DAMAGES

1. DEFINITION AND CONCEPT

“Damage” has been defined by Escriche as “the detriment, injury,
or loss which are occasioned by reason of fault of another in the
property or person.” (Escriche, Diccionario Razonado de
Legislacion y Jurisprudencia, vol. 2, p. 597). Of whatsoever nature
the damage be, and from whatsoever cause it may proceed, the
person who has done the injury ought to repair it by an indemnity
proportionate to his fault and to the loss caused thereby. (1
Cushing, Domat’s Civil Law, p. 741, cited in Simona Manzanares
vs. Rafael Moreta, G.R. No. 12306, October 22, 1918).
The Supreme Court defined the word “damages” in one case as the
pecuniary compensation, recompense, or satisfaction for an injury
sustained, or as otherwise expressed, the pecuniary consequences
which the law imposes for the breach of some duty or violation of
some rights. (People vs. Ballesteros, 285 SCRA 438, 448 [1998]).
Damages may either be:
(a) The injury or loss to another by the violation of his legal
right; or
(b) The sum of money which the law awards or imposes as
pecuniary compensation, recompense, or satisfaction for an
injury done or wrong sustained as a consequence either of a
breach of contractual obligation or a tortuous act
2. APPLICABILITY OF THE LAW
The law mentions of its applicability to all obligations
mentioned in Article 1157 of the Civil Code arising from:
(a) Law
(b) Contracts
(c) Quasi-contracts
(d) Delicts
 (e) Quasi-delicts
3. NATURE AND PURPOSE
A complaint for damages is a personal action. The law on damages
is intended to repair the damage done by putting the plaintiff in
the same position as far as pecuniary compensation ca do, that he
would be, had the damage not been inflicted and the wrong not
committed. Damages are not designed to enrich the plaintiff.
4. VENUE
It may be commenced and tried where the defendant or any of the
defendant resides or may be found, or where the plaintiff or any of
the plaintiffs resides at the election of the plaintiff.
5. AWARD
In actions for damages, courts should award an amount to the
winning party and not its equivalent in property. The damages that
should be awarded should be the money value of such damages.
In one case, the plaintiffs were ordered “jointly and solidarily liable
to defendants the quantity of one hundred (100) cavans of palay
every year from 1972.” The Supreme Court deleted such award
explaining that one hundred (100) cavans of palay as a form of
damages cannot be sustained because palay is not legal currency
in the Philippines (Heirs of Simeon Borlado v. Court of Damages,
363 SCRA 753, 757).

6. KINDS
The word “damages” involve any and all manifestations of life:
physical or material, moral or psychological, mental or spiritual,
financial, economic, social, political and religious. (Castro vs. Acro
Taxicab Co., 82 Phil. 359, 381). It is in recognition of these
different facets of damages that the Civil Code identified and
defined all the different kinds of damages that may be awarded in
this jurisdiction. Thus, Article 2197 of the Civil Code provides:
 Art. 2197. Damages may be: (MENTAL)
(1) Actual or compensatory;
(2) Moral;
(3) Nominal;
(4) Temperate or moderate;
(5) Liquidated; or
(6) Exemplary or corrective.

I.
ACTUAL OR COMPENSATORY DAMAGE
Article 2199 of the Civil Code provides that “except as provided by
law or by stipulation, one is entitled to an adequate compensation
only for such pecuniary loss suffered by him as he has duly proved.
Such compensation is referred to as actual or compensatory dam-
ages.” The Supreme Court described this type of damage in Algarra
vs. Sandejas (supra, at p. 32):
“The words ‘actual damages’ shall be construed to
include all damages that the plaintiff may show he has
suffered in respect to his property, business, trade,
profession, or occupation, and no other damages
whatever.” (Gen. Stat. Minn., 1894, sec. 5418). “Actual
damages are compensatory only.” (Lord, Owen & Co. vs.
Wood, 120 Iowa, 303, 94 N. W., 842.)
“The purpose of the law in awarding actual
damages is to repair the wrong that has been done, to
compensate for the injury inflicted, and not to impose a
penalty.
KINDS OF ACTUAL OR COMPENSATORY DAMAGES:
1. Loss of what a person already possesses (daño emergente)
2. Failure to receive as a benefit that would have pertained to him
(lucro cesante).

The latter type of damage includes those mentioned in Article 2205

of the Civil Code which states:

“Art. 2205. Damages may be recovered:

(1) For loss or impairment of earning capacity in cases of
temporary or permanent personal injury;
(2) For injury to the plaintiff’s business standing or com-
mercial credit.’’

EXTENT AND MEASURE OF DAMAGES

The basic principle for the measure of damages in tort is that there
should be restitutio in integrum. The amount to be awarded to the
plaintiff should be that sum of money which will put the party who
has been injured or who has suffered in the same position as he
would have been in if he had not sustained the wrong for which he
is now getting his compensation or reparation. (Winfield and
Jolowich, p. 757). The primary object of an award in civil action,
and the fundamental principle or theory on which it is based, is just
compensation, indemnity or reparation for the loss or injury
sustained by the injured party so that he may be made whole or
restored as nearly as possible prior to the injury.
Consequently, the damages is measured on plaintiff’s loss and not
on defendant’s gain. (25 C.J.S. 628).
EXCEPTION:
By way of exception, damages is measured by the benefit that has
accrued to the defendant in certain cases. The theory is that the
benefits derived by the defendant pertain to or could have been
received by the plaintiff because only the plaintiff is supposed to
profit from the activity involved. For instance, the Intellectual
Property Code allows recovery of the amount that was earned by
the defendant who infringed the right of the owner of the mark.
(Section 156, R.A. No. 8293).

WHAT MUST BE PROVED

It is a basic rule that to recover damages, the amount of loss must
not only be capable of proof but must actually be proven with a
reasonable degree of certainty, premised upon competent proof or
best evidence obtainable of the actual amount thereof. The
claimant is duty-bound to point out specific facts that afford a basis
for measuring whatever compensatory damages are borne. (PNOC
Shipping and Transport Corporation vs. Court of Appeals, supra;
Bernardo vs. Court of Appeals, 275 SCRA 413 [1997]; Kierulf vs.
Court of Appeals, 269 SCRA 433 [1997]; Development Bank of the
Philippines vs. Court of Appeals, 249 SCRA 331 [1995]; Lufthansa
German Airlines vs. Court of Appeals, 243 SCRA 600 [1995]).
A court cannot rely on speculations, conjectures, or guesswork as
to the fact and amount of damages. It cannot also rely on hearsay
or uncorroborated testimony, the truth of which is suspect.
(Development Bank of the Philippines vs. Court of Appeals, G.R.
No. 118367, January 5, 1998; Bargaza vs. Court of Appeals, 268
SCRA 105 [1997]; People vs. Gutierrez, 258 SCRA 70 [1996];
Baliwag Transit, Inc. vs. Court of Appeals, 256 SCRA 746 [1996];
Gatchalian vs. Delim, 203 SCRA 126 [1991]; Guilatco vs. City of
Dagupan, 171 SCRA 382 [1989]; Raagas vs. Traya, 22 SCRA 839
[1968]; Executive Secretary vs. Court of Appeals, 162 SCRA 51
[1988])
EXCEPTIONS:
(1) The same is liquidated
(2) The same is not actual
(3) The loss is presumed
(4) It is as case of forfeiture of bonds in favor of the government
for the promotion of public interest and public policy
ACTUAL DAMAGES MUST BE PLEADED; EXCEPTION
If there is a general prayer for “such other relief” such phrase may
include actual damages provided they are proved.
WHAT MAY BE AWARDED IN CASE OF DEATH
(1) Indemnity for the death
(2) Indemnity for loss of earning capacity
(3) Moral damages
(4) Exemplary damages
(5) Attorney’s fees and expense of litigation
(6) Interest in proper cases

AWARD OF DAMAGES IN CASE OF DEATH

It has now been increased to 50,000 or even 75,000 due to
the decrease in the purchasing power of the Philippine Currency.
The amount of 75,000 is awarded if reclusion perpetua or life
imprisonment is imposed.
ACTUAL OR COMPENSATORY DAMAGE IS MANDATORY IN
RAPE CASES
In People vs. Condes, G.R. No. 187077, February 23, 2011, the SC
ruled in a case of rape that civil indemnity, which is actually on the
nature of actual or compensatory damage, is mandatory upon the
finding of the fact of rape.
BURDEN AND QUANTUM OF PROOF
The burden of proof is on the party who would be defeated if no
evidence would be presented on either side. He must establish his
case by a preponderance of evidence which means that evidence,
as a whole, adduced by one side is superior to that of the other.
UNCERTAINTY AS TO THE PRECISE AMOUNT NOT FATAL
It should be emphasized however that uncertainty as to the precise
amount is not necessarily fatal. (Talisay-Silay Milling, Inc. vs.
Associacion de Agricultores de Talisay-Silay, Inc., 247 SCRA 361
[1996]). Mere difficulty in the assessment of damages is not suf-
ficient reason for refusing them where the right to them has been
established. (Ball vs. Pardy CT.J. Construction Co., 63 ALR 139,
108 Conn. 549, 143 A 855).
DAMAGE TO PROPERTY
Where goods were destroyed by the wrongful act of the defendant,
the plaintiff is entitled to their value at the time of destruction.
Normally, the award is the sum of money which plaintiff would have
to pay in the market for identical or essentially similar good, plus
in proper cases, damages for the loss of use during the period
before replacement. In case of profit-earning chattels, what has to
be assessed is the value of the chattel to its owner as a going
concern at the time and place of the loss. (PNOC Shipping and
Transport Corporation vs. Court of Appeals, supra).
LOSS OF A SHIP
The loss of a ship would require payment of its assessed value at
the time and place of the loss. In determining such value, regard
must be made to existing and pending engagements. Thus:
“ x x x If the market value of the ship reflects the fact that
it is in any case virtually certain of profitable employment,
then nothing can be added to that value in respect of
charters actually lost, for to do so would be pro tanto to
compensate the plaintiff twice over. On the other hand, if
the ship is valued without reference to its actual future
engagements and only in the light of its profit-earning
potentiality, then it may be necessary to add to the value
thus assessed the anticipated profit on a charter or other
engagement which it was unable to fulfill. What the court
has to ascertain in each case is the ‘capitalized value of the vessel
as a profit-earning machine not in the abstract but in view of the
actual circumstances,’ without, of course, taking into account
considerations which were too remote at the time of the loss.”
(ibid., citing Clerk & Lindsell on Torts, 17th Ed., pp. 1489-1490).
REAL PROPERTY AND PERSONAL PROPERTY
With respect to real property, the measure of damage for a per-
manent injury is ordinarily the difference between the reasonable
market value of the property immediately before and after the
injury. (Reed vs. Mercer County Fiscal Ct., 54 ALR 1275, 220 Ky.
646, 295 SW 995). In case of total loss, the value of the real
property at the time and place of the loss must also be assessed
and such assessed value is the measure of the damage due to the
plaintiff.
Where the plaintiff was merely deprived of his possession, said
plaintiff is entitled to the value of use of the premises. (Daywalt vs.
La Corporacion de los Padres Agustinos Recoletos, 39 Phil. 587;
Ching vs. Court of Appeals, 181 SCRA 9 [1990]). Thus, the rental
value should be assessed against the plaintiff for trespass or illegal
occupation of a house. (Saldivar vs. Municipality of Talisay, 18 Phil.
362). This rule is equally applicable in cases involving deprivation
of possession of personal property
LIABLE FOR DAMAGES EVEN IF THE TRESPASS IS
INTERMITTENT
The plaintiff is also entitled to damages equivalent to rentals even
if the trespass is intermittent. Thus, in Daywalt vs. La Corporacion
de los Padres Agustinos Recoletos proper rent was awarded to the
plaintiff who sought to recover damages for the use and occupation
of the land in question by reason of the pasturing of cattle thereon.
It was established that wrongful use of the land by the defendant
was not continuous throughout the year but was confined mostly
to the season when the forage obtainable on the land of the
defendant was not sufficient to maintain the cattle.
PERSONAL INJURY AND DEATH
If the plaintiff is asking for damages for his own injury or for the
death of his relative, said plaintiff is entitled to the amount of
medical expenses as well as other reasonable expenses that he
incurred to treat his or his relative’s injuries. Courts may also
award monthly payments to the person who was injured to answer
for his future medical expenses. Thus, in Rogelio E. Ramos, et al.
vs. Court of Appeals, et al. (G.R. No. 124354, December 29, 1999)
the Court sustained the award of monthly compensation of
P8,000.00 to answer for the medical expenses that will be incurred
by a comatose victim of the negligent act of the defendants. The
Court even awarded temperate damages to compensate for the
increase in cost of such medical expenses through time.
In proper cases, the award of damages may likewise include the
amount spent for the plastic surgery of the plaintiff or any
procedure to restore the part of the body that was affected.
(Gatchalian vs. Delim, 203 SCRA 126; Spouses Renato Ong vs.
Court of Appeals, G.R. No. 117103, January 21, 1999).
WAKE AND FUNERAL EXPENSES IN CASE OF DEATH
In case of death, the plaintiff is entitled to the amount that he spent
during the wake and funeral of the deceased. However, it has been
ruled that expenses after the burial are not compensable. The heirs
are not entitled to an award of damages for the expenses incurred
relating to the 9th day, 40th day and 1st year death anniversaries
(Victory Liner, Inc. v. Heirs of Andres Malecdan, No. 154278,
December 27, 2002; People v. Mangahas, 311 SCRA 384 [1999]).
DEATH CAUSED BY A CRIME OR QUASI-DELICT
The damages that may be awarded for death caused by a crime or
quasi-delict include the following:
“Art. 2206. The amount of damages for death caused by a
crime or quasi-delict shall be at least three thousand pesos,
even though there may have been mitigating
circumstances. In addition:
 (1) The defendant shall be liable for the loss of the earning
capacity of the deceased, and the indemnity shall be paid
to the heirs of the latter; such indemnity shall in every
case be assessed and awarded by the court, unless the
deceased on account of permanent physical disability not
caused by the defendant, had no earning capacity at the
time of his death;
(2) If the deceased was obliged to give support according to
the provisions of Article 291, the recipient who is not an
heir called to the decedent’s inheritance by the law of
testate or intestate succession, may demand support
from the person causing the death, for a period not
exceeding five years, the exact duration to be fixed by
the court;
(3) The spouse, legitimate and illegitimate descendants and
ascendants of the deceased may demand moral damages for
mental anguish by reason of the death of the deceased.’’
WHAT MAY BE RECOVERED
(1) Indemnity for death

The law also requires payment of the amount of P3,000.00 to

the heirs of the deceased. The fixed amount of three thousand
pesos (P3,000) is in addition to any damage that may have
resulted because the act or omission of the defendant
including medical expenses and loss of earning capacity. It
should be noted, however that the Supreme Court had
repeatedly increased the amount of indemnity from three
thousand pesos (P3,000.00) in order to reflect the current
value of currency and prevailing inflation. The current amount
of fixed damages as increased by the Court is P50,000.00.
(Gregorio Pestano et al. v. Spouses Paz, G.R. No. 139875,
December 4, 2000, 346 SCRA 870).
(2) Loss of Earning Capacity.
Formula.
 The formula for the computation of the awarded damages for
loss of earning capacity was laid down in the landmark case
of Villa Rey Transit vs. Court of Appeals. The Supreme Court
observed in the said case that the important variables taken
into account in determining the compensable amount of lost
earnings are: (1) the number of years for which the victim
would otherwise have lived (life expectancy); and (2) the rate
of loss sustained by the heirs of the deceased (net income).
The following formula should therefore be used:

Net Earning Capacity = Life Expectancy x [Gross Annual

Income less Necessary Living Expenses]

Life expectancy= (2/3 x [80 — age at death])

(3) Net Earnings

The Court considered as an important element in measuring
loss of earning capacity, the net earnings of the deceased as
well as the latter’s potentiality and capacity to increase his
future income.

It is therefore not the net monthly income that is actually re-

ceived by the deceased that will serve as basis of the
computation. The proper computation should be based on the
gross income of the victim minus the necessary and incidental
living expenses which the victim would have incurred if he
were alive (People v. Arnel Mataro, et al., G.R. No. 130378,
March 8, 2001, 354 SCRA 27, 38-39; People v. Nullan, 305
SCRA 679, 706-707 [1999]). Needless to state, sufficient
evidence should be presented by the plaintiff to establish the
net earnings of the deceased.

Best Evidence of the Salary of the Deceased

In this connection, it was ruled that the payroll of companies

and the Income Tax Returns constitute the best evidence of
 the salary of the deceased (Phil. Airlines, Inc. vs. Court of Appeals, 185
SCRA 110 [1990]).

AWARD FOR LOST INCOME NEED NOT ALWAYS BE

SUPPORTED BY DOCUMENTARY EVIDENCE

Nevertheless, it is not correct to state that the award for lost

income should always be supported by documentary evidence. (In
fact, as will be explained hereunder, the heirs of the deceased may
be entitled to lost earnings even if the deceased was not working).
Hence, the testimonies of the officers of the employer of the
deceased may also suffice. (Phil. Airlines, Inc. vs. Court of Appeals,
supra). Similarly, the testimonies of the widows of the victims were
held acceptable where a reasonable estimate of the income can be
made on the basis of such testimonies.

Mere testimonies unsupported by documentary evidence were

accepted in some cases because of the nature of the work of the
deceased. Thus, testimonial evidence was deemed sufficient in
People v. Pedro Perreras (G.R. No. 139622, July 31, 2001) because
the victim was a waiter in a restaurant who was only earning
P130.00 per day. In another case, no documentary evidence was
required because the deceased was a daily wage earner who
worked in a hacienda and was even receiving less than the
minimum wage (People v. Uganap, G.R. No. 130605, June 19,
2001, 358 SCRA 674, 687; see also People v. Dizon, 320 SCRA 513
[1999]). A self-employed tricycle driver cannot likewise be
expected to present documentary evidence and proof of his income
must necessarily be testimonial (People v. Leonilo Villarba, G.R.
No. 132784, October 30, 2000).

REQUISITES FOR RECOVERY IN CASE OF NON-

AVAILABILITY OF DOCUMETARY EVIDENCE

(a) the victim was self-employed earning less than the minimum
wage under the current labor laws and judicial notice was taken of
the fact that in the victim’s line of work, no documentary evidence
is available; and

(b) the victim was employed as a daily wage worker earning less
than the minimum wage under the current labor laws (People v.
Muyco, 331 SCRA 192 [1999]; People v. Dindo Pajotal, et al, G.R.
No. 142870, November 14, 2001).

(4) Living Expenses

The amount of the living expenses must also be established to
determine the net earnings. However, the Supreme Court has
consistently ruled that, the amount thereof is fixed at fifty percent
(50%) of the gross income in the absence of proof of the amount
of living expenses to be deducted from the gross income (Metro
Manila Transit Corporation et al. v. Court of Appeals, et al., G.R.
Nos. 116617 & 126395, November 16, 1998; People v. Templo,
346 SCRA 626 [2000]; People v. Agapito Listerio, G.R. No. 122099,
July 5, 2000;People v. Elger Guzman, G.R. No. 132750, December
14, 2001;People v. Angelito Yatco, G.R. No. 138388, March 19,
2002;People v. Ireneo Godoy, G.R. No. 140545, May 29, 2002;
Smith Bell Dodwell Shipping Agency Corporation v. Catalino Borja,
et al., G.R. No. 143008, June 10, 2002).

WHEN AMOUNT LESS THAN 50 PERCENT OF GROSS INCOME

MAY BE USED AS THE BASIS OF ACTUAL LIVING EXPENSES
Upon proof thereof or in the existence of other circumstances that
would justify the reduction of the living expenses (Smith Bell
Dodwell Shipping Agency Corporation v. Catalino Borja, et al.,
ibid.).

NON-WORKING VICTIMS
Earning capacity may be impaired even if no actual earning is lost
in the meantime.
In a number of cases, the Supreme Court recognized the entitle-
ment of the heirs of the deceased for loss of earning capacity of
the deceased even if the said deceased was not working at the time
of the accident. What is important is that there is proof of loss of
earning capacity and not necessarily actual loss of income.
Section 2206 of the Civil Code provides that the defendant shall be
liable for the loss of the earning capacity of the deceased, and the
indemnity shall be paid to the heirs of the latter “unless the
deceased on account of permanent physical disability not caused
by the defendant, had no earning capacity at the time of his death.”
Thus, the heirs of the deceased may still be entitled to damages
even if the actual income of the latter as a farmer was not duly
established so long as there is indication that the said deceased
had earning capacity at the time of his death (People of the
Philippines v. Elger Guzman, G.R. No. 132750, December 14,
2001).
In Metro Manila Transit Corporation et al. v. Court of Appeals et al.
(G.R. Nos. 116617/126395, November 16, 1998), the Supreme
Court awarded damages in favor of the plaintiffs for the death of
their non-working minor child who was killed because of the
negligent driving of a bus driver. The Supreme Court used the
minimum wage for non-agricultural workers in computing the net
earnings.

Civil Code provides that in addition to the indemnity for death

caused by a crime or quasi delict, the “defendant shall be liable for
the loss of the earning capacity of the deceased, and the indemnity
shall be paid to the heirs of the latter; . . . .” Compensation of this
nature is awarded not for loss of earnings but for loss of capacity
to earn money. [People v. Teehankee, 249 SCRA 54, 118 (1995)]

WHAT MUST BE PROVED

Evidence must be presented that the victim, if not yet employed at

the time of death, was reasonably certain to complete training for
a specific profession.

Thus, in Haumersen v. Ford Motor Co., 40 [257 N.W. 2d 7,

17 (1977)] the court allowed the heirs of a seven-year-old
 boy who was killed in a car accident to recover
compensation for loss of earning capacity:
Considerable evidence was presented by plaintiffs in an effort to
give the jury a foundation on which to make an award. Briefly
stated, this evidence showed Charles Haumersen was a seven-
year-old of above average characteristics. He was described as
“very intelligent” and “all-American.” He received high marks in
school. He was active in church affairs and participated in
recreational and athletic events, often with children older than
himself. In addition, he had an unusual talent for creating nu-
merous cartoons and other drawings, some of which plaintiffs
introduced at trial.

Life Expectancy
The formula used in Villa Rey Transit shows that life expectancy of
the deceased is not only relevant but also an important element in
fixing the amount recoverable. It is important to emphasize in this
connection that it is the life of the deceased or victim that is the
element of the formula for computing loss of earning capacity and
not that of the heirs (Gregorio Pestano et al. v. Spouses Teotimo
& Paz C. Sumayang, G.R. No. 139875, December 4, 2000).
In determining the life expectancy of the victim, the Supreme Court
had repeatedly used the American Expectancy Table of Mortality or
the Actuarial of Combined Experience Table of Mortality that are
used by insurers. The table being used by insurance companies is
adopted because “there is a link here with actuarial tables, which
were created by life assurance companies for the purpose of
determining what capital sum should be charged for an annuity,
since the insurer is obviously vitally concerned to make the
estimate of the annuitant’s life expectancies.

FACTORS CONSIDERED IN REDUCING THE LIFE

EXPECTANCY MUTLIPLIER
Several factors were considered by the Supreme Court in reducing
the life expectancy multiplier in some of the cases that it decided.
(1) For instance, the Supreme Court reduced the multiplier in one
case because it considered the fact that a man does not expect
to work up to the final month or year of his life in reducing
the multiplier. (People vs. Quilaton, p. 289).
(2) The multiplier can likewise be reduced by considering the
medical history of the deceased. Thus, in one case, the
Supreme Court considered the fact that the deceased underwent a
major surgery such as a caesarian section. From 24 years, the life
expectancy was reduced to 20 years. (MD Transit vs. Court of Ap-
peals, p. 546). In another case, the multiplier was reduced from
33 years to 25 years because the medical history of the deceased
showed that he had complained of and had been treated for such
ailments as backaches, chest pains and occasional feeling of
tiredness. (Davila vs. PAL, p. 504).
(3) The nature of the work may likewise result in the reduction
of the multiplier. Thus, a reduction was made in a case where the
deceased was a jeepney driver. The Supreme Court observed that
drivers of passenger jeepneys cannot continue the backbreaking
pace and unnerving nature of their work for many years. (People
vs. Daniel, p. 104 [1985]).

(4)In another case, the Supreme Court likewise suggested that

habit and manner of life should be taken into account. Thus,
a reduction can be made if the deceased had been consistently
engaged in a dangerous and risky activity tending to shorten his
life. (Rodriguez-Luna vs. Intermediate Appellate Court, 135 SCRA
242, 248 [1985]).

REASONS FOR REDUCTION

(1) Some allowance must be made for the general vicissitudes

of life, that is to say, damaging events like early death or
unemployment which might have affected the plaintiff even if the
defendant had not injured him.
 (2) Account must also be taken of the fact that the lump sum
of damage will itself produce an investment income. The
theoretical aim of the process is to provide a lump sum sufficient,
if invested, to produce an income equal to the lost income when
the interest is supplemented by withdrawal of capital. (Winfield and
Jolowich, p. 769).

FACTORS TO CONSIDER IN FIXING A GREATER AMOUNT

(1) Financial Capacity

(2) The life expectancy of the deceased or of the beneficiary,
whichever is shorter
(3) Pecuniary loss to the plaintiff or the beneficiary
(4) Loss of service
(5) Loss of support
(6) Loss of society
(7) Mental suffering of beneficiaries
(8) Medical and Funeral Expenses

(5) Permanent Incapacity.

The plaintiff is also entitled to damages for loss of earning capacity
when the defendant’s act or omission resulted in his permanent
incapacity. Thus, in Borromeo vs. Manila Electric Railroad & Light
Co. (44 Phil. 165, 167 [1922]), the Supreme Court awarded in
favor of the plaintiff an amount for his loss of earning capacity
because he lost his left foot. The Court observed that because of
such loss, the plaintiff could no longer be employed as a marine
engineer on any vessel as evidenced by the fact that the Collector
of Customs has refused to grant him a license to follow his
profession as a marine engineer.
(6) Loss of Profits.
The right to recover lost profits is now expressly recognized under
the New Civil Code. This may take the form of commissions that
were lost by reason of the acts or omissions of the defendant.
(General Enterprises, Inc. vs. Lianga Bay Logging Co., Inc.). This
may also take the form of income that was stipulated in the
contract that was terminated in a wanton and fraudulent manner.
(Consolidated Dairy Products, et al. vs. Court of Appeals, 212 SCRA
810, 822 [1992]).
The Supreme Court explained in Consolidated Dairy Products
(ibid.) that the amount of lost profits may be determined by consid-
ering the average profit for the preceding years multiplied by the
number of years during which the business is affected by the
wrongful act or breach.
INCOME OF SIMILAR BUSINESSES OR ACTIVITIES MAY BE
CONSIDERED
In G.A. Machineries, Inc. vs. Yaptinchay (126 SCRA 78, 88 [1983]),
the Supreme Court ruled that the income of similar businesses or
activities may be considered. Thus, if the question is loss of profit
of a freight truck, the average income of other trucks can be
considered.
However, it is basic that unrealized profit cannot be awarded if the
basis is too speculative and conjectural to show actual damages for
a future period. The plaintiff must therefore present reports and
documents that may show the average actual profits earned by the
business as well as other evidence of profitability which are neces-
sary to prove plaintiff’s claim for said amount.
(7) Attorney’s Fees.
Article 2208 enumerates all the cases when the award of attorney’s
fees in the concept of damages is justified. The damages
contemplated by such article is an amount that is due to the
plaintiff and not to his counsel. (Quirante vs. The Hon.
Intermediate Appellate Court, G.R. No. 73886, January 31, 1989).
Consequently, the amount agreed upon by the plaintiff and his
counsel does not control the amount of attorney’s fees that should
be awarded. In the same vein, the plaintiff’s counsel does not have
a right to enforce the award of attorney’s fees because, as stated
earlier, the same is due to the plaintiff and not to his counsel. The
governing statute provides:
 “Art. 2208. In the absence of stipulation, attorney’s fees and
expenses of litigation, other than judicial costs, cannot be
recovered, except:
(1) When exemplary damages are awarded;
(2) When the defendant’s act or omission has compelled the
plaintiff to litigate with third persons or to incur expenses to
protect his interest;
(3) In criminal cases of malicious prosecution against the
plaintiff;
(4) In case of a clearly unfounded civil action or proceeding
against the plaintiff;
(5) Where the defendant acted in gross and evident bad
faith in refusing to satisfy the plaintiff’s plainly valid, just
and demandable claim;
(6) In actions for legal support;
(7) In actions for the recovery of wages of household
helpers, laborers and skilled workers;
(8) In actions for indemnity under workmen’s compensation
and employer’s liability laws;
(9) In a separate civil action to recover civil liability arising
from a crime;
(10) When at least double judicial costs are awarded;
(11) In any other case where the court deems it just and
equitable that attorney’s fees and expenses of litigation
should be recovered.
In all cases, the attorney’s fees and expenses of litigation must be
reasonable under the circumstances.
(8) Interests.
The Code Commission included provisions in the Civil Code allowing
interest on damages because they believed that “such interest is
in fact a part of the loss suffered.” The pertinent articles of the
Code provides:
 “Art. 2209. If the obligation consists in the payment of a
sum of money, and the debtor incurs in delay, the indemnity
for damages, there being no stipulation to the contrary,
shall be the payment of the interest agreed upon, and in the
absence of stipulation, the legal interest, which is six per
cent per annum. (1108)
Art. 2210. Interest may, in the discretion of the court, be
allowed upon damages awarded for breach of contract.
Art. 2211. In crimes and quasi-delicts, interest as a part of
the damages may, in a proper case, be adjudicated in the
discretion of the court.
Art. 2212. Interest due shall earn legal interest from the
time it is judicially demanded, although the obligation may
be silent upon this point. (1109a)
Art. 2213. Interest cannot be recovered upon unliquidated
claims or damages, except when the demand can be
established with reasonable certainty.’’
The rules on the award of interest on damages was explained in
Crismina Garments, Inc. vs. Court of Appeals (G.R. No. 128721,
March 9, 1999) by the Supreme Court:
“x x x In Reformina vs. Tomol Jr., this Court stressed that the
interest rate under CB Circular No. 416 applies to (1) loans; (2)
forbearance of money, goods or credits; or (3) a judgment in-
volving a loan or forbearance of money, goods or credits. Cases
beyond the scope of the said circular are governed by Article 2209
of the Civil Code, which considers interest a form of indemnity for
the delay in the performance of an obligation.
Through Circular No. 799, the board declared that, effective July 1,
2013 “the rate of interest for the loan or forbearance of any money,
goods or credits and the rate allowed in judgments, in the absence
of an express contract as to such rate of interest, shall be 6 percent
per annum.”
Mitigation of Liability.
Articles 2203, 2204, 2214 and 2215 provides:
“Art. 2203. The party suffering loss or injury must exercise
the diligence of a good father of a family to minimize the
damages resulting from the act or omission in question.
Art. 2204. In crimes, the damages to be adjudicated may
be respectively increased or lessened according to the
aggravating or mitigating circumstances.
Art. 2214. In quasi-delicts, the contributory negligence of
the plaintiff shall reduce the damages that he may recover.
Art. 2215. In contracts, quasi-contracts, and quasi-delicts,
the court may equitably mitigate the damages under
circumstances other than the case referred to in the
preceding article, as in the following instances:
(1) That the plaintiff himself has contravened the terms of
the contract;
(2) That the plaintiff has derived some benefit as a result of
the contract;
(3) In cases where exemplary damages are to be awarded,
that the defendant acted upon the advice of counsel;
(4) That the loss would have resulted in any event;
(5) That since the filing of the action, the defendant has done his
best to lessen the plaintiff’s loss or injury.
DOCTRINE OF AVOIDABLE CONSEQUENCES
Article 2203 of the Civil Code embodies what is known as the
doctrine of avoidable consequences. The principle is that a party
cannot recover damages flowing from consequences which the
party could reasonably have avoided.
AVOIDABLE CONSEQUENCE VERSUS CONRIBUTORY
NEGLIGENCE
Although the result is the same, it should be differentiated from
contributory negligence because in the latter, the plaintiff’s act or
omission occurs before or at the time of the act or omission of the
defendant. The acts of the plaintiff under the doctrine of avoidable
consequences occur after the act or omission of the defendant.

II.
MORAL DAMAGES
a. Concept.
The Civil Code provides that moral damages include physical
suffering, mental anguish, fright, serious anxiety, besmirched
reputation, wounded feelings, moral shock, social humiliation, and
similar injury. Though incapable of pecuniary computation, moral
damages may be recovered if they are the proximate result of the
defendant’s wrongful act for omission. (Article 2217, Civil Code).
The award of moral damages is designed to compensate the
claimants for actual injury and is not meant to enrich the complain-
ant at the expense of the defendant. They are awarded only to
enable the injured party to obtain means, diversions or amusement
that will serve to alleviate the moral suffering he has undergone by
reason of the defendant’s culpable action. (Kierulf vs. Court of
Appeals, 269 SCRA 433 [1997]; Zenith Insurance Corporation vs.
Court of Appeals, 185 SCRA 308 [1990]). Its aim is the restoration
within the limits of the possible the spiritual status quo ante.
(Visayan Sawmil Co., Inc. vs. Court of Appeals, 219 SCRA 378
[1993]).
It must be understood to be in the concept of grants not punitive
or corrective in nature, calculated to compensate the claimant for
the injury suffered. In other words, moral damages are not
awarded to punish the defendant but to compensate the victim.
(People vs. Aringue, 283 SCRA 291 [1997]; Morales vs. Court of
Appeals, 274 SCRA 282 [1997]; Del Mundo vs. Court of Appeals,
240 SCRA 348 [1996]; De la Serna vs. Court of Appeals, 233 SCRA
325 [1994]; Bautista vs. Mangaldan Rural Bank, Inc., 230 SCRA
16 [1994]; Zenith Insurance Corp. vs. Court of Appeals, 185 SCRA
398 [1990]; Simex International (Manila), Inc. vs. Court of
Appeals, 183 SCRA 360 [1990]; Robleza vs. Court of Appeals, 174
SCRA 354 [1989]).
b. Proof and Proximate Cause.
No proof of pecuniary loss is necessary in order that moral dam-
ages may be adjudicated. The assessment of such damages is left
to the discretion of the court, according to the circumstances of
each case. (Article 2216, Civil Code). However, there must be proof
that the defendant caused physical suffering, mental anguish,
fright, serious anxiety, besmirched reputation, wounded feelings,
moral shock, social humiliation, and similar injury to the plaintiff.
Without allegation and proof of such sufferings, no moral damages
can be awarded. (Compania Maritima vs. Allied Free Worker’s
Union, 77 SCRA 24). Nevertheless, the language of the law need
not be used to warrant the award of moral damages. (Mirana-
Ribaya vs. Carbonell, 95 SCRA 672). So long as there is satisfactory
proof of the psychological and mental trauma actually suffered by
a party, the grant to him of moral damages is warranted. (Del
Rosario vs. Court of Appeals, 267 SCRA 58 [1997]).
Aside from the fact that there is a need for the claimant to sat-
isfactorily prove the existence of the factual basis of the damages,
it is also necessary to prove its causal relation to the defendant’s
act. (Raagas vs. Traya, 22 SCRA 839 [1968]). While moral
damages is incapable of pecuniary estimation, they are recoverable
if they are the proximate cause of the defendant’s wrongful act or
omission. (Enervida vs. De la Torre, 55 SCRA 339; Yutuk vs. Manila
Electric Co., 2 SCRA 337 [1961]).
The exception to the rule that the factual basis for moral damages
must be alleged are criminal cases. Moral damages may be
awarded to the victim in criminal proceedings in such amount as
the court deems just without the need for pleading or proof of the
basis thereof. (People vs. Prades, G.R. No. 127569, July 30, 1998;
People vs. Moreno, G.R. No. 126921, August 28, 1998; People vs.
Bagayong, G.R. No. 126518, December 2, 1998).
Cases when Moral Damages are allowed.
Articles 2219 and 2220 of the Civil Code enumerate the cases when
moral damages may be awarded by the courts:
“Art. 2219. Moral damages may be recovered in the follow-
ing 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.
Art. 2220. Willful injury to property may be a legal ground for
awarding moral damages if the court should find that, under the
circumstances, such damages are justly due. The same rule applies
to breaches of contract where the defendant acted fraudulently or
in bad faith.’’
For instance, it is well settled that no moral damages may be
awarded in the absence of a wrongful act or omission or of fraud
or bad faith. (Ong Yui vs. Court of Appeals, 91 SCRA 223; Castillo
vs. Castillo, 95 SCRA 40; St. Peter Memorial Park, Inc. vs. Cleofas,
92 SCRA 389).
BREACH OF CONTRACT MUST BE MALICIOUS
The same rule applies to cases involving breach of contract, that
is, no moral damages may be awarded where the breach of
contract is not malicious. (Francisco vs. GSIS, 7 SCRA 577 [1963];
Mercado vs. Lira, 3 SCRA 124 [1961]; Martinez vs. Gonzales, 6
SCRA 331 [1962]).
CONDITIONS FOR THE AWARD OF MORAL DAMAGES
An award of moral damages would require certain conditions to be
met, to wit: (
1) First, there must be an injury, whether physical, mental or
psychological, clearly sustained by the claimant;
(2) second, there must be a culpable act or omission factually
established;
(3) third, the wrongful act or omission of the defendant is the
proximate cause of the injury sustained by the claimant; and
(4) fourth, the award of damages is predicated on any of the cases
stated in Article 2219.
WHEN RECOVERABLE IN CASE OF BREACH OF CONTRACT
Under the provisions of this law, in culpa contractual or breach of
contract, moral damages may be recovered when the defendant
acted in bad faith or was guilty of gross negligence (amounting to
bad faith) or in wanton disregard of his contractual obligation and,
exceptionally, when the act of breach of contract itself is
constitutive of tort resulting in physical injuries. By special rule in
Article 1764, in relation to Article 2206, of the Civil Code, moral
damages may also be awarded in case the death of a passenger
results from a breach of carriage.
WHEN RECOVERABLE IN CASE OF QUASI DELICT
In culpa aquiliana, or quasi-delict, (a) when an act or omission
causes physical injuries, or (b) where the defendant is guilty of
intentional tort, moral damages may aptly be recovered. This rule
also applies, as aforestated, to contracts when breached by tort.
WHEN RECOVERABLE IN CULPA CRIMINAL
In culpa criminal, moral damages could be lawfully due when the
accused is found guilty of physical injuries, lascivious acts, adultery
or concubinage, illegal or arbitrary detention, illegal arrest, illegal
search, or defamation. Malicious prosecution can also give rise to
a claim for moral damages. The term “analogous cases,” referred
to in Article 2219, following the ejusdem generis rule, must be held
similar to those expressly enumerated by the law.’’
Unfounded Suits
It is also well settled that moral damages (and attorney’s fees
under paragraph [4] of Article 2208 of the Civil Code) cannot be
assessed against the plaintiff by the mere fact that he filed a case
against the defendant so long as the same was done in good faith.
(Grapilon vs. Mun. Council of Carigara, 2 SCRA 103 [1961];
National Rice and Corn Corporation vs. Antonio, 2 SCRA 643
[1961]; Solis & Yarisantos vs. Salvador, 14 SCRA 887 [1965];
Francel Realty Corp. vs. Court of Appeals, 252 SCRA 156 [1996];
Mijares vs. Court of Appeals, 271 SCRA 558 [1997]). The rule
applies even if the plaintiff’s case is declared to be unfounded. (De
la Pena vs. Court of Appeals, 231 SCRA 456 [1994]). No damages
can be charged on those who may exercise the right to litigate in
good faith even if done erroneously (“J” Marketing Corporation v.
Sia, Jr., 285 SCRA 580 [1998]).
Nevertheless, there are instances when award of moral damages
(as well as attorney’s fees) is justified if there is clear abuse of
court processes. There can be no blanket clearance against the
filing of all types of cases (Cometa v. Court of Appeals, 301 SCRA
459 [1999]). Although no person should be penalized for the
exercise of the right to litigate, this right must be exercised in good
faith. Absence of good faith is established if the plaintiff clearly has
no cause of action against the defendant but he recklessly filed the
suit anyway and wantonly pursued pointless appeals, thereby
causing the defendant to spend valuable time, money and effort in
unnecessarily defending himself, incurring damages in the process
(Industrial Insurance Co. v. Pablo Bondad, G.R. No. 136722, April
12, 2000, 330 SCRA 706, 707).
Labor Cases
Moral damages may be recovered where the dismissal of the
employee was attended by bad faith or fraud or constitute an act
oppressive to labor, or was done in a manner contrary to morals,
good customs, or public policy. (Triple Eight Integrated Services,
Inc. vs. NLRC, 299 SCRA 608, 620-621 [1998]; Hilario vs. NLRC,
252 SCRA 555 [1996]; Estiva vs. NLRC, 225 SCRA 169 [1993]).
Criminal Taking of Life.
In a number of cases, the Supreme Court upheld the rule that in
the present stage of our case law involving criminal taking of
human life, evidence must be adduced by the offended party to
warrant an award of moral damages (See: People v. Acaya, 327
SCRA 269 [2000];People v. Pirame, 327 SCRA 552 [2000]).
However, the rule was clarified by stating that no such proof is
necessary in case of violent death. The Supreme Court explained
in Carlos Arcona y Moban v. The Court of Appeals and the People
of the Philippines (G.R. No. 134784, December 9, 2002; see also
People v. Cabote, G.R. 136143, November 15, 2001 and People v.
Panado, 348 SCRA 679, 690-691 [2000]; People v. Cortez, 348
SCRA 663 [2000]) that “as borne out by human nature and
experience, a violent death invariably and necessarily brings about
emotional pain and anguish on the part of the victim’s family. It is
inherently human to suffer sorrow, torment, pain and anger when
a loved one becomes the victim of a violent or brutal killing. Such
violent death or brutal killing not only steals from the family of the
deceased his precious life, deprives them forever of his love,
affection and support, but often leaves them with the gnawing
feeling that an injustice has been done to them. For this reason,
moral damages must be awarded even in the absence of any
allegation and proof of the heirs’ emotional suffering.”
Factors to Consider in Determining Amount.
There is no hard and fast rule in the determination of what would
be a fair amount of moral damages, since each case must be
governed by its own peculiar circumstances. (Philippine National
Bank vs. Court of Appeals, 266 SCRA 136). The Court should take
into consideration the circumstances obtaining in the case and
assess damages according to its discretion (Fule v. Court of
Appeals, 286 SCRA 698 [1998]).
There are, however, factors specified by law and established by
jurisprudence that could affect the amount to be recovered. An
example of these is Article 2218 of the Civil Code which provides
that in the adjudication of moral damages, the sentimental value
of property, real or personal, may be considered.
(1) Extent of Humiliation
The extent of humiliation may also determine the amount of moral
damages that can be awarded. Thus, in one case, moral damages
was awarded and fixed because of the humiliation caused by the
dicriminatory acts of an airline company. (Philippine Airlines vs.
Court of Appeals, 275 SCRA 621 [1997]). In another, moral
damages was awarded because the plaintiff was slapped in the
face. (Ford vs. Court of Appeals, 186 SCRA 21 [1990]).
(2) Pain and Suffering
The extent of pain and suffering likewise determines the award
(Valenzuela vs. Court of Appeals, supra at p. 37). For instance, an
increase in the amount of moral damages was justified in an
attempted homicide case where the accused bit the ear of the
complainant causing mutilation. The nature of the injuries and the
degree of physical suffering endured by the complainant warrants
an increase. The tragic incident left indelible marks on the
complainant’s body and will serve as a constant reminder of his
traumatic experience. (Sumaplong vs. Court of Appeals, 268 SCRA
764, 776 [1997]). The award was also justified in another case
because of the pain and disfigurement suffered by the respondent,
a pretty girl of 16 whose left arm was scraped of flesh from
shoulder to elbow (De Leon Brokerage Co. v. Court of Appeals, No.
L-15247, February 28, 1962; see also Ong v. Court of Appeals, 301
SCRA 387 [1999]; Salao v. Court of Appeals, 284 SCRA 493
[1998]).
(3) Official, political, social and financial standing.
Official, political, social and financial standing of the offended party
and the business and financial position of the offender affect the
amount of damages. (Lopez vs. Pan American World Airways, 16
SCRA 431; Zulueta vs. Pan American World Airways, Inc., 43 SCRA
397; Kierulf vs. Court of Appeals, 269 SCRA 133 [1997]). In
another case, the Supreme Court ruled that the age of the claimant
is material in the determination of the amount of moral damages
due to the plaintiff. (Zamboanga Trans Co., Inc. vs. Court of
Appeals, 30 SCRA 717 [1969]; Domingding vs. Ng, 103 Phil. 111;
Yutuk v. Manila Electric Co., May 31, 1961).
The Court considered the credit standing of the plaintiff in awarding
moral damages in Producer’s Bank of the Philippines v. Court of
Appeals (G.R. No. 111584, September 17, 2001, 365 SCRA 326).
The wrongful dishonor of a check that was issued by the plaintiff
affected his credit standing. The plaintiff was a businessman
engaged in several businesses and his suppliers discontinued the
credit line that they extended causing his businesses to collapse.
The Court quoted Leopoldo Araneta v. Bank of America (40 SCRA
144 [1971]) where it was explained that: “The financial credit of a
businessman is a prized and valuable asset, it being a significant
part of the foundation of his business. Any adverse reflection
thereon constitutes some financial loss to him.”

Persons who may recover

Generally, the person who endured physical suffering, mental
anguish, fright, serious anxiety, besmirched reputation, wounded
feelings, moral shock, social humiliation, and similar injury is the
person who can recover moral damages. If the basis of the claim
is physical suffering, only the one who suffered and not his or her
spouse may recover. (Sobereno vs. Manila Railroad Co., Nov. 23,
1966). In the same manner, a person who symphatized with an
injured relative is not entitled to recover for the physical suffering
of another. (Strebel vs. Figueros, 96 Phil. 321).
The exception to said rule (where only the victim can recover) is
found in the last two paragraphs of Article 2219:
“The parents of the female seduced, abducted, raped, or
abused, referred to in No. 3 of this article, may also recover
moral damages.
The spouse, descendants, ascendants, and brothers and sisters
may bring the action mentioned in No. 9 of this article, in the order
named.’’
It should be noted however that in those cases, the relatives have
also suffered although they are not the victims of the assault. They
must also have suffered mental anguish, serious anxiety, wounded
feelings, moral shock and other similar injuries.
Corporations
Corporations and other artificial being are not entitled to recover
moral damages. There was confusion before regarding the right of
corporation because of the obiter of the Supreme Court in a
number of cases. However, the rule was finally clarified in ABS-
CBN Broadcasting Corporation vs. Honorable Court of Appeals
(G.R. No. 128690, January 21, 1999):
The award of moral damages cannot be granted in favor of
a corporation because, being an artificial person and having
existence only in legal contemplation, it has no feelings, no
emotions, no senses. It cannot, therefore, experience
physical suffering and mental anguish which can be
experienced only by one having a nervous system. The
statement in People vs. Manero and Mambulao Lumber Co.
vs. PNB that a corporation may recover moral damages if it
“has a good reputation that is debased, resulting in social
humiliation” is an obiter dictum. On this score alone the
award for damages must be set aside, since RBS is a
corporation.”

In another case, the Supreme Court explained that while it is true

that besmirched reputation is included in moral damages, it cannot
cause mental anguish to a corporation, unlike in the case of a
natural person, for a corporation has no reputation in the sense
that an individual has, and besides, it is inherently impossible for
a corporation to suffer mental anguish.

III.
NOMINAL DAMAGES

The allowance of nominal damages is generally based on the

ground that every injury from its very nature legally imports
damage, or that the injury complained of would in the future be
evidence in favor of the wrongdoer, especially where, if continued
for a sufficient length of time, the invasion of the plaintiff’s rights
would ripen into a prescriptive right in favor of the defendant. (22
Am. Jur. 2d 20).
In this jurisdiction, the award of nominal damages was justified by
the Code Commission by stating that there are instances when
the vindication or recognition of the plaintiff’s right is of the utmost
importance to him, as in the case of trespass upon real property.
The Commission observed that in those instances, the awarding of
nominal damages does not run counter to the maxim, “De minimis
non curate lex.” (Report). The pertinent provisions of the Civil Code
on nominal damages are as follows:

“Art. 2221. Nominal damages are adjudicated in order that

a right of the plaintiff, which has been violated or invaded
by the defendant, may be vindicated or recognized, and not
for the purpose of indemnifying the plaintiff for any loss
suffered by him.
Art. 2222. The court may award nominal damages in every
obligation arising from any source enumerated in Article
1157, or in every case where any property right has been
invaded.
Art. 2223. The adjudication of nominal damages shall preclude
further contest upon the right involved and all accessory questions,
as between the parties to the suit, or their respective heirs and
assigns.’’
ASSESSMENT AND AWARD OF NOMINAL DAMAGES:
TECHNICAL INJURY
The assessment of nominal damages is left to the discretion of the
court according to the circumstances of the case. (Ventanilla vs.
Centeno, 1 SCRA 215 [1961]). Generally, nominal damages by
their nature are small sums fixed by the court without regard to
the extent of the harm done to the injured party. However, it is
generally held that a nominal damage is a substantial claim, if
based upon the violation of a legal right; in such case, the law
presumes damage although actual or compensatory damages are
not proven. In truth, nominal damages are damages in name only
and not in fact, and are allowed, not as an equivalent of wrong
inflicted, but simply in recognition of the existence of a technical
injury.
NOMINAL DAMAGES MAY STILL BE AWARDED IN THE
ABSENCE OF COMPETENT PROOF
The award of nominal damages is also justified in the absence of
competent proof of the specific amounts of actual damages
suffered. (People vs. Dianos, 297 SCRA 191; Sumaplong vs. Court
of Appeals, 268 SCRA 764 [1997]; People v. Gopio, 346 SCRA 408
[2000]). Thus, nominal damages were awarded in Sumaplong vs.
Court of Appeals (268 SCRA 764, 775-776 [1997]), an attempted
homicide case where the victim’s left ear was mutilated and a
permanent scar remained in the latter’s forearm. In the said case,
the Supreme Court observed that nominal damages is proper
“whenever there has been a violation of an ascertained legal right,
although no actual damages resulted or none are shown.”
Similarly, nominal damages were awarded in Northwest Airlines,
Inc. vs. Nicolas L. Cuenca (14 SCRA 1063, 1066 [1965]). The
plaintiff was the holder of a first class ticket from Manila to Tokyo
who was rudely compelled by an agent of the airlines to move to
the tourist class notwithstanding the agent’s knowledge that the
plaintiff was a Commissioner of Public Highways of the Republic of
the Philippines who was travelling in his official capacity as a
delegate of the country to a conference in Tokyo. There was also
no proof of actual damages in the said case.
NOMINAL DAMAGES CANNOT CO-EXIST WITH ACTUAL OR
COMPENSATORY DAMAGES
The purpose of nominal damages is to vindicate or recognize a right
that has been violated, in order to preclude further contest thereof;
and not for the purpose of indemnifying the plaintiff for any loss
suffered by him. An award of compensatory damages is a
vindication of a right. It is in itself a recognition that plaintiff’s right
was violated, hence, the award of nominal damages is unnecessary
and improper. (Vda. De Medina vs. Cresencia, 99 SCRA 506, 510
[1956]).

IV.
TEMPERATE OR MODERATE DAMAGES

The Civil Code includes provisions allowing temperate and

moderate damages. Articles 2224 and 2225 state:
“Art. 2224. Temperate or moderate damages, which are
more than nominal but less than compensatory damages,
may be recovered when the court finds that some pecuniary
loss has been suffered but its amount can not, from the
nature of the case, be provided with certainty.
Art. 2225. Temperate damages must be reasonable under the
circumstances.’’
The Code Commission justified the adoption of the above-quoted
provisions by citing the law in the United States:
“In some States of the American Union, temperate damages are
allowed. There are cases where from the nature of the case,
definite proof of pecuniary loss cannot be offered, although the
court is convinced that there has been such loss. For instance,
injury to one’s commercial credit or to the goodwill of a business
firm is often hard to show with certainty in terms of money. Should
damages be denied for that reason? The judge should be
empowered to calculate moderate damages in such cases, rather
than that the plaintiff should suffer, without redress, from the
defendant’s wrongful act.’’
The Supreme Court explained in Pleno vs. Court of Appeals (G.R.
No. 56505, May 9, 1988; see also People v. Singh, G.R. No.
129782, 360 SCRA 404, 408 [2001]; People v. Plazo, 350 SCRA
433 [2001]) that:
“Temperate damages are included within the context of
compensatory damages. In arriving at a reasonable level of
temperate damages to be awarded, courts are guided by the ruling
that x x x there are cases where from the nature of the case,
definite proof of pecuniary loss can not be offered, although the
court is convinced that there has been such loss. For instance,
injury to one’s commercial credit or to the goodwill of a business
firm is often hard to show certainly in terms of money. Should
damages be denied for that reason? The judge should be empow-
ered to calculate moderate damages in such case, rather than the
plaintiff should suffer, without redress from the defendant’s
wrongful act.”

V.
LIQUIDATED DAMAGES

Liquidated damages are those agreed upon by the parties to a

contract, to be paid in case of breach thereof. (Article 2226, Civil
Code). Ordinarily, the court cannot change the amount of
liquidated damages agreed upon by the parties. However, Article
2227 of the Civil Code provides that liquidated damages, whether
intended as an indemnity or a penalty, shall be equitably reduced
if they are iniquitous or unconscionable. In addition, Article 2228
provides that when the breach of the contract committed by the
defendant is not the one contemplated by the parties in agreeing
upon the liquidated damages, the law shall determine the measure
of damages, and not the stipulation.

VI.
EXEMPLARY OR CORRECTIVE DAMAGES

Corrective damages are called exemplary or “punitive” damages in

American law. The Code Commission used the term “corrective,”
in lieu of “punitive,” in harmony with the modern theory of
penology. (Report of the Code Commission). The Commission
further explained that exemplary damages are required by public
policy to suppress wanton acts. They are antidotes so that the
poison of wickedness may not run through the body politic. (ibid.).
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. (Article 2229,
Civil Code; Zenith Insurance Corporation vs. Court of Appeals, 185
SCRA 398 [1990]; Del Rosario vs. Court of Appeals, 267 SCRA 158
[1997]). They are designed to reshape behavior that is socially
deleterious in its consequence. (Mevenas vs. Court of Appeals).
Also known as “punitive” or “vindictive” damages, exemplary or
corrective damages are intended to serve as a deterrent to serious
wrongdoings and as a vindication of undue sufferings and wanton
invasion of the rights of an injured or a punishment for those guilty
of outrageous conduct.
REQUISITED FOR AWARD OF EXEMPLARY DAMAGES
 1. They may be imposed by way of example in addition to
compensatory damages, and only after the claimant’s
right to them has been established;
2. They cannot be recovered as a matter of right, their de-
termination depending upon the amount of
compensatory damages that may be awarded to the
claimant;
3. The act must be accompanied by bad faith or done in wan
ton, fraudulent, oppressive or malevolent manner

The award of exemplary damages is governed by the following

statutory provisions:
“Art. 2230. In criminal offenses, exemplary damages as a
part of the civil liability may be imposed when the crime was
committed with one or more aggravating circumstances.
Such damages are separate and distinct from fines and shall
be paid to the offended party.
Art. 2231. In quasi-delicts, exemplary damages may be
granted if the defendant acted with gross negligence.
Art. 2232. In contracts and quasi-contracts, the court may
award exemplary damages if the defendant acted in a
wanton, fraudulent, reckless, oppressive, or malevolent
manner.
Art. 2233. Exemplary damages cannot be recovered as a
matter of right; the court will decide whether or not they
should be adjudicated.
Art. 2234. While the amount of the exemplary damages
need not be proved, the plaintiff must show that he is
entitled to moral, temperate or compensatory damages
before the court may consider the question of whether or
not exemplary damages should be awarded. In case
liquidated damages have been agreed upon, although no
proof of loss is necessary in order that such liquidated
damages may be recovered, nevertheless, before the court
 may consider the question of granting exemplary in addition
to the liquidated damages, the plaintiff must show that he
would be entitled to moral, temperate or compensatory
damages were it not for the stipulation for liquidated
damages.
Art. 2235. A stipulation whereby exemplary damages are
renounced in advance shall be null and void.’’
Criminal Cases.
The Civil Code authorizes the imposition of exemplary damages in
criminal cases:
(1) Where there is an aggravating circumstance. The term
“aggravating circumstances” used by the Civil Code, the law not
having specified otherwise, is to be understood in its broad or
generic sense. In fine, relative to the civil aspect of the case, an
aggravating circumstance, whether ordinary or qualifying, should
entitle the offended party to an award of exemplary damages
within the unbridled meaning of Article 2230 of the Civil Code
(People v. Catubig, supra.).
(2) Nevertheless, the award of exemplary damages is also justified,
not only due to the presence of aggravating circumstance, but also
if the circumstances show the depravity of the mind of the
accused.
Hence, exemplary damages was awarded against an accused who
assaulted a pregnant woman. By sexually assaulting a pregnant
woman, the accused has shown moral corruption, perversity and
wickedness. (People vs. Cristobal, 252 SCRA 507 [1996]). It was
also imposed to deter fathers with perverse tendencies or aberrant
sexual behavior from abusing their own daughters. (People vs.
Matrimonio, 215 SCRA 613 [1992]).