damages full text

7/24/2019 Damages Full Text

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G.R. No. L-65935 September 30, 1988

FILINVEST CREDIT CORPORTION, petitioner,vs.

T!E INTER"EDITE PPELLTE CO#RT $%& NESTOR '. S#() *R., respondents.

Labaguis, Loyola, Angara Law Offices for

petitioner. Juan C. Navarro, Jr. for private

respondent.

SR"IENTO, J.:

In this special civil action for certiorari, Filinvest Credit Corporation implores us to declare the nullity of the

Decision 1 dated September 30, !"3 and the Resolution + dated December #, !"3 of the Intermediate$ppellate Courts3 %no& Court of $ppeals' &hich &ere alle(edly issued &ith (rave abuse of discretion, amountin(to lac) of *urisdiction, or in e+cess of *urisdiction, and &ith patent denial of due process.

he facts as found by the trial court are as follo&s- 5

his is a case for dama(es filed by estor /. Sun(a r., businessman and o&ner of the /S

1achineries 1ar)etin( and the $2$2 ransit. 2laintiff alle(ed that he purchased a

passen(er minibus 1a4da from the 1otor center, Inc. at Calasiao, 2an(asinan on 1arch 5,

!6" and for &hich he e+ecuted a promissory note %7+hibit 8/8' to cover the amount of

2#5,9!5.00 payable monthly in the amount of 25,#0".00 for 5: months due and payable the

st day of each month startin( 1ay , !6" thru and inclusive of 1ay , !"0. ;n the same

date, ho&ever, a chattel mort(a(e &as e+ecuted by him in favor of the 1otor center, Inc.

%7+hibit 8$8'. he Chattel 1ort(a(e and $ssi(nment &as assi(ned to the Filinvest Credit

Corporation &ith the conformity of the plaintiff. estor Sun(a claimed that on ;ctober 5,

!6", the minibus &as sei4ed by t&o %5' employees of the defendant Filinvest Credit

Corporation upon orders of the branch mana(er 1r. Gaspar de los Santos, &ithout any

receipt, &ho claimed that he &as delin


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he various assi(nments of error may be synthesi4ed into the sole issues 9 of. ?hether or not the respondentcourt

a' in alle(edly i(norin( the various assi(ned errors in petitioners brief b' in resolvin( issues not raised at the trial

and on appeal c' in increasin( the amount of moral dama(es and %d' in adherin( to its decision in 7dilberto

Rebosura et al. vs. Ro(aciano ;rope4a, C$G.R. o. #30:"R, as &ell as to /atasan /ill o. 3069, &hich is yet to

be enacted into la&, acted &ith (rave abuse of discretion amountin( to lac) of *urisdiction.

Contrary vie&s are espoused by the parties in this case. 2etitioner maintains that it &as patent (rave abuse ofdiscretion amountin( to lac) of *urisdiction and a bare denial of the petitionerBs constitutional ri(ht to due process

of la&, &hen the respondent court completely brushed aside the assi(ned errors in its brief. 10 It asserts that theconstitutionality of the contractual stipulation bet&een the parties embodied in the documents denominated as2romissory ote and Deed of 1ort(a(e &as not in issue in the court a quo and neither &as the same raised on

appea 11 and therefore should not have been passed upon based on the premise that the appellate court should

not consider any error other than those assi(ned or specified. 1+ Further, it submits that the controversy on appealis capable of ad*udication on other substantive (rounds, &ithout necessarily treadin( into constitutional


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2etitioner assi(ned t&o %5' errors, namely-

I

@7 @;;R$/A7 C;R ;F $227$AS 7RR7D I FIDIG @$ 2RI$7 R7S2;D7 7;D;AF;

R$1;S IS @7 ;?7R ;F @7 :.590 @7C$R7 A$D I E7SI;.

II

@7 @;;R$/A7 C;R ;F $227$AS 7RR7D I R7EIRIG @7 27II;7R ; D7AI7R F;R= %:0'

C$$S $$AA= ; 2RI$7 R7S2;D7 D7S2I7 IS FIDIG @$ ;A= ;7@IRD %>3' ;F

@7 2R;DC7 8?7 ;8 @7 2A$IIFF %R$1;S', ?;@IRDS %5>3' /7IG F;R @IS 7$.

he petition is impressed &ith merit.

It is undisputed that the land in #' pursuant

to the 7+traudicial Settlement $(reement, but on a subse3' representin( his tenantBs share, only the onethird %>3' of the annual hmust be a&arded to Ramos.

Ramos, on the other hand, ar(ues that his tenant &ill be deprived of his share if only onethird %>3' of the ha

&ill be a&arded to him.

$ctual or compensatory dama(es cannot be presumed, but must be duly proved, and proved &ith reasonab

de(ree of certainty. $ court cannot rely on speculation, con*ecture or (uess&or) as to the fact and amount o

dama(es, but must depend upon competent proof that they have suffered and on evidence of the actual am

thereof %Dee @ua Aion( 7lectrica l Corporation v. Reyes, :9 SCR$ 63, ovember 59, !"#'.- nad

It is undisputed that the land in


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R 7 S ; A I ;

FELICINO, J.:

he Han(yo /an) Atd., o)yo, apan, issued Aetter of Credit o. :0565 in the amount of S 5",90.00 in

favor of the 2edro /artolome 7nterpri ses of 1anila to cover an e+port shipment of lo(s to apan. he beneficiary

of the Aetter of Credit assi(ned its ri(hts to Aanu4a Aumber. ;n 5! 1arch !#0, 2rocopio Caderao, doin(

business under the trade name 8Aanu4a Aumber,8 obtained a loan of 2 59,000.00 from plaintiffappellee

2hilippine ational /an) %2/' as evidenced by a promissory note on the security, amon( other thin(s, of the

proceeds of the Aetter of Credit. he 2/ in addition re


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1ana(e

r

SIG7D I @7

2R7S7C7 ;F-

%S(d' IAA7GI/A7

%S(d' IAA7GI/A7. %7mphasis supplied'

he surety bond &as accompanied by an 7ndorsement o. /#03 &hich provided as follo&s-

In lieu of the last para(raph of this bond, it is hereby declared and a(reed that the follo&in(

condition be incorporated in said bond and made an inte(ral part thereof -

hat, if the above bounden principal and surety shall, in all respects, duly and fully observe

and perform all and sin(ular terms and conditions of the aforementioned Aetter of Credit, then

this obli(ation shall be and become null and of no further force nor effect in the contrary

case, the same shall continue in full effect and be enforceable, as a *oint and several

obli(ation of the parties hereto in the manner provided by la& so lon( as the account remains

unpaid and outstandin( in the boo)s of the /an) either thru noncollection, e+tension,

rene&als or plans of payment &ith or &ithout consent of the surety.

It is a special condition of this bond that the liability of the surety thereon shall, at all times,

be enforceable simultaneously &ith that of the principal &ithout the necessity of havin( the

assets of the principal resorted to, or e+hausted by, the creditor 2rovided, ho&ever, that the

liability of the surety shall he limited to the sum of ?7=FI7 @;S$D 27S;S %2

59,000', 2hilippine Currency. othin( herein contained shall be held to vary, alter, &aive or

chan(e any of the terms, limits or conditions of the bond, e+cept as hereinabove set forth.

%7mphasis supplied'

he promissory note e+ecuted by Aanu4a Aumber became due and payable. either Aanu4a Aumber nor tasscopaid the loan despite repeated demands by 2/ for payment. $ccordin(ly, 2/ filed in the then Court of FirstInstance of 1anila an action to recover the amount of the promissory note &ith interest as provided thereon plus

attorneyBs fees. 1

In its $ns&er to 2/Bs complaint, tassco stated that it had 8no )no&led(e or information sufficient to form a belief

as to the truth of the alle(ations contained in Lpara(raphs 5, 3, : and 9M of the amended complaint and perforce

LdeniedM the same.8 +$t the same time, ho&ever, in settin( out its affirmative defense, tassco admitted that ithad e+ecuted the surety bond and simultaneously pointed to the provisions of 7ndorsement o. / #03. In

particular, tassco contended that its obli(ation under the Surety /ond &as to secure the performance of all the

terms and conditions of the S 5",90.00 Aetter of Credit issued by Han(yo /an) Atd. and had not (uaranteed

the performance of Aanu4a AumberBs obli(ation under its 2 59,000.00 loan from 2/.

;n : anuary !6, upon motion of 2/, the trial court rendered *ud(ment on the pleadin(s. he dispositive part

of the *ud(ment reads as follo&s-

?@7R7F;R7, in the li(ht of the fore(oin( considerations, *ud(ment is hereby rendered

orderin( the defendant to pay the plaintiff the sum of 2 59,000.00 plus # N interest per

annum counted from 1ay !, !#5, the date of the filin( of the ori(inal complaint until fu

paid, plus attorneyBs fees e


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In said case the suit &as one for foreclosure of mort(a(e, and a copy of the deed of mort(a(e

&as attached to the complaint- thus, accordin( to this Court, it &ould have been easy for the

defendants to specifically alle(e in their ans&er &hether or not they had e+ecuted the alle(ed

mort(a(e. he same thin( can be said in the present case, &here a copy of the promissory

note sued upon &as attached to the complaint. he doctrine in ?arner /arnes J Co. Atd. &as

reiterated in .2. uan J Sons, Inc. v. Aian(a Industries, Inc., G.R. o. A5936, uly 5", !#!

%5" SCR$ "06' . . . . %7mphasis supplied'

$t the same time that tassco pretended to have denied the alle(ations of 2/Bs amended complaint, it admitted

in the affirmative defense section of its ans&er that it had indeed e+ecuted the Surety /ond and 7ndorsement o.

/#0 3 in favor of 2/ tassco must be deemed thereby to have admitted the due e+ecution of the /ond and the

7ndorsement. Its affirmative defense in fact consisted of pleadin( the very provisions of the Surety /ond upon

&hich 2/ based its cause of action. hus, the issues raised by the amended complaint and the ans&er &ere not

(enuine issues of fact on &hich evidence &ould have had to be submitted. hose pleadin(s raised, rather,


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Such theory ali(ned &ith Sec. 90 of the Code of Civil 2rocedure &hich &as subse


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. in not holdin( that he %petitioner Aao' has a valid defense to the action for maliciousprosecution in Civil Case o. ":1

5. in not holdin( that he &as deprived of a day in court due to the (ross i(norance, ne(li(enceand dereliction of duty of the la&yer &hom his employer hired as his and the companyBscounsel, but &ho failed to protect his interest and even acted in a manner inimical to himand

3. in not partially annullin( the decision of the trial court dated anuary 55, !"9 insofar ashe is concerned.

he petition is meritorious.

Aao had a valid defense to the action for malicious prosecution %Civil Case o. ":1' because it &as hisemployer, St. oseph Aumber, not himself, that &as the complainant in the estafa case a(ainst 7spiritu. It &as

Chan on(, the o&ner of the St. oseph Aumber, &ho, upon advice of his counsel, filed the criminal complaint

a(ainst 7spiritu. Aao &as only a &itness in the case. @e had no personal interest in the prosecution of 7spiritu for

he &as not the party defrauded by 7spiritu. @e e+ecuted the affidavit &hich &as used as basis of the criminal

char(e a(ainst 7spiritu because he &as the salesman &ho sold the construction materials to 7spiritu. @e &as

only an a(ent of St. oseph Aumber, hence, not personally liable to the party &ith &hom he contracted %$rt. "!6,

Civil Code 2hilippine 2roducts Co. vs. 2rimateria Societe $nonyme, 55 2hil. #!"'.

o maintain an action for dama(es based on malicious prosecution, three elements must be present- First, the fact

of the prosecution and the further fact that the defendant &as himself the prosecutor, and that the action &as

finally terminated &ith an ac or Petitioner.

Leo%&o C. De$%te $%& Peter N2$> or Private Respondents.

SLL'#S

. CIIA A$? D$1$G7S 7127R$7 ;R 1;D7R$7 D$1$G7S 1$= /7 R7C;7R7D ?@7 S;1727CI$R= A;SS @$S /77 SFF7R7D ; ?$RR$7D I C$S7 $ /$R. O $rticle 555: of the

CivilCode provides- 8emperate or moderate dama(es, &hich are more than nominal but less than compensatory

dama(es, may be recovered &hen the Court finds that some pecuniary loss has been suffered but is amount can

not, from the nature of the case, be proved &ith certainty.8 he (rant thereof is proper under the provision of

$rticle 5509 of the Civil Code, &hich provides that dama(es may be recovered. In this case ho&ever, there &as

no sho&in( nor proof that petitioner &as entitled to an a&ard of this )ind of dama(es in addition to the actual

dama(es it suffered as a direct conse


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his is a petition for revie& on certiorari of the decision of the Court of $ppeals in C$G.R. o. 056": entitled,

8Consolidated 2ly&ood Industries, Inc. and @enry ?ee v. ?illie Hho and $lfred C.@. Hho,8 &hich modified the

decision of the Court of First Instance %no& Re(ional rial Court' of /a(an(a, Davao ;riental, by deletin( the

a&ard for moral dama(es, attorneys fees and actual dama(es in the sum of 2390,000.00 for the unfulfilled import

of lo(s, &hich &ere (ranted by the trial court.

Consolidated 2ly&ood Industries, Inc. %Corporation' and @enry ?ee filed an action for breach of contract

and dama(es a(ainst ?illie Hho and $lfred C.@. Hho &ith the Court of First Instance %no& Re(ional rial

Court' of /a(an(a, Davao ;riental. he facts as summari4ed by the trial court are as follo&s-

8+ + +

8Sometime in February, !6", the plaintiff Corporation of &hich the plaintiff @enry ?ee is the 2resident, bein( in

the business of lo((in( and manufacturin( timber products at its lo((in( concession at /a(an(a and Cara(a,

Davao ;riental, on one hand, and the defendants, father and son, &ho are operatin( a fleet of haulin( truc)s,

entered into a verbal haulin( a(reement &ith the follo&in( terms and conditions to &it- that defendants shall haul

the lo(s of the plaintiffs from the concession area to the lo(pond at /aculin, /a(an(a, Davao ;riental, at a haulin(

fee of 2.59>cu.m.>)m. of all species of timber, payable on &ee)ly li


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8?@7R7F;R7, and in the li(ht of all the fore(oin(, the appealed *ud(ment is affirmed e+cept the a&ard ofdama(es for Qunfulfilled import of lo(s,P moral dama(es and attorneyPs fees &hich are hereby denied and ordereddeleted.8 %p. 39:, Rollo'

In this petition before s, the petitioners Corporation and @enry ?ee


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his favor after the commencement of the action and that the in*unction bond filed by Sy is liable for &hatever

dama(es ;7C may have suffered by reason of the in*unction.

;n the counterclaim of ;7C the trial court found that the said lessor &as deprived of the possession and

en*oyment of the leased premises and also suffered dama(es as a result of the filin( of the case by Sy and his

violation of the terms and conditions of the lease a(reement. @ence, it held that ;7C is entitled to recover the

said dama(es in addition to the arrears in rentals and amusement ta+ delin


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unduly harsh. hus, ?e allo&ed the amendment of the complaint by specifyin( the amount of dama(es &ithin a

none+tendible period of five

%9' days from notice and the reassessment of the filin( fees. hen, in un 2nsurance Office, Ltd. v. Asuncion, G.R.6!!363", February 3, !"!, 60 SCR$ 56:, ?e held that &here the filin( of the initiatory pleadin( is notaccompanied by payment of the doc)et fee, the court may allo& payment of the fee &ithin a reasonable time but inno case beyond the applicable prescriptive or re(lemen tary period.

evertheless, ;7CBs counterclaims are compulsory so no doc)et fees are ree& o *2>t7e> Co%7ep7o%, Serr$%o S$%Deo DR. CORNELIO S. TNTOCO $%& *#N 'RIONES repre>e%te& b4 &m%>tr$trB ")DLEN'ERNRDO, respondentsappellees.

%ortunato de Leon, Celso *. Ja&ora and uiller&o *. 2lagan for petitioners$

appellants. Jose *. 1uerto for respondent$appellee Juan *riones.

0iogracias !. Reyes ' Associates and Jose #. Luison for respondent$appellee Cornelio . !antoco.

PRS, J.:

his is an appeal by certiorari from the decision of the Court of $ppeals %Si+th Division' in C.$., G.R. o.:050R promul(ated on February 5, !60 affirmin( the *ud(ment of the Court of First Instance of /ulacan,&ith modification of the amount of moral and e+emplary dama(es from 200,000.00 to 2#0,000.00 and the

amount of attorneyBs fees from 20,000.00 to 29,000.00 the dispositive portion of &hich appellate courtBs

decision reads as follo&s-

?@7R7F;R7, the decision appealed from is hereby modified as above indicated respectin(

the a&ard of moral and e+emplary dama(es as &ell as attorneyBs fees. he rest are hereby

affirmed &ith costs a(ainst plaintiffsappellants. %pp. #6, Decision of the Court of $ppeals

pp. ##5, Rollo'

he facts of the case as dra&n by respondent court from the evidence on record are


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interest secured by a second mort(a(e in favor of defendant, e+ecuted and signed by t"e /riones spouses on

1ay 5#,!9!, &hich deed of second mort(a(e &as duly re(istered in the ;ffice of the Re(ister of Deeds of

1alolos, /ulacan on 1ay 56, !9! and properly annotated at the bac) of ransfer Certificate of itle o. 5"5!#

issued in the names of uan /riones and 1a(dalena /ernardo that the amount of 25!,3"5.90 sent by plaintiff as

alle(ed counsel of the spouses uan /riones and 1a(dalena /ernardo &as accepted by the said defendant as

part payment or partial e+tin(uishment of the mort(a(e loan of 2#","5:.00 &ith 0N interest thereon per annum

from 1ay 55, !9!, and plaintiffs have been informed of the tenor of said acceptance and application thereof as

partial payment of the mort(a(e obli(ation in


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;n uly 50, !60 the Court resolved amon( others to deny- %' respondent antocoBs motion to dismiss appeal %5'

petitioners motion for reconsideration of the CourtBs resolution of une ", !60 and %3' respondent antocoBs

motion for partial entry of *ud(ment insofar as the portion of the decision appealed from &hich is not the sub*ect of

the instant appeal by certiorari is concerned, &ithout pre*udice to respondentBs presentin( the same motion to

respondent Court of $ppeals for consideration and action at the proper time %Rollo, p. 33'.

Respondent Cornelio S. antoco filed &ith this Court on uly 5, !60 reply to consolidated opposition and

re*oinder to reply to respondent antocoBs motion to dismiss appeal %Rollo, p. 3:'.

/rief for petitioners &as filed on $u(ust 9, !60 %Rollo, p. 9!' brief for respondents &as filed on ;ctober 5",

!60 %Rollo, p. "6'.

;n ovember :,!60 petitioners filed an 8r(ent 2etition e+parte For Issuance of Restrainin( ;rder and oDeclare Respondent Cornelio S. antoco Guilty of Contempt of Court8 statin( that respondent antoco filed &ith

the Court of $ppeals on $u(ust :, !60 the same motion for partial entry of *ud(ment &hich &as filed &ith this

Court and denied in the resolution of uly 50, !60 but &hich &as (ranted by the Court of $ppeals in its resolution

of ;ctober 3, !60 over petitionersappellantsB ob*ection %Rollo, p. !5'. ;n ovember ", !60 respondents

&ere re


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for(ery and of enterin( into collusion &ith the end in vie& of e+tractin( e+tra amount ... from

the herein plaintiff. $ll these tried to picture defendant Cornelio antoco &ith alle(ed

dishonesty &ho respectin( the le(itimate obli(ation of the /riones to defendant Cornelio

antoco, thereby blemishin( his honor, inte(rity and reputation as a prominent doctor and a

businessman. ?ith all these e+tant circumstances &hich served as a (uidepost for us in

determinin( the reasonable amount of dama(es sustained by the defendantappellee, this

Court hereby fi+es the amount of 2#0,000.00 representin( moral and e+emplary dama(es

and the further sum of 29,000.00 as attorneyBs fees, &hich plaintiffsappellants should pay the

defendantappellee. %Rollo, p. #'

$s a la&yer in the practice of la& since his admission to the /ar in !5!, &ho has held several important

positions in the (overnment %S, $pril 55, !#9, p. 56' petitioner Fortunato de Aeon could not have missed the

import of the annotation at the bac) of C o. 5"5!# re(ardin( the second mort(a(e for the sum of si+ty ei(htthousand ei(ht hundred t&entyfour pesos %2#","5:.00' of the property he &as buyin(, in favor of respondent

Cornelio antoco, entry o. 9:"39 in the re(istry of deeds of /ulacan %7+hibits, p. !3'. he same annotation &as

transferred to C o. 5906! in the name of petitioner after the sale of the property &as effected and entered

in the re(istry of deeds of /ulacan on une 3, !9! %7+hibits, p. 05'. Furthermore, petitioners cannot deny

havin( assumed the mort(a(e debts of the /riones spouses amountin( to 2"!,000.00 in favor of the antocos.

he 82atunay8 %7+hibits 3a' e+ecuted by the /riones spouses on une 3, !9! (ives the information that their

property, and fishpond, &as sold by them to the spouses Fortunato de Aeon and uana F. Gon4ales for the

amount of one hundred t&enty thousand pesos %2l50,000.00', payment made to them, as follo&s-

2inana(utan na amin(

pa()a)autan( )ay

G. @ermo(enes antoco han((an(1ayo !9!

2"!,000.00

Cash na tinan((apnamin 2/C Chec) o.960:0

,000.00

2a(are o. unio ,

!9!

0,000.00

2a(are o. 5 unio ,

!9!

0,000.00

Habuuan 250,000.00

$t the bottom of the 82atunay8 in the hand&ritin( of petitioner Fortunato de Aeon is a statement si(ned by him

%7+h. 3b' si(nifyin( that he &as assumin( the spousesBdebt of 2"!,000.00 to respondent antoco, in thefollo&in( &ords-

$n( pa()autan( na 2"!,000.00 sa m(a antoco ay a)in( inaasumihan. %7+hibits, p. !6'.

2etitioner retained 2"!,000.00 out of the 250,000.00, representin( the mort(a(e loan of the /riones spouses to

the antocos, includin( interest. Immediately after the sale of the fishpond &as effected and re(istered &ith the

re(istry of deeds of /ulacan petitioner paid the 250,000.00 loan of the /riones spouses to @ermo(enes an

includin( 0N interest on the loan, covered by a first mort(a(e on the property. $ccordin(ly, @ermo(enes a

e+ecuted a deed of dischar(e from the mort(a(e. ;ut of the 2#",000.00 mort(a(e loan of the /riones spous

from respondent Cornelio antoco, petitioner, ho&ever made only a payment of 25!,3"5.90 but &ould &ant

respondent to e+ecute the necessary dischar(e document. he documents spea) for themselves. hey are

but plain and visible evidence of the deliberate intent of petitioner to defraud respondent of the amount &ithh

from the /riones spouses to cover the amount of the mort(a(e loan in favor of respondent.

he filin( of the case a(ainst respondent bein( unfounded and maliciously prosecuted satisfactorily proves th

e+istence of the factual basis for moral dama(es and the causal relation to petitionersB acts %@a&pia v. Court

$ppeals, 50 SCR$ 939 L!#6M entura v. /ernabe, 3" SCR$ 9"6 L!6M 7nervida v. de la orre, 99 SCR$

L!6:M an Hapoe v. 1asa, 3: SCR$ 53 L!"9M'. 2rivate respondent has a (ood name to protect. @e is a

sur(eon by profession, had been Chief of the /ulacan 2rovincial @ospital since !:# until he put up a hospithis o&n, the Rosary General @ospital.@e is a member of the Hni(hts of Columbus, a Cursillista, a member o

Aions, a fello& of the 2hilippine Colle(e of Sur(eons in (ood standin( from !:# up to the present, a membe

the 2hilippine 1edical $ssociation and of the /ulacan 1edical $ssociation. @e has been humiliated, embarr

mali(ned and has been char(ed in bad faith as a money lender in petitionerBs complaint accusin( him of

defraudin( the /riones spouses %S, pp. 556590'.

he entitlement to moral dama(es havin( been established the a&ard of e+emplary dama(es is proper %/ert

;smeTa J $ssociates v. Court of $ppeals, 50 SCR$ 3!9 L!"3M an Hapoe v. 1asa, 3: SCR$ 53 L!"9

?hile the a&ard of moral and e+emplary dama(es in an a((re(ate amount may not be the usual &ay of

a&ardin( said dama(es there is no


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Peope . :2$to%, ).R. No. 69666, +05 SCR +9 , *$%2$r4 +3, 199+

).R. No. L-69666 *$%2$r4 +3, 199+T!E PEOPLE OF T!E P!ILIPPINES,plaintiffappellee, vs.

)#"ERCINDO :#ILTON 4 E'ROL, defendantappellant.!"e olicitor eneral for plaintiff$appellee. 1ublic Attorney3s Officefor accused$appellant

FELICINO, J.:$ppellant Gumercindo Euilaton &as found (uilty of murder and sentenced to suffer the penalty of reclusion

perpetua, and re


19/39

must rely on the stren(th of his o&n evidence and not on the &ea)ness of that of the prosecution for even if the

prosecutionBs evidence &ere &ea), it cannot be disbelieved after appellant has admitted the )illin(. 8

he evidence of appellant on his claim of selfdefense consisted solely of his o&n testimony. he trial courtre*ected that testimony, firstly, because it &as not supported by convincin( corroborative evidence and, secondly,because the trial court had perceived appellant to be a liar.

Durin( trial of the case, the prosecution had mar)ed and offered in evidence the letter of the I2 Station

Commander in Dala(uete, Cebu informin( the I2 Station Commander in San Simon, 2ampan(a that appellant

had t&o %5' pendin( cases in Dala(uete, Cebu. ;ne of those cases &as for murder and the other for double

murder. Certified true copies of the alias &arrants for the arrest of appellant in both cases &ere also mar)ed in

evidence by the prosecution. 9$ppellant had denied the pendency of the cases. ;n crosse+amination, hetestified as follo&s-

E 1r. Euilaton, in your to&n in Dala(uete, Cebu your 1ayor is 2a4

?on( $ I do not )no& her, sir.

E $nd &ho is the mayor &hom you )no& in

your to&n $ Ae(aspi, sir.

E ?ho &as your Station Commander &hen you left

Dala(uete, Cebu $ I do not )no& his name, sir.

E 1r. Euilaton, is it not a fact that you have a pendin( case of double murder in the 1unicipal rial Court of

Dala(uete, Cebu doc)eted as Crim. Case o. 3035 before the @onorable ud(e /uenconse*o

$ I do not )no& that, sir.

E =ou do not also )no& that there is also another pendin( murder case doc)eted as Crim. Case o. 560 before

the @on. Dominador umula)

$ I do not )no& that, sir.

E ?ill you deny that you have also another pendin( case before the RC, /ranch 5# of $rdaos,

Cebu $ one, sir.

E =ou mean you have no pendin(

case in Cebu $ one, sir.

E Is it not a fact 1r. Euilaton that you &ere a convictescapee in the 2rovincial ail of

Cebu $ o, sir.

E Since you left Cebu, have you

returned to Cebu $ ot yet, sir. 10

he trial court instead (ave credence to the testimony of Aamberto $bu(an &ho had seen appellant initiate a

deadly assault on the victim Roland 1anahan by dra&in( a fan )nife from his ri(ht hip and by announcin( his

intention to )ill 1anahan. he ordinary rule is that findin(s of fact of the trial court on the credibility of &itnesses are

entitled to (reat respect considerin( that the trial court &as in a position to evaluate the deportment of &itnesses

&hile

testifyin(. 11 he Court does not see any compellin( reason to depart from the (eneral rule.

his Court, ho&ever, a(rees &ith the Solicitor General that appellant should be convicted of homicide only.

information here filed specified treachery and evident premeditation as


20/39


21/39

Rate V 2!">day

Date of Decision V $u(. ", !!"

Aen(th of Service V " yrs. J month

2!".00 + 5# days + " months V 2:,":.00

/$CH?$G7S

Date Dismissed V anuary 5:, !!6

Rate per day V 2!#.00

Date of Decisions V $u(. ", !!"

a' >5:>!6 to 5>9>!" V 5.3# mos.

2!#.00>day + 5.3# mos. V 2#5,!"#.9#

b' 5>#>!" to ">">!" V #.: months

2revailin( Rate per day V 2#5,!"#.00

2!".00 + 5# days + #.: mos. V 235,!:6.50

; $ A V 2!9.!33.6#

+ + + +

?@7R7F;R7, premises considered, *ud(ment is hereby rendered findin( respondents (uilty of constructive

dismissal and are therefore, ordered-

o pay *ointly and severally the complainant the amount of si+tyt&o thousand nine hundred ei(htysi+ pesos and

9#>00 %2#5,!"#.9#' 2esos representin( his separation pay

o pay *ointly and severally the complainant the amount of nine %sic' five thousand nine hundred thirtythree and

3#>00 %2!9,!33.3#' representin( his bac)&a(es and

$ll other claims are hereby dismissed for lac)

of merit. S; ;RD7R7D.:

Respondents appealed to the ARC, but it &as dismissed for lac) of merit in the Resolution9

dated February 5!,5000. $ccordin(ly, the ARC sustained the decision of the Aabor $rbiter. Respondents filed a motion for

reconsideration, but it &as denied.#

Dissatisfied, respondents filed a 2etition for Revie& on Certiorari before the C$. ;n $u(ust 5:, 5000, the C$

issued a Resolution dismissin( the petition. Respondents filed a 1otion for Reconsideration, but it &as li)e&ise

denied in a Resolution dated 1ay ", 500 .6

Respondents then sou(ht relief before the Supreme Court, doc)eted as G.R. o. 9335. Findin( no revers

error on the part of the C$, this Court denied the petition in the Resolution dated $pril 6, 5005."

$n 7ntry of ud(ment &as later issued certifyin( that the resolution became final and e+ecutory on 1ay 56

5005.!he case &as, thereafter, referred bac) to the Aabor $rbiter. $ pree+ecution conference &as

conse


22/39

2etitioner then appealed before the ARC,5&hich appeal &as denied by the ARC in its Resolution 55datedSeptember 56, 500#. 2etitioner filed a 1otion for Reconsideration, but it &as li)e&ise denied in the

Resolution53dated anuary 3, 5006.

$((rieved, petitioner then sou(ht recourse before the C$, doc)eted as C$G.R. S2 o. !"9!.

;n September 53, 500", the C$ rendered a Decision 5:denyin( the petition. he C$ opined that since petitioner

no lon(er appealed the ;ctober 9, !!" Decision of the Aabor $rbiter, &hich already became final and

e+ecutory, a belated correction thereof is no lon(er allo&ed. he C$ stated that there is nothin( left to be done

e+cept to enforce the said *ud(ment. Conse


23/39

It &as at this point that the present case arose. Focusin( on the core ille(al dismissal portion of the ori(inal labor

arbiterBs decision, the implementin( labor arbiter ordered the a&ard recomputed he apparently read the fi(ures

ori(inally ordered to be paid to be the computation due had the case been terminated and implemented at th

labor arbiterBs level. hus, the labor arbiter recomputed the a&ard to include the separation pay and the

bac)&a(es due

up to the finality of the C$ decision that fully terminated the case on the merits. nfortunately, the labor arbiterBs

approved computation &ent beyond the finality of the C$ decision %uly 5!, 5003' and included as &ell the

payment for a&ards the final C$ decision had deleted specifically, the proportionate 3th month pay and the

indemnity a&ards. @ence, the C$ issued the decision no&


24/39

o recapitulate and for future (uidance, the (uidelines laid do&n in the case of 7astern Shippin( Aines :5areaccordin(ly modified to embody /S21/ Circular o. 6!!, as follo&s-

I. ?hen an obli(ation, re(ardless of its source, i.e., la&, contracts,


25/39

).R. No. 91+ *24 1+, 199

ESTERN S!IPPIN) LINES, INC.,petitioner,vs.

!ON. CO#RT OF PPELS ND "ERCNTILE INS#RNCE CO"PN, INC., respondents.

Alo/ada ' arcia and Ji&enea, 0ala ' 8arago9a for

petitoner. 8apa Law Office for private respondent.

VIT#), J.:

he issues, albeit not completely novel, are- %a' &hether or not a claim for dama(e sustained on a shipment of

(oods can be a solidary, or *oint and several, liability of the common carrier, the arrastre operator and the

customs bro)er

%b' &hether the payment of le(al interest on an a&ard for loss or dama(e is to be computed from the time thecomplaint is filed or from the date the decision appealed from is rendered and %c' &hether the applicablerate of interest, referred to above, is t&elve percent %5N' or si+ percent %#N'.

he findin(s of the court a quo, adopted by the Court of $ppeals, on the antecedent and undisputed facts that

have led to the controversy are hereunder reproduced-

his is an action a(ainst defendants shippin( company, arrastre operator and bro)erfor&arder for dama(es sustained by a shipment &hile in defendantsB custody, filed by theinsurersubro(ee &ho paid the consi(nee the value of such losses>dama(es.

;n December :, !", t&o fiber drums of riboflavin &ere shipped from =o)ohama, apan for

delivery vessel 8SS 7$S7R C;178 o&ned by defendant 7astern Shippin( Aines under/ill of Aadin(

o. =1$" %7+h. /'. he shipment &as insured under plaintiffBs 1arine Insurance 2olicy o.

">066 for 23#,3"5,:##.3".

pon arrival of the shipment in 1anila on December 5, !", it &as dischar(ed unto the

custody of defendant 1etro 2ort Service, Inc. he latter e+cepted to one drum, said to be in

bad order, &hich dama(e &as un)no&n to plaintiff.

;n anuary 6, !"5 defendant $llied /ro)era(e Corporation received the shipment from

defendant 1etro 2ort Service, Inc., one drum opened and &ithout seal %per 8Redama(e sustained by said drum, the consi(neesuffered losses totalin( 2!,035.!9, due to the fault and ne(li(ence of defendants. Claims&ere presented a(ainst defendants &ho failed and refused to pay the same %7+hs. @, I, , H,A'.

$s a conselosses

incurred after the shipment &as incurred after the shipment &as turned over to the latter, is no

lon(er its liability %p. 6, Record' 1etroport averred that althou(h sub*ect shipment &as

dischar(ed unto its custody, portion of the same &as already in bad order %p. , Record' $ll

/ro)era(e alle(ed that plaintiff has no cause of action a(ainst it, not havin( ne(li(ent or at fa

the shipment &as already in dama(e and bad order condition &hen received by it, but noneth

it still e+ercised e+tra ordinary care and dili(ence in the handlin(>delivery of the car(o to con

in the same condition shipment &as received by it.

From the evidence the court found the

follo&in(- he issues are-

. ?hether or not the shipment sustained losses>dama(es

5. ?hether or not these losses>dama(es &ere sustained &hile in the custoof defendants %in &hose respective custody, if determinable'

3. ?hether or not defendant%s' should be held liable for the losses>dama(plaintiffBs prerial /rief, Records, p. 3: $lliedBs prerial /rief, adoptin(

plaintiffBs Records, p. 3"'.

$s to the first issue, there can be no doubt that the shipment sustained

losses>dama(es. he t&o drums &ere shipped in (ood order and condit

clearly sho&n by the /ill of Aadin( and Commercial Invoice &hich do not

indicate any dama(es drum that &as shipped %7+hs. / and C'. /ut &hen

December 5, !" the shipment &as delivered to defendant 1etro 2or

Service, Inc., it e+cepted to one drum in bad order.

Correspondin(ly, as to t"e second issue, it follo&s that the losses>dama

&ere sustained &hile in the respective and>or successive custody and

possession of defendants carrier %7astern', arrastre operator %1etro 2or

bro)er %$llied /ro)era(e'. his becomes evident &hen the 1arine Car(o

Survey Report %7+h. G', &ith its 8$dditional Survey otes8, are considere

the latter notes, it is stated that &hen the shipment &as 8landed on vesse

doc) of 2ier X 9, South @arbor, 1anila on December 5, !", it &asobserved that 8one :5; fiber dru& :was; in da&aged condition, covered

vessel3s Agent3s *ad Order !ally "eet No. [email protected] he report further st

that &hen defendant $llied /ro)era(e &ithdre& the shipment from defen

arrastre operatorBs custody on anuary 6, !"5, one drum &as found ope

&ithout seal, cello ba( partly torn but contents intact. et unrecovered

spilla(es &as


26/39

9 )(s. he report &ent on to state that &hen the drums reached the

consi(nee, one drum &as found &ith adulterated>fa)ed contents. It is obvious,

therefore, that these losses>dama(es occurred before the shipment reached

the consi(nee &hile under the successive custodies of defendants. nder $rt.

636 of the e& Civil Code, the common carrierBs duty to observe

e+traordinary dili(ence in the vi(ilance of (oods remains in full force and

effect even if the (oods are temporarily unloaded and stored in transit in the

&arehouse of the carrier at the place of destination, until the consi(nee has

been advised and has had reasonable opportunity to remove or dispose of the

(oods %$rt. 63", CC'.

Defendant 7astern Shippin(Bs o&n e+hibit, the 8urn;ver Survey of /ad ;rder

Car(oes8 %7+hs. 37astern' states that on December 5, !" one drum &as

found 8open8.

and thus

held-

?@7R7F;R7, 2R71IS7S C;SID7R7D, *ud(ment is hereby rendered-

;rderin( defendants to pay plaintiff, *ointly and severally-

. he amount of 2!,035.!9, &ith the present le(al interest of 5N perannu& from ;ctober , !"5, the date of filin( of this complaints, until

fully paid %the liability of defendant 7astern Shippin(, Inc. shall not

e+ceed S900 per case or the CIF value of the loss, &hichever is

lesser, &hile the liability of defendant 1etro 2ort Service, Inc. shall be to

the e+tent of the actual invoice value of each pac)a(e, crate bo+ or

container in no case to e+ceed 29,000.00 each, pursuant to Section

#.0 of the 1ana(ement Contract'

5. 23,000.00 as attorneyBs fees, and

3. Costs.

/. Dismissin( the counterclaims andcrossclaim of defendant>crossclaimant

$llied /ro)era(e Corporation.

S; ;RD7R7D. %p. 506, Record'.

Dissatisfied, defendantBs

recourse to S. he appeal

is devoid of merit.

$fter a careful scrutiny of the evidence on record. ?e find that the conclusion dra&ntherefrom is correct. $s there is sufficient evidence that the shipment sustained dama(e &hilein the successive possession of appellants, and therefore they are liable to the appellee, assubro(ee for the amount it paid to the consi(nee. %pp. "6"!, Rollo.'

he Court of $ppeals thus affirmed in toto the *ud(ment of the court

a quo.

In this petition, 7astern Shippin( Aines, Inc., the common carrier, attributes error and (rave abuse of discret

the part of the appellate court &hen O

I. I @7AD 27II;7R C$RRI7R ;IA= $D S77R$AA= AI$/A7 ?I@ @7$RR$SR7 ;27R$;R $D CS;1S /R;H7R F;R @7 CA$I1 ;F 2RI$7R7S2;D7 $S GR$7D I @7 E7SI;7D D7CISI;

II. I @7AD @$ @7 GR$ ;F I7R7S ; @7 CA$I1 ;F 2RI$7 R7S2;D7S@;AD C;117C7 FR;1 @7 D$7 ;F @7 FIAIG ;F @7 C;12A$I $ R$7 ;F ?7A7 27RC7 1)R ANN# IS7$D ;F FR;1 @7 D$7 ;F @7D7CISI; ;F @7 RI$A C;R $D ;A= $ @7 R$7 ;F SI 27RC7 1)R

ANN#, 2RI$7 R7S2;D7BS CA$I1 /7IG IDIS2$/A= AIEID$7D

he petition is, in part, (ranted.

In this decision, &e have be(un by sayin( that the


27/39

It &ill be noted that in the cases already adverted to the rate of interest is imposed on th


28/39

$rt. 550!. O If the obli(ation consists in the payment of a sum of money,

and the debtor incurs in delay, the indemnity for dama(es, there bein( no

stipulation to the contrary, shall be the payment of interest a(reed upon,

and in the absence of stipulation, the le(al interest &hich is si+ percent

per annu&.

he above rule &as reiterated in 1"ilippine Rabbit *us Lines, 2nc., v. Cru9, promul(ated on 5" uly !"#. hecase &as for dama(es occasioned by an in*ury to person and loss of property. he trial court a&arded privaterespondent 2edro 1anabat actual and compensatory dama(es in the amount of 265,900.00 &ith legal interest

t"ereon fro& t"e filing of t"e co&plaint until fully paid. Relyin( on the Refor&ina v. !o&ol case, this Court 8

&odified t"e interest award fro& 5?G to =G interest per annu& but sustained t"e ti&e co&putation t"ereof, i.e.,fro& t"e filing of t"e co&plaint until fully paid.

In Na4pil and ons vs. Court of Appeals, 9 the trial court, in an action for the recovery of dama(es arisin(from the collapse of a buildin(, ordered,inter alia, the 8defendant nited Construction Co., Inc. %one of the petitioners'. . . to pay the plaintiff, . . . , the sum of 2!"!,339.#" &ith interest at t"e legal rate fro& Nove&ber ?B, 5B=


29/39

. . . , %'he transaction involved is clearly not a loan or forbearance of money, (oods or

credits but e+propriation of certain parcels of land for a public purpose, the payment of &hich

is &ithout stipulation re(ardin( interest, and the interest ad*ud(ed by the trial court is in the

nature of indemnity for dama(es. he le(al interest re


30/39

because under the Code of Federal Re(ulations by the Civil $eronautics /oard of the nited States of $merica it

is allo&ed to overboo) fli(hts.

he factual bac)drop of the case is as follo&s-

2etitionersspouses Cesar C. Kalamea and Suthira Kalamea, and their dau(hter, Aiana Kalamea, purchased three

%3' airline tic)ets from the 1anila a(ent of respondent rans?orld $irlines, Inc. for a fli(ht to e& =or) to Aos

$n(eles on une #, !":. he tic)ets of petitionersspouses &ere purchased at a discount of 69N &hile that of

their dau(hter &as a full fare tic)et. $ll three tic)ets represented confirmed reservations.

?hile in e& =or), on une :, !":, petitioners received notice of the reconfirmation of their reservations for said

fli(ht. ;n the appointed date, ho&ever, petitioners chec)ed in at 0-00 a.m., an hour earlier than the scheduled

fli(ht at -00 a.m. but &ere placed on the &aitlist because the number of passen(ers &ho had chec)ed in

before them had already ta)en all the seats available on the fli(ht. Aiana Kalamea appeared as the o. 3 on the

&aitlist &hile the t&o other Kalameas &ere listed as 8o. 3:, sho&in( a party of t&o.8 ;ut of the :5 names on the

&ait list, the first 55 names &ere eventually allo&ed to board the fli(ht to Aos $n(eles, includin( petitioner Cesar

Kalamea. he t&o others, on the other hand, at o. 3:, bein( ran)ed lo&er than 55, &ere not able to fly. $s it

&ere, those holdin( full fare tic)ets &ere (iven first priority amon( the &aitlisted passen(ers. 1r. Kalamea, &ho

&as holdin( the fullfare tic)et of his dau(hter, &as allo&ed to board the plane &hile his &ife and dau(hter, &ho

presented the discounted tic)ets &ere denied boardin(. $ccordin( to 1r. Kalamea, it &as only later &hen he

discovered the he &as holdin( his dau(hterBs fullfare tic)et.

7ven in the ne+t ?$ fli(ht to Aos $n(eles 1rs. Kalamea and her dau(hter, could not be accommodated because

it &as also fully boo)ed. hus, they &ere constrained to boo) in another fli(ht and purchased t&o tic)ets from

$merican $irlines at a cost of ine @undred 7i(hteen %!".00' Dollars.

pon their arrival in the 2hilippines, petitioners filed an action for dama(es based on breach of contract of air

carria(e before the Re(ional rial Court of 1a)ati, 1etro 1anila, /ranch :9. $s aforesaid, the lo&er court ruled in

favor of petitioners in its decision 1 dated anuary !, !"! the dispositive portion of &hich states as follo&s-

?@7R7F;R7, *ud(ment is hereby rendered orderin( the defendant to pay plaintiffs thefollo&in( amounts-

%' S !".00, or its peso e


31/39

&hich &as also fully boo)ed. 1 he purchase of the $merican $irlines tic)ets by petitioners Suthira and Aiana dama(es and another 290,000.00 e+emplary dama(es &ould suffice under the circumstances obtainin( in th


32/39

&hich &as also fully boo)ed. he purchase of the $merican $irlines tic)ets by petitioners Suthira and Aiana

&as the conse&% *2&e, 'r$%7 o te Reo%$ Tr$ Co2rt SBt *2&7$ Reo%,S$% *o>e, %tG2eH T!E PEOPLE OF T!E P!ILIPPINES, repre>e%te& b4 te !o%or$be Pro7$ o%tG2eH $%& CRISTIN VE)FRI, respondents.

Co&elec Legal Assistance Office for petitioner.

Co&elec Legal Assistance Officer for private respondent.

FERNN, C.J.:

;n 1ay 3, !6!, herein petitioner 7ulo(io ;ccena instituted before the Second 1unicipal Circuit rial Court of

Sibalom, San Remi(io O /elison, 2rovince of $nti


33/39

of Sibalom, SanRemi(io/elison, 2rovince of $nti


34/39

2iestany, and lost his i))on camera.

In ovember !"", private respondent &rote to petitioner a letter demandin(- %' 20,000.00 cost of alle(edly lost

i))on camera %5' 500.00 for alle(ed cost of transportin( lu((a(e from ienna to 2iestany and %3' 200,000.00

as dama(es. In its reply, petitioner informed private respondent that his letter &as for&arded to its le(al

department for investi(ation.

2rivate respondent felt his demand letter &as left unheeded. @e instituted an action for Dama(es doc)eted as

Civil Case o. "!3:!# before the Re(ional rial Court of 1a)ati.

2etitioner contested the complaint. It disclaimed any liability on the (round that there &as neither a report of

mishandled ba((a(e on fli(ht 2R 655 nor a tracer tele+ received from its ienna Station. It, ho&ever, contended

that if at all liable its obli(ation is limited by the ?arsa& Convention rate.

2etitioner filed a hird2arty Complaint a(ainst Aufthansa German $irlines imputin( the mishandlin( of

private respondent Bs ba((a(e, but &as dismissed for its failure to prosecute.

In its decision, the trial court observed that petitionerBs actuation &as not attended by bad faith. evertheless, it

a&arded private respondent dama(es and attorneyBs fees, the dispositive portion of &hich reads-

?@7R7F;R7, *ud(ment is hereby rendered in favor of the plaintiff %private respondent' anda(ainst the defendant %petitioner', thereby orderin( the latter to pay the follo&in(-

%a' .S. 500.00 as cost of transportin( the suitcase fromienna to C4echoslova)ia

%b' 2:0,000.00 as moral dama(es

%c' 250,000.00 as e+emplary dama(es and%d' 29,000.00 as attorneyBs fees.

S; ;RD7R7D. 5

@ence, this petition for revie&.

In breach of contract of carria(e by air, moral dama(es are a&arded only if the defendant acted fraudulently or in

bad faith. 6 *ad fait" means a breach of a )no&n duty throu(h same motive of interest or ill &ill.

he trial court erred in a&ardin( moral dama(es to private respondent. he established facts evince that

petitionerBs late delivery of the ba((a(e for eleven %' days &as not motivated by ill &ill or bad faith. In fact, it

immediately coordinated &ith its Central /a((a(e Services to trace private respondentBs suitcase and succeeded

in findin( it. $t the hearin(, petitionerBs 1ana(er for $dministration of $irport Services Department 1i(uel 7bio

testified that their records disclosed that 1anila, the ori(inatin( station, did not receive any tracer tele+. 8 $ tracertele+, an airline lin(o, is an action of any station that the airlines operate from &hom a passen(er may complain or

have not received his ba((a(e upon his arrival. 9 It &as reasonable to presume that the handlin( of the ba((a(e&as normal and re(ular. pon in


35/39

+

+

+

nder the circumstances obtainin(, considerin( that defendant3s :petitioner3s; actuation was

not attendant wit" bad fait", the a&ard of moral dama(es in the amount of 2:0,000.00 is but

*ust and fair. 1+

/ad faith must be substantiated by evidence. In L*C vs. Court

of Appeals, 13 &e ruled-

/ad faith under the la& cannot be presumed it must be established by clear and convincin(evidence. $(ain, the unbro)en *urisprudence is that in breach of contract cases &here the

defendant is not sho&n to have acted fraudulently or in bad faith, liability for dama(es is

limited to the natural and probable conse


36/39

errors- I

@7 @;;R$/A7 C;R ;F $227$AS 7RR7D I ; @;ADIG @$ 27II;7RS @$7

S/S$I$AA=, C;12AI7D ?I@ @7 7R1S ;F @7IR $GR7717 ?I@ 2RI$7 R7S2;D7S.

II

@7 @;;R$/A7 C;R ;F $227$AS 7RR7D I @;ADIG @$ @7 C;R$C ; S7AA 1$= /7

$;1$IC$AA= R7SCID7D $D 2RI$7 R7S2;D7 1$= IA$7R$AA= R7SCID7D S$ID

C;R$C $D R77C @7 C;SIG$I; ;F 2$=17S 1$D7 /= 27II;7RS, ?@IC@ $CI;S

;F 2RI$7 R7S2;D7 $R7 @IG@A= IIEI;S $D C;SCI;$/A7.

III

@7 @;;R$/A7 C;R ;F $227$AS 7RR7D I ; @;ADIG @$ 2RI$7 R7S2;D7BS $C

;F F;RF7IIG $AA 2R7I;S 2$=17S 1$D7 /= 27II;7RS IS C;R$R= ; A$?, @IG@A=

IIEI;S $D C;SCI;$/A7. L2etitione rsB /rief, pp. 356.M

$s stated at the outset, the principal issue in this case is the le(ality of the rescission of the contract and the

forfeiture of the payments already made by petitioners.

o support the rescission and forfeiture private respondent falls bac) on para(raph 3 of the contract &hich

reads-

his contract shall be considered automatically rescinded and cancelled and of no further

force and effect, upon the failure of the endee to pay &hen due hree %3' or more

consecutive monthly installments mentioned in 2ara(raph 5 of this Contract, or to comply

&ith any of the terms and conditions hereof, in &hich case the endor shall have the ri(ht to

resell the said parcel of land to any endee and any amount derived from the sale on account

hereof shall be forfeited in favor of the endor as li


37/39

petitioners, the Court is convinced that the forfeiture of the amount of 29.00 althou(h it includes the accumulated

fines for petitionersB failure to construct a house as re


38/39

;A= 2aris>Geneva $ir France ;7D;RS$/A7 $AID

; $F ;A= Geneva>1adrid one

1adrid>ice $ir France ;7D;RS$/A7 $AID ; $F ;A=

ice>Rome $ir France ;7D;RS$/A7 $AID ;

$F ;A= Rome>$thens one

$thens>el $viv one

el $vive>/an()o) $ir France ;7D;RS$/A7 $AID ;

$F ;A= /an()o)>1anila $ir France ;7D;RS$/A7

$AID ; $F ;A= 1

?hile in e& =or), .S.$. on 3 ovember !66, private respondent 1orales obtained three %3' medical

certificates %7+hibits G, G, G5' attestin( to ear an infection &hich necessitated medical treatment. From e&

=or), he fle& to 2aris, Stoc)holm and then Copenha(en &here he made representations &ith petitionerBs office

to shorten his trip by deletin( some of the cities in the itinerary. Respondent 1orales &as informed that, as a

matter of procedure, confirmation of petitionerBs office in 1anila %as tic)etin( office' must be secured before

shortenin( of the route %already paid for'. $ir France in $msterdam tele+ed $F 1anila reRome $K

5! ov. ;H %$litalia' Rome>@on()on(

/$ 05 Dec. ;H %/ritish $ir&ays'

@on()on(>1anila 2R ;pen ;pen %2hilippine $irlines' 3

1ana(ement Corporation. Respondent 1orales &as advised to surrender the unused fli(ht coupons for a reof its value, but he )ept the same and, instead, filed a complaint for breach of contract of carria(e and dama

CFI ud(e 1arcelino Sayo found $ir France in evident bad faith for violation of the contract of carria(e,

a((ravated by the threatenin( attitude of its employees in @ambur(. Considerin( the social and economic

standin( of respondent, &ho is chairman of the board of directors of a multimillion corporati on and a mem

several civic and business or(ani4ations, an a&ard of moral and e+emplary dama(es, in addition to the actu

dama(es incurred, &as deemed proper under the circumstances. he dispositive part of the CFI decision st

?@7R7F;R7, this Court hereby renders *ud(ment for the plaintiff and orders the defen

to pay to the plaintiff the sum of ,!: German 1ar)s, in its e


39/39

nder the factual milieu, &as there really a breach of contract of carria(e on the part of the petitioner, as to *ustify

the a&ard to private respondent of actual, moral and e+emplary dama(es ?e find none.

International $ir ransportation $ssociation %I$$' Resolution o. 569 e, 5., special note reads- 8?here a fare is

restricted and such restrictions are not clearly evident from the reRestrictions8 bo+ of the applicable

fli(ht coupon%s' or attached thereto by use of an appropriate notice.8 oluntary chan(es to tic)ets, 8 &hileallo&able, are also covered by %I$$' Resolution o. 03, $rt. II, &hich provides- 8. chan(es to the tic)et

re

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