YHT Realty Corporation vs CA

GR. No. 126780

February 17, 2005

Tinga, J.

http://sc.judiciary.gov.ph/jurisprudence/2005/feb2005/126780.htm

Topic: Art 2003

FACTS:
-Maurice Peaches Mcloughlin, an Australian Businessman- Philantrophist, who used to stay in
Sheraton Hotel during his trips in the Philippines met Brunhilda Mata-Tan and whom later gave
him tours and convinced him to transfer to Tropicana where Lainez, Payam and Danilo
Lopez were employed in.

-October 30, 1987- Mcloughlin registered in Tropicana in his trip to Manila and he rented a
safety deposit box wherein there are 2 keys one which he is in possession and one with the
management. He placed therein 3 envelopes with the respective amounts : US $10,000;
US$5,000; and AU$10,000. He also placed envelopes containing his credit cards, passport and
bank books. On Dec. 2 he took the envelopes containing US$5,000 and AU$10,000 on his trip to
Hongkong without checking out of the hotel. When he arrived in HK he found out that his US
$5000 envelope was only containing $3000 but only assumed that it was due to bad accounting.
When he arrived in Australia, after returning to Manila and checked out from Tropicana on Dec.
18, he discovered that his envelope containing US $10,000 was short of 5K and that the jewelry
which he bought in HK(which he stored in the deposit box) are also lost.

-He went back to the PH on 4 Apr 1988 and asked Lainez (who had custody of the management
key) if some money was missing or returned to her, to which the latter answered there was not.
He again registered at the Tropicana and rented a safety deposit box. He placed an envelope
containing US$15,000, another of AU$10,000. On 16 Apr, he opened his safety deposit box and
noticed that US$2,000 and AU$4,500 was missing from the envelopes. He immediately
confronted Lainez and Payam who admitted that Tan opened the safety deposit box with the key
assigned to McLoughlin. McLoughlin went up to his room where Tan was staying and
confronted her. Tan admitted that she had stolen McLoughlins key and was able to open the
safety deposit box with the assistance of Lopez, Payam and Lainez. Lopez also told McLoughlin
that Tan stole the key assigned to McLoughlin while the latter was asleep.

- McLoughlin requested the management for an investigation of the incident. Lopez got in touch
with Tan and arranged for a meeting with the police and McLoughlin. When the police did not
arrive, Lopez and Tan went to the room of McLoughlin at Tropicana and thereat, Lopez wrote on
a piece of paper a promissory note. He made Lopez and Tan sign a promissory note for him for
the loss. However, Lopez refused liability on behalf of the hotel, reasoning that McLoughlin
signed an "Undertaking for the Use of Safety Deposit Box" which disclaims any liability of the
hotel for things put inside the box. On 17 May 1988 McLoughlin went back to AU and consulted
his lawyers. They wrote a letter addressed to Pres. Cory Aquino which was pushed back to the
DOJ and the Western Police District. He went back from the PH to AU several times more to
attend business and follow up but the matter was only filed on 3 Dec 1990 since he was not there
to personally follow up.

- McLoughlin filed an action against YHT Realty Corporation, Lopez, Lainez, Payam and Tan.
The RTC rendered judgment in favor of McLoughlin. The CA modified only the amount of
damages awarded. Tan and Lopez, however, were not served with summons, and trial proceeded
with only Lainez, Payam and YHT Realty Corporation as defendants.

ISSUES

a. WON there was gross negligence on the part of the innkeepers

b. WON the "Undertaking for the Use of the Safety Deposit Box" is null and void.

HELD

a. Payam and Lainez, who were employees of Tropicana, had custody of the master key of
the management when the loss took place. They even admitted that they assisted Tan on
three separate occasions in opening McLoughlins safety deposit box.
The management contends that McLoughlin made its employees believe that Tan was his
spouse for she was always with him most of the time. The evidence on record is bereft of
any showing that McLoughlin introduced Tan to the management as his wife. Mere close
companionship and intimacy are not enough to warrant such conclusion. They should
have confronted him as to his relationship with Tan considering that the latter had been
observed opening McLoughlins safety deposit box a number of times at the early hours
of the morning.
Art 2180, par (4) of the same Code provides that the owners and managers of an
establishment or enterprise are likewise responsible for damages caused by their
employees in the service of the branches in which the latter are employed or on the
occasion of their functions. Given the fact that the loss of McLoughlins money was
consummated through the negligence of Tropicanas employees both the employees and
YHT, as owner of Tropicana, should be held solidarily liable pursuant to Art 2193.
b. Yes, it is null and void. Art. 2003[1] is controlling. This is an expression of public policy
that the hotel business like common carriers are imbued with public interest. This
responsibility cannot be waived away by any contrary stipulation in so-called
"undertakings" that ordinarily appear in prepared forms imposed by hotel keepers on
guests for their signature.
 The CA (former case) even ruled before that hotelkeepers are liable even though the
effects are not delivered to them or their employees, but it is enough that the effects are
within the hotel or inn.
Pars. 2 and 4 of the undertaking manifestly contravene Art. 2003 of the NCC. Meanwhile,
the defense that Art. 2002 exempts the hotel-keeper from liability if the loss is due to the
acts of the guest, family or visitors falls because the hotel is guilty of negligence as well.
This provision presupposes that the hotel-keeper is not guilty of concurrent negligence or
has not contributed in any degree to the occurrence of the loss.

Notes:

Par 2 & 4 of the undertaking for the use of the safety deposit box

2. To release and hold free and blameless TROPICANA APARTMENT HOTEL from any
liability arising from any loss in the contents and/or use of the said deposit box for any
cause whatsoever, including but not limited to the presentation or use thereof by any
other person should the key be lost;

...

4. To return the key and execute the RELEASE in favor of TROPICANA APARTMENT
HOTEL upon giving up the use of the box