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THIRD DIVISION G.R. No. 166869 : February 16, 2010 PHILIPPINE HAWK CORPORATION, Petitioner, v. VIVIAN TAN LEE, Respondent. D E C I S I O N PERALTA, J.: This is a Petition for Review on Certiorari 1cralaw of the Decision of the Court of Appeals in CA-G.R. CV No. 70860, promulgated on August 17, 2004, affirming with modification the Decision of the Regional Trial Court (RTC) of Quezon City, Branch 102, dated March 16, 2001, in Civil Case No. Q-91-9191, ordering petitioner Philippine Hawk Corporation and Margarito Avila to jointly and severally pay respondent Vivian Tan Lee damages as a result of a vehicular accident. The facts are as follows: On March 15, 2005, respondent Vivian Tan Lee filed before the RTC of Quezon City a Complaint2cralaw against petitioner Philippine Hawk Corporation and defendant Margarito Avila for damages based on quasi-delict, arising from a vehicular accident that occurred on March 17, 1991 in Barangay Buensoceso, Gumaca, Quezon. The accident resulted in the death of respondent's husband, Silvino Tan, and caused respondent physical injuries. On June 18, 1992, respondent filed an Amended Complaint,3cralaw in her own behalf and in behalf of her children, in the civil case for damages against petitioner. Respondent sought the payment of indemnity for the death of Silvino Tan, moral and exemplary damages, funeral and interment expenses, medical and hospitalization expenses, the cost of the motorcycle's repair, attorney's fees, and other just and equitable reliefs. The accident involved a motorcycle, a passenger jeep, and a bus with Body No. 119. The bus was owned by petitioner Philippine Hawk Corporation, and was then being driven by Margarito Avila. In its Answer,4cralaw petitioner denied liability for the vehicular accident, alleging that the immediate and proximate cause of the accident was the recklessness or lack of caution of Silvino Tan. Petitioner asserted that it exercised the diligence of a good father of the family in the selection and supervision of its employees, including Margarito Avila. On March 25, 1993, the trial court issued a Pre-trial Order5cralaw stating that the parties manifested that there was no possibility of amicable settlement between them. However, they agreed to stipulate on the following facts:
The parties also agreed on the following issues:
Respondent testified that on March 17, 1991, she was riding on their motorcycle in tandem with her husband, who was on the wheel, at a place after a Caltex gasoline station in Barangay Buensoceso, Gumaca, Quezon on the way to Lopez, Quezon. They came from the Pasumbal Machine Shop, where they inquired about the repair of their tanker. They were on a stop position at the side of the highway; and when they were about to make a turn, she saw a bus running at fast speed coming toward them, and then the bus hit a jeep parked on the roadside, and their motorcycle as well. She lost consciousness and was brought to the hospital in Gumaca, Quezon, where she was confined for a week. She was later transferred to St. Luke's Hospital in Quezon City, Manila. She suffered a fracture on her left chest, her left arm became swollen, she felt pain in her bones, and had high blood pressure.8cralaw Respondent's husband died due to the vehicular accident. The immediate cause of his death was massive cerebral hemorrhage.9cralaw Respondent further testified that her husband was leasing10cralaw and operating a Caltex gasoline station in Gumaca, Quezon that yielded one million pesos a year in revenue. They also had a copra business, which gave them an income of Ernest Ovial, the driver of the passenger jeep involved in the accident, testified that in the afternoon of March 17, 1991, his jeep was parked on the left side of the highway near the Pasumbal Machine Shop. He did not notice the motorcycle before the accident. But he saw the bus dragging the motorcycle along the highway, and then the bus bumped his jeep and sped away.12cralaw For the defense, Margarito Avila, the driver of petitioner's bus, testified that on March 17, 1999, at about 4:30 p.m., he was driving his bus at 60 kilometers per hour on the Maharlika Highway. When they were at Barangay Buensoceso, Gumaca, Quezon, a motorcycle ran from his left side of the highway, and as the bus came near, the motorcycle crossed the path of the bus, and so he turned the bus to the right. He heard a loud banging sound. From his side mirror, he saw that the motorcycle turned turtle ("bumaliktad"). He did not stop to help out of fear for his life, but drove on and surrendered to the police. He denied that he bumped the motorcycle.13cralaw Avila further testified that he had previously been involved in sideswiping incidents, but he forgot how many times.14cralaw Rodolfo Ilagan, the bus conductor, testified that the motorcycle bumped the left side of the bus that was running at 40 kilometers per hour.15cralaw Domingo S. Sisperes, operations officer of petitioner, testified that, like their other drivers, Avila was subjected to and passed the following requirements:
Efren Delantar, a Barangay Kagawad in Buensoceso, Gumaca, Quezon, testified that the bus was running on the highway on a straight path when a motorcycle, with a woman behind its driver, suddenly emerged from the left side of the road from a machine shop. The motorcycle crossed the highway in a zigzag manner and bumped the side of the bus.17cralaw In its Decision dated March 16, 2001, the trial court rendered judgment against petitioner and defendant Margarito Avila, the dispositive portion of which reads: ACCORDINGLY, MARGARITO AVILA is adjudged guilty of simple negligence, and judgment is hereby rendered in favor of the plaintiff Vivian Lee Tan and h[er] husband's heirs ordering the defendants Philippine Hawk Corporation and Margarito Avila to pay them jointly and solidarily the sum of The trial court found that before the collision, the motorcycle was on the left side of the road, just as the passenger jeep was. Prior to the accident, the motorcycle was in a running position moving toward the right side of the highway. The trial court agreed with the bus driver that the motorcycle was moving ahead of the bus from the left side of the road toward the right side of the road, but disagreed that the motorcycle crossed the path of the bus while the bus was running on the right side of the road.19cralaw The trial court held that if the bus were on the right side of the highway, and Margarito Avila turned his bus to the right in an attempt to avoid hitting the motorcyle, then the bus would not have hit the passenger jeep, which was then parked on the left side of the road. The fact that the bus also hit the passenger jeep showed that the bus must have been running from the right lane to the left lane of the highway, which caused the collision with the motorcycle and the passenger jeep parked on the left side of the road. The trial court stated that since Avila saw the motorcycle before the collision, he should have stepped on the brakes and slowed down, but he just maintained his speed and veered to the left.20cralaw The trial court found Margarito Avila guilty of simple negligence. The trial court held petitioner bus company liable for failing to exercise the diligence of a good father of the family in the selection and supervision of Avila, having failed to sufficiently inculcate in him discipline and correct behavior on the road.21cralaw On appeal, the Court of Appeals affirmed the decision of the trial court with modification in the award of damages. The dispositive portion of the decision reads: WHEREFORE, foregoing premises considered, the appeal is DENIED. The assailed decision dated March 16, 2001 is hereby AFFIRMED with MODIFICATION. Appellants Philippine Hawk and Avila are hereby ordered to pay jointly and severally appellee the following amount: (a) Petitioner filed this petition, raising the following issues:
In short, the issues raised by petitioner are: (1) whether or not negligence may be attributed to petitioner's driver, and whether negligence on his part was the proximate cause of the accident, resulting in the death of Silvino Tan and causing physical injuries to respondent; (2) whether or not petitioner is liable to respondent for damages; and (3) whether or not the damages awarded by respondent Court of Appeals are proper. Petitioner seeks a review of the factual findings of the trial court, which were sustained by the Court of Appeals, that petitioner's driver was negligent in driving the bus, which caused physical injuries to respondent and the death of respondent's husband. The rule is settled that the findings of the trial court, especially when affirmed by the Court of Appeals, are conclusive on this Court when supported by the evidence on record.24cralaw The Court has carefully reviewed the records of this case, and found no cogent reason to disturb the findings of the trial court, thus: The Court agree[s] with the bus driver Margarito that the motorcycle was moving ahead of the bus towards the right side from the left side of the road, but disagrees with him that it crossed the path of the bus while the bus was running on the right side of the highway. If the bus were on the right side of the highway and Margarito turned his bus to the right in an attempt to avoid hitting it, then the bus would not have hit the passenger jeep vehicle which was then parked on the left side of the road. The fact that the bus hit the jeep too, shows that the bus must have been running to the left lane of the highway from right to the left, that the collision between it and the parked jeep and the moving rightways cycle became inevitable. Besides, Margarito said he saw the motorcycle before the collision ahead of the bus; that being so, an extra-cautious public utility driver should have stepped on his brakes and slowed down. Here, the bus never slowed down, it simply maintained its highway speed and veered to the left. This is negligence indeed.25cralaw Petitioner contends that the Court of Appeals was mistaken in stating that the bus driver saw respondent's motorcycle "about 15 meters away" before the collision, because the said distance, as testified to by its witness Efren Delantar Ong, was Ong's distance from the bus, and not the distance of the bus from the motorcycle. Petitioner asserts that this mistaken assumption of the Court of Appeals made it conclude that the bus driver, Margarito Avila, had the last clear chance to avoid the accident, which was the basis for the conclusion that Avila was guilty of simple negligence. A review of the records showed that it was petitioner's witness, Efren Delantar Ong, who was about 15 meters away from the bus when he saw the vehicular accident.26cralaw Nevertheless, this fact does not affect the finding of the trial court that petitioner's bus driver, Margarito Avila, was guilty of simple negligence as affirmed by the appellate court. Foreseeability is the fundamental test of negligence.27cralaw To be negligent, a defendant must have acted or failed to act in such a way that an ordinary reasonable man would have realized that certain interests of certain persons were unreasonably subjected to a general but definite class of risks.28cralaw In this case, the bus driver, who was driving on the right side of the road, already saw the motorcycle on the left side of the road before the collision. However, he did not take the necessary precaution to slow down, but drove on and bumped the motorcycle, and also the passenger jeep parked on the left side of the road, showing that the bus was negligent in veering to the left lane, causing it to hit the motorcycle and the passenger jeep. Whenever an employee's negligence causes damage or injury to another, there instantly arises a presumption that the employer failed to exercise the due diligence of a good father of the family in the selection or supervision of its employees.29cralaw To avoid liability for a quasi-delict committed by his employee, an employer must overcome the presumption by presenting convincing proof that he exercised the care and diligence of a good father of a family in the selection and supervision of his employee.30cralaw The Court upholds the finding of the trial court and the Court of Appeals that petitioner is liable to respondent, since it failed to exercise the diligence of a good father of the family in the selection and supervision of its bus driver, Margarito Avila, for having failed to sufficiently inculcate in him discipline and correct behavior on the road. Indeed, petitioner's tests were concentrated on the ability to drive and physical fitness to do so. It also did not know that Avila had been previously involved in sideswiping incidents. As regards the issue on the damages awarded, petitioner contends that it was the only one that appealed the decision of the trial court with respect to the award of actual and moral damages; hence, the Court of Appeals erred in awarding other kinds of damages in favor of respondent, who did not appeal from the trial court's decision. Petitioner's contention is unmeritorious. Section 8, Rule 51 of the 1997 Rules of Civil Procedure provides: SEC. 8. Questions that may be decided . -- No error which does not affect the jurisdiction over the subject matter or the validity of the judgment appealed from or the proceedings therein will be considered unless stated in the assignment of errors, or closely related to or dependent on an assigned error and properly argued in the brief, save as the court pass upon plain errors and clerical errors. Philippine National Bank v. Rabat31cralaw cited the book32cralaw of Justice Florenz D. Regalado to explain the section above, thus: In his book, Mr. Justice Florenz D. Regalado commented on this section, thus:
In this case for damages based on quasi-delict, the trial court awarded respondent the sum of In its Decision, the Court of Appeals sustained the award by the trial court for loss of earning capacity of the deceased Silvino Tan, moral damages for his death, and actual damages, although the amount of the latter award was modified. The indemnity for loss of earning capacity of the deceased is provided for by Article 2206 of the Civil Code.34cralaw Compensation of this nature is awarded not for loss of earnings, but for loss of capacity to earn money.35cralaw As a rule, documentary evidence should be presented to substantiate the claim for damages for loss of earning capacity.36cralaw By way of exception, damages for loss of earning capacity may be awarded despite the absence of documentary evidence when: (1) the deceased is self-employed and earning less than the minimum wage under current labor laws, in which case, judicial notice may be taken of the fact that in the deceased's line of work no documentary evidence is available; or (2) the deceased is employed as a daily wage worker earning less than the minimum wage under current labor laws.37cralaw In this case, the records show that respondent's husband was leasing and operating a Caltex gasoline station in Gumaca, Quezon. Respondent testified that her husband earned an annual income of one million pesos. Respondent presented in evidence a Certificate of Creditable Income Tax Withheld at Source for the Year 1990,38cralaw which showed that respondent's husband earned a gross income of P950,988.43 in 1990. It is reasonable to use the Certificate and respondent's testimony as bases for fixing the gross annual income of the deceased at one million pesos before respondent's husband died on March 17, 1999. However, no documentary evidence was presented regarding the income derived from their copra business; hence, the testimony of respondent as regards such income cannot be considered. In the computation of loss of earning capacity, only net earnings, not gross earnings, are to be considered; that is, the total of the earnings less expenses necessary for the creation of such earnings or income, less living and other incidental expenses.39cralaw In the absence of documentary evidence, it is reasonable to peg necessary expenses for the lease and operation of the gasoline station at 80 percent of the gross income, and peg living expenses at 50 percent of the net income (gross income less necessary expenses). In this case, the computation for loss of earning capacity is as follows:
The Court of Appeals also awarded actual damages for the expenses incurred in connection with the death, wake, and interment of respondent's husband in the amount of Actual damages must be substantiated by documentary evidence, such as receipts, in order to prove expenses incurred as a result of the death of the victim40cralaw or the physical injuries sustained by the victim. A review of the valid receipts submitted in evidence showed that the funeral and related expenses amounted only to Moreover, the Court of Appeals correctly sustained the award of moral damages in the amount of In addition, the Court of Appeals correctly awarded temperate damages in the amount of The Court of Appeals also correctly awarded respondent moral damages for the physical injuries she sustained due to the vehicular accident. Under Art. 2219 of the Civil Code,45cralaw moral damages may be recovered in quasi-delicts causing physical injuries. However, the award of Further, the Court of Appeals correctly awarded respondent civil indemnity for the death of her husband, which has been fixed by current jurisprudence at In fine, the Court of Appeals correctly awarded civil indemnity for the death of respondent's husband, temperate damages, and moral damages for the physical injuries sustained by respondent in addition to the damages granted by the trial court to respondent. The trial court overlooked awarding the additional damages, which were prayed for by respondent in her Amended Complaint. The appellate court is clothed with ample authority to review matters, even if they are not assigned as errors in the appeal, if it finds that their consideration is necessary in arriving at a just decision of the case.49cralaw WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals dated August 17, 2004 in CA-G.R. CV No. 70860 is hereby AFFIRMED with MODIFICATION. Petitioner Philippine Hawk Corporation and Margarito Avila are hereby ordered to pay jointly and severally respondent Vivian Lee Tan: (a) civil indemnity in the amount of Fifty Thousand Pesos ( Costs against petitioner. SO ORDERED. DIOSDADO M. PERALTA WE CONCUR: RENATO C. CORONA
JOSE CATRAL MENDOZA A T T E S T A T I O N I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court's Division. RENATO C. CORONA C E R T I F I C A T I O N Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court's Division. REYNATO S. PUNO Endnotes:
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