CHAPTER 9 SCALE OF DAMAGES

DUTY OF INJURED PARTY

RULES
CRIMES
PEOPLE V. NARVAEZ 121 scra 394
ACTS: Mamerto Narvaez has been convicted of murder
(qualified by treachery) of David Fleischer and Flaviano Rubia.
On August 22, 1968, Narvaez shot Fleischer and Rubia during
the time the two were constructing a fence that would prevent
Narvaez from getting into his house and rice mill. The
defendant was taking a nap when he heard sounds of
construction and
found fence being made. He addressed the group and asked
them to stop destroying his house and asking if they could
talk things over. Fleischer responded with "No, gadamit,
proceed, go
ahead." Defendant lost his "equilibrium," and shot Fleisher
with his shotgun. He also shot Rubia who was running towards
the jeep where the deceased's gun was placed. Prior to the
shooting, Fleischer and Co. (the company of Fleischer's family)
was involved in a legal battle with the defendant and other
land settlers of Cotabato over certain pieces of property. At
the time
of the shooting, the civil case was still pending for annulment
(settlers wanted granting of property to Fleisher and Co. to be
annulled). At time of the shooting, defendant had leased his
property from Fleisher (though case pending and ownership
uncertain) to avoid trouble. On June 25, defendant received
letter terminating contract because he allegedly didn't pay
rent.
He was given 6 months to remove his house from the land.
Shooting was barely 2 months after letter. Defendant claims
he killed in defense of his person and property. CFI ruled that
Narvaez was guilty. Aggravating circumstances of evident
premeditation offset by the mitigating circumstance of
voluntary surrender. For both murders, CFI sentenced him to
reclusion perpetua, to indemnify the heirs, and to pay for
moral damages.
ISSUES:
1. Whether or not CFI erred in convicting defendant-appellant
despite the fact that he acted in defense of his person.
No. The courts concurred that the fencing and chiselling of the
walls of the house of the defendant was indeed a form of
aggression on the part of the victim. However, this
aggression was not done on the person of the victim but
rather on his rights to property. On the first issue, the courts
did not err. However, in consideration of the violation of
property rights, the courts referred to Art. 30 of the civil code
recognizing the right of owners to close and fence their land.
Although is not in dispute, the victim was not in the position to
subscribe to the article because his ownership of the land
being awarded by the government was still pending, therefore
putting ownership into question. It is accepted that the victim
was the original aggressor.
ON he should be liable for subsidiary imprisonment since he is
unable to pay the civil indemnity due to the offended party.
No. He is not liable to be subsidiarily imprisoned for
nonpayment of civil indemnity. RA 5465 made the provisions
of Art. 39 applicable to fines only and not to reparation of
damage caused, indemnification of consequential damages
and costs of proceedings. Although it was enacted only after
its conviction, considering that RA 5465 is favorable to the
accused who is not a habitual delinquent, it may be given
retroactive effect pursuant to Art. 22 of the RPC.
Judgment: Defendant guilty of homicide but w/ mitigating
circumstances and extenuating circumstance of incomplete
self defense. Penalty is 4 months arresto mayor and to
indemnify
each group of heirs 4,000 w/o subsidiary imprisonment and
w/o award for moral damages. Appellant has already been
detained 14 years so his immediate release is ordered.
question is, was the aggression unlawful or lawful? Did the
victims have a right to fence off the contested property, to

destroy appellant's house and to shut off his ingress and

egress to his residence and the highway?
In the case at bar, there was an actual physical invasion of
appellant's property which he had the right to resist, pursuant
to Art. 429 of the Civil Code of the Philippines which provides:
The reasonableness of the resistance is also a requirement of
the justifying circumstance of self-defense or defense of one's
rights under paragraph 1 of Article 11, Revised Penal Code.
When the appellant fired his shotgun from his window, killing
his two victims, his resistance was disproportionate to the
attack.
WE find, however, that the third element of defense of
property is present, i.e., lack of sufficient provocation on the
part of appellant who was defending his property. As a matter
of fact, there was no provocation at all on his part, since he
was asleep at first and was only awakened by the noise
produced by the victims and their laborers. His plea for the
deceased and their men to stop and talk things over with him
was no provocation at all.
Be that as it may, appellant's act in killing the deceased was
not justifiable, since not all the elements for justification are
present. He should therefore be held responsible for the death
of his victims, but he could be credited with the special
mitigating circumstance of incomplete defense, pursuant to
paragraph 6, Article 13 of the Revised Penal Code.
The civil liability of the appellant should be modified. In the
case of Zulueta vs. Pan American World Airways (43 SCRA
397), the award for moral damages was reduced because the
plaintiff contributed to the gravity of defendant's reaction. In
the case at bar, the victims not only contributed but they
actually provoked the attack by damaging appellant's
properties and business. Considering appellant's standing in
the community, being married to a municipal councilor, the
victims' actuations were apparently designed to humiliate him
and destroy his reputation. The records disclose that his wife,
councilor Feliza Narvaez, was also charged in these two cases
and detained without bail despite the absence of evidence
linking her to the killings. She was dropped as a defendant
only upon motion of the prosecution dated October 31, 1968.
(p. 14, CFI rec. of Crim. Case No. 1816), but acted upon on
November 4, 1968 (p. 58, CFI rec. of Criminal Case No. 1815).
Since in the case at bar, there was no direct evidence of the
planning or preparation to kill the victims nor that the accused
premeditated the killing, and clung to his premeditated act,
the trial court's conclusion as to the presence of such
circumstance may not be endorsed.
These circumstances, coming so near to the time when his
first house was dismantled, thus forcing him to transfer to his
only remaining house, must have so aggravated his
obfuscation that he lost momentarily all reason causing him to
reach for his shotgun and fire at the victims in defense of his
rights. Considering the antecedent facts of this case, where
appellant had thirty years earlier migrated to this so-called
"land of promise" with dreams and hopes of relative
prosperity and tranquility, only to find his castle crumbling at
the hands of the deceased, his dispassionate plea going
unheeded-all these could be too much for any man-he should
be credited with this mitigating circumstance.
Consequently, appellant is guilty of two crimes of homicide
only, the killing not being attended by any qualifying nor
aggravating circumstance, but extenuated by the privileged
mitigating circumstance of incomplete defense-in view of the
presence of unlawful aggression on the part of the victims and
lack of sufficient provocation on the part of the appellant-and
by two generic mitigating circumstance of voluntary surrender
and passion and obfuscation.
Article 249 of the Revised Penal Code prescribes the penalty
for homicide as reclusion temporal. Pursuant to Article 69,
supra, the penalty lower by one or two degrees shall be
imposed if the deed is not wholly excusable by reason of the
lack of some of the conditions required to justify the same.
Considering that the majority of the requirements for defense
of property are present, the penalty may be lowered by two
degrees, i.e., to prision correccional And under paragraph 5 of
Article 64, the same may further be reduced by one degree,

i.e., arresto mayor, because of the presence of two mitigating

circumstances and no aggravating circumstance.
QUASI DELICTS
CONTRACTS, QUASI-CONTRACTS
LIQUIDATED DAMAGES
APPROXIMATION OF EMOTIONAL OR MORAL INJURY
PHILIPPINE COMMERCIAL AND INDUSTRIAL BANK V.
ALEJANDRO
petitioner filed against respondent a complaint[3] for sum of
money with prayer for the issuance of a writ of preliminary
attachment. Said complaint alleged that on September 10,
1997, respondent, a resident of Hong Kong, executed in favor
of petitioner a promissory note obligating himself to pay
P249,828,588.90 plus interest. In view of the fluctuations in
the foreign exchange rates which resulted in the insufficiency
of the deposits assigned by respondent as security for the
loan, petitioner requested the latter to put up additional
security for the loan. Respondent, however, sought a
reconsideration of said request pointing out petitioners
alleged mishandling of his account due to its failure to carry
out his instruction to close his account as early as April 1997,
when the prevailing rate of exchange of the US Dollar to
Japanese yen was US$1.00:JPY127.50.[4] It appears that the
amount of P249,828,588.90 was the consolidated amount of a
series of yen loans granted by petitioner to respondent during
the months of February and April 1997.[5]
In praying for the issuance of a writ of preliminary attachment
under Section 1 paragraphs (e) and (f) of Rule 57 of the Rules
of Court, petitioner alleged that (1) respondent fraudulently
withdrew his unassigned deposits notwithstanding his verbal
promise to PCIB Assistant Vice President Corazon B.
Nepomuceno not to withdraw the same prior to their
assignment as security for the loan; and (2) that respondent is
not a resident of the Philippines. The application for the
issuance of a writ was supported with the affidavit of
Nepomuceno
In light of the foregoing, the Court of Appeals properly
sustained the finding of the trial court that petitioner is liable
for damages for the wrongful issuance of a writ of attachment
against respondent.
Anent the actual damages, the Court of Appeals is correct in
not awarding the same inasmuch as the respondent failed to
establish the amount garnished by petitioner. It is a well
settled rule that one who has been injured by a wrongful
attachment can recover damages for the actual loss resulting
therefrom. But for such losses to be recoverable, they must
constitute actual damages duly established by competent
proofs, which are, however, wanting in the present case.[36]
Nevertheless, nominal damages may be awarded to a plaintiff
whose right has been violated or invaded by the defendant,
for the purpose of vindicating or recognizing that right, and
not for indemnifying the plaintiff for any loss suffered by him.
Its award is thus not for the purpose of indemnification for a
loss but for the recognition and vindication of a right. Indeed,
nominal damages are damages in name only and not in fact.
[37] They are recoverable where some injury has been done
but the pecuniary value of the damage is not shown by
evidence and are thus subject to the discretion of the court
according to the circumstances of the case.[38]
In this case, the award of nominal damages is proper
considering that the right of respondent to use his money has
been violated by its garnishment. The amount of nominal
damages must, however, be reduced from P2 million to
P50,000.00 considering the short period of 2 months during
which the writ was in effect as well as the lack of evidence as
to the amount garnished.
Likewise, the award of attorneys fees is proper when a party is
compelled to incur expenses to lift a wrongfully issued writ of
attachment. The basis of the award thereof is also the amount
of money garnished, and the length of time respondents have
been deprived of the use of their money by reason of the

wrongful attachment.[39] It may also be based upon (1) the

amount and the character of the services rendered; (2) the
labor, time and trouble involved; (3) the nature and
importance of the litigation and business in which the services
were rendered; (4) the responsibility imposed; (5) the amount
of money and the value of the property affected by the
controversy or involved in the employment; (6) the skill and
the experience called for in the performance of the services;
(7) the professional character and the social standing of the
attorney; (8) the results secured, it being a recognized rule
that an attorney may properly charge a much larger fee when
it is contingent than when it is not.[40]
All the aforementioned weighed, and considering the short
period of time it took to have the writ lifted, the favorable
decisions of the courts below, the absence of evidence as to
the professional character and the social standing of the
attorney handling the case and the amount garnished, the
award of attorneys fees should be fixed not at P1 Million, but
only at P200,000.00.
The courts below correctly awarded moral damages on
account of petitioners misrepresentation and bad faith;
however, we find the award in the amount of P5 Million
excessive. Moral damages are to be fixed upon the discretion
of the court taking into consideration the educational, social
and financial standing of the parties.[41] Moral damages are
not intended to enrich a complainant at the expense of a
defendant.[42] They are awarded only to enable the injured
party to obtain means, diversion or amusements that will
serve to obviate the moral suffering he has undergone, by
reason of petitioners culpable action. Moral damages must be
commensurate with the loss or injury suffered. Hence, the
award of moral damages is reduced to P500,000.00.

Considering petitioners bad faith in securing the writ of

attachment, we sustain the award of exemplary damages by
way of example or correction for public good. This should
deter parties in litigations from resorting to baseless and
preposterous allegations to obtain writs of attachments. While
as a general rule, the liability on the attachment bond is
limited to actual (or in some cases, temperate or nominal)
damages, exemplary damages may be recovered where the
attachment was established to be maliciously sued out.[43]
Nevertheless, the award of exemplary damages in this case
should be reduced from P5M to P500,000.00.
Finally, contrary to the claim of petitioner, the instant case for
damages by reason of the invalid issuance of the writ,
survives the dismissal of the main case for sum of money.
Suffice it to state that the claim for damages arising from such
wrongful attachment may arise and be decided separately
from the merits of the main action.
CHAPTER 10 MISCELLANEOUS RULES AND JURISPRUDENCE
DAMAGES THAT CANNOT CO-EXIST
NOMINAL DAMAGES W/ OTHER DAMAGES
ARMOVIT V. CA
petitioners decided to spend their Christmas holidays with
relatives and friends in the Philippines, so they purchased
from private respondent, (Northwest Airlines, Inc.) three (3)
round trip airline tickets from the U.S. to Manila and back, plus
three (3) tickets for the rest of the children, though not
involved in the suit. Each ticket of the petitioners which was in
the handwriting of private respondent's tickets sales agent
contains the following entry on the Manila to Tokyo portion of
the return flight:
from Manila to Tokyo, NW flight 002, date 17 January, time
10:30 A.M. Status, OK. 1
On their return trip from Manila to the U.S. scheduled on
January 17, 1982, petitioner arrived at the check-in counter of
private respondent at the Manila International Airport at 9:15
in the morning, which is a good one (1) hour and fifteen (15)
minutes ahead of the 10:30 A.M. scheduled flight time recited
in their tickets. Petitioners were rudely informed that they

cannot be accommodated inasmuch as Flight 002 scheduled

at 9:15 a.m. was already taking off and the 10:30 A.M. flight
time entered in their plane tickets was erroneous.
Previous to the said date of departure petitioners re-confirmed
their reservations through their representative Ernesto
Madriaga who personally presented the three (3) tickets at the
private respondent's Roxas Boulevard office. 2 The departure
time in the three (3) tickets of petitioners was not changed
when re-confirmed. The names of petitioners appeared in the
passenger manifest and confirmed as Passenger Nos. 306,
307, and 308, Flight 002. 3
Herein petitioner Dr. Armovit protested in extreme agitation
that because of the bump-off he will not be able to keep his
appointments with his patients in the U.S. Petitioners suffered
anguish, wounded feelings, and serious anxiety day and night
of January 17th until the morning of January 18th when they
were finally informed that seats will be available for them on
the flight that day.
However, there is no question that appellant acted with
negligence in not informing appellees about the change of
hour of departure. To provide an example or correction for the
public good, therefore, the award of exemplary damages is
proper (Art. 2229 & 2231 Civil Code; Lopez v. Pan American
World Airways, 16 SCRA 431; Prudenciado vs. Alliance
Transport, 148 SCRA 440). Nonetheless, the awards granted
by the trial court are far too exhorbitant and excessive
compared to the actual loss of P1,300.00. The authority of the
Court of Appeals to modify or change the amounts of awards
has been upheld in a long line of decisions. We reduce the
award of exemplary damages from P500,000.00 to
P100,000.00 in favor of Dr. Herman Armovit, from
P500,000.00 to P50,000.00 in favor of Mrs. Dora Armovit; and
from P300,000.00 to P20,000.00 in favor of Miss Jacqueline
Armovit. (Gellada vs. Warner Barnes, 57 O.G. (4) 7347, Sadie
vs. Bachrach, 57 O.G. (4) 636, Prudenciado vs. Alliance
Transport, supra). The award of nominal damages has to be
eliminated since we are already awarding actual loss. Nominal
damages cannot co-exist with actual or compensatory
damage
Because of the refusal of the private respondent to heed the
repeated demands of the petitioners for compensatory
damages arising from the aforesaid breach of their airtransport contracts, 4 petitioners were compelled to file an
action for damages in the Regional Trial Court of Manila.
By the same token to provide an example for the public good,
an award of exemplary damages is also proper. 14 The award
of the appellate court is adequate.
Nevertheless, the deletion of the nominal damages by the
appellate court is well-taken since there is an award of actual
damages. Nominal damages cannot co-exist with actual or
compensatory damages. 15
ACTUAL AND LIQUIDATED DAMAGES
DAMAGES THAT MUST CO-EXIST
EXEMPLARY W/ MD, TD, LD, CD
DAMAGES THAT MUST STAND ALONE
NOMINAL DAMAGES
JURISDICTION ON DAMAGES IN LABOR CASES
RODRIGUEZ JR V. AGUILAR
Petitioners are members of the Board of Directors of Philippine
Postal Savings Bank, Inc. (PPSBI) at Liwasang Bonifacio,
Manila; private respondent Antonio L. Aguilar was employed
as Vice President of its Finance and Administrative Group from
February 14, 2000 to January 31, 2001, and thereafter as
Compliance Officer until September 26, 2001 when his
services were terminated.
On October 25, 2001, private respondent filed a complaint
against petitioners with the Regional Trial Court, Branch 49,
City of Manila alleging that he was illegally dismissed by the
petitioners in an oppressive way; that the cause of his
dismissal was his principled act of exposing anomalies in the
bank; that considering the seriousness of the violations of
internal control and bank policies, there is a need to prohibit
petitioners from performing their functions as members of the
Board in their own personal capacity. He prayed for the award
of damages, the issuance of a temporary restraining order

enjoining the petitioners from dismissing him or in the

alternative, to immediately reinstate him, and the prohibition
of the petitioners from performing their personal and official
acts in the bank.
On October 29, 2001, public respondent Judge motu proprio
dismissed the complaint for lack of jurisdiction stating that
jurisdiction over the case lies with the Labor Arbiter of the
National Labor Relations Commission.
Unaware of the dismissal[,] petitioners, on November 9, 2001,
filed a Motion to Dismiss private respondents complaint on the
ground of the RTCs lack of jurisdiction over the subject matter
of the complaint.
On November 12, 2001, private respondent filed a Motion for
Reconsideration of the Order dated 29 October 2001.
However, on November 26, 2001, he filed an Ex-Parte Motion
to Withdraw Motion For Reconsideration of the Dismissal Order
and In Lieu Thereof to Submit Amended Complaint, which was
attached thereto. In his Amended Complaint, he emphasized
that his dismissal (constructive and actual) was done in a very
oppressive manner. His prayer for reinstatement was deleted.
In an Order dated January 4, 2002, public respondent Judge
admitted the Amended Complaint reasoning that amendment
was a matter of right before defendants filed a responsive
pleading, the motion to dismiss not being a responsive
pleading. Petitioners were ordered to file their Answer within
fifteen (15) days from receipt thereof.
On January 30, 2002, without filing a Motion for
Reconsideration of the above Order, petitioners again filed a
Motion to Dismiss, this time of the Amended Complaint, on
the ground of lack of jurisdiction over the persons of the
petitioners and over the subject matter of the claim.
In an Order dated February 8, 2002, public respondent Judge
ruled that petitioners filing of the above Motion to Dismiss was
tantamount to a voluntary appearance through a pleading
that vested the court with jurisdiction over their persons.
Petitioners were given an additional ten (10) days within
which to submit an Answer, otherwise, said defendants
(herein petitioners), may be declared in default.
nder Article 217(a) of the Labor Code, as amended by
Republic Act No. 6715 which took effect on March 21, 1989,
labor arbiters shall have original and exclusive jurisdiction to
hear and decide: [c]laims for actual, moral, exemplary and
other forms of damages arising from the employer-employee
relations x x x.
Clearly, in the case before us, respondents claim for damages
against petitioners arose from a prior employer-employee
relationship. The averments in the Complaint indisputably
show that his claim for damages was anchored on and was a
consequence of the termination of his employment with
PPSBI.
Indeed, the trial court initially made this observation when it
dismissed motu proprio respondents Complaint.[19] It ruled
that the manner in which the dismissal was implemented was
anti-social, oppressive and in disregard of procedural due
process x x x is but an incident part and parcel of the main
issue which is the alleged illegal dismissal of [respondent].
The trial court likewise opined that the plea of respondent for
reinstatement made his case one of illegal dismissal per se.
Later, however, it reversed its dismissal Order after he
subsequently amended his Complaint by deleting his prayer
for reinstatement and by stressing that his claim for damages
had resulted from the alleged oppressive manner of his
dismissal.
The trial court should have dismissed the Amended
Complaint. With regard to claims for damages under
paragraph 4 of Article 217, quoted above, jurisprudence has
applied the reasonable connection rule: if there is a
reasonable causal connection between the claim asserted and

the employer-employee relations, then the case falls within

the jurisdiction of the labor arbiter.[20] We do not agree with
the trial court that the case became a civil dispute simply
because respondent had not asked for reinstatement in his
Amended Complaint. An employee need not seek
reinstatement in order to have a complaint heard by the labor
arbiter.[21]
A comparison of the original[22] and the Amended
Complaint[23] reveals that the allegations and the prayers in
both are almost identical, except that the prayer for
reinstatement and the claim for salary increases and
allowances are no longer included in the Amended Complaint.
These are telltale signs that the claim of respondent for
damages is intertwined with his separation from his
employment, allegedly without a just cause. Consequently, his
claim has a reasonable causal connection with his employeremployee relations with the bank.
The Court is aware that the Civil Code provisions on human
relations and damages may be used as bases for justifying his
claim. But, the fact remains: the present action primarily
involves an employer-employee relationship. The damages he
incurred are mere consequences of the alleged injury brought
about by his perceived illegal dismissal. The civil ramifications
of his actual claim cannot alter the reality that it is
primordially a labor matter cognizable by the labor tribunals.
Under Article 217 (a) of the Labor Code, the labor arbiter has
the jurisdiction to award to a dismissed employee not only the
reliefs provided by the Labor Code, but also moral and other
forms of damages governed by the Civil Code.[24] Although a
dismissal from employment may be a violation not only of the
Labor but also of the Civil Code,[25] an illegally dismissed
employee has only a single cause of action.
Moral damages are recoverable when, for example, the
dismissal was effected without an authorized cause and/or
due process -- for which relief is granted by the Labor Code -and also when the dismissal (1) was attended by bad faith or
fraud; (2) constituted an act oppressive to labor; or (3) was
done in a manner contrary to morals, good customs or public
policy. For any of these, the obtainable relief is determined by
the Civil Code.[26]
This Court expounded on this matter in the earlier case
Primero v. Intermediate Appellate Court,[27] which we quote:
It is clear that the question of the legality of the act of
dismissal is intimately related to the issue of the legality of
the manner by which that act of dismissal was performed. But
while the Labor Code treats of the nature of, and the remedy
available as regards the first the employees separation from
employment it does not at all deal with the second the
manner of that separation which is governed exclusively by
the Civil Code. In addressing the first issue, the Labor Arbiter
applies the Labor Code; in addressing the second, the Civil
Code. And this appears to be the plain and patent intendment
of the law. For apart from the reliefs expressly set out in the
Labor Code flowing from illegal dismissal from employment,
no other damages may be awarded to an illegally dismissed
employee other than those specified by the Civil Code. Hence,
the fact that the issue of whether or not moral or other
damages were suffered by an employee and in the
affirmative, the amount that should properly be awarded to
him in the circumstances is determined under the provisions
of the Civil Code and not the Labor Code, obviously was not
meant to create a cause of action independent of that for
illegal dismissal and thus place the matter beyond the Labor
Arbiters jurisdiction.
Hence, for a single cause of action, the dismissed employee
cannot be allowed to sue in two forums: one, before the labor
arbiter for reinstatement and recovery of back wages or for
separation pay, upon the theory that the dismissal was illegal;
and two, before a court of justice for recovery of moral and
other damages, upon the theory that the manner of dismissal
was unduly injurious or tortious. Suing in the manner
described is known as splitting a cause of action, a practice

engendering a multiplicity of actions. It is considered

procedurally unsound and obnoxious to the orderly
administration of justice.
Splitting a cause of action was precisely what private
respondent did in filing the Amended Complaint. He split his
cause of action, then made one of the split parts the subject
of his Amended Complaint before a court of justice.
Precisely, such duplicity prodded the lawmakers to amend the
Labor Code by restoring to the labor arbiters the jurisdiction
over claims for damages of this nature. From 1979 to 1980,
jurisdiction over employment-predicated actions for damages
vacillated from labor tribunals to regular courts, and back to
labor tribunals
AGUILAR V. BURGER MACHINE HOLDINGS CORPORATION
The facts show that respondent Burger Machine Holdings
Corporation (Burger Machine) is a domestic corporation
engaged in the business of food service. Respondents Caesar
B. Rodriguez, Fe Esperanza S. Rodriguez, and Melchor V. De
Jesus, Jr., (De Jesus) are Burger Machines Chairperson,
President, and Vice-President, respectively.
On September 26, 2000, Burger Machine hired petitioner as a
Strategic Business Unit Manager Trainee. On March 26, 2001
he was regularized and assigned as Profit Center Manager of
the Burger Machine North Corporation (BMNC) and the
overseer of the Central Luzon Food Corporation (CLFC) and
the Eastern Luzon Food Corporation (ELFC). He was likewise
tasked to spearhead the expansion of their outlets in Baguio
City.
On June 26, 2001, petitioner was commended for his valuable
assistance and guidance to the trainee managers of CLFC and
ELFC.[4] This was followed by another commendation on July
6, 2001 for his guidance to the trainee-manager of CLFC in
achieving the following: (a) highest NIBT as of May; (b) 2nd
Best ROI; (c) 3rd Highest ADS; (d) 3rd Highest Sales Growth as
of May; (e) JanuaryMay Bad Debts of .5% of Net Sales; and (f)
Fastest Expanding Profit Center.[5]
On October 9, 2001, however, Burger Machine released the
results of the audit of BMNCs operation showing that
petitioner had not complied with the companys purchasing
system policy manual and that he made several purchases,
the amounts of which were beyond his authority to approve.
[6] In reply thereto, petitioner attributed the lapses in the
approval of purchases to the lack of information on the
standard operating procedures of the company.
On October 17, 2001, De Jesus directed petitioner to cease
from overseeing the CLFC and ELFC and to concentrate on
BMNC to resolve faster all critical problems such as shortages,
low ADS, low promo compliance, etc.[7] On November 19,
2001, De Jesus ordered him to reduce his gross sales
shortages to 1% or less by the end of November 2001.[8]
Petitioner was able to reduce this shortage to as low as 0.86%
for the month of November.[9]
At the end of the year 2001, petitioner did not receive his
14th month pay bonus of P35,000.00 while the amount of
P15,291.00 representing the alleged unauthorized expenses
was deducted from his salary.
On March 7, 2002, De Jesus ordered petitioner to turn over
BMNC to Ms. Gloria Centino starting March 12 up to the end of
March.[10] No reason was stated in the directive, neither was
a new assignment given to petitioner, thus he wrote a letter to
respondent Caesar B. Rodriguez, seeking an explanation for
the actions of De Jesus,
fter the turn over of BMNC, petitioner went on an approved
leave of absence. On April 23, 2002, he was appointed as
Profit Center Manager of Tatyana Foods Corporation (TFC), a
new project of Burger Machine to be established in La Union,
Ilocos Sur, Ilocos Norte, Cagayan and Isabela.[12] Petitioner

accepted the appointment and started scouting for the area in

connection with the business plan.
On May 14, 2002, De Jesus informed petitioner that he would
instead be transferred to the National Capital Region (NCR) to
oversee the operations of the Peoples Dimsum (PD). On May
17, 2002, petitioner figured in an accident while on his way to
De Jesus office in Metro Manila. He was thus hospitalized and
was constrained to go on leave. He requested for cash
advance and financial assistance from the company for his
medical expenses but was denied.
On July 5, 2002, petitioner reported for work. On July 16, 2002,
De Jesus issued a memorandum directing him to report at the
Epifanio de los Santos Avenue (EDSA) office of Burger Machine
on July 17, 2002 and onwards from 9:00 a.m. up to 6:00 p.m.
[13]
On July 17, 2002, petitioner filed a complaint for constructive
dismissal contending that the totality of respondents conduct
constitutes harassment aimed to pressure him to resign from
his job.
If the underlying reason for the posting of petitioner at the
EDSA office of Burger Machine was his series of request for
leave of absences, then the proper recourse is to make him
explain for said absences and to impose the proper penalty if
necessary. It appears, however, that all said requests for leave
have valid bases, otherwise, they would not have been
approved by Burger Machine. This only shows that the
transfer of petitioner at the EDSA office was to pressure him
and to ultimately ease him out of the company.
The test of constructive dismissal is whether a reasonable
person in the employees position would have felt compelled
to give up his position under the circumstances. Based on the
factual considerations in the instant case, we hold that the
hostile and unreasonable working conditions of petitioner
justified the finding of the Labor Arbiter and the NLRC that
petitioner was constructively dismissed. Petitioners
performance may not have been exceptional as he ranked
14th in the quality food service control survey for the 1st
quarter of 2002.[27] But he was certainly not grossly
inefficient as Burger Machine pictured him to be. In fact, he
received several citations and was able to comply with the
directive to reduce his shortages for the month of November
2001. From all indications, there is really no ground to dismiss
petitioner for gross inefficiency. And, as Burger Machine saw
it, the only way to get rid of the latter was to constructively
dismiss him.
The Labor Arbiter and the NLRCs findings that petitioner was
constructively dismissed are binding on this Court[28]
especially so that the contrary conclusion of the Court of
Appeals was based on the misapprehension of the factual
antecedents of this case. The appellate court focused only on
the transfer of petitioner to the PD in the NCR without taking
into consideration the entire factual milieu of the controversy.
Had the Court of Appeals done so, it would have arrived at the
same conclusion as the labor tribunals below.
Anent the solidary liability for the constructive dismissal of
petitioner, the same cannot attach with respect to
respondents Caesar B. Rodriguez and Fe Esperanza B.
Rodriguez, Chairperson and President of Burger Machine,
respectively, considering that no substantial evidence was
presented to prove their participation in the acts of
respondent De Jesus. It was only the latter who pressured
petitioner to relinquish his position and was the one
responsible for the issuance of the oppressive Memorandum
transferring petitioner to the EDSA office. Liability must
likewise be imputed to Burger Machine. The failure to exercise
proper diligence in the supervision of its employees, is
ultimately its responsibility.[29]

Petitioner was properly awarded moral and exemplary

damages. Moral damages may be recovered only where the
dismissal of the employee was tainted by bad faith or fraud,
or where it constituted an act oppressive to labor, and done in
a manner contrary to morals, good customs, or public policy
while exemplary damages are recoverable only if the
dismissal was done in a wanton, oppressive, or malevolent
manner. These damages, however, are not intended to enrich
petitioner and should therefore be reduced to P50,000.00
each.[30]
MEANNG OF DAMAGES IN EJECTMENT CASES
HERRERA V. BOLLOS
b initio, on August 5, 1993, Teodora Bollos commenced before
the Municipal Circuit Trial Court of Bayawan-Basay Civil Case
No. 993, for forcible entry, solely against Eddie Herrera
alleging that the latter, sometime in the second week of 1993,
through stealth and strategy and taking advantage of the
absence of Teodora, entered and occupied her Sugarland
known as Lot No. 20, GSS-615, located at Camandagan,
Maninyon, Bayawan, Negros Oriental. Teodora claims to have
inherited said parcel, being the only heir, from her deceased
father, Alfonso Bollos, who died on December 10, 1992.
Defendant, Eddie Herrera, denied the allegations against him
maintaining that he entered and occupied not Lot No. 20, as
claimed by Teodora, but Lot No. 21, GSS-615, which is owned
by Conrado Bollos, a brother of Teodoras father, Alfonso.
Further, Herrera said that his occupation of the property was
not through stealth or strategy but by virtue of a contract of
lease executed between Conrado Bollos, as lessor, and
Ernesto Tijing, as lessee. Herrera is Tijings overseer on the
land.
As a consequence, the complaint was twice amended, first, on
March 23, 1994 to include Ernesto T. Tijing as a partydefendant and much later on October 4, 1995, this time to
implead Conrado Bollos as an additional defendant.
After due proceedings, the first level court rendered its
judgment dispositively ruling:
ACCORDINGLY, in the light of the foregoing considerations for
plaintiffs failure to make-out a forcible entry case because of
lack of jurisdiction the above-entitled case is hereby
DISMISSED. Plaintiffs remedy should be reivendicatory (sic)
action before the proper forum.
On the second issue, the concept of damages in an action for
forcible entry and detainer cases is well defined in several
cases.[12] These damages mean rents or the reasonable
compensation for the use and occupation of the premises, or
fair rental value of the property.[13] Temperate, actual, moral
and exemplary are neither rents nor reasonable compensation
for the use and occupation of the premises, nor fair rental
value, and are not recoverable in such cases.[14]
In the case at bar, the municipal trial court dismissed the case
for lack of jurisdiction, and the regional trial court reversed
the dismissal but rendered judgment ejecting the defendants
from the parcel of land involved, and condemning them to pay
damages and attorneys fees. This is not correct. In case of
reversal, the case shall be remanded to the municipal trial
court for further proceedings.[15] The regional trial court in
reversing an appealed case dismissing the action cannot
decree the eviction of the defendants and award damages. A
court cannot take judicial notice of a factual matter in
controversy. The court may take judicial notice of matters of
public knowledge, or which are capable of unquestionable
demonstration, or ought to be known to judges because of
their judicial functions.[16] Before taking such judicial notice,
the court must allow the parties to be heard thereon.[17]
Hence, there can be no judicial notice on the rental value of
the premises in question without supporting evidence.
VILLAFUERTE V. CA
ppelees the spouses Reynaldo C. Villafuerte and Perlita TanVillafuerte operated a gasoline station known as Peewees
Petron Powerhouse Service Station and General Merchandise
on the premises of three (3) adjoining lots at the corner of
Gomez Street and Quezon Avenue in Lucena City. One of
these lots, Lot No. 2948-A with an area of 575 square meters,

is owned by several persons, one of whom is appellant

Edilberto de Mesa, while the other lot, Lot 2948-B with an area
of 290 square meters, is owned by appellant Gonzalo Daleon
and his brother Federico A. Daleon. The remaining lot belongs
to Mrs. Anicia Yap-Tan, mother of appellee Perlita TanVillafuerte.
Appellants Edilberto de Mesa and Gonzalo Daleon acquired
their respective lots subject to the lease by Petrophil
Corporation which had built thereon the gasoline station being
managed by the Villafuerte couple. When the lease of
Petrophil Corporation expired on December 31, 1988, the
Villafuertes obtained a new lease on Lot No. 2948-A from
appellant Edilberto de Mesa for a period expiring on
December 31, 1989, thus:.
1 This lease will be for a period of one (1) year only, from
January 1, 1989 and will terminate on the 31st of December
1989 at a monthly rental of FOUR THOUSAND PESOS
(P4,000.00). (Exhibit 1-A-1 De Mesa).
As regards Lot 2948-B of the Daleon brothers, the Villafuertes
were not as lucky. For, instead of obtaining a lease renewal,
what they received were demand letters from the brothers
counsel ordering them to vacate the premises. Instead of
complying therewith, the Villafuertes simply ignored the
demand and continued operating the gas station (Exhibits 3-B,
3-C and 3-F, Daleon).
On May 9, 1989, in the Office of the Barangay Captain of
Barangay Tres, Lucena City, a complaint for ejectment was
filed by Gonzalo Daleon against the Villafuertes (Exhibit 6,
Daleon). Evidently, no settlement was reached thereat, as
shown by a certification to file action issued by the lupon.
With their problem with the Daleon brothers far from over, the
Villafuertes were apt for another one; their lease contract with
Edilberto de Mesa was not renewed when it expired on
December 31, 1989. Nonetheless, and duplicating what they
had done in the case of the property of the Daleon brothers,
the spouses continued to operate their gasoline station and
other businesses on the lot of de Mesa despite the latters
demand to vacate.
What transpired next lays at the core of the instant
controversy.
It appears that in the early morning of February 1, 1990,
appellants Edilberto de Mesa and Gonzalo Daleon, with the aid
of several persons and without the knowledge of the
Villafuertes, caused the closure of the latters gasoline station
by constructing fences around it.
The following day February 2, 1990 the Villafuertes countered
with a complaint for damages with preliminary mandatory
injunction against both Edilberto de Mesa and Gonzalo
Daleon. Docketed in the court below as Civil Case No. 90-11,
the complaint seeks vindication for the alleged malicious and
unlawful fencing of the plaintiffs business premises (Records,
pp. 1-6).
Invoking their status as owners of the withheld premises, the
defendants admitted in their respective answers having
caused the fencing of the plaintiffs gasoline station thereat
but reasoned out that they did so on account of the plaintiffs
refusal to vacate the same despite demands.
After hearing the parties in connection with the plaintiffs
application for a writ of preliminary mandatory injunction, the
lower court, in its order of May 23, 1990, ruled that with the
expiration of the lease on the defendants property, the
plaintiffs have no more right to stay thereon and, therefore,
cannot pretend to have a clear and unmistakable right to an
injunctive writ and accordingly denied their application
therefore (Rec., p. 186). In a subsequent order of July 30,
1990, the same court denied the Villafuertes motion for
reconsideration
As expected, petitioners instituted this action praying that
private respondents be held liable for actual damages, moral

damages, exemplary damages, attorneys fees, and costs of

litigation. We shall resolve their right to these damages in
seriatim.
Actual or compensatory damages are those awarded in order
to compensate a party for an injury or loss he suffered. They
arise out of a sense of natural justice and are aimed at
repairing the wrong done.[11] Except as provided by law or by
stipulation, a party is entitled to an adequate compensation
only for such pecuniary loss as he has duly proven.[12] It is
hornbook doctrine that to be able to recover actual damages,
the claimant bears the onus of presenting before the court
actual proof of the damages alleged to have been suffered,
Noticeably, petitioner Perlitas testimony was replete with
claims that her unrealized income, as far as these items were
concerned, were based on the average. Except, however, for
the record of daily petroleum sales for the month of January
1990,[22] petitioners failed to present any evidence that
would sufficiently establish their mean income from these
business undertakings. In the absence of any corroborative
proof, this Court is not bound to award in petitioners favor the
actual damages for items a, b, c, d, e, and f of her alleged
unrealized income. Nor can we give premium on the summary
of daily petroleum sales for January 1990 prepared by
petitioner Perlita as the same is not supported by any
competent evidence; at best, said exhibit is self-serving.
Anent the actual damages claimed for the deterioration of the
items which remained inside petitioners office, petitioner
Perlita testified that when they were able to retrieve the
merchandise from the gasoline station, they noticed that most
of them were already defective and so they valued[23] the
damages thereto at seventy (70%) of their total value. As for
the items entrusted to her by the Hermana Fausta Memorial
Foundation of which she was the executive vice president at
that time, petitioner Perlita alleged that the amount of five
thousand pesos represents the production cost of these
materials which the foundation purportedly paid to Imprenta
Lucentina. As regards the amount of P30,000.00 sought as
actual damages for the damaged office equipment, petitioner
Perlita stated before the trial court that she arrived at this
figure after computing the acquisition costs of these
equipment which she approximated[24] to be P35,000.00.
Evidently, in establishing the amount of actual damages for
the merchandise inventory, office equipment, and materials
owned by the Hermana Fausta Memorial Foundation,
petitioners relied solely on their own assessment of the prices
of these items as well as the damage thereto purportedly
occasioned by the fencing of the gasoline station. This is
clearly demonstrated by the inconsistent stance of petitioner
Pertlita with regard to the percentage of damaged
merchandise stored in the gasoline station
We find, however, that an award of temperate damages to
petitioners is in order. In lieu of actual damages, temperate
damages, which are more than nominal but less than
compensatory damages, may be awarded where the court
finds that some pecuniary loss had been suffered by the
claimant but its amount cannot be proved with certainty.
Undoubtedly, pecuniary loss had been inflicted upon
petitioners in this case, however, due to the insufficiency of
evidence before us, we cannot place its amount with certainty.
In this regard, we find the amount of P50,000.00 to be
sufficient.
Petitioners also assail the removal by the Court of Appeals of
the moral damages previously ordered by the trial court. They
argue that contrary to the findings of the appellate court, they
came to court with clean hands as they believed that the
lease contract with private respondent De Mesa was modified
and extended. At the same time, they contend that they had a
verbal understanding with private respondent Daleon wherein
the latter permitted them to remain in his lot for as long as
Petron Corporation was not removing its equipment. Further,
petitioners contend that under Article 2219 of the Civil Code,
this Court had awarded moral damages in instances where
the claimants were victims of capricious, wanton, oppressive,
malicious, and arbitrary acts such as petitioners in this case.

On this issue, we agree in the findings of the Court of Appeals

that:
The Court must have to disallow the lower courts award of
moral damages. The concept of moral damages, as
announced in Article 2217 of the Civil Code, is designed to
compensate the complainant for his physical suffering, mental
anguish, fright, serious anxiety, besmirched reputation,
wounded feelings, moral shock, social humiliation and similar
injury occasioned by the defendants wrongful act or omission.
Article 2219 of the same Code specifies the cases where
moral damages may be awarde
DAMAGES IN DIFF KINDS OF BONDS
BELZUNCE V. FERNANDEZ
y a complaint filed in the month of September, 1905, the
plaintiff instituted ejectment proceedings against the
defendants to oust the latter from the hacienda named
"Anonolip," and to recover from him the sum of P1,723.22, the
amount of rent due and unpaid.
The said complaint was filed with the court of the justice of
the peace of Isabela, and judgment was entered dismissing
the ejectment proceedings, but sentencing the defendants to
pay to the plaintiff the rents due in the amount specified in
the complaint. But parties appealed from this judgment.
The court of the justice of the peace furthermore issued an
order for the preliminary attachment of the carabaos and
agricultural products of the defendants.
Upon the filing of a complaint with the Court of First Instance
of Occidental Negros, similar to the former, the plaintiff
prayed for the recovery of the possession of the said hacienda
called "Anonolip," and the payment of the rents corresponding
to 1904 and 1905, already due, and the rents which might
accrue during the year 1906, together with the legal interest
and the costs.
The defendants, by their answer, made a general denial of all
the facts alleged and, by way of special defense, alleged that
they had already paid the rent claimed, which constitutes the
interest on a mortgage debt, and that, on the contrary, there
remained a balance to their credit. In addition thereto, the
defendants, by way of counterclaim, made a further claim for
damages amounting to P15,000 resulting, on the one hand,
from the preliminary attachment, and on the other, from
noncompliance, on the part of the plaintiff, with a contract
under seal, dated July 15, 1905, according to the terms of
which the latter bound himself to furnish the defendants the
money necessary to cultivate the hacienda "Anonolip."cralaw
virtua1aw library
This hacienda had been sold by the defendants to the plaintiff
on June 14, 1903, the right of repurchase was reserved to the
former, and by the terms of the agreement in the form of a
contract of lease said land was to be left in the possession of
the vendors during the period allowed for the repurchase,
conditioned upon the payment of rent, which was made the
subject of the complaint in this case, because the rent was not
paid during the years above mentioned.
fourth error is the only one might serve as the basis for the bill
exceptions. Nevertheless, the Court of First Instance did not
err in not finding against the plaintiff for the payment of
damages resulting from the preliminary attachment issued by
request of the latter, nor did the lower court commit error in
not reserving to the defendants the right to bring a separate
action for said damages:chanrob1es virtual 1aw library
First, because the nonreservation by judgment of the court of
the right which one of the parties to an action deems he may
exercise in a separate action is neither an error nor an injury,
because the law does not impose upon the judge the duty of
making a reservation of this kind in cases when the exercise
of the right does not depend thereon.
Second, because the counterclaim for damages, filed for the
first time on appeal before the Court of First Instance, not
having been filed nor being proper in the proceeding for

ejectment in the court of the justice of the peace, it was

reasonably denied, on account of its notorious impropriety, as
has been determined in several decisions of the Supreme
Court.
Third, because, according to section 439 of the Code of Civil
Procedure, whose heading is "Disposition of attached property
in case of judgment against the plaintiff upon the obligation
provided in section 427 for any damages he may have
sustained by reason of the attachment, after summary
hearing in the same action on due notice," if the attachment,
according to section 427, "shall finally be adjudged to have
been wrongful or without sufficient cause."cr
PIONEER INSURANCE AND SURETY CORPORATION V. DE DIOS
TRANS
espondents De Dios Transportation Co. (DDTC) and De Dios
Marikina Transport Corporation (DMTC) were the franchise
holders and owners of fifty-eight buses plying the BuendiaAyala-UP and Monumento-Ayala routes. On February 23, 1995,
the respondents, as vendors, executed a Deed of Conditional
Sale covering the said buses and their franchise in favor of
Willy Choa Coyukiat (Coyukiat) and/or Goldfinger Transport
Corporation (Goldfinger) as vendees. In the said contract, the
respondents bound and obliged themselves to sell to Coyukiat
and Goldfinger the fifty-eight buses and their corresponding
franchise, and to deliver and turn over possession of the said
buses to the vendees for the price of P12,000,000, payable as
follows:
The respondents, as vendors, guaranteed that the franchise
and routes to Buendia-Ayala-UP and vice versa and
Monumento-Ayala via EDSA were valid, fully and completely
utilizable, and merely required registration with the Land
Transportation Office (LTO) for the vendees to be able to
operate the same.[5] The vendees delivered the
downpayment and postdated checks drawn upon the account
of Goldfinger with the Philbanking Corporation for the balance
of the purchase price.
On March 23, 1995, the respondents delivered the buses to
the vendees. The respondents were able to encash the check
for the downpayment of the purchase price. However, before
the respondents could deposit the first check for the
remaining balance, the vendees stopped all payments, on
their claim that, contrary to the representations of the
respondents, some of the buses were not in good running
condition. The color of the buses had been changed without
the proper permits or clearances from the Land Transportation
Franchising and Regulatory Board (LTFRB), the LTO and the
Philippine National Police (PNP). Consequently, the vendees
failed to operate the buses. The vendees were, likewise,
unable to operate the buses along the Buendia-Ayala-UP
route, notwithstanding the representation of the respondents
that only registration with the LTO was required.
On July 20, 1995, the vendees, through its counsel, the Padilla
Reyes & De la Torre Law Office, filed a complaint against the
respondents and Philbanking Corporation as defendants with
the Regional Trial Court (RTC) of Quezon City for rescission of
contract with a plea for a temporary restraining order or writ
of preliminary injunction.[6]
Therein plaintiffs Coyukiat and Goldfinger alleged that
defendants (the respondents herein) reneged on their
obligation to deliver the buses in good running condition. By
reason of the defendants misrepresentation regarding the
registration of the buses, they failed to secure certificates of
registration under their names, preventing them from
operating the buses, thus causing tremendous losses to their
business which impelled them to stop the payments of the
eleven remaining postdated checks.
Even assuming, for the sake of argument that an application
for damages can still be made, defendants-appellees suffered
no damage by reason of the issuance of the injunction
The petitioner averred that the decision of the trial court had
become final and executory on September 14, 1999, upon the
withdrawal of the appeal. Further, when the CA issued its
October 8, 1999 Resolution directing the respondents in this
case to address their motion to the trial court, it had already
lost its jurisdiction over the appeal. Even assuming that the

motion of the respondents was timely filed, nevertheless, they

did not suffer any damages arising from the preliminary
injunction issued by the trial court. The injunction bond
answers only for the damages caused to the adverse party by
reason of the wrongful issuance of the injunction and not for
the damages awarded by the trial court on the respondents
counterclaims.
CALIFORNIA BUS LINES V. STATE INVESTMENT HOUSE
Facts:
Delta Motors Corporation applied for financial assistance from
respondent State Investment House, Inc., a domestic
corporation engaged in the business of quasi-banking. SIHI
agreed to extend a credit line to Delta which eventually
became indebted to SIHI. Meanwhile, petitioner purchased on
installment basis several buses to Delta. To secure the
payment of the obligation petitioner executed promissory
notes in favor of Delta. When petitioner defaulted on the
payments of the debts, it entered into an agreement with
delta to cover its due obligations. However, petitioner still had
trouble meeting its obligations with delta. Pursuant to the
memorandum of agreement delta executed a deed of sale
assigning to respondent, the promissory notes from petitioner.
Respondent subsequently sent a demand letter to petitioner
requiring remitting payments due on the promissory notes.
Petitioner replied informing respondent of the fact that delta
had taken over its management and operations.
he question whether the attachment of the sixteen (16) buses
was valid and in accordance with law, however, has already
been resolved with finality by the Court of Appeals in CA-G.R.
SP No. 08376. In its July 31, 1987, decision, the Court of
Appeals upheld the legality of the writ of preliminary
attachment SIHI obtained and ruled that the trial court judge
acted with grave abuse of discretion in discharging the writ of
attachment despite the clear presence of a determined
scheme on the part of CBLI to dispose of its property.
Considering that the said Court of Appeals decision has
already attained finality on August 22, 1987, there exists no
reason to resolve this question anew. Reasons of public policy,
judicial orderliness, economy and judicial time and the
interests of litigants as well as the peace and order of society,
all require that stability be accorded the solemn and final
judgments of courts or tribunals of competent jurisdiction.[81]
Finally, in the light of the justness of SIHIs claim against CBLI,
we cannot sustain CBLIs contention that the Court of Appeals
erred in dismissing its counterclaim for lost income and the
value of the 16 buses over which SIHI obtained a writ of
preliminary attachment. Where the party who requested the
attachment acted in good faith and without malice, the claim
for damages resulting from the attachment of property cannot
be sustained
CARLOS V. SANDOVAL
arlos asserted that he was the sole surviving compulsory heir
of his parents, Felix B. Carlos and Felipa Elemia,1 who had
acquired during their marriage, six parcels of land (subject
properties). His brother, Teofilo ("Teofilo"), died intestate in
1992. At the time of his death, Teofilo was apparently married
to Sandoval, and cohabiting with her and their child,
respondent Teofilo II. Nonetheless, Carlos alleged in his
Complaint that Teofilo and Sandoval were not validly married
as they had not obtained any marriage license.2 Furthermore,
Carlos also asserted that Teofilo II could not be considered as
Teofilos child. As a result, Carlos concluded that he was also
the sole heir of his brother Teofilo, since the latter had died
without leaving any heirs.
Carlos also claimed that Teofilo, prior to their father Felixs
death in 1963, developed a scheme to save the elder Carloss
estate from inheritance taxes. Under the scheme, the
properties of the father would be transferred to Teofilo who
would, in turn, see to it that the shares of the legal heirs are
protected and delivered to them. Felix assented to the plan,
and the subject properties were transferred in the name of
Teofilo. After Teofilos death, Carlos entered into certain
agreements with Sandoval in connection with the subject
properties. Carlos did so, believing that the latter was the
lawful wife of his brother Teofilo. Subsequently though, Carlos
discovered that Sandoval and his brother were never validly

married, as their marriage was contracted without a marriage

license.3
Carlos now sought to nullify these agreements with Sandoval
for want of consideration, the premise for these contracts
being non-existent. Thus, Carlos prayed of the RTC to declare
the alleged marriage between Teofilo and Sandoval void ab
initio, provided that Teofilo died without issue, order that new
titles covering the subject properties be issued in the name of
Carlos, and require Sandoval to restitute Carlos in the amount
of P18,924,800.00.4
Carlos likewise prayed for the issuance of the provisional relief
of preliminary attachment.
nder the circumstances, too, there can be no gainsaying the
suretys full awareness of its undertakings under its bond:
that, as the law puts it: "the plaintiff will pay all costs which
may be adjudged to the defendant(s), and all damages which
may be sustained by reason of the attachment, if the same
shall finally be adjudged to have been wrongful and without
cause," and that those damages plainly comprehended not
only those sustained during the trial of the action but also
those during the pendency of the appeal. This is the law, and
this is how the surety's liability should be understood. The
surety's liability may be enforced whether the application for
damages for wrongful attachment be submitted in the original
proceedings before the Trial Court, or on appeal, so long as
the judgment has not become executory. The surety's liability
is not and cannot be limited to the damages caused by the
improper attachment only during the pendency of the appeal.
That would be absurd. The plain and patent intendment of the
law is that the surety shall answer for all damages that the
party may suffer as a result of the illicit attachment, for all the
time that the attachment was in force; from levy to
dissolution. . . .
The fact that the second paragraph of the rule speaks only of
"damages sustained during the pendency of the appeal" is of
no moment; it obviously proceeds from the assumption in the
first paragraph that the award for the damages suffered
during the pendency of the case in the trial court was in fact
"included in the final judgment" (or applied for therein before
the appeal was perfected or the judgment became executory);
hence, it states that the damages additionally suffered
thereafter, i.e., during the pendency of the appeal, should be
claimed before the judgment of the appellate tribunal
becomes executory. It however bears repeating that where. as
in the case at bar, the judgment of the Trial Court has
expressly or impliedly sustained the attachment and thus has
given rise to no occasion to speak of, much less, file an
application for damages for wrongful attachment, and it is
only in the decision of the Court of Appeals that the
attachment is declared wrongful and that the applicant "was
not entitled thereto," the rule is, as it should be, that it is
entirely proper at this time for the application for damages for
such wrongful attachment to be filedi.e., for all the damages
sustained thereby, during all the time that it was in force, not
only during the pendency of the appeal. . . .68
The rule is thus well-settled that the bond issued upon an
application for preliminary attachment answers for all
damages, incurred at whatever stage, which are sustained by
reason of the attachment. The award of actual damages by
the Court of Appeals is thus proper in amount. However, we
disagree that the rate of legal interest be counted from the
date of the "unlawful garnishment," or on 27 June 1996.
Properly, interest should start to accrue only from the moment
it had been finally determined that the attachment was
unlawful, since it is on that basis that the right to damages
comes to existence. In this case, legal interest commences
from the date the Court of Appeals decision in CA-G.R. SP No.
39267 became final, by reason of its affirmation by this Court.
The award of attorneys fees in the amount of P1,000,000.00
is also questioned before this Court, considering that the
Court of Appeals did not award moral or exemplary damages.
The general rule may be that an award of attorneys fees
should be deleted where the award of moral and exemplary
damages are eliminated.69 Nonetheless, attorneys fees may

be awarded under the Civil Code where the court deems it just
and equitable that attorneys fees and expenses of litigation
should be recovered,70 even if moral and exemplary damages
are unavailing.71
FLORES V. STRONGHOLD INSURANCE COMPANY
pouses Napoleon M. Flores, Sr. and Veronidia J. Flores were
engaged in business under the business name Flojos
Garments Manufacturing (FGM). On April 28, 1995, Stephen
Liu and the spouses Flores executed a Memorandum of
Agreement (MOA),[3] whereby the latter sold for
P8,500,000.00 all their rights and interests over their
garments manufacturing business, including all its existing
licenses and government permits, machinery, supplies and
spare parts, and its real property located at No. 17, Jacamar
St., Marikina Subdivision, Marikina City; and all other
accessories, raw materials, and other related items. For his
part, Liu obliged himself to assume the payment of the
spouses obligations with Metropolitan Bank and Trust
Company as part of the purchase price, the balance of the
purchase price to be paid within 120 days from the date of the
signing of the MOA.
On September 7, 1995, Liu filed a complaint[4] against the
spouses Flores and Alexander J. Flores (in his capacity as
attorney-in-fact of Napoleon Flores, Sr.) for specific
performance and damages with a prayer for issuance of
temporary restraining order and/or writ of preliminary
injunction and a writ of preliminary attachment. He alleged
that the spouses Flores failed and refused to execute the
necessary deeds of conveyance, transfer or assignment of all
the items included in the MOA, causing damages to him; as a
consequence of their acts of harassment and obstruction, he
was entitled to the issuance of a temporary restraining order
or writ of preliminary injunction. He averred that, unless a writ
of preliminary attachment was issued, there might not be
sufficient security for the satisfaction of any judgment which
the court might render against them.
On October 3, 1995, the RTC issued an Order[5] granting Lius
prayer for writ of preliminary injunction and attachment upon
the filing and approval of an injunction bond in the amount of
P2,000,000.00 and attachment bond in the amount of
P3,000,000.00. The plaintiff thus posted Attachment Bond No.
00565 and Injunction Bond No. 00566 issued by Stronghold
Insurance Corporation, Inc. for P3,000,000.00 and
P2,000,000.00, respectively.
In their Answer to the complaint,[6] the spouses Flores alleged
that the complaint failed to state a cause of action as there
was no allegation that he complied with his obligations under
the MOA;
ether the petition for application of damages against the
bonds posted by respondent SICI was already time-barred
when petitioners filed the same on July 16, 1999.

The petition is meritorious.

Section 20 of Rule 57 of the 1997 Rules of Civil Procedure
reads:
SEC. 20. Claim for damages on account of improper, irregular
or excessive attachment. An application for damages on
account of improper, irregular or excessive attachment must
be filed before the trial or before appeal is perfected or before
the judgment becomes executory, with due notice to the
attaching party and his surety or sureties, setting forth the
facts showing his right to damages and the amount thereof.
Such damages may be awarded only after proper hearing and
shall be included in the judgment on the main case.

An application for damages against the bonds must be filed in

the same case where the bond was issued, either (a) before
the trial or (b) before the appeal is perfected or (c) before the
judgment becomes executory.[25] The principal party and his
surety or sureties must be notified of said application. This

rule is mandatory.[26] In the absence of due notice to the

surety, no judgment for damages may be entered and
executed against it.[27]

In this case, petitioners, as defendants below, received the

Decision of the RTC dated June 25, 1999 on July 1, 1999.
Under Rule 41 of the Revised Rules of Court, the decision may
be appealed to the CA by filing a notice of appeal with the
court which rendered judgment or final order within fifteen
(15) days from notice thereof.
After the lapse of the fifteen-day period, the judgment or final
order becomes final and executory and is beyond the power
or jurisdiction of the court which rendered it to further amend
or reverse.[28] The court loses jurisdiction over the case
except to issue orders for the protection and preservation of
the rights of the parties which do not involve any matter
litigated by the appeal, approve compromises, permit appeals
of indigent litigants, order execution pending appeal, and
allow withdrawal of the appeal.[29]
Article 13, last paragraph of the New Civil Code provides that
in computing a period, the first day shall be excluded and the
last day included. Section 1, Rule 22, of the Revised Rules of
Court also provides that, in computing any period of time
prescribed or allowed by the Rules, or by order of the court or
by any applicable Statute, the day of the act or event from
which the designated period of time begins is to be excluded
and the date of the performance included.
In the present case, petitioners received a copy of the
decision on July 1, 1999. Conformably with Section 1, Rule 22,
in relation to Section 3, Rule 41, July 1, 1999 should be
excluded from the computation of the fifteen-day period;
hence, the 15-day period should be computed from July 2,
1999. Counting 15 days from July 2, 1999, the 15th day fell on
July 16, 1999; as such, petitioners had until July 16, 1999
within which to perfect their appeal from the decision of the
trial court or file their application under Section 20, Rule 57.
JUDGEMENT OF ACQUITTAL EXTINGUISHES LIABILITY OF
ACCUSED FOR DAMAGES
EUSEBIO-CALDERON V. PEOPLE
Facts: Elizabeth Eusebio-Calderon was charged by her aunt
Teresita Eusebio, Amelia Casanova and cousin Manolito
Eusebio with three count Estafa. According to private
complainants, petitioner assured them that the checks will be
honored upon maturity. They gave her the money because
she showed them her pieces of jewelry which convinced them
that she has the ability to pay the loans. In her defense,
petitioner admits that she issued the checks but alleges that it
was not done to defraud her creditors. After trial, the lower
court rendered a joint decision finding petitioner guilty beyond
reasonable doubt, but ruled that her liability for the interest
checks was only civil, thereby acquitting the accused but
indemnify to pay. The Decision of the Court of Appeals which
reversed and set aside the Decision of the Regional Trial Court
acquitting the accused but ordering her to pay civil liability.
Issues: (1) Did the Court of Appeals err in finding the appellant
civilly liable to complainants with respect to the interest in the
principal loan despite the dismissal of the interest checks by
the Regional Trial Court? (2) Is the interest agreed upon by the
parties usurious? (3) Should the private respondents file a
separate civil complaint for the claim of Sum of Money?
Ruling: The court finds the petition meritorious. When
petitioner appealed her conviction, the dismissal of the
interest checks by the lower court did not preclude the Court
of Appeals from reviewing such decision and modifying her
civil liability. The appeal conferred upon the appellate court
full jurisdiction and rendered it competent to examine the
records, revise the judgment appealed from, increase the
penalty and cite the proper provision of the penal law. Under
Article 29 of the Civil Code, when the accused in a criminal
prosecution is acquitted on the ground that his guilt has not
been proven beyond reasonable doubt, a civil action for

damages for the same act or omission may be instituted. The

judgment of acquittal extinguishes the liability of the accused
for damages only when it includes a declaration that the fact
from which the civil liability might arise did not exist. Thus,
Section 1, paragraph (a) of Rule 111 of the Rules of Court
provides:
SECTION 1. Institution of criminal and civil actions. (a) When
a criminal action is instituted, the civil action for the recovery
of civil liability arising from the offense charged shall be
deemed instituted with the criminal action unless the
offended party waives the civil action, reserves the right to
institute it separately or institutes the civil action prior to the
criminal action. An accused who is acquitted of Estafa may
nevertheless be held civilly liable where the facts established
by the evidence so warrant. Petitioner Elizabeth Calderon is
clearly liable to the private respondents for the amount
borrowed. The Court of Appeals found that the former did not
employ trickery or deceit in obtaining money from the private
complainants, instead, it concluded that the money obtained
was undoubtedly loans for which petitioner paid interest. The
checks issued by petitioner as payment for the principal loan
constitute evidence of her civil liability which was deemed
instituted with the criminal action. The civil liability of
petitioner includes only the principal amount of the loan. With
respect to the interest checks she issued, the same are void.
There was no written proof of the payable interest except for
the verbal agreement that the loan shall earn 5% interest per
month. Under Article 1956 of the Civil Code, an agreement as
to payment of interest must be in writing, otherwise it cannot
be valid. Consequently, no interest is due and the interest
checks she issued should be eliminated from the computation
of her civil liability. However, while there can be no stipulated
interest, there can be legal interest pursuant to Article 2209 of
the Civil Code. It is elementary that in the absence of a
stipulation as to interest, the loan due will now earn interest
at the legal rate of 12% per annum. In view of our ruling that
there can be no stipulated interest in this case, there is no
need to pass upon the second issue of whether or not the
interests were usurious. The Decision of the Court of Appeals
is AFFIRMED with the MODIFICATION that petitioner is ordered
to pay Amelia Casanova,Teresita Eusebio, and Manolito
Eusebio as civil liability with legal interest of twelve percent
(12%) per annum until its satisfaction.
n a criminal case, an appeal throws the whole case wide open
for review. Issues whether raised or not by the parties may be
resolved by the appellate court.[12] When petitioner appealed
her conviction, the dismissal of the interest checks by the
lower court did not preclude the Court of Appeals from
reviewing such decision and modifying her civil liability. The
appeal conferred upon the appellate court full jurisdiction and
rendered it competent to examine the records, revise the
judgment appealed from, increase the penalty and cite the
proper provision of the penal law.[13]
Under Article 29 of the Civil Code, when the accused in a
criminal prosecution is acquitted on the ground that his guilt
has not been proven beyond reasonable doubt, a civil action
for damages for the same act or omission may be instituted.
The judgment of acquittal extinguishes the liability of the
accused for damages only when it includes a declaration that
the fact from which the civil liability might arise did not exist.
[14] Thus, Section 1, paragraph (a) of Rule 111 of the Rules of
Court provides
we established the guidelines particularly for the award of
interest in the concept of actual and compensatory damages,
the rate of interest, as well as the accrual thereof as follows:
PADILLA V. COURT OF APPEALS
used, Roy Padilla, Filomeno Galdones, Pepito Bedenia, Yolly
Rico, David Bermundo, Villanoac, Roberto Rosales, Villania,
Romeo Garrido, Jose Ortega, Jr., Ricardo Celestino, Realingo
alias Kamlon, John Doe alias Tato, and Fourteen Richard Does,
by confederating and mutually helping one another, and
acting without any authority of law, did then and there
wilfully, unlawfully, and feloniously, by means of threats, force
and violence prevent Antonio Vergara and his family to close
their stall located at the Public Market, Building No. 3, Jose
Panganiban, Camarines Norte, and by subsequently forcibly
opening the door of said stall and thereafter brutally
demolishing and destroying said stall and the furnitures

therein by axes and other massive instruments, and carrying

away the goods, wares and merchandise, to the damage and
prejudice of the said Antonio Vergara and his family in the
amount of P30,000.00 in concept of actual or compensatory
and moral damages, and further the sum of P20,000.00 as
exemplary damages.
That in committing the offense, the accused took advantage
of their public positions: Roy Padilla, being the incumbent
municipal mayor, and the rest of the accused being
policemen, except Ricardo Celestino who is a civilian, all of
Jose Panganiban, Camarines Norte, and that it was committed
with evident premeditation.
The judgment of acquittal extinguishes the liability of the
accused for damages only when it includes a declaration that
the facts from which the civil might arise did not exist. Thus,
the civil liability is not extinguished by acquittal where the
acquittal is based on reasonable doubt (PNB v. Catipon, 98
Phil. 286) as only preponderance of evidence is required in
civil cases; where the court expressly declares that the
liability of the accused is not criminal but only civil in nature
(De Guzman v. Alvia, 96 Phil. 558; People v. Pantig, supra) as,
for instance, in the felonies of estafa, theft, and malicious
mischief committed by certain relatives who thereby incur
only civil liability
When the accused in a criminal prosecution is acquitted on
the ground that his guilt has not been proved beyond
reasonable doubt, a civil action for damages for the same act
or omission may be instituted. Such action requires only a
preponderance of evidence. Upon motion of the defendant,
the court may require the plaintiff to file a bond to answer for
damages in case the complaint should be found to be
malicious.
We see no need to amend Article 29 of the Civil Code in order
to allow a court to grant damages despite a judgment of
acquittal based on reasonable doubt. What Article 29 clearly
and expressly provides is a remedy for the plaintiff in case the
defendant has been acquitted in a criminal prosecution on the
ground that his guilt has not been proved beyond reasonable
doubt. It merely emphasizes that a civil action for damages is
not precluded by an acquittal for the same criminal act or
omission. The Civil Code provision does not state that the
remedy can be availed of only in a separate civil action. A
separate civil case may be filed but there is no statement that
such separate filing is the only and exclusive permissible
mode of recovering damages.
There is nothing contrary to the Civil Code provision in the
rendition of a judgment of acquittal and a judgment awarding
damages in the same criminal action. The two can stand side
by side. A judgment of acquittal operates to extinguish the
criminal liability. It does not, however, extinguish the civil
liability unless there is clear showing that the act from which
civil liability might arise did not exist.
DAMAGES UNDER RPC
RAMISCAL V. SANDIGANBAYAN
Facts:
Ramiscal Jr (Ramiscal) was a retired officer of AFP and the
former president of AFP-Retirement and Separation Benefits
System (AFP-RSBS). During his incumbency, the BOD of AFPRSBS approved the acquisition of 15,020 sq. m. of land for
development as housing projects. On August 1, 1997 AFPRSBS as represented by Ramiscal Jr., and Flaviano the
attorney-in-fact of 12 individual vendors executed and signed
a bilateral Deed of Sale (1st Deed) over the subject property
at the agreed price of P 10,500.00 per sq. m. After the
payment @ P 10,500.00 per sq. m., Flaviano executed and
signed a unilateral Deed of Sale (2nd Deed) over the same
property with a purchase price of P 3,000.00 per sq. m.
Thereafter the 2nd Deed was presented by Flaviano for
registration which became the basis of the Certificate of Title
of the said property.
Ramiscal Jr filed his first Motion for Reconsideration date
February 12, 1999 with a supplemental motion dated May 28,
1999 regarding the findings of the Ombudsman. With this, a
panel of prosecutors was tasked to review the records of the
case, they found out that Ramiscal Jr., indeed participated in
an affixed his signature on the contracts and found probable

cause. The Ombudsman acted positively on the findings of the

prosecutor and scheduled the arraignment of Ramiscal Jr.
Howver, Ramiscal Jr., refused to enter a plea for petitioner on
the ground that there is a pending resolution of his second
Motion for Reconsideration.
Issue:
Whether or not the second Motion for Reconsideration is valid
and should hold his arraignment.
Whether or not there is probable cause to file a case for
violation of Section 3 (e) of the Anti-Graft and Corrupt
Practices Act and falsification of public documents.
Ruling:
No, Sec 7 of Rule 11 of the Rules provides that only one
motion for reconsideration or reinvestigation of an approved
order or resolution shall be allowed xxxxx the filing of a
motion for reconsideration/reinvestigation shall not bar the
filling of the corresponding information in Court on the basis of
the finding of probable cause in the resolution subject of the
motion.
The arraignment may be suspended under Sec. 11 of Rule 116
of the Rules of Court are: unsoundness of mind, prejudicial
question and a pending petition for review of the resolution of
the prosecutor in the DOJ in which the suspension shall not
exceed 60 days. Ramiscal Jr., failed to show that any of the
instances constituting a valid ground for suspension of
arraignment obtained in this case.
With respect to the finding of probable cause, it is the
Ombudsman who has the full discretion to determine whether
or not a criminal case should be filed in the Sandiganbayan,
once the case has been filed with the said court, it is the
Sandiganbayan, and no longer the Ombudsman which has full
control of the case. Ramiscal Jr., failed to establish that
Sandiganbayan committed grave abuse of discretion, thus,
there is probable cause in the filing of the case.
We agree with the contention of the petitioner that the AGFOI,
and even Commodore Aparri and Brig. Gen. Navarro, are not
the offended parties envisaged in Section 16, Rule 110, in
relation to Section 1, Rule 111 of the Revised Rules of Criminal
Procedure.
Under Section 5, Rule 110[45] of the Rules, all criminal actions
covered by a complaint or information shall be prosecuted
under the direct supervision and control of the public

prosecutor. Thus, even if the felonies or delictual acts of the

accused result in damage or injury to another, the civil action
for the recovery of civil liability based on the said criminal acts
is impliedly instituted[46] and the offended party has not
waived the civil action, reserved the right to institute it
separately or instituted the civil action prior to the criminal
action, the prosecution of the action inclusive of the civil
action remains under the control and supervision of the public
prosecutor
n the other hand, the sole purpose of the civil action is for the
resolution, reparation or indemnification of the private
offended party for the damage or injury he sustained by
reason of the delictual or felonious act of the accused.[50]
Under Article 104 of the Revised Penal Code, the following are
the civil liabilities of the accused:
ART. 104. What is included in civil liability. The civil liability
established in Articles 100, 101, 102 and 103 of this Code
includes:
1. Restitution;
2. Reparation of the damage caused;
3. Indemnification for consequential damages.
Under Section 16, Rule 110 of the Revised Rules of Criminal
Procedure, the offended party may also be a private individual
whose person, right, house, liberty or property was actually or
directly injured by the same punishable act or omission of the
accused,[55] or that corporate entity which is damaged or
injured by the delictual acts complained of. Such party must
be one who has a legal right; a substantial interest in the
subject matter of the action as will entitle him to recourse
under the substantive law, to recourse if the evidence is
sufficient or that he has the legal right to the demand and the
accused will be protected by the satisfaction of his civil
liabilities. Such interest must not be a mere expectancy,
subordinate or inconsequential.
We agree with the petitioner that the AGFOI is not even the
offended party in Criminal Cases Nos. 25134 to 25145 for
falsification of public documents under paragraph 4, Sec. 1,
Article 171, of the Revised Penal Code. It bears stressing that
in the felony of falsification of public document, the existence
of any prejudice caused to third person or the intent to cause
damage, at the very least, becomes immaterial. The
controlling consideration is the public character of a document
and the violation of the public faith and the destruction of
truth therein solemnly proclaimed. The offender does not, in
any way, have civil liability to a third person