Torts and Damages Case Digest: Producer's Bank v. CA (2001)

G.R. No. 111584            September 17, 2001

Lessons Applicable: Factors in determining amount (Torts and Damages)

Laws Applicable: ART. 2208, Article 2232 of the Civil Code

FACTS:

• April, 1982: Salvador Chua was offered by Mr. Jimmy Rojas, manager of Producers Bank of the Philippines to transfer his account from Pacific Banking Corporation to Producers Bank.
• Chua did and was able to obtain a loan for P2,000,000 which was secured by a real estate mortgage and payable within a period of 3 years or from 1982 to 1985
• January 20, 1984: Chua deposited with Producers Bank P960,000 which was entered into their savings account passbook but failed to credit it because Sixto Castillo, absconded with the money.
• Producers Bank dishonored the checks drawn by Chua in favor of various creditors.  Although his balance was P1,051,051.19.
• Despite their request for copies of the bank's ledgers, it refused so Chua filed an action for damages.  
• October 15, 1984: Producer's Bank filed a petition for extrajudicial foreclosure of the real estate mortgage
• RTC: favored Chua ordering Producers to pay P2,000,000 moral damages, with legal rate of interest; P90,000/month and P18,000/month unrealized profits from his cement and gasoline station business, to commence from October 16, 1984, with legal rate of interest until fully paid; P250,000 exemplary damages.  Offset the P960,000 with his agricultural loan of P1,300,000 with 14% interest, to commence from January 4, 1984, covered by a real estate mortgage, both of which shall have a cut-off time frame on the date of this decision.  Loan of P175,000 and the clean loan of P400,000 without interest shall be off-settled by the moral, actual and compensatory damages. 15% of moral, actual and compensatory damages as attorney's fees. Cost of suit. 
• CA: modified moral damages to P500,000. P100,000.00 attorney's fees

ISSUE: W/N the award for damages is reasonable.

HELD: YES. affirmed with MODIFICATION. P300,000 moral damages. P150,000 exemplary damages. P100,000 attorney's fees and litigation expenses.

• Obviously, petitioner bank's wrongful act caused serious anxiety, embarrassment, and humiliation to private respondents for which they are entitled to recover moral damages in the amount of P300,000.00 which we deem to be reasonable
• Producer's bank failure to credit the deposit constituted gross negligence in the performance of its contractual obligation which amounts to evident bad faith
• Verily, all these acts of petitioner were accompanied by bad faith and done in wanton, fraudulent and malevolent manner warranting the award of exemplary damages in favor of private respondents, in accordance with Article 2232 of the Civil Code
• Need not prove the actual extent of exemplary damages, for its determination is addressed to the sound discretion of the court upon proof of the plaintiff's entitlement to moral, temperate, or compensatory damages (Article 2234, Civil Code)
• There are two kinds of actual or compensatory damages:
• loss of what a person already possesses
• failure to receive as a benefit that which would have pertained to him
• damages consisting of unrealized profits, frequently referred as "ganacias frustradas" or "lucrum cessans," are not to be granted on the basis of mere speculation, conjecture, or surmise, but rather by reference to some reasonably definite standard such as market value, established experienced, or direct inference from known circumstances
• When the existence of a loss is established, absolute certainty as to its amount is not required. The benefit to be derived from a contract which one of the parties has absolutely failed to perform is of necessity to some extent, a matter of speculation, but the injured party is not to be denied for that reason alone. He must produce the best evidence of which his case is susceptible and if that evidence warrants the inference that he has been damaged by the loss of profits which he might with reasonable certainty have anticipated but for the defendant's wrongful act, he is entitled to recover. 
• evidence of private respondents insufficient to be considered within the purview of "best evidence."
• The bare assertion of private respondent Salvador Chua that he lost an average of P18,000/month is inadequate if not speculative and should be admitted with extreme caution especially because it is not supported by independent evidence. 
• Could have presented such evidence as reports on the average actual profits earned by their gasoline business, their financial statements, and other evidence of profitability which could aid the court in arriving with reasonable certainty at the amount of profits which private respondents failed to earn. Did not even present any instrument or deed evidencing their claim that they have transferred their right to operate their gasoline station to their relatives. 
• Extrajudicial foreclosure is clearly unfounded, this does not necessarily mean, in the absence of specific facts proving damages, that actual damage has been sustained.  It must depend on actual proof of the damages alleged to have been suffered.
• Attorney's fees may be awarded when a party is compelled to litigate or to incur expenses to protect his interest by reason of an unjustified act of the other party
• act of not crediting private respondents' deposit of P960,000.00, as well as the premature filing of the extrajudicial foreclosure, have compelled private respondents to institute an action for injunction and damages primarily in order to protect their rights and interests 

Torts and Damages Case Digest: Lopez v. Pan American (1966)

G.R. No. L-20434            July 30, 1966

Lessons Applicable: Factors in determining amount (Torts and Damages)

Laws Applicable: 

FACTS:

• August 1, 1960: Pan American Employees Association staged a strike so Pan Am forced them to take a leave of absence without pay on February 22, 1961 to February 23, 1961
• court a quo: affected them financially and economically, it ordered Pan America to pay them their two days salaries
• CA: affirmed.

ISSUE: W/N the employees should be awarded back wages.

HELD: NO. AFFIRMED in so far as it declares petitioner Pan American World Airways, Inc. not guilty of unfair labor practice, but IS REVERSED in so far as it orders said petitioner to pay the members of the respondent labor union, Pan American Employees Association, their wages or salaries for February 22 and 23, 1961 when they were made by the petitioner to go on furlough. The petitioner is absolved from paying the said back wages. No pronouncement as to costs. It is so ordered.

• The dismiss employee is not entirely without remedy if his charge of unfair labor practice fails and his complaint dismissed, because the breach by the employer of the obligation to him may be redressed like an ordinary contract or obligation
• in placing its employees on furlough for two days, petitioner acted in good faith. The record shows that before laying them off it asked permission from the industrial court and only effected the furlough after said court authorized it to do so.
• the step taken by respondent was necessary to protect its interest whose business is mainly dependent on the flight of its planes," giving as additional reason that "lack of work as a cause of lay-off is justified.
• Inasmuch as petitioner acted in good faith, it should not be ordered to pay back wages to its laid off employees. 
• not paid their wages for only two days, We do not believe that the same would place them in such a financial and economic distress as to warrant the award of their back wages

Torts and Damages Case Digest: Sumaplong v. CA (1997)

G.R. No. 123404  February 26, 1997

Lessons Applicable: Factors in determining amount (Torts and Damages)

Laws Applicable: 

FACTS:

• August 6, 1982: Arsolo Ramos and his wife Leonarda were on their way home from their ricefield when Aurelio Sumalpong asked Leonarda if she knew who stoned his house. Leonarda told him to determine first who did it.  But, Aurelio angered slapped Leonarda causing her to fall to the ground and while on her hands and knees shot her on the back of her head with a .38 caliber revolver killing her. 
• Arsolo rushed towards Aurelio who shot him twice but missed.  While grappling, Aurelio bit Arsolo's forearm and left ear causing a mutilation.
• RTC: convicting the Aurelio of the crime of attempted homicide and sentenced him to suffer the penalty of imprisonment from 6 months and 1 day of arresto mayor as minimum to 2 years, 4 months and 1 day of prision correccional as maximum. The petitioner was likewise ordered to indemnify the complainant in the amount of: (a) P16,800 for the loss of his crops due to his failure to attend to his farmwork because of the injuries inflicted upon him by the petitioner; (b) P2,000 for hospitalization expenses and (c) P5,000 by way of moral damages
• CA: increased moral damages to P10,000 and adding nominal damages P10,000

ISSUE: W/N the award for damages is proper.

HELD: YES. CA affirmed.

• 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.
• whenever there has been a violation of an ascertained legal right, although no actual damages resulted or none are shown, the award of nominal damages is proper
• in the absence of competent proof of the amount of actual damages,  the complainant is entitled only to nominal damages.
• Anent the increase in the amount of moral damages suffice it to state that the nature of the injuries and the degree of physical suffering endured by the complainant warrants the same. The tragic incident caused a mutilation of complainant's left ear and a permanent scar on his right forearm. These injuries have left indelible marks on the complainant's body and will serve as a constant reminder of this traumatic experience.

Torts and Damages Case Digest: Philippine Airlines v. CA (1997)

G.R. No. 120262  July 17, 1997

Lessons Applicable: Factors in determining amount (Torts and Damages)

Laws Applicable: 

FACTS:

• October 23, 1988: Pantejo, then City Fiscal of Surigao City, boarded a PAL plane in Manila and disembarked in Cebu City where he was supposed to take his connecting flight to Surigao City.  But, due to typhoon Osang, the connecting flight to Surigao City was cancelled.  
• PAL gave out cash assistance of P100 and P200 the next day.  
• Pantejo requested instead that he be billeted in a hotel at PAL’s expense because he did not have cash with him at that time, but PAL refused.  He instead shared with a co-passenger Andoni Dumlao and stayed at Sky View Hotel with the promise to pay his share of the expenses upon reaching Surigao
• October 25, 1988: Pantejo discovered that co-passangers Superintendent Ernesto Gonzales and Mrs. Gloria Rocha, an auditor of the Philippine National Bank were reimbursed by PAL for their hotel stay.
• He told Oscar Jereza, PAL’s Manager for Departure Services that he will sue for discrimination and it was then that he offered P300.
• RTC: Ordered PAL to pay P300 actual damages, P150,000 moral damages, P100,000 exemplary damages, P15,000 attorney’s fees, and 6% interest from the time of the filing of the complaint until paid, plus costs of suit
• CA: affirmed but deleted attorney’s fees and litigation expenses

ISSUE: W/N PAL was in bad faith so award for damages is proper

HELD: YES.  AFFIRMED, subject to the MODIFICATION regarding the computation of the 6% legal rate of interest on the monetary awards

• No compelling or justifying reason was advanced for such discriminatory and prejudicial conduct.  More importantly, it has been sufficiently established that it is petitioner’s standard company policy, whenever a flight has been cancelled, to extend to its hapless passengers cash assistance or to provide them accommodations in hotels with which it has existing tie-ups.
• PAL acted in bad faith in disregarding its duties as a common carrier to its passengers and in discriminating Pantejo.  He was exposed to humiliation and embarrassment especially because of his government position and social prominence, which altogether necessarily subjected him to ridicule, shame and anguish.  His refusal to accept the P300.00 proffered as an afterthought when he threatened suit was justified by his resentment when he belatedly found out that his co-passengers were reimbursed for hotel expenses and he was not.  The discriminatory act of petitioner against respondent ineludibly makes the former liable for moral damages under Article 21 in relation to Article 2219 (10) of the Civil Code.
• Under the peculiar circumstances of this case, we are convinced that the awards for actual, moral and exemplary damages granted in the judgment of respondent court, for the reasons meticulously analyzed and thoroughly explained in its decision, are just and equitable. 
• interest of 6% imposed by respondent court should be computed from the date of rendition of judgment and not from the filing of the complaint

Torts and Damages Case Digest: Fule v. CA (1998)

G.R. No. 112212  March 2, 1998

Lessons Applicable: Factors in determining amount (Torts and Damages)

Laws Applicable: 

FACTS:

• Gregorio Fule acquired a 10-hectare property in Tanay, Rizal and mortgaged it with Rural Bank of Alaminos  to secure a loan in the amount of P10,000 to secure a loan in the amount of P10,000
• July 1984: Gregorio Fule asked Remelia Dichoso and Oliva Mendoza to look for a buyer who might be interested in the Tanay property.  Fule was interested to buy the emerald-cut diamond earrings of Dr. Cruz so he tried to negotiate it for a barter but it cannot be ensued since the 1-year redemption period was yet to expire. 
• To cut through any legal impediment, Fule issued a deed of redemption on behalf of Fr. Jacobe  for P15,987.78 who sold the property to Fule for P75,000
• Atty. Belarmino to finally execute a deed of absolute sale while Fule signed the deed and gave P13,700 for necessary expenses to be incurred by the transfer.  They also executed a certificate that the actual consideration of the sale was  P200,000 and not P80,000.  The lower value was for the purpose of lowering the capital gains tax.  Since the jewelry was appraised only at P160,000.00, the parties agreed that the balance of P40,000.00 would just be paid later in cash.  For services rendered, Fule paid the agents, Dichoso and Mendoza, the amount of US$300 and some pieces of jewelry
• Soon, Fule applied the tester and alleged that the jewelry was fake.  He went to Dichoso and Mendoza to take back what she had given them and went to report to the police.
• Fule filed a complaint to the RTC for the contract of sale over the Tanay property be declared null and void on the ground of fraud and deceit.
• RTC issued a TRO.
• RTC: Fule reported it 2 hours later is considered unreasonable delay and finding him with wanton bad faith so award of attorney's fees was warranted. Dra. Cruz runs her own hospital and defendant Belarmino is a well respected legal practitioner so their reputations were besmirched.
• CA: affirmed

ISSUE: W/N attorney's fees should be awarded.

HELD: YES. CA affirmed. Ordered to pay P40,000 balance.

• It was in fact Fule who resorted to machinations to convince Dr. Cruz to exchange her jewelry for the Tanay property
• Moral and exemplary damages may be awarded without proof of pecuniary loss. In awarding such damages, the court shall take into account the circumstances obtaining in the case said assess damages according to its discretion. To warrant the award of damages, it must be shown that the person to whom these are awarded has sustained injury. He must likewise establish sufficient data upon which the court can properly base its estimate of the amount of damages. Statements of facts should establish such data rather than mere conclusions or opinions of witnesses.
• While, as a rule, moral damages cannot be recovered from a person who has filed a complaint against another in good faith because it is not sound policy to place a penalty on the right to litigate, the same, however, cannot apply in the case at bar. The factual findings of the courts a quo to the effect that petitioner filed this case because he was the victim of fraud; that he could not have been such a victim because he should have examined the jewelry in question before accepting delivery thereof, considering his exposure to the banking and jewelry businesses; and that he filed the action for the nullification of the contract of sale with unclean hands, all deserve full faith and credit to support the conclusion that petitioner was motivated more by ill will than a sincere attempt to protect his rights in commencing suit against respondents.  
• He had rather placed himself in a situation from which it preponderantly appears that his seeming ignorance was actually just a ruse.  It must be noted that before petitioner was able to convince Dr. Cruz to exchange her jewelry for the Tanay property, petitioner took pains to thoroughly examine said jewelry, even going to the extent of sketching their appearance. Why at the precise moment when he was about to take physical possession thereof he failed to exert extra efforts to check their genuineness despite the large consideration involved has never been explained at all by petitioner. His acts thus failed to accord with what an ordinary prudent man would have done in the same situation. Being an experienced banker and a businessman himself who deliberately skirted a legal impediment in the sale of the Tanay property and to minimize the capital gains tax for its exchange, it was actually gross recklessness for him to have merely conducted a cursory examination of the jewelry when every opportunity for doing so was not denied him. Apparently, he carried on his person a tester which he later used to prove the alleged fakery but which he did not use at the time when it was most needed. Furthermore, it took him two more hours of unexplained delay before he complained that the jewelry he received were counterfeit. Hence, we stated earlier that anything could have happened during all the time that petitioner was in complete possession and control of the jewelry, including the possibility of substituting them with fake ones, against which respondents would have a great deal of difficulty defending themselves. The truth is that petitioner even failed to successfully prove during trial that the jewelry he received from Dr. Cruz were not genuine. 
  

Torts and Damages Case Digest: PNB v. CA (1997)

G.R. No. 118357    May 6, 1997
Lessons Applicable: Factors in determining amount (Torts and Damages)

Laws Applicable: 

FACTS:

• Industrial Enterprises, Inc. (IEI) entered into a coal operating contract with the Bureau of Energy Development (BED) with Cabarrus and then Minister of Energy Geronimo Velasco as signatories.  IEI found 3 newly-discovered coal blocks and applied it for conversion.  But instead it was awarded to Marinduque Mining and Industrial Corporation (MMIC).  
• Consequently, IEI made written demands to MMIC, pursuant to the MOA, for the reimbursement of all costs and expenses it had incurred on the project which, as of July 31, 1983, had amounted to P31.66 million as audited by the Sycip, Gorres and Velayo Company
• IEI filed a complaint alleging that MMIC acted in gross and evident bad faith in entering into the MOA when it had no intention at all to operate the 2 coal blocks and of complying with any of its obligations under the said agreement
• July 13, 1981: MMIC entered into a Mortgage Trust Agreement in favor of PNB and DBP.  MMIC defaulted in the payment of its loan obligation.
• August 15, 1984: IEI advised PNB and DBP that it had assigned to MMIC per the MOA were still unpaid but still foreclosure sale proceeded.
• IEI filed a rescission of the assignment of the Giporlos Coal Project to MMIC before the RTC impleading PNB and DBP
• RTC: granted. PNB is equally guilty of bad faith because it was advised beforehand that the heavy equipment and movable property which are part of the Giporlos Coal Project were still unpaid.  MMIC and PNB jointly and solidarily liable to pay moral damages P300,000,exemplary damages P200,000 and P200,000 attorney's fees
• CA: reversed.  IEI's claim against PNB for actual, consequential and moral damages including attorney's fees, litigation expenses and costs of suit, has neither legal nor factual bases.

ISSUE: W/N PNB should be liable for damages.

HELD: NO.  REVERSED and SET ASIDE insofar as it renders petitioner solidarily liable with Marinduque Mining and Industrial Corporation for damages and AFFIRMED insofar as it nullifies the foreclosure sale of August 31, 1984

• In view of the noninvolvement of petitioner in the alleged conspiracy to strip private respondent of the its rights over the Giporlos Project, petitioner cannot be made solidarily liable with the MMIC for damages. However, although petitioner's rights to foreclose the mortgage and to subject the equipment of private respondent to the foreclosure sale are unassailable, we find that the foreclosure proceedings fell short of the requirements of the law.

Torts and Damages Case Digest: Valenzuela v. CA (1996)

G.R.No. 115024  February 7, 1996
Lessons Applicable: 

• Calculation of Risk (Torts and Damages)
• Factors in Determining Amount (Torts and Damages)

FACTS:

• June 24, 1990 2 am: While driving from her restaurant at Araneta avenue towards the direction of Manila, Ma. Lourdes Valenzuela noticed that she had a flat tire so she parked along the sidewalk about 1 1/2 feet away, place her emergency lights and seeked help
• She was with her companion Cecilia Ramon
• While she was pointing her tools to the man who will help her fixed the tires, she was suddenly hit by another Mitsubishi Lancer driven by Richard Li who was intoxicated and she slammed accross his windshield and fell to the ground
• She was sent to UERM where she stayed for 20 days and her leg was amputated and was replaced with an artificial one.
• Her expenses totalled 147, 000 [120,000 php (confinement) + 27, 000 (aritificial leg)]
• RTC: Richard Li guilty of gross negligence and liable for damages under Article 2176 of the Civil Code. Alexander Commercial, Inc., Li’s employer, jointly and severally liable for damages pursuant to Article 2180 P41,840 actual damages, P37,500 unrealized profits because of the stoppage of plaintiffs Bistro La Conga restaurant 3 weeks after the accident on June 24, 1990, P20,000 a month as unrealized profits of Bistro La Conga restaurant, from August, 1990 until the date of this judgment, P30,000.00, a month, for unrealized profits in 2 Beauty salons, P1,000,000 in moral damages, P50,000, as exemplary damages, P60,000, as reasonable attorney’s fees and costs.
• CA: there was ample evidence that the car was parked at the side but absolved Li's employer
• Li: 55 kph - self serving and uncorraborated
• Rogelio Rodriguez, the owner-operator of an establishment located just across the scene of the accident: Valenzuela’s car parked parallel and very near the sidewalk and Li was driving on a very fast speed and there was only a drizzle (NOT heavy rain)

ISSUE: 

1. W/N Li was driving at 55 kph - NO

2. W/N Valenzuela was guilty of contributory negligence - NO

3. W/N Alexander Commercial, Inc. as Li's employer should be held liable - YES
4. W/N the awarding of damages is proper. - YES.

HELD: CA modified with reinstating the RTC decision

1. NO

• If Li was running at only about 55 kph then despite the wet and slippery road, he could have avoided hitting the Valenzuela by the mere expedient or applying his brakes at the proper time and distance
• it was not even necessary for him to swerve a little to the right in order to safely avoid a collision with the on-coming car since there is plenty of space for both cars, since Valenzuela car was running at the right lane going towards Manila and the on-coming car was also on its right lane going to Cubao

2. NO.

• Contributory negligence is conduct on the part of the injured party, contributing as a legal cause to the harm he has suffered, which falls below the standard to which he is required to conform for his own protection
• emergency rule
• an individual who suddenly finds himself in a situation of danger and is required to act without much time to consider the best means that may be adopted to avoid the impending danger, is not guilty of negligence if he fails to undertake what subsequently and upon reflection may appear to be a better solution, unless the emergency was brought by his own negligence
• She is not expected to run the entire boulevard in search for a parking zone or turn on a dark Street or alley where she would likely find no one to help her
• She stopped at a lighted place where there were people, to verify whether she had a flat tire and to solicit help if needed
• she parked along the sidewalk, about 1½ feet away, behind a Toyota Corona Car

3. YES.

• Not the principle of respondeat superior, which holds the master liable for acts of the servant (must be in the course of business), but that of pater familias, in which the liability ultimately falls upon the employer, for his failure to exercise the diligence of a good father of the family in the selection and supervision of his employees
• Ordinarily, evidence demonstrating that the employer has exercised diligent supervision of its employee during the performance of the latter‘s assigned tasks would be enough to relieve him of the liability imposed by Article 2180 in relation to Article 2176 of the Civil Code. 
• situation is of a different character, involving a practice utilized by large companies with either their employees of managerial rank or their representatives.
• Moreover, Li’s claim that he happened to be on the road on the night of the accident because he was coming from a social visit with an officemate in Parañaque was a bare allegation which was never corroborated in the court below. It was obviously self-serving. Assuming he really came from his officemate’s place, the same could give rise to speculation that he and his officemate had just been from a work-related function, or they were together to discuss sales and other work related strategies.
• Alexander Commercial, Inc. has not demonstrated, to our satisfaction, that it exercised the care and diligence of a good father of the family in entrusting its company car to Li

4. YES.

• As the amount of moral damages are subject to this Court’s discretion, we are of the opinion that the amount of P1,000,000.00 granted by the trial court is in greater accord with the extent and nature of the injury -. physical and psychological - suffered by Valenzuela as a result of Li’s grossly negligent driving of his Mitsubishi Lancer in the early morning hours of the accident.
• the damage done to her would not only be permanent and lasting, it would also be permanently changing and adjusting to the physiologic changes which her body would normally undergo through the years. The replacements, changes, and adjustments will require corresponding adjustive physical and occupational therapy. All of these adjustments, it has been documented, are painful.