Construction Development Corp. v. Estrella
REITERATIONFacts
The Antecedents: On December 29, 1978, respondents Rebecca G. Estrella and Rachel E. Fletcher were passengers on a Batangas Laguna Tayabas Bus Co. (BLTB) bus bound for Pasay City. The BLTB bus was rammed from behind by a tractor-truck owned by Construction Development Corporation of the Philippines (CDCP). The impact caused injuries to Estrella and Fletcher, requiring hospitalization and medical treatment. Procedural History: Respondents filed a Complaint for damages against CDCP, BLTB, and their respective drivers, alleging negligence and failure to exercise the diligence of a good father of a family. The Regional Trial Court (RTC) of Manila found CDCP and BLTB, along with their drivers, jointly and severally liable for damages. The RTC awarded actual damages and attorney's fees, and additional amounts to Fletcher and Estrella. Upon appeal by respondents, the Court of Appeals (CA) affirmed the RTC decision with modifications, increasing attorney's fees, awarding exemplary and moral damages, and clarifying the commencement of legal interest. CDCP's claim against its insurer, Philippine Phoenix Surety & Insurance, Inc. (Phoenix), was dismissed due to prescription. The Petition: CDCP filed a petition for review, assailing the CA's decision, primarily questioning its joint and several liability with BLTB, the award of damages, attorney's fees, and legal interest, and the dismissal of its claim against Phoenix.
Issue(s)
Whether or not the Court of Appeals gravely erred in not holding respondents BLTB and/or its driver Wilfredo Datinguinoo solely liable for the damages sustained by herein respondents Fletcher and Estrella. Whether or not the Court of Appeals gravely erred in awarding excessive or unfounded damages, attorney's fees and legal interest to respondents Fletcher and Estrella. Whether or not the Court of Appeals gravely erred in not holding respondent Phoenix liable under its insurance policy on the ground of prescription.
Ruling
The petition is denied. The Decision of the Court of Appeals is affirmed with modifications regarding the amounts of damages and the computation of legal interest. CDCP is held jointly and severally liable with BLTB for actual damages, moral damages, exemplary damages, and attorney's fees. The award of damages shall earn interest at the rate of 6% per annum from the date of the trial court's judgment until finality, and 12% per annum thereafter until satisfaction.
Ratio Decidendi
On the issue of sole liability of BLTB and its driver: The Court held that CDCP and BLTB, along with their respective drivers, are jointly and severally liable. The case filed against CDCP was for culpa aquiliana (quasi-delict) under Article 2176 of the Civil Code. CDCP's liability stems from the negligent act of its driver, Espiridion Payunan, Jr., and its failure to prove it exercised the diligence of a good father of a family in the selection and supervision of its employees. The Court reiterated the established jurisprudence that the owner of a vehicle that collides with a common carrier is solidarily liable to the injured passenger of the common carrier. This liability arises from the concurrence of their separate and distinct acts that produced the same injury, making them joint tort feasors who are jointly and severally liable for the entire damage. On the issue of excessive or unfounded damages, attorney's fees, and legal interest: The Court found the award of moral damages in favor of Fletcher and Estrella in the amount of P80,000.00 by the CA to be excessive and reduced it to P50,000.00 each, consistent with prevailing jurisprudence. However, the award of exemplary damages of P20,000.00 each was affirmed, as the driver's reckless driving constituted gross negligence, justifying such damages. The award of attorney's fees was also affirmed, as it falls under the extraordinary concept of indemnity for damages. Regarding legal interest, the Court clarified that for unliquidated claims, the 6% interest commences from the date of the trial court's judgment, not from the filing of the complaint, until finality. Thereafter, a 12% interest applies until satisfaction. On the issue of Phoenix's liability: The Court affirmed the dismissal of CDCP's claim against Phoenix due to prescription. Section 384 of P.D. 612, as amended, requires that a written notice of claim be filed within six months from the date of the accident, and an action for recovery must be brought within one year from the denial of the claim. Since CDCP failed to file a claim within the prescribed six-month period, its right of action had prescribed, barring recovery from the insurer.
Main Doctrine
In cases where the negligence of a bus driver concurs with the negligence of a third-party driver, both the bus company and the third-party vehicle owner and driver are jointly and severally liable to the injured passenger. The liability of the bus company arises from breach of contract of carriage, while the liability of the third-party owner and driver arises from quasi-delict. Both liabilities can be pursued simultaneously, provided there is no double recovery for the same injury.