxxxxxxxx
14. The malicious prosecution, nay persecution, of plaintiff for a non-existent crime
had severely injured and besmirched plaintiffs name and reputation and forever
stigmatized his stature as a public figure, thereby causing him extreme physical
suffering, serious anxiety, mental anguish, moral shock and social humiliation. [34]
is a mere conclusion of law and is not an averment or allegation of ultimate facts. It does
not, therefore, aid in any wise the complaint in setting forth a valid cause of action
against the petitioners.
It is worthy to note that this case was elevated to the public respondent Court of
Appeals and now to this Court because of respondent Judge Macli-ings denial of
petitioners motion to dismiss the Adaza complaint. The ordinary procedure, as a general
rule, is that petitioners should have filed an answer, go to trial, and if the decision is
adverse, reiterate the issue on appeal.[35] This general rule, however, is subject to certain
exceptions, among which are, if the court denying the motion to dismiss acts without or
in excess of jurisdiction or with grave abuse of discretion, in which case certiorari under
20
Rule 65 may be availed of. The reason is that it would be unfair to require the defendants
(petitioners in this case) to undergo the ordeal and expense of trial under such
circumstances, because the remedy of appeal then would then not be plain and
adequate.[36] Judge Macli-ing committed grave abuse of discretion in denying
petitioners motion to dismiss the Adaza complaint, and thus public respondent Court
of Appeals should have issued the writ of certiorari prayed for by the petitioners and
annulled the February 8, 1991 and May 14, 1991 Orders of respondent Judge. It was
grievous error on the part of the court a quo not to have done so. This has to be
corrected. Respondent Adazas baseless action cannot be sustained for this would
unjustly compel the petitioners to needlessly go through a protracted trial and thereby
unduly burden the court with one more futile and inconsequential case.
WHEREFORE, the petition is GRANTED. The Resolutions of respondent Court of
Appeals dated January 31, 1992 and September 2, 1992 affirming the February 8, 1991
and May 14, 1991 Orders of respondent Judge George C. Macli-ing are all hereby
NULLIFIED AND SET ASIDE. Respondent Judge is DIRECTED to take no further
action on Civil Case No. Q-90-6073 except to DISMISS the same.
SO ORDERED.
G.R. No. L-51832 April 26, 1989
RAFAEL PATRICIO, petitioner, vs. THE HONORABLE OSCAR LEVISTE, JUDGE,
CFI CAPIZ, BRANCH II and BIENVENIDO BACALOCOS, respondents.
PADILLA, J.:
Petition for review on certiorari of the Order 1 of the Court of First Instance of Capiz,
Branch II, on the motion for reconsideration flied by private respondent Bienvenido
Bacalocos, dismissing the complaint for damages against the latter, docketed as Civil
Case No. V-3937.
Petitioner Rafael Patricio, an ordained Catholic priest, and actively engaged in social
and civic affairs in Pilar, Capiz, where he is residing, was appointed Director General of
the 1976 Religious and Municipal Town Fiesta of Pilar, Capiz.
On 16 May 1976 at about 10:00 o'clock in the evening, while a benefit dance was on-
going in connection with the celebration of the town fiesta, petitioner together with two
(2) policemen were posted near the gate of the public auditorium to check on the
assigned watchers of the gate. Private respondent Bienvenido Bacalocos, President of
the Association of Barangay Captains of Pilar, Capiz and a member of the Sangguniang
Bayan, who was in a state of drunkenness and standing near the same gate together with
his companions, struck a bottle of beer on the table causing an injury on his hand which
started to bleed. Then, he approached petitioner in a hostile manner and asked the latter
if he had seen his wounded hand, and before petitioner could respond, private
respondent, without provocation, hit petitioner's face with his bloodied hand. As a
consequence, a commotion ensued and private respondent was brought by the
policemen to the municipal building. 2
As a result of the incident, a criminal complaint for "Slander by Deed was flied by
petitioner with the Municipal Trial Court of Pilar, Capiz, docketed as Criminal Case No.
2228, but the same was dismissed. 3 Subsequently, a complaint for damages was filed
by petitioner with the court a quo. In a decision 4 dated 18 April 1978, the court ruled in
favor of herein petitioner (as complainant), holding private respondent liable to the
former for moral damages as a result of the physical suffering, moral shock and social
humiliation caused by private respondent's act of hitting petitioner on the face in public.
The dispositive part of the decision reads as follows:
WHEREFORE, the Court orders defendant to pay plaintiff the
damages as follows:
a) Moral damages of P10,000.00
b) Exemplary damages, P1,000.00 and
c) Attorney's fees, P2,000.00.
SO ORDERED. 5
On 9 June 1978, petitioner filed a motion for execution of judgment, alleging that the 18
April 1978 decision had become final and executory after the lapse of thirty (30) days
from receipt thereof by private respondent, without any motion for reconsideration or
appeal having been filed. 6 However, said motion was denied by the court a quo on the
ground that there was a pending motion for reconsideration filed by private
respondent. 7 Subsequently, private respondent filed a supplemental motion for
reconsideration 8 and the court ordered petitioner to file a reply (opposition)
thereto. 9 In compliance, petitioner flied a reply (opposition) to the motion for
reconsideration, alleging that the filing of said motion and supplement thereto was
without notice to the adverse party and proof of service, hence, the decision sought to
be reconsidered had already become final and unappealable. 10
Private respondent filed a rejoinder (reply) and a manifestation stating that petitioner
was duly served with a copy of said motion for reconsideration by ordinary mail,
attaching thereto the affidavit of Godofredo Almazol who stated that he mailed the
envelope to counsel for herein petitioner. 11 The court a quo then scheduled the motion
for oral argument and the parties were allowed to extensively argue their respective
causes.
On 3 August 1979, an order 12 of dismissal of the petitioner's complaint was issued by
the trial court, thus —
ORDER
This is a motion for reconsideration of the decision of this Court dated April 18, 1978,
filed by counsel for defendant on May 18, 1978.
In view of the recent trend in the Supreme Court to liberally construe the Rules, and
in view of Section 2, Rule 1, the Court resolves to give due course to the motion.
21
Upon review of the facts of the case, it appears and the Court finds merit in the
motion for reconsideration, particularly noting that there is indeed no showing of
compensatory damages being proved.
WHEREFORE, tills Court reconsiders its decision to conform to the facts and the law,
namely, that moral and exemplary damages, in order to merit, the plaintiff ought to
have proven actual or compensatory damages.
WHEREFORE, this case is ordered dismissed.
SO ORDERED.
Not satisfied with said order, petitioner filed the petition at bar contending that no copy
of the Motion for consideration was served upon petitioner and no proof of service as
well as notice of hearing were attached to said motion when filed with the court a
quo; thus, the motion for reconsideration did not interrupt the running of the period to
appeal. The alleged mailing of a copy of said motion by ordinary mail did not, according
to petitioner, cure the defect. Petitioner further argues that respondent's admission that
he slapped herein petitioner in public causing him physical suffering and social
humiliation, entitles the latter to moral damages. Actual and compensatory damages
need not be proven before an award of moral damages can be granted, so petitioner
contends.
On the other hand, private respondent claims that the order of the court a quo apprising
petitioner of the motion for reconsideration filed by private respondent and requiring
the former to file a reply (opposition) thereto, had cured the defect of lack of proof of
service and notice of hearing of said motion for reconsideration; and that the award of
moral damages to petitioner is without basis for lack of proof of bad faith on the part of
private respondent.
With respect to the alleged lack of service on petitioner of a copy of the motion and
notice of hearing and failure to attach to the motion proof of service thereof, the general
rule is that notice of motion is required where a party has a right to resist the relief
sought by the motion and principles of natural justice demand that his rights be not
affected without an opportunity to be heard. 13
In the case at bar, a copy of the motion for reconsideration was served upon petitioner,
although service was effected through ordinary mail and not by registered mail as
reqired by the rules. But, petitioner was duly given the full opportunity to be heard and
to argue his case when the court a quo required him to file a reply (opposition) to the
motion for reconsideration and subsequently set the motion for oral argument.
What the law really eschews is not the lack of previous notice of hearing but the lack of
opportunity to be heard. It has been held that parties should not rely on mere
technicalities which, in the interest of justice, may be relaxed. 14The rifles of procedure
should be viewed as mere tools designed to facilitate the attainment of justice. Their
strict and rigid application, which would result in technicalities that tend to frustrate
rather than promote substantial justice, must be avoided. 15 Moreover, the case should,
as much as possible, be decided on the merits and not merely on technicalities.
As to the petitioner's claim for moral damages, we find the same to be meritorious. There
is no question that moral damages may be recovered in cases where a defendant's
wrongful act or omission has caused the complainant physical suffering, mental
anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock,
social humiliation and similar injury. 16 An award of moral damages is allowed in cases
specified or analogous to those provided in Article 2219 of the Civil Code, to wit:
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.
xxx xxx xxx
Private respondent's contention that there was no bad faith on his part in slapping
petitioner on the face and that the incident was merely accidental is not tenable. It was
established before the court a quo that there was an existing feud between the families of
both petitioner and private respondent and that private respondent slapped the
petitioner without provocation in the presence of several persons.
The act of private respondent in hitting petitioner on the face is contrary to morals and
good customs and caused the petitioner mental anguish, moral shock, wounded feelings
and social humiliation. Private respondent has to take full responsibility for his act and
his claim that he was unaware of what he had done to petitioner because of drunkenness
is definitely no excuse and does not relieve him of his liability to the latter.
Pursuant to Art. 21 of the Civil Code in relation to par. (10) of Art. 2219 of the same Code,
"any person who wilfully causes loss or injury to another in a manner that is contrary to
morals, good customs or public policy shall compensate the latter for the damage."
The fact that no actual or compensatory damage was proven before the trial court, does
not adversely affect petitioner's right to recover moral damages. Moral damages may be
awarded in appropriate cases referred to in the chapter on human relations of the Civil
22
Code (Articles 19 to 36), without need of proof that the wrongful act complained of had
caused any physical injury upon the complainant. 17 It is clear from the report of the
Code Commission that the reason underlying an award of damages under Art. 21 of the
Civil Code is to compensate the injured party for the moral injury caused upon his
person, thus —
... . Fully sensible that there are countless gaps in the statutes, which leave so many
victims of moral wrongs helpless, even though they have actually suffered material
and moral injury, the Commission has deemed it necessary, in the interest of justice,
to incorporate in the proposed Civil Code the following rule:
ART. 23. Any person who wilfully causes loss or injury to another in a manner that
is contrary to morals, good customs or public policy shall compensate the latter for
the damage.
xxx xxx xxx 18
In addition to the award of moral damages, exemplary or corrective damages may be
imposed upon herein private respondent by way of example or correction for the public
good. 19 Exemplary damages are required by public policy to suppress the wanton acts
of the offender. They are an antidote so that the poison of wickedness may not run
through the body politic. 20 The amount of exemplary damages need not be proved
where it is shown that plaintiff is entitled to either moral, temperate or compensatory
damages, as the case may be, 21 although such award cannot be recovered as a matter
of right. 22
In cases where exemplary damages are awarded to the injured party, attorney's fees are
also recoverable. 23
WHEREFORE, the petition is GRANTED. The order appealed from, dated 3 August
1979, is REVERSED and the decision of the court a quo dated 18 April 1978 is hereby
REINSTATED. With costs against private respondent.
SO ORDERED.
G.R. No. L-48250 December 28, 1979
GRAND UNION SUPERMARKET, INC. and NELIA SANTOS
FANDINO, petitioners, vs. JOSE J. ESPINO JR., and THE HONORABLE COURT
OF APPEALS, respondents.
GUERRERO, J.
This is a petition tor certiorari by way of appeal from the decision of the Court of
Appeals 1 dated September 26, 1977 rendered in CA-G.R. No. 55186-R entitled "Jose J.
Espino, Jr., plaintiff-appellant. versus Grand Union Supermarket, Inc. and Nelia Santos-
Fandino, defendants-appellees," the dispositive portion of which states;
 WHEREFORE, the appealed judgment is hereby reversed and set
aside. Defendants are ordered to pay plaintiff-jointly and severally,
the sum of Seventy-Five Thousand Pesos (P75,000.00) by way of moral
damages. Twenty-Five Thousand Pesos (P25,000.00) as exemplary
damages, and Five Thousand Pesos (P5,000.00) as attorney's fee, Costs
of both instances shall be taxed against the defendant defendants.
The facts of the case are as stated in the decision of the respondent court to wit:
"Upon the evidence, and from the findings of the lower court, it appears that in the
morning of August 22, 1970, plaintiff Jose J. Espino. Jr., a civil engineer and an executive
of Procter and Gamble Philippines, Inc., and his wife and their two daughters went to
shop at the defendants' South Supermarket in Makati. While his wife was shopping at
the groceries section, plaintiff browsed around the other parts of the market. Finding a
cylindrical "rat tail" file which he needed in his hobby and had been wanting to buy,
plaintiff picked up that item from one of the shelves. He held it in his hand thinking that
it might be lost, because of its tiny size, if he put it in his wife's grocery cart. In the course
of their shopping, plaintiff and his wife saw the maid of plaintiff's aunt. While talking
to this maid, plaintiff stuck the file into the front breast pocket of his shirt with a good
part of the merchandise exposed.
"At the check-out counter, the plaintiff paid for his wife's purchases which amounted to
P77.00, but he forgot to pay for the file. As he was leaving by the exit of the supermarket
on his way to his car, carrying two bags of groceries and accompanied by his wife and
two daughter, plaintiff was approached by a uniformed guard of the supermarket who
said: "Excuse me, Mr., I think you have something in your pocket which you have not
paid for." (p. 5, tsn, Aug. 13, 1971), pointing to his left front breast pocket. Suddenly
reminded of the file, plaintiff apologized thus: "I am sorry," and he turned back toward
the cashier to pay for the file. But the guard stopped him and led him instead toward
the rear of the supermarket. The plaintiff protested but the guard was firm saying: "No,
Mr., please come with me. It is the procedure of the supermarket to bring people that
we apprehend to the back of the supermarket" (p. 8, Ibid). The time was between 9 and
10 o'clock. A crowd of customers on their way into the supermarket saw the plaintiff
being stopped and led by a uniformed guard toward the rear of the supermarket.
Plaintiff acquiesced and signaled to his wife and daughters to wait.
"Into a cubicle which was immediately adjacent to the area where deliveries to the
supermarket were being made, the plaintiff was ushered. The guard directed him to a
table and gave the file to the man seated at the desk. Another man stood beside the
plaintiff. The man at the desk looked at the plaintiff and the latter immediately explained
the circumstances that led to the finding of the file in his possession. The man at the desk
pulled out a sheet of paper and began to ask plaintiff's name, age, residence and other
personal data. Plaintiff was asked to make a brief statement, and on the sheet of paper
or "Incident Report" he wrote down the following: "While talking to my aunt's maid
with my wife, I put this item in my shirt pocket. I forgot to check it out with my wife's
23
items" (Exhibit A). Meanwhile, the plaintiff's wife joined him and asked what had taken
him so long.
"The guard who had accosted plaintiff took him back inside the supermarket in the
company of his wife. Plaintiff and his wife were directed across the main entrance to the
shopping area, down the line of check-out counters, to a desk beside the first checkout
counter. To the woman seated at the desk, who turned out to be defendant Nelia Santos-
Fandino, the guard presented the incident report and the file, Exhibit B. Defendant
Fandino read the report and addressing the guard remarked: "Ano, nakaw na naman
ito" (p. 22, Id.). Plaintiff explained and narrated the incident that led to the finding of the
file in his pocket, telling Fandino that he was going to pay for the file because he needed
it. But this defendant replied: "That is all they say, the people whom we cause not paying
for the goods say... They all intended to pay for the things that are found to them." (p.
23, Id). Plaintiff objected and said that he was a regular customer of the supermarket.
"Extracting a P5.00 bill from his pocket, plaintiff told Fandino that he was paying for the
file whose cost was P3.85. Fandino reached over and took the P5.00 bill from plaintiff
with these words: "We are fining you P5.00. That is your the fine." Plaintiff was shocked.
He and his wife objected vigorously that he was not a common criminal, and they
wanted to get back the P5.00. But Fandino told them that the money would be given as
an incentive to the guards who apprehend pilferers. People were milling around them
and staring at the plaintiff. Plaintiff gave up the discussion. He drew a P50.00 bill and
took back the file. Fandino directed him to the nearest check-out counter where he had
to fall in line. The people who heard the exchange of words between Fandino and
plaintiff continued to stare at him. At the trial, plaintiff expressed his embarrassment
and humiliation thus: " I felt as though I wanted to disappear into a hole on the ground"
(p. 34, Id.). After paying for the file, plaintiff and his wife walked as fast as they could
out of the supermarket. His first impulse was to go back to the supermarket that night
to throw rocks at its glass windows. But reason prevailed over passion and he thought
that justice should take its due course.
"Plaintiff was certain during the trial that when he signed the incident report, Exhibit A,
inside the cubicle at the back of the supermarket only his brief statement of the facts
(Exhibit A-2), aside from his name and personal circumstances, was written thereon. He
swore that the following were not in the incident report at, the time he signed it:
Exhibit A-I which says opposite the stenciled word SUBJECT
"Shoplifting"
Exhibit A-3 which says opposite the stenciled words Action Taken:
Released by Mrs. Fandino after paying the item.
Exhibit A-4 which says opposite the stenciled words Remarks
Noted: "Grd. Ebreo requested Grd. Paunil to apprehend subject
shoplifter.
Private respondent's complaint filed on October 8, 1970 is founded on Article 21 in
relation to Article 2219 of the New Civil Code and prays for moral damages, exemplary
damages, attorney s fees and 'expenses of litigation, costs of the suit and the return of
the P5.00 fine. After trial, the Court of First Instance of Pasig, Rizal, Branch XIX
dismissed the complaint, Interposing the appeal to the Court of Appeals, the latter
reversed and set aside the appealed judgment, granting and damages as earlier stated.
Not satisfied with the decision of the respondent court, petitioners instituted the present
petition and submits the following grounds and/or assignment of errors, to wit:
I Respondent Court of Appeals erred in awarding moral and exemplary damages to the
respondent Espino under Articles 19 and 21 in relation to Article 2219 of the Civil Code,
considering that —
A. Respondent Espino was guilty of theft;
B. Petitioners legitimately exercised their right of defense of property within the context
of Article 429 of the Civil Code negating the application of Articles 19 and 21 of the same
Code;
C. Petitioners acted upon probable cause in stopping and investigating respondent
Espino for shoplifting and as held in various decisions in the United States on
shoplifting, a merchant who acts upon probable cause should not be held liable in
damages by the suspected shoplifter;
D. Petitioners did not exercise their right maliciously, wilfully or in bad faith; and/or
E. The proximate cause of respondent Espino's alleged injury or suffering was his own
negligence or forgetfulness; petitioners acted in good faith.
II Assuming arguendo that petitioners are hable for moral and exemplary damages, the
award of P75,000.00 for moral damages and P25,000.00 for exemplary damages by the
respondent Court of Appeals is not legally justified and/or is grossly excessive in the
premises.
III The award of P5,000.00 for attorney's fees by the respondent Court of Appeals is
unjustified and unwarranted under Article 2199 of the Civil Code.
We agree with the holding of the respondent appellate court that "the evidence sustains
the court's finding that the plaintiff had absolutely no intention to steal the file." The
totality of the facts and circumstances as found by the Court of Appeals unerringly
points to the conclusion that private respondent did not intend to steal the file and that
is act of picking up the file from the open shelf was not criminal nor done with malice
or criminal intent for on the contrary, he took the item with the intention of buying and
paying for it.
24
This Court needs only to stress the following undisputed facts which strongly and
convincingly uphold the conclusion that private respondent was not "shoplifting." Thus,
the facts that private respondent after picking the cylindrical "rat-tail" file costing P3.85
had placed it inside his left front breast pocket with a good portion of the item exposed
to view and that he did not conceal it in his person or hid it from sight as well as the fact
that he paid the purchases of his wife amounting to P77.00 at the checkout counter of
the Supermarket, owed that he was not acting suspiciously or furtively. And the
circumstance that he was with his family consisting of his wife Mrs. Caridad Jayme
Espino, and their two daughters at the time negated any criminal intent on his part to
steal. Moreover, when private respondent was approached by the guard of the
Supermarket as he was leaving by the exit to his car who told him, "Excuse me, Mr., I
think you have something in your pocket which you have not paid for," Espino,
immediately apologized and answered, "I am sorry," which indicated his sincere
apology or regrets. He turned back towards the cashier to pay for the file which proved
his honesty sincerity and good faith in buying the item, and not to shoplift the same. His
brief statement on the sheet of paper called the Incident Report where private
respondent wrote the following: "While talking to my aunt's maid with my wife, I put
this item in in my shirt pocket. I forgot to check it out with my wife's item," was an
instant and contemporaneous explanation of the incident.
Considering further the personal circumstances of the private respondent. his education,
position and character showing that he is a graduate Mechanical Engineer from U.P.
Class 1950, employed as an executive of Proctor & Gamble Phils., Inc., a corporate
manager incharge of motoring and warehousing therein; honorably discharged from the
Philippine Army in 1946; a Philippine government pensionado of the United States for
six months; member of the Philippine veterans Legion; author of articles published in
the Manila Sunday Times and Philippines Free Press; member of the Knights of
Columbus, Council No. 3713; son of the late Jose Maria Espino, retired Minister,
Department of Foreign Affairs at the Philippine Embassy Washington, We are fully
convinced, as the trial and appellate courts were, that private respondent did not intend
to steal the article costing P3.85. Nothing in the records intimates or hints whatsoever
that private respondent has had any police record of any sort much less suspicion of
stealing or shoplifting.
We do not lay down here any hard-and-fast rule as to what act or combination of acts
constitute the crime of shoplifting for it must be stressed that each case must be
considered and adjudged on a case-to-case basis and that in the determination of
whether a person suspected of shoplifting has in truth and in fact committed the same,
all the attendant facts and circumstances should be considered in their entirety and not
from any single fact or circumstance from which to impute the stigma of shoplifting on
any person suspected and apprehended therefor.
We likewise concur with the Court of Appeals that "(u)pon the facts and under the law,
plaintiff has clearly made the cause of action for damages against the defendants.
Defendants wilfully caused loss or injury to plaintiff in a manner that was contrary to
morals, good customs or public policy, making them amenable to damages under
Articles 19 and 21 in relation to Article 2219 of the Civil Code." 2
That private respondent was falsely accused of shoplifting is evident. The Incident
Report (Exhibit A) with the entries thereon under Exhibit A-1 which says opposite the
stenciled word SUBJECT: "Shoplifting," Exhibit A-3 which says opposite the stenciled
words Action Taken: Relesed by Mrs. Fandino after paying the item," Exhibit A-4 which
says opposite the stenciled words Remarks Noted: Grd. Ebreo requested Grd. Paunil to
apprehend subject shoplifter," established the opinion, judgment or thinking of the
management of petitioner's supermarket upon private respondent's act of picking up
the file. ln plain words, private respondent was regarded and pronounced a shoplifter
and had committed "shoplifting."
We also affirm the Court of Appeals' finding that petitioner Nelia Santos Fandino, after
reading the incident report, remarked the following: "Ano, nakaw na naman ito". Such
a remark made in the presence of private respondent and with reference to the incident
report with its entries, was offensive to private respondent's dignity and defamatory to
his character and honesty. When Espino explained that he was going to pay the file but
simply forgot to do so, Fandino doubted the explanation. saying: "That is all what they
say, the people whom we caught not paying for the goods say... they all intended to pay
for the things that are found to them." Private respondent objected and said that he was
a regular customer of the Supermarket.
The admission of Fandino that she required private respondent to pay a fine of P5.00
and did in fact take the P5.00 bill of private respondent tendered by the latter to pay for
the file, as a fine which would be given as an incentive to the guards who apprehend
pilferers clearly proved that Fandino branded private respondent as a thief which was
not right nor justified.
The testimony of the guard that management instructed them to bring the suspected
customers to the public area for the people to see those kind of customers in order that
they may be embarassed (p. 26, tsn, Sept. 30, 1971); that management wanted "the
customers to be embarrassed in public so that they will not repeat the stealing again" (p.
2, tsn, Dec. 10, 1971); that the management asked the guards "to bring these customers
to different cashiers in order that they will know that they are pilferers" (p. 2, Ibid.) may
indicate the manner or pattern whereby a confirmed or self-confessed shoplifter is
treated by the Supermarket management but in the case at bar, there is no showing that
such procedure was taken in the case of the private respondent who denied strongly
and vehemently the charge of shoplifting.
Nonetheless, the false accusation charged against the private respondent after detaining
and interrogating him by the uniformed guards and the mode and manner in which he
was subjected, shouting at him, imposing upon him a fine, threatening to call the police
and in the presence and hearing of many people at the Supermarket which brought and
caused him humiliation and embarrassment, sufficiently rendered the petitioners liable
for damages under Articles 19 and 21 in relation to Article 2219 of the Civil Code. We
rule that under the facts of the case at bar, petitioners wilfully caused loss or injury to
private respondent in a manner that was contrary to morals, good customs or public
policy. It is against morals, good customs and public policy to humiliate, embarrass and
25
degrade the dignity of a person. Everyone must respect the dignity, personality, privacy
and peace of mind of his neighbors and other persons (Article 26, Civil Code). And one
must act with justice, give everyone his due and observe honesty and good faith (Article
19, Civil Code).
Private respondent is entitled to damages but We hold that the award of Seventy-Five
Thousand Pesos (P75,000.00) for moral damages and Twenty-Five Thousand Pesos
(P25,000.00, for exemplary damages is unconscionable and excessive.
While 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 (Art. 2216, New Civil Code). In the case at bar, there is no
question that the whole incident that befell respondent had arisen in such a manner that
was created unwittingly by his own act of forgetting to pay for the file. It was his
forgetfullness in checking out the item and paying for it that started the chain of events
which led to his embarassment and humiliation thereby causing him mental anguish,
wounded feelings and serious anxiety. Yet, private respondent's act of omission
contributed to the occurrence of his injury or loss and such contributory negligence is a
factor which may reduce the damages that private respondent may recover (Art. 2214,
New Civil Code). Moreover, that many people were present and they saw and heard the
ensuing interrogation and altercation appears to be simply a matter of coincidence in a
supermarket which is a public place and the crowd of onlookers, hearers or bystanders
was not deliberately sought or called by management to witness private respondent's
predicament. We do not believe that private respondent was intentionally paraded in
order to humiliate or embarrass him because petitioner's business depended for its
success and patronage the good will of the buying public which can only be preserved
and promoted by good public relations.
As succinctly expressed by Mr. Justice J. B. L. Reyes in his concurring and dissenting
opinion in Pangasinan Transportation Company, Inc, vs. Legaspi, 12 SCRA 598, the
purpose of moral damages is essentially indemnity or reparation, both punishment or
correction. Moral damages are emphatically not intended to enrich a complainant at the
expense of a defendant; they are awarded only to enable the injured party to obtain
means, diversion or amusements that will serve to alleviate the moral suffering he has
undergone, by reason of the defendant's culpable action. In other words, the award of
moral damages is aimed at a restoration, within the limits of the possible, of the
spiritual status quo ante and, it must be proportionate to the suffering inflicted.
In Our considered estimation and assessment, moral damages in the amount of Five
Thousand Pesos (P5,000.00) is reasonable and just to award to private respondent.
The grant of Twenty-Five Thousand Pesos (P25,000.00) as exemplary damages is
unjustified. Exemplary or corrective damages are imposed by way of example or
correction for the public good, in addition to the moral, temperate, liquidated or
compensatory damages (Art. 2229, New Civil Code). Exemplary damages cannot be
recovered as a matter of right; the court will decide whether or not they could be
adjudicated (Art. 2223, New Civil Code). Considering that exemplary damages are
awarded for wanton acts, that they are penal in character granted not by way of
compensation but as a punishment to the offender and as a warning to others as a sort
of deterrent, We hold that the facts and circumstances of the case at bar do not warrant
the grant of exemplary damages.
Petitioners acted in good faith in trying to protect and recover their property, a right
which the law accords to them. Under Article 429, New Civil Code, the owner or lawful
possessor of a thing has a right to exclude any person from the enjoyment and disposal
thereof and for this purpose, he may use such force as may be reasonably necessary to
repel or prevent an actual or threatened unlawful physical invasion or usurpation of his
property. And since a person who acts in the fulfillment of a duty or in the lawful
exercise of a right or office exempts him from civil or criminal liability, petitioner may
not be punished by imposing exemplary damages against him. We agree that petitioners
acted upon probable cause in stopping and investigating private respondent for taking
the file without paying for it, hence, the imposition of exemplary damages as a warning
to others by way of a deterrent is without legal basis. We, therefore, eliminate the grant
of exemplary damages to the private respondent.
In the light of the reduction of the damages, We hereby likewise reduce the original
award of Five Thousand Pesos (P5,000.00) as attorney's fees to Two Thousand Pesos
(P2,000.00).
WHEREFORE, IN VIEW OF THE FOREGOING, the judgment of the Court of Appeals
is hereby modified. Petitioners are hereby ordered to pay, jointly and severally, to
private respondent moral damages in the sum of Five Thousand Pesos (P5,000.00) and
the amount of Two Thousand Pesos (P2,000.00) as and for attorney's fees; and further,
to return the P5.00 fine to private respondent. No costs.
SO ORDERED.
G.R. No. L-14986 July 31, 1962
CORNELIO AMARO and JOSE AMARO, plaintiffs-appellants, vs. AMBROSIO
SUMANGUIT, defendant-appellee.
MAKALINTAL, J.:
Appellants filed suit for damages in the Court of First Instance of Negros Occidental
against the chief of police of the City of Silay. Although not specifically alleged in the
complaint, it is admitted by both parties, as shown in their respective briefs, that the
action is predicated on Articles 21 and/or 27 of the Civil Code, which provide:
ART. 21. Any person who wilfully causes loss or injury to another in a manner
that is contrary to morals, good customs or public policy shall compensate the
latter for the damage.
26
ART. 27. Any person suffering material or moral loss because a public servant
or employee refuses or neglects, without just cause, to perform his official duty
may file an action for damages and other relief against the latter, without
prejudice to any disciplinary administrative action that may be taken.
The complaint was dismissed upon appellee's motion in the court below on the ground
that it does not state facts sufficient to constitute a cause of action. The only question
now before us refers to correctness of the order dismissal.
The pertinent allegations in the complaint are that on October 5, 1958 appellant Jose
Amaro was assaulted and shot at near the city government building of Silay; that the
following day he, together with his father (Cornelio Amaro) and his witnesses, "went to
the office of the defendant but instead of obtaining assistance to their complaint they
were harassed and terrorized;" that in view thereof they "gave up and renounced their
right and interest in the prosecution of the crime . . . .;" that upon advice of the City
Mayor given to appellee an investigation (of said crime) was conducted and as a result
the city attorney of Silay was about to file or had already filed an information for illegal
discharge of firearm against the assailant; and that "having finished the investigation of
the crime complained of, the defendant chief of police is now harassing the plaintiffs in
their daily work, ordering them thru his police to appear in his office when he is absent,
and he is about to order the arrest of the plaintiffs to take their signatures in prepared
affidavits exempting the police from any dereliction of duty in their case against the
perpetrator of the crime."
We are of the opinion that the facts set out constitute an actionable dereliction on
appellee's part in the light of Article 27 of the Civil Code. That appellants were "harrased
and terrorized" may be a conclusion of law and hence improperly pleaded. Their claim
for relief, however, is not based on the fact of harassment and terrorization but on
appellee's refusal to give them assistance, which it was his duty to do as an officer of the
law. The requirement under the aforesaid provision that such refusal must be "without
just cause" is implicit in the context of the allegation. The statement of appellee's
dereliction is repeated in a subsequent paragraph of the complaint, where it is alleged
that "he is about to order the arrest of the plaintiffs" to make them sign affidavits of
exculpation in favor of the policemen.
The complaint is, without doubt, imperfectly drafted. It suffers from vagueness and
generalization. But all that the Rules require is that there be a showing by a statement of
ultimate facts, that the plaintiff his a right and that such right has been violated by the
defendant. An action should not be dismissed upon mere ambiguity, indefiniteness or
uncertainty, for these are not grounds for a motion to dismiss, under Rule 8, but rather
for a bill of particulars according to Rule 16. Moran, Comments on the Rules of Court,
1957 ed., Vol. I, p. 111. In two cases decided by this Court, it was observed:
Under the new Rules of Court, an action cannot be dismissed upon the ground
that the complaint is vague, ambiguous, or indefinite (see Rule 8, section 1),
because the defendant, in such case, may ask for more particulars (Rule 16) or
 he may compel the plaintiff to disclose more relevant facts under the different
methods of discovery provided by the Rules. (Rules 18, 20, 21, 22 and 23.)
Professor Sunderland once said "The real test of good pleading under the new
rules is whether the information given is sufficient to enable the party to plead
and prepare for trial. A legal conclusion may serve the purpose of pleading as
well as anything else if it gives the proper information. If the party wants more
he may ask for more details in regard to the particular matter that is stated too
generally (Vol. XIII, Cincinnati Law Review, January 1939.) Co Tiamco vs. Diaz,
75 Phil. 672.
At any rate, if respondent's complaint, which was clear enough, had created
confusion in petitioner's mind as to the foundation of her cause of action, then
it should have moved for a more definite statement of the same before the
trial. De Leon Brokerage Co., Inc. vs. The Court of Appeals, et al., G.R. No. L-15247,
Feb. 28, 1962.
The fact, cited by the court below in the order subject to review, that appellants have
another recourse (in connection with the crime of illegal discharge of firearm supposedly
committed against one of them) as by filing their complaint directly with the city
attorney of Silay or by lodging an administrative charge against appellee herein, does
not preclude this action for damages under Article 27 of the Civil Code and hence does
not justify its dismissal.
THE ORDER APPEALED from is set aside and the case is remanded to the Court of
origin for further proceedings. Costs against appellee.
G.R. No. L-46061 November 14, 1984
ST. LOUIS REALTY CORPORATION, petitioner, vs.COURT OF APPEALS and
CONRADO J. ARAMIL, respondents.
AQUINO, J.:
This case is about the recovery of damages for a wrongful advertisement in the Sunday
Times where Saint Louis Realty Corporation misrepresented that the house of Doctor
Conrado J. Aramil belonged to Arcadio S. Arcadio.
St. Louis Realty caused to be published with the permission of Arcadio S. Arcadio (but
without permission of Doctor Aramil) in the issue of the Sunday Times of December 15,
1968 an advertisement with the heading "WHERE THE HEART IS". Below that heading
was the photograph of the residence of Doctor Aramil and the Arcadio family and then
below the photograph was the following write-up:
Home is where the heart is. And the hearts of MR. AND MRS.
ARCADIO S. ARCADIO and their family have been captured by
BROOKSIDE HILLS. They used to rent a small 2-bedroom house in a
cramped neighborhood, sadly inadequate and unwholesome for the
needs of a large family. They dream(ed) of a more pleasant place free
27
from the din and dust of city life yet near all facilities. Plans took shape
when they heard of BROOKSIDE HILLS. With thrift and
determination, they bought a lot and built their dream house ... for
P31,000. The Arcadios are now part of the friendly, thriving
community of BROOKSIDE HILLS... a beautiful first-class
subdivision planned for wholesome family living.
The same advertisement appeared in the Sunday Times dated January 5, 1969. Doctor
Aramil a neuropsychiatrist and a member of the faculty of the U. E. Ramon Magsaysay
Memorial Hospital, noticed the mistake. On that same date, he wrote St. Louis Realty
the following letter of protest:
Dear Sirs:
This is anent to your advertisements appearing in the December 15,
1968 and January 5, 1969 issues of the Sunday Times which boldly
depicted my house at the above-mentioned address and implying that
it belonged to another person. I am not aware of any permission or
authority on my part for the use of my house for such publicity.
This unauthorized use of my house for your promotional gain and much more
the apparent distortions therein are I believe not only transgression to my
private property but also damaging to my prestige in the medical profession
I have had invited in several occasions numerous medical colleagues, medical
students and friends to my house and after reading your December 15
advertisement some of them have uttered some remarks purporting doubts as
to my professional and personal integrity. Such sly remarks although in light
vein as "it looks like your house," "how much are you renting from the
Arcadios?", " like your wife portrayed in the papers as belonging to another
husband," etc., have resulted in no little mental anguish on my part.
I have referred this matter to the Legal Panel of the Philippine Medical
Association and their final advice is pending upon my submission of
supporting ownership papers.
I will therefore be constrained to pursue court action against your
corporation unless you could satisfactorily explain this matter within
a week upon receipt of this letter.
The letter was received by Ernesto Magtoto, an officer of St. Louis Realty in charge of
advertising. He stopped publication of the advertisement. He contacted Doctor Aramil
and offered his apologies. However, no rectification or apology was published.
On February 20, 1969, Aramil's counsel demanded from St. Louis Realty actual, moral
and exemplary damages of P110,000 (Exh. D). In its answer dated March 10, St. Louis
Realty claimed that there was an honest mistake and that if Aramil so desired,
rectification would be published in the Manila Times (Exh. 3).
It published in the issue of the Manila Times of March 18, 1969 a new advertisement with
the Arcadio family and their real house. But it did not publish any apology to Doctor
Aramil and an explanation of the error.
On March 29, Aramil filed his complaint for damages. St. Louis Realty published in the
issue of the Manila Times of April 15, 1969 the following "NOTICE OF RECTIFICATION"
in a space 4 by 3 inches:
This will serve as a notice that our print ad 'Where the Heart is' which
appeared in the Manila Timesissue of March 18, 1969 is a rectification
of the same ad that appeared in the Manila Times issues rectification
of the same ad that appeal of December 15, 1968 and January 5, 1969
wherein a photo of the house of another Brookside Homeowner (Dr.
Aramil-private respondent) was mistakenly used as a background for
the featured homeowner's the Arcadio family.
The ad of March 18, 1969 shows the Arcadio family with their real
house in the background, as was intended all along.
Judge Jose M. Leuterio observed that St. Louis Realty should have immediately published
a rectification and apology. He found that as a result of St. Louis Realty's mistake,
magnified by its utter lack of sincerity, Doctor Aramil suffered mental anguish and his
income was reduced by about P1,000 to P1,500 a month. Moreover, there was violation
of Aramil's right to privacy (Art. 26, Civil Code).
St. Louis Realty also contends that the decision is contrary to law and that the case was
decided in a way not in conformity with the rulings of this Court. It argues that the case
is not covered by article 26 which provides that "every person shall respect the dignity,
personality, privacy and peace of mind of his neighbors and other persons". "Prying into
the privacy of another's residence" and "meddling with or disturbing the private life or
family relations of another" and "similar acts", "though they may not constitute a criminal
offense, shall produce a cause of action for damages, prevention and other relief".
The damages fixed by Judge Leuterio are sanctioned by Articles 2200, 2208 and 2219 of
the Civil Code. Article 2219 allows moral damages for acts and actions mentioned in
Article 26. As lengthily explained by Justice Gatmaitan, the acts and omissions of the
firm fan under Article 26.
St. Louis Realty's employee was grossly negligent in mixing up the Aramil and Arcadio
residences in a widely circulated publication like the Sunday Times. To suit its purpose,
it never made any written apology and explanation of the mix-up. It just contented itself
with a cavalier "rectification ".
Persons, who know the residence of Doctor Aramil, were confused by the distorted,
lingering impression that he was renting his residence from Arcadio or that Arcadio had
leased it from him. Either way, his private life was mistakenly and unnecessarily
exposed. He suffered diminution of income and mental anguish.
WHEREFORE, the judgment of the Appellate Court is affirmed. Costs against the
petitioner.
SO ORDERED.

The trial court awarded Aramil P8,000 as actual damages, P20,000 as moral damages
and P2,000 as attorney's fees. St. Louis Realty appealed to the Court of Appeals.

The Appellate Court affirmed that judgment, with Acting Presiding Justice Magno S.
Gatmaitan as ponente, and Justices Sixto A. Domondon and Samuel F. Reyes concurring.

The Appellate Court reasoned out that St. Louis Realty committed an actionable quasi-
delict under articles 21 and 26 of the Civil Code because the questioned advertisements
pictured a beautiful house which did not belong to Arcadio but to Doctor Aramil who,
naturally, was annoyed by that contretemps.

In this appeal, St. Louis Realty contends that the Appellate Court ignored certain facts
and resorted to surmises and conjectures. This contention is unwarranted. The Appellate
Court adopted the facts found by the trial court. Those factual findings are binding on
this Court.

28