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![Commercial letters of credit have come into general use in international sales transactionswhere much time
necessarily elapses between the saleand the receipt by a purchaser of the merchandise,duringwhich interval
great pricechanges may occur.Buyers and sellers strugglefor the advantage of position.The seller is desirousof
being paid as surely and as soon as possible,realizingthatthe vendee at a distantpoint has itin his power to reject
on trivial grounds merchandiseon arrival,and causeconsiderablehardship to the shipper.Letters of credit meet
this condition by affordingcelerity and certainty of payment. Their purpose is to insureto a seller payment of a
definite amount upon presentation of documents. The bank deals only with documents. It has nothingto do with
the quality of the merchandise. Disputes as to the merchandiseshipped may ariseand be litigated later between
vendor and vendee, but they may not impede acceptance of drafts and payment by the issuingbank when the
proper documents arepresented.
The trial courtand the public respondent likewiseerred in disregardingthetrust receipt and in not holdingthat Philippine Rayon
was liablethereon. In People vs. Yu Chai Ho, 20 this Court explains thenature of a trust receipt by quoting In re Dunlap Carpet
Co., 21 thus:
By this arrangement a banker advances money to an intendingimporter, and thereby lends the aid of capital,of
credit, or of business facilities and agencies abroad,to the enterprise of foreign commerce. Much of this trade
could hardly be carried on by any other means, and therefore itis of the firstimportancethat the fundamental
factor in the transaction,the banker's advanceof money and credit, should receive the amplestprotection.
Accordingly,in order to secure that the banker shall berepaid atthe critical point — that is,when the imported
goods finally reach the hands of the intended vendee — the banker takes the full titleto the goods atthe very
beginning; he takes it as soon as the goods are bought and settled for by his payments or acceptances in the
foreign country, and he continues to hold that title as his indispensablesecurity until the goods are sold in the
United States and the vendee is called upon to pay for them. This security is notan ordinary pledge by the
importer to the banker, for the importer has never owned the goods, and moreover he is not ableto deliver the
possession;butthe security is the complete title vested originally in thebankers,and this characteristicof the
transaction has again and again been recognized and protected by the courts. Of course,the title is atbottom a
security title, as ithas sometimes been called,and the banker is always under the obligation to reconvey; but only
after his advances havebeen fully repaid and after the importer has fulfilled the other terms of the contract.
As further stated in National Bank vs. Viuda e Hijos de Angel Jose, 22 trust receipts:
. . . [I]n a certain manner, . . . partakeof the nature of a conditional saleas provided by the Chattel Mortgage Law,
that is,the importer becomes absoluteowner of the imported merchandiseas soon an he has paid its price.The
ownership of the merchandisecontinues to be vested in the owner thereof or in the person who has advanced
payment, until he has been paid in full,or if the merchandisehas already been sold,the proceeds of the sale
should be turned over to himby the importer or by his representativeor successor in interest.
Under P.D. No. 115,otherwise known an the Trust Receipts Law, which took effect on 29 January 1973,a trust receipt transaction is
defined as "any transaction by and between a person referred to in this Decree as the entruster, and another person referred to in
this Decree as the entrustee, whereby the entruster, who owns or holds absolutetitleor security interests' over certain specified
goods, documents or instruments, releases the same to the possession of the entrustee upon the latter's execution and deliver y to
the entruster of a signed document called the "trust receipt" wherein the entrustee binds himself to hold the designated goods,
documents or instruments in trust for the entruster and to sell or otherwise disposeof the goods, documents or instruments with
the obligation to turn over to the entruster the proceeds thereof to the extent of the amount owing to the entruster or as appears in
the trust receipt or the goods, instruments themselves if they are unsold or not otherwise disposed of,in accordancewith the terms
and conditions specified in the trusts receipt, or for other purposes substantially equivalentto any one of the following:. . ."
It is alleged in the complaintthat privaterespondents "not only have presumably put said machinery to good use and have pro fited
by its operation and/or disposition butvery recent information that(sic) reached plaintiff bank thatdefendants already sold the
machinery covered by the trust receipt to Yupangco Cotton Mills,"and that "as trustees of the property covered by the trust receipt,
. . . and therefore actingin fiduciary (sic) capacity,defendants have willfully violated their duty to account for the whereabouts of
the machinery covered by the trust receipt or for the proceeds of any lease,saleor other disposition of the same that they may have
made, notwithstandingdemands therefor; defendants have fraudulently misapplied or converted to their own use any money
realized from the lease, sale,and other disposition of said machinery." 23 Whilethere is no specific prayer for the delivery to the
petitioner by PhilippineRayon of the proceeds of the saleof the machinery covered by the trustreceipt, such relief is covered by the
general prayer for "such further and other relief as may be justand equitableon the premises." 24 And although itis true that the](https://image.slidesharecdn.com/100643368-cases-150908173009-lva1-app6891/85/100643368-cases-22-320.jpg)
100643368 cases
- 1. Homework Help https://www.homeworkping.com/ Research Paperhelp https://www.homeworkping.com/ Online Tutoring https://www.homeworkping.com/ click here for freelancing tutoring sites G.R. No. L-54598 April 15, 1988 JOSE B. LEDESMA, petitioner, vs. HON. COURT OF APPEALS, Spouses PACIFICO DELMO and SANCHA DELMO (as private respondents),respondents. The Solicitor General for petitioner. Luzel D. Demasu-ay for respondent. GUTIERREZ, JR., J.: This petition seeks to reverse the decision of the respondent Court of Appeals which afirmed the decision of the Court of Fir st Instanceof Iloilo,adjudgingthepetitioner, who was then the Presidentof the West Visayas Collegeliablefor damages under Article 27 of the Civil Codeof the Philippines for failureto graduate a student with honors. The facts are not disputed. An organization named Student Leadership Club was formed by some students of the West Visayas College.They elected the late Violets Delmo as the treasurer. In that capacity,Delmo extended loans fromthe funds of the club to some of the students of the school."the petitioner claims thatthe said actof extending loans was againstschool rules and regulations.Thus,the petitioner, as President of the School,sent a letter to Delmo informingher that she was being dropped from the membership of the club and that she would not be a candidatefor any award or citation fromthe school. Delmo asked for a reconsideration of the decision butthe petitioner denied it. Delmo, thus, appealed to the Office of the Director of the Bureau of Public Schools. The Director after due investigation,rendered a decison on April 13,1966 which provided: Records of the preliminary investigation conducted by one of the legal officers of this Officedisclosed the following:That Violeta Delmo was the treasurer of the Student Leadership Club,an exclusivestudent organization; that pursuantto ArticleIX of the of the Constitution and By-Laws of the club, itpassed Resolution No. 2, authorizingthe treasurer to disbursefunds of the Club to student for financial aid and other humanitarian purposes;that in compliancewith said resolution and as treasurer of the Club,Violeta Delmo extended loans to some officers and members of the Club upon proper application duly approved by the majority of the members of the Executive Board; and that upon receivingthe report from Mr. Jesse Dagoon, adviser of the funds of the Club, that Office conducted an investigation on the matter and havingbeen convinced of the guiltof Violets Delmo and the other officers and members of the Club, that Office rendered the order or decision in question.In justifying
- 2. that Office's orderor decision,itis contended that approval by that Office of the Constitution and By-Laws of the Club is necessary for its effectivity and validity and sinceitwas never submitted to that Office, the Club had no valid constitution and By-Laws and that as a consequence, Resolution No. 2 which was passed based on the Constitution and By-Laws- is without any force and effect and the treasurer,Violeta Delmo, who extended loans to some officers and members of the Club pursuantthereto are illegal (sic),hence, she and the other students involved are deemed guilty of misappropriatingthefunds of the Club.On the other hand, Raclito Castaneda, Nestor Golez and Violeta Delmo, President, Secretary and Treasurer of the Club,respectively, testified that the Club had adopted its Constitution and By-Laws in a meeting held lastOctober 3, 1965,and that pursuantto Article I of said Constitution and By-Laws, the majority of the members of the Executive Board passed Resolution No. 2, which resolution became the basisfor the extension on of loans to some officers and members of the Club,that the Club honestly believed that its Constitution and By-Laws has been approved by the superintendent because the adviser of the Club, Mr. Jesse Dagoon, assured the President of the Club that he will causethe approval of the Constitution and By-Laws by the Superintendent; the officers of the Club have been inducted to officeon October 9,1965 by the Superintendent and that the Club had been likewiseallowed to cosponsor the Education Week Celebration. After a careful study of the records, this Officesustainstheaction taken by the Superintendent in penalizingthe adviser of the Club as well as the officers and members thereof by droppingthem from membership therein. However, this Officeis convinced that Violets M. Delmo had acted in good faith,in her capacity as Club Treasurer, in extending loans to the officers and members of the Student partnership Club.Resolution No. 2 authorizingthe Club treasurer to dischargefinds to students in need of financial assistanceand other humanitarian purposes had been approved by the Club adviser,Mr. Jesse Dagoon, with the notation that approval was given in his capacity as adviser of the Club and extension of the Superintendent's personality.Asidefrom misleadingthe officers and members of the Club,Mr. Dagoon, had unsatisfactorily explained why he failed to give the Constitution and By- Laws of the Club to the Superintendent for approval despitehis assuranceto the Club president that he would do so. With this findingof negligence on the partof the Club adviser,not to mention laxity in the performance of his duties as such,this Officeconsiders as too severe and unwarranted that portion of the questioned order stating that Violeta Delmo "shall notbe a candidatefor any award or citati on from this school or any organization in this school."Violeta Delmo, itis noted, has been a consistentfull scholar of the school and shealonehas maintained her scholarship.Thedecision in question would,therefore, set at naught all her sacrificea nd frustrateher dreams of graduatingwith honors in this year's commencement exercises. In view of all theforegoing, this Officebelieves and so holds and hereby directs that appellantVioleta.M. Delmo, and for that matter all other Club members or officers involved in this case,be not deprived of any award,citation or honor from the school,if they areotherwise entitled thereto. (Rollo,pp. 28-30) On April 27,1966, the petitioner received by mail the decision of the Director and all the records of the case.On the same day, petitioner received a telegram statingthe following: "AIRMAIL RECORDS DELMO CASE MISSENT THAT OFFICE" The Director asked for the return only of the records but the petitioner allegedly mistook the telegram as orderinghim to al so send the decision back.On the same day, he returned by mail all therecords plus the decision of the Director to the Bureau of Public Schools. The next day, the petitioner received another telegram from the Director order him to furnish Delmo with a copy of the decision. The petitioner, in turn, sent a night letter to the Director informingthe latter that he had sent the decision back and that he had not retained a copy thereof.. On May 3, 1966,the day of the graduation,the petitioner received another telegram from the Director orderinghim not to deprive Delmo of any honors due her. As it was impossibleby this time to includeDelmo's name in the program as one of the honor students, the petitioner let her graduate as a plain studentinstead of being awarded the Latin honor of Magna Cum Laude. To delay the matter further, the petitioner on May 5, 1966, wrote the Director for a reconsideration of the latters" decision because he believed that Delmo should not be allowed to graduatewith honors. The Director denied the petitioner's request. On July 12, 1966,the petitioner finally instructed the Registrar of the school to enter into the scholastic records of Delmo the honor, "Magna Cum Laude."
- 3. On July 30,1966,Delmo, then a minor, was joined by her parents in flagaction for damages againstthepetitioner. Duringthe pendency of the action,however, Delmo passed away,and thus, an Amended and Supplemental Complaintwas filed by her parents as her soleand only heirs. The trial courtafter hearingrendered judgment againstthe petitioner and in favor of the spouses Delmo. The court said: Let us go to specific badges of the defendants (now petitioners) bad faith.Per investigation of Violeta Delmo's appeal to Director Vitaliano Bernardino of the Bureau of Public Schools(ExhibitLitwas the defendant who inducted the officers of the Student Leadership Club on October 9, 1965. In fact the Club was allowed to cosponsor the Education Week Celebration.(Exh. "L"). If the defendant he not approve of the constitution and by-laws of the Club, why did he inductthe officers into office and allowthe Club to sponsor the Education Week Celebration"? It was through his own actthat the students were misled to do as they did. Coupled with the defendants tacit recognition of the Club was the assuranceof Mr. Jemm Dagoon, Club Adviser, who made the students believe that he was actingas an extension of Mr. Ledesma's personality.(Exhibit"L"). Another badge of the defendan'ts want of good faith is the factthat, although, he kaew as early as April 27,1966 that per on of r Bernardino,Exhibit"L," he was directed to give honors to Miss Delmo, he kept Id information to . He told the Court that he knew that the letter of Director Bernardino directed him not to deprive Miss Delmo the honors due her, but she (sic) says thathe has not finished readingthe letter-decision,Exhibit"L," of Director Bernardino 0, him to give honors to Miss Delmo.(Tsn, Feb. 5, 1974,testimony of Mr. Ledesma, pp. .33-35). It could not be true that he has not finished readingthe letter-decision,Exh. "L," becausesaid letter consisted of only three pages, and the portion which directed that Miss Delmo "be not deprived of any award,citation or honor from the school,if otherwise entitled thereto is found at the lastparagraph of the same. How did he know the last paragraph if he did not read the letter. Defendants actuations regardingMissDelmo's camhad been one of bias and prejudice.When his action would favor him, he was deliberate and aspectto the utter prejudiceand detriment of Miss Delmo. Thus, although, as early as April 27,1966,he knew of the exoneration of Miss Delino by Director Bernardino,he withheld the information from Miss Delmo. This is eloquently dramatized by Exh. "11" and Exh. "13" On April 29,1966,Director Bernardino cabled himto furnish Violeta Delmo copy of the Decision,Exh. "L," but instead of informingMiss Delmo about the decision,sincehesaid he mailed back the decision on April 28,1966,he sent a night letter on April 29,1966,to Director Bernardino,informingthe latter that he had returned the decision (Exh. "l3"), together with the record. Why a night letter when the matter was of utmost urgency to the parties in the case,because graduation day was only four days ahead? An examination of the telegrams sent by the defendant shows that he had been sendingordinary telegram and not nightletters. (Exh. "5", Exhibit"7"). At least, if the defendant could not furnish a copy of the decision,(Exh. "L"), to Miss Delmo, he should have told her about itor that Miss Delmo's honors and citation in the commencement be announced or indicated.But Mr. Ledesma is one who cannot admit a mistake. Very ungentlemanly this is home out by his own testimony despite his knowledge that his decision to deprive Miss Delmo of honors due to her was overturned by Director Bernardino,he on his wrong belief.To quote the defendant,1 believed that she did not deserve those honors(Tsn Feb. 5, 1974,p. 43,Empasized supplied). Despite the telegram of Director Bernardino which the defendant received hours before the commencement executory on May 3-4,1966,he did not obey Director Bernardino becausehe said in his testimony that he would be embarrassment. Tan Feb 5,1974, P. 46). Evidently, he knew only his embarrassmentand not that of r Bernardino whose order was being flagrantly and wantonly disregarded by bim And certainly,not the leastof Miss Delmo's embarrassment. His acts speak eloquently of ho bad faith and unjustof mindwarped by his delicate sensitivity for havingbeen challenged by Miss Delmo, a mere student. xxx xxx xxx Finally thedefendant's behaviour relativeto Miss s casesmacks of contemptuous arrogance,oppression and abuse of power. Come to think of it. He refused to obey the directiveof Be o and instead,chose to feign ignoranceof it." (Reward on Appeal, p. 72-76). The trial courtawarded P20,000.00 to the estate of Violeta Delmo and P10,000.00 to her parents for moral damages; P5,000.00 for nominal damages to Violeta's estate; exemplary damages of P10,000.00 and P2,000.00 attorney's fees. On appeal,the Court of Appeals affirmed the decision.Hence, this petition. The issues raised in this petition can be reduced to the solequestion of whether or not the respondent Court of Appeal s erred in affirmingthe trial court's findingthatpetitioner is liablefor damages under Article27 of the New Civil Code.
- 4. We find noreason why the findings of the trial and appellatecourts should bereversed. It cannotbe disputed that Violeta Delmo went through a painful ordeal which was broughtabout by the petitioner's neglect of duty and callousness.Thus,moral damages are but proper. As we have affirmed in the caseof (Prudenciado v. AllianceTransportSystem, Inc.,148 SCRA 440, 448): There is no argument that moral damages includephysical suffering,mental anguish,fright,serious anxiety, besmirched reputation, wounded feelings,moral shock,social humiliation,and similarinjury.Though incapableof pecuniary computation, moral damages may be recovered if they are the proximate resultof defendant's wrongly act or omission."(People v. Baylon,129 SCRA 62 (1984). The Solicitor-General tries to cover-up the petitioner's deliberate omission to informMiss Delmo by statingthat it was not the duty of the petitioner to furnish her a copy of the Director's decision.Grantingthis to be true, itwas nevertheless the petitioner's duty to enforce the said decision.He could havedone so consideringthathe received the decision on April 27, 1966 and even though he sent it back with the records of the case, he undoubtedly read the whole of itwhich consisted of only three pages. Moreover, the petitioner should havehad the decency to meet with Mr. Delmo, the girl's father,and inform the latter, at the very leastof the decision.This,the petitioner likewisefailed to do, and not without the attendant bad faith which the appellatecourt correctly pointed out in its decision,to wit: Third, assumingthatdefendant could not furnish Miss Delmo of a copy of the decision,he could have used his discretion and plain common sense by informingher about itor he could havedirected the inclusion of Miss Delmo's honor in the printed commencement program or announced it duringthe commencement exercises. Fourth, defendant despite receipt of the telegram of Director Benardino hours before the commencement exercises on May 3-4, 1966, disobeyed his superior by refusingto give the honors due Miss Delmo with a lame excuse that he would be embarrassed if he did so,to the prejudiceof and in complete disregard of Miss Delmo's rights. Fifth, defendant did not even extend the courtesy of meeting Mr. Pacifico Delmo,father of Miss Delmo, who tried several times to see defendant in his officethus Mr. Delmo suffered extreme disappointment and humiliation. xxx xxx xxx Defendant, being a public officer should haveacted with circumspection and due regard to the rights of Miss Delmo. Inasmuch as he exceeded the scopeof his authority by defiantly disobeyingthe lawful directive of his superior,Director Bernardino,defendant is liablefor damages in his personal capacity... . (Rollo,pp- 57-58) Based on the undisputed facts,exemplary damages arealso in order. In the same caseof Prudenciado v. Alliance Transport System, Inc., supra., atp. 450,we ruled: The rationalebehind exemplary or corrective damages is,as the name implies,to providean example or correction for the public good (Lopez, et al.v. Pan American World Airways,16 SCRA 431). However, we do not deem itappropriateto award the spouses Delmo damages in the amount of P10,000.00 in their individual capacity,separately fromand in addition to what they are already entitled to as soleheirs of the deceased Violeta Delmo. Thus, the decision is modified insofar as moral damages areawarded to the spouses in their own behalf. WHEREFORE, the petition is DISMISSED for lack of merit. The decision of the Court of Appeals is AFFIRMED with the slight modification as stated in the preceding paragraph.This decision isimmediately executory. SO ORDERED. Fernan (Chairman), Feliciano, Bidin and Cortes, JJ., concur.
- 5. G.R. No. L-39999May 31, 1984 ROY PADILLA, FILOMENO GALDONES, ISMAEL GONZALGO and JOSE FARLEY BEDENIA, petitioners, vs. COURT OF APPEALS, respondent. Sisenando Villaluz, Sr. for petitioners. The Solicitor General for respondent. GUTIERREZ, JR., J.: This is a petition for review on certiorari of a Court of Appeals' decision which reversed the trial court's judgment of conviction and acquitted the petitioners of the crime of grave coercion on the ground of reasonabledoubt but inspiteof the acquittal order ed them to pay jointly and severally theamount of P9,000.00 to the complainants asactual damages. The petitioners were charged under the followinginformation: The undersigned Fiscal accused ROYPADILLA, FILOMENO GALDONES, PEPITO BEDENIA, YOLLY RICO, DAVID BERMUNDO, VILLANOAC, ROBERTO ROSALES, VILLANIA, ROMEO GARRIDO, JOSE ORTEGA, JR., RICARDO CELESTINO, REALINGO alias"KAMLON", JOHN DOE aliasTATO, and FOURTEEN (14) RICARDO DOES of the crime of GRAVE COERCION, committed as follows: That on or about February 8, 1964 at around 9:00 o'clock in the morning, in the municipality of Jose Panganiban, provinceof Camarines Norte, Philippines,and within the jurisdiction of this HonorableCourt,the above- named accused,Roy Padilla,Filomeno Galdones,Pepito Bedenia, Yolly Rico,David Bermundo, Villanoac,Roberto Rosales, Villania,Romeo Garrido,JoseOrtega, Jr., Ricardo Celestino,Realingo aliasKamlon,John Doe aliasTato,and Fourteen Richard Does,by confederating and mutually helpingone another, and actingwithout 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 closetheir stall located atthe Public Market, BuildingNo. 3, Jose Panganiban, Camarines Norte, and by subsequently forcibly openingthe door of said stall and thereafter brutally demolishing and destroying said stall and thefurnitures therein by axes and other massiveinstruments,and carryingaway the goods, wares and merchandise,to the damage and prejudiceof the said Antonio Vergara and his family in the
- 6. amount of P30,000.00in 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,beingthe incumbent municipal mayor,and the rest of the accused being policemen, except Ricardo Celestino who is a civilian,all of JosePanganiban,Camarines Norte, and that itwas committed with evident premeditation. The Court of FirstInstanceof Camarines Norte, Tenth Judicial Districtrendered a decision,the dispositiveportion of which states that: IN VIEW OF THE FOREGOING, the Court finds the accused Roy Padilla,Filomeno Galdonez,Ismael Gonzalgo and Jose Parley Bedenia guilty beyond reasonabledoubtof the crimeof grave coercion,and hereby imposes upon them to suffer an imprisonment of FIVE (5) months and One (1) day; to pay a fineof P500.00 each; to pay actual and compensatory damages in the amount of P10,000.00; moral damages in the amount of P30,000.00; and another P10,000.00 for exemplary damages, jointly and severa lly,and all the accessory penalties provided for by law; and to pay the proportionate costs of this proceedings. The accused Federico Realingo alias'Kamlon',David Bermundo, Christopher Villanoac,Godofredo Villania,Romeo Garrido,Roberto Rosales,Ricardo Celestino and JoseOrtega, are hereby ordered acquitted on grounds of reasonabledoubt for their criminal participation in thecrime charged. The petitioners appealed the judgment of conviction to the Court of Appeals. They contended that the trial cour t's findingof grave coercion was not supported by the evidence. Accordingto the petitioners, the town mayor had the power to order the clearance of market premises and the removal of the complainants' stall becausethe municipality had enacted municipal ordinances pursuantto which the market stall was a nuisanceper se. The petitioners stated that the lower courterred in findingthat the demolition of the complainants' stall was a violation of the very directive of the petitioner Mayor which gave the stall owners seventy two (72) hours to vacatethe market premises. The petitioners questioned the imposition of prison terms of five months and one day and of accessory penalties provided by law.They also challenged the order to pay fines of P500.00 each, P10,000.00 actual and compensatory damages, P30,000.00 moral damages,P10,000.00 exemplary damages, and the costs of the suit. The dispositiveportion of the decision of the respondent Court of Appeals states: WHEREFORE, we hereby modify the judgment appealed from in the sense that the appellants areacquitted on ground of reasonabledoubt. but they areordered to pay jointly and severally to complainants theamount of P9,600.00,as actual damages. The petitioners filed a motion for reconsideration contendingthat the acquittal of the defendants-appellants as to criminal liability results in the extinction of their civil liability.The Court of Appeals denied the motion holdingthat: xxx xxx xxx ... appellants' acquittal was based on reasonabledoubtwhether the crime of coercion was committed, not on facts that no unlawful actwas committed; as their takingthe lawinto their hands,destructing(sic) complainants' properties is unlawful,and,as evidence on record established thatcomplainants suffered actual damages,the imposition of actual damages is correct. Consequently, the petitioners filed this special civil action,contendingthat: I THE COURT OF APPEALS COMMITTED A GRAVE ERROR OF LAW OR GRAVELY ABUSED ITS DISCRETION IN IMPOSING UPON PETITIONERS PAYMENT OF DAMAGES TO COMPLAINANTS AFTER ACQUITTING PETITIONERS OF THE CRIME CHARGED FROM WHICH SAID LIABILITY AROSE. II THE COURT OF APPEALS ERRED IN HOLDING IN ITS RESOLUTION DATED DECEMBER 26, 1974 THAT SINCE APPELLANTS' ACQUITTAL WAS BASED ON REASONABLE DOUBT, NOT ON FACTS THAT NO UNLAWFUL ACT WAS COMMITTED, THE IMPOSITIONOF ACTUAL DAMAGES IS CORRECT. III THE COURT OF APPEALS COMMITTED A LEGAL INCONSISTENCY, IF NOT PLAIN JUDICIAL ERROR, IN HOLDING IN ITS APPEALED RESOLUTION THAT PETITIONERS COMMITTED AN UNLAWFUL ACT, THAT IS TAKING THE LAW INTO THEIR HANDS, DESTRUCTING (sic) 'COMPLAINANTS' PROPERTIES', AFTER HOLDING IN ITS MAIN DECISION OF NOVEMBER 6,1974 THAT THE ACTS FOR WHICH THEY WERE CHARGED DID NOT CONSTITUTE GRAVE COERCION AND THEY WERE NOT CHARGED OF ANY OTHER CRIME. IV
- 7. THE COURT OFAPPEALS ERRED IN ORDERING THE PETITIONERS HEREIN, APPELLANTS IN CA-G.R. NO. 13456CR, JOINTLY AND SEVERALLY, TO PAY COMPLAINANTS P9,600.00 IN SUPPOSED ACTUAL DAMAGES. The issueposed in the instantproceeding is whether or not the respondent court committed a reversibleerror in requiringthe petitioners to pay civil indemnity to the complainants after acquittingthem from the criminal charge. Petitioners maintain the view that where the civil liability which is included in the criminal action isthatarisingfromand as a consequence of the criminal act,and the defendant was acquitted in the criminal case,(no civil liability arisingfromthe c riminal case),no civil liability arisingfromthe criminal chargecould beimposed upon him. They cite precedents to the effect that the liability of the defendant for the return of the amount received by him may not be enforced in the criminal casebutmust be raised in a separate civil action for the recovery of the said amount(People v. Pantig,97 Phil.748;followingthe doctrine laid down in Manila Railroad Co.v. HonorableRodolfo Baltazar,49 O.G. 3874;Pueblo contra Abellera, 69 Phil.623;People v. Maniago 69 P hil. 496; People v. Miranda,5 SCRA 1067;Aldaba v. Elepafio 116 Phil.457).In the casebefore us, the petitioners were acquitted not because they did not commit the acts stated in the charge againstthem. There is no disputeover the forcibleopening of the market stall,its demolition with axes and other instruments, and the cartingaway of the merchandize. The petitioners were acquitted because these acts were denominated coercion when they properly constituted some other offense such as threat or malicious mischief. The respondent Court of Appeals stated in its decision: For a complaintto prosper under the foregoing provision,theviolence must be employed againstthe person, not againstproperty as what happened in the caseat bar. ... xxx xxx xxx The next problem is:May the accused be convicted of an offense other than coercion? From all appearances,they should havebeen prosecuted either for threats or malicious mischief.But the lawdoes not allowus to render judgment of conviction for either of these offenses for the reason that they were not indicted for, these offenses. The information under which they were prosecuted does not allegethe elements of either threats or maliciousmischief.Although the information mentions that the actwas by means of threats', it does not allege the particular threatmade. An accused person is entitled to be informed of the nature of the acts imputed to him before he can be made to enter into trial upon a valid information. We rulethat the crime of grave coercion has not been proved in accordancewith law. Whileappellants areentitled to acquittal they nevertheless are liablefor the actual damages suffered by the complainants by reason of the demolition of the stall and loss of someof their properties. The extinction of the penal action does not carry with itthat of the civil,unlesstheextinction proceeds from a declaration in a final judgment that the factfrom which the civil mightarisedid notexist. (Rule 111,Sec. 3 (c), Rev. Rules of Court; Laperal v. Aliza,51 OG.R. 1311,People v. Velez, 44 OG. 1811).In the instantcase,the factfrom which the civil might arise,namely, the demolition of the stall and loss of the properties contained therein; exists,and this is not denied by the accused.And sincethere is no showingthat the complainants havereserved or waived their rightto institutea separatecivil action,thecivil aspecttherein is deemed instituted with the criminal action.(Rule111, Sec. 1, Rev. Rules of Court). xxx xxx xxx Section 1 of Rule 111 of the Rules of Court states the fundamental proposition thatwhen a criminal action isinstituted,the civil action for recovery of civil liability arisingfromthe offense charged is impliedly instituted with it. There is no implied institution when the offended party expressly waives the civil action or reserves his rightto instituteit separately.(Morte Sr. v. Alvizo,Jr., 101 SCRA 221). The extinction of the civil action by reason of acquittal in the criminal caserefers exclusively to civil liability ex delic to founded on Article100 of the Revised Penal Code. (Elcano v. Hill,77 SCRA 98; Virata v. Ochoa,81 SCRA 472).In other words,the civil liability which is also extinguished upon acquittal of the accused is the civil liability arisingfromthe actas a crime. As easily as 1942,the Supreme Court speakingthrough JusticeJorge Bocobo in Barredo v. Garcia, et at. 73 Phil.607 laid down the rulethat the same punishableactor omission can createtwo kinds of civil liabilities againstthe accused and,where provided by law, his employer. 'There is the civil liability arisingfromthe actas a crime and the liability arisingfromthe same act as a quasi- delict. Either one of these two types of civil liability may be enforced againstthe accused,However, the offended party cannot recover damages under both types of liability.For instance,in cases of criminal negligenceor crimes due to reckless imprudence, Article2177 of the Civil Codeprovides:
- 8. Responsibility for faultornegligence under the preceding articleis entirely separateand distinctfromthe civil liability arisingfromnegligence under the Penal Code. But the plaintiff cannotrecover damages twice for the same act or omission of the defendant. Section 3 (c) of Rule 111 specifically providesthat: Sec. 3. Other civil actions arising from offenses. — In all cases notincluded in the preceding section the following rules shall beobserved: xxx xxx xxx xxx xxx xxx (c) Extinction of the penal action does not carry with itextinction of the civil,unlesstheextinction proceeds from a declaration in a final judgment that the fact from which the civil mightarisedid not exist.In other cases,the person entitled to the civil action may instituteitin the Jurisdiction and in themanner provided by lawagainstthe person who may be liablefor restitution of the thing and reparation or indemnity for the damage suffered. The judgment of acquittal extinguishesthe liability of the accused for damages only when it includes a declaration thatthe facts from which the civil mightarisedid notexist.Thus, the civil liability is notextinguished by acquittal where the acquittal is based on reasonabledoubt (PNB v. Catipon,98 Phil.286) as only preponderance of evidence is required in civil cases;where the court expressly declares thatthe liability of the accused is not criminal butonly civil in nature(De Guzman v. Alvia,96 Phil.558; People v. Pantig,supra) as,for instance,in the felonies of estafa, theft, and maliciousmischief committed by certain relatives who thereby incur only civil liability (See Art. 332, Revised Penal Code); and, where the civil liability does not arisefrom or is not based upon the criminal actof which the accused was acquitted (Castro v. Collector of Internal Revenue, 4 SCRA 1093; See Regalado, Remedial Law Compendium, 1983 ed., p. 623). Article29 of the Civil Codealso provides that: When the accused in a criminal prosecution isacquitted on the ground that his guilthas notbeen proved beyond reasonabledoubt, 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 filea bond to answer for damages in casethe complaintshould be found to be malicious. If in a criminal casethe judgment of acquittal is based upon reasonabledoubt, the court shall so declare.In the absence of any declaration to that effect, it may be inferred from the text of the decision whether or not the acquittal is dueto that ground. More recently, we held that the acquittal of the defendant in the criminal casewould not constitute an obstacleto the filingof a civil casebased on the same acts which led to the criminal prosecution: ... The findingby the respondent court that he spent said sumfor and in the interest of the CapizAgricultural and Fishery School and for his personal benefitis not a declaration thatthe fact upon which Civil CaseNo. V-3339 is based does not exist.The civil action barred by such a declaration isthecivil liability arisingfromthe offense charged, which is the one impliedly instituted with the criminal action.(Section 1,Rule III,Rules of Court.) Such a declaration would not bar a civil action filed againstan accused who had been acquitted in the criminal caseif the criminal action ispredicated on factual or legal considerations other than the commission of the offense charged. A person may be acquitted of malversation where, as in the caseat bar,he could show that he did not misappropriatethe public funds in his possession,buthe could be rendered liableto restore said funds or atleast to make a proper accountingthereof if he shall spend the same for purposes which are not authorized nor intended, and in a manner not permitted by applicablerules and regulations.(Republic v.Bello,120 SCRA 203) There appear to be no sound reasons to requirea separatecivil action to still befiled consideringthatthe facts to be proved in the civil casehavealready been established in the criminal proceedings where the accused was acquitted.Due process has been accorded the accused.He was, in fact, exonerated of the criminal charged.The constitutional presumption of innocencecalled for more vigilantefforts on the partof prosecutingattorneys and defense counsel,a keener a wareness by all witnesses of the serious implications of perjury,and a more studied consideration by the judge of the entire records and of applicablestatutes and precedents. To require a separatecivil action simply becausethe accused was acquitted would mean needless cloggingof court dockets and unnecessary duplication of litigation with all its attendantloss of time, effort, and money on the part of all c oncerned. The trial courtfound the followingfacts clearly established by the evidence adduced by both the prosecution and the defense: xxx xxx xxx (9) In the morning of February 8, 1964,then Chief Galdones,complyingwith the instructions contained in said Memorandum No. 32 of the Mayor, and upon seeing that Antonio Vergara had not vacated the premises in question, with the aid of his policemen,forced upon the store or stall and ordered the removal of the goods inside
- 9. the store ofVergara, at the same time takinginventory of the goods taken out, piled them outsidein front of the store and had itcordoned with a rope, and after all the goods were taken out from the store, ordered the demolition of said stall of Antonio Vergara.Since then up to the trial of this case,the whereabouts of the goods taken out from the store nor the materials of the demolished stall havenotbeen made known. The respondent Court of Appeals made a similar findingthat: On the morning of February 8th, becausethe said Vergaras had notup to that time complied with the order to vacate, the co-accused Chief of PoliceGaldones and some members of his policeforce,went to the market and, usingax,crowbars and hammers, demolished the stall of the Vergaras who were not present or around,and after havingfirstinventoried the goods and merchandisefound therein, they had them brought to the municipal buildingfor safekeeping. Inspiteof noticeserved upon the Vergaras to take possession of the goods and merchandisethus taken away, the latter refused to do so. The loss and damage to the Vergaras as they evaluated them were: Cost of stall construction P1,300.00 Value of furnitureand equipment judgment destroyed 300.00 Value of goods and equipment taken 8,000.00 P9,600.00 It is not disputed that the accused demolished the grocery stall of the complainants Vergaras and carted away its contents. The defense that they did so in order to abate what they considered a nuisanceper se is untenable, This finds no support in lawand in fact. The couplehas been payingrentals for the premises to the government which allowed them to leasethe stall.Itis,therefore, farfetched to say that the stall was a nuisanceper se which could be summarily abated. The petitioners, themselves, do not deny the fact that they caused the destruction of the complainant's marketstall and had its contents carted away. They state: On February 8, 1964, despite personal pleas on Vergaras by the Mayor to vacate the passageways of Market BuildingNo. 3, the Vergaras were still in thepremises, so the petitioners Chief of Policeand members of the Police Force of Jose Panganiban,pursuantto the Mayor' 6 directives, demolished the store of the Vergaras,made an inventory of the goods found in said store,and brought these goods to the municipal buildingunder the custody of the Municipal Treasurer,... The only supposed obstacleis the provision of Article29 of the Civil Code,earlier cited,that "when the accused in a criminal prosecution is acquitted on the ground that his guilthas not been proved beyond reasonabledoubt, a civil action for damages for the same act or omission may be instituted." According to some scholars,this provision of substantivelawcallsfor a separatecivil action and cannot be modified by a rule of remedial laweven in the interests of economy and simplicity and followingthedic tates of logic and common sense. As stated by retired Judge J. Cezar Sangco: ... if the Court finds the evidence sufficientto sustain thecivil action butinadequateto justify a conviction in the criminal action,may itrender judgment acquittingthe accused on reasonabledoubt, but hold himcivilly liable nonetheless? An affirmativeanswer to this question would be consistentwith the doctrinethat the two are distinctand separateactions,and win (a) dispensewith the reinstitutingof the same civil action,or onebased on quasi-delictor other independent civil action,and of presenting the same evidence: (b) save the injured party unnecessary expenses in the prosecution of the civil action or enablehim to take advantageof the free services of the fiscal;and (c) otherwise resolvethe unsettlingimplications of permittingthe reinstitution of a separate civil action whether based on delict,or quasi-delict,or other independent civil actions. ... But for the court to be ableto adjudicatein the manner here suggested, Art. 29 of the Civil Codeshould be amended because itclearly and expressly provides thatthe civil action based on the same actor omission may only be instituted in a separateaction,and therefore, may not inferentially beresolved in the same criminal action. To dismissthecivil action upon acquittal of the accused and disallowthe reinstitution of any other civil action, would likewiserender, unjustifiably,the acquittal on reasonabledoubtwithout any significance,and would violate the doctrine that the two actions aredistinctand separate. In the lightof the foregoing exposition,itseems evident that there is much sophistry and no pragmatismin the doctrine that itis inconsistentto award in the same proceedings damages againstthe accused after acquittinghim
- 10. on reasonabledoubt. Suchdoctrinemust recognize the distinctand separatecharacter of the two actions,the nature of an acquittal on reasonabledoubt,the vexatious and oppressiveeffects of a reservation or institution of a separatecivil action,and thatthe injured party is entitled to damages not becausethe act or omission is punishablebutbecausehe was damaged or injured thereby (Sangco, PhilippineLaw on Torts and Damages, pp. 288-289). We see no need to amend Article29 of the Civil Codein order to allowa court to grant damages despite a judgment of acquittal based on reasonabledoubt. What Article29 clearly and expressly provides isa remedy for the plaintiff in casethe defendant has been acquitted in a criminal prosecution on the ground that his guilthas not been proved beyond reasonabledoubt. It merely emphasizes that a civil action for damages is not precluded by an acquittal for the same criminal actor omission.The Civil Code provision does not state that the remedy can be availed of only in a separatecivil action.Aseparatecivil casemay be filed but there is no statement that such separatefilingis theonly and exclusivepermissiblemode of recovering damages. There is nothing contrary to the Civil Codeprovision in the rendition of a judgment of acquittal and a judgment awardingdamages in the same criminal action.The two can stand sideby side.A judgment of acquittal operates to extinguish the criminal liability.Itdoes not, however, extinguish the civil liability unless thereis clear showingthatthe act from which civil liability mightarisedid notexist. A different conclusion would beattributingto the Civil Codea trivial requirement, a provision which imposes an uncalled fo r burden before one who has already been the victimof a condemnable, yet non-criminal,actmay be accorded the justicewhich he seeks. We further note the rationalebehind Art. 29 of the Civil Codein arrivingatthe intent of the legislator thatthey could not possibly have intended to make it more difficultfor the aggrieved party to recover justcompensation by makinga separatecivil action mandatory and exclusive: The old rule that the acquittal of the accused in a criminal casealso releases himfromcivil liability is oneof the most serious flaws in the Philippinelegal system. Ithas given riseto numberless instances of miscarriageof justice, where the acquittal was dueto a reasonabledoubtin the mind of the court as to the guiltof the accused.The reasoningfollowed is thatinasmuch as the civil responsibility is derived fromthe the criminal offense,when the latter is not proved, civil liability cannotbe demanded. This is one of those cases where confused thinkingleads to unfortunate and deplorableconsequences.Such reasoningfailsto drawa clear lineof demarcation between criminal liability and civil responsibility,and to determine the logical resultof the distinction.Thetwo liabilities areseparateand distinctfromeach other. One affects the social order and the other, privaterights. One is for the punishment or correction of the offender while the other is for reparation of damages suffered by the aggrieved party... it is justand proper that, for the purposes of the imprisonment of or fineupon the accused,the offense should be proved beyond reasonabledoubt. But for the purpose of indemnifyingthe complainingparty,why should the offense also beproved beyond reasonable doubt? Is not the invasion or violation of every privateright to be proved only by preponderance of evidence? Is the right of the aggrieved person any less privatebecausethe wrongful actis also punishableby the criminal law? (Code Commission,pp. 45-46). A separatecivil action may bewarranted where additional facts haveto be established or more evidence must be adduced or where the criminal casehas been fully terminated and a separatecomplaintwould be justas efficaciousor even more expedient than a timely remand to the trial courtwhere the criminal action was decided for further hearings on the civil aspects of the case.The offended party may, of course,choose to filea separateaction.These do not existin this case.Consideringmoreover the delays suffered by the casein the trial,appellate,and review stages,it would be unjustto the complainants in thiscaseto require atthis time a separate civil action to be filed. With this in mind, we therefore hold that the respondent Court of Appeals did not err in awardingdamages despite a judgment of acquittal. WHEREFORE, we hereby AFFIRM the decision of the respondent Court of Appeals and dismiss thepetition for lack of merit. SO ORDERED. Fernando, C.J., Teehankee, Makasiar, Guerrero, Abad Santos, Melencio- Herrera, Plana,Escolin, Relova and De la Fuente, JJ., concur. Aquino, J., concur in the result. De Castro, J., took no part. Concepcion, Jr. J., is on leave.
- 11. G.R. No. 102007September 2,1994 PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. ROGELIO BAYOTAS y CORDOVA, accused-appellant. The Solicitor General for plaintiff-appellee. Public Attorney's Office for accused-appellant. ROMERO, J.: In Criminal CaseNo. C-3217 filed before Branch 16, RTC Roxas City,Rogelio Bayotas y Cordova was charged with Rape and eventually convicted thereof on June 19, 1991 in a decision penned by Judge Manuel E. Autajay. Pending appeal of his conviction,Bayotas died on February 4, 1992 at the National Bilibid Hospital dueto cardio respiratory arrestsecondary to hepatic encephalopathy secondary to hipato carcin oma gastric malingering.Consequently,the Supreme Court in its Resolution of May 20,1992 dismissed the criminal aspectof the appeal. However, it required the Solicitor General to fileits comment with regard to Bayotas' civil liability arisingfromhis commi ssion of the offense charged. In his comment, the Solicitor General expressed his view that the death of accused-appellantdid notextinguish his civil liability as a resultof his commission of the offense charged. The Solicitor General,relyingon the caseofPeople v. Sendaydiego 1 insists thatthe appeal should still beresolved for the purposeof reviewing his conviction by the lower courton which the civil liability i sbased. Counsel for the accused-appellant,on the other hand, opposed the view of the Solicitor General arguingthatthe death of the accused whilejudgment of conviction is pendingappeal extinguishes both his criminal and civil penalties.In supportof his position, said counsel invoked the rulingof the Court of Appeals in People v. Castillo and Ocfemia 2 which held that the civil obligation in a criminal casetakes rootin the criminal liability and,therefore, civil liability is extinguished if accused should diebefore final judgment is rendered. We arethus confronted with a singleissue:Does death of the accused pendingappeal of his conviction extinguish hiscivil liability? In the aforementioned caseof People v. Castillo, this issuewas settled in the affirmative.This same issueposed therein was phrased thus: Does the death of Alfredo Castillo affectboth his criminal responsibility and his civil liability as a consequenceof the alleged crime?
- 12. It resolved thisissuethru the followingdisquisition: Article89 of the Revised Penal Code is the controllingstatute.It reads, in part: Art. 89. How criminal liability is totally extinguished. — Criminal liability is totally extinguished: 1. By the death of the convict, as to the personal penalties;and as to the pecuniary penalties liability therefor is extinguished only when the death of the offender occurs before final judgment; With reference to Castillo'scriminal liability,there is no question. The lawis plain.Statutory construction is unnecessary.Said liability is extinguished. The civil liability,however, poses a problem. Such liability is extinguished only when the death of the offender occurs before final judgment. Saddled upon us is the task of ascertainingthe legal importof the term "final judgment." Is itfinal judgment as contradistinguished froman interlocutory order? Or, is ita judgment which is final and executory? We go to the genesis of the law.The legal precept contained in Article89 of the Revised Penal Code heretofore transcribed is lifted from Article132 of the Spanish El Codigo Penal de 1870 which, in part, recites: La responsabilidad penal seextingue. 1. Por la muerte del reo en cuanto a las penas personales siempre,y respecto a las pecuniarias, solo cuando a su fallecimiento no hubiere recaido sentencia firme. xxx xxx xxx The code of 1870 . . . itwill be observed employs the term "sentencia firme." Whatis "sentencia firme" under the old statute? XXVIII Enciclopedia Juridica Española,p.473, furnishes the ready answer: It says: SENTENCIA FIRME. La sentencia que adquierela fuerza de las definitivaspor no haberse utilizado por las partes litigantes recurso alguno contra elladentro de los terminos y plazos legales concedidos al efecto. "Sentencia firme" really should beunderstood as one which is definite. Because, it is only when judgment is such that, as Medina y Maranon puts it,the crimeis confirmed — "en condena determinada;" or, in the words of Groizard,the guiltof the accused becomes — "una verdad legal."Prior thereto, should the accused die, according to Viada,"no hay legalmente, en tal caso,ni reo, ni delito, ni responsabilidad criminal deninguna clase."And, as Judge Kapunan well explained,when a defendant dies before judgment becomes executory, "there cannot be any determination by final judgment whether or not the felony upon which the civil action mightariseexists,"for the simplereason that "there is no party defendant." (I Kapunan,Revised Penal Code, Annotated, p. 421.Senator Francisco holdsthesame view. Francisco,Revised Penal Code, Book One, 2nd ed., pp. 859-860) The legal import of the term "final judgment" is similarly reflected in the Revised Penal Code. Articles 72 and 78 of that legal body mention the term "final judgment" in the sense that it is already enforceable.This also bringsto mind Section 7, Rule 116 of the Rules of Court which states that a judgment in a criminal casebecomes final "after the lapseof the period for perfecting an appeal or when the sentence has been partially or totally satisfied or served, or the defendant has expressly waived in writinghis rightto appeal." By fair intendment, the legal precepts and opinions herecollected funnel down to one positiveconclusion:The term final judgment employed in the Revised Penal Code means judgment beyond recall.Really,as longas a judgment has not become executory, it cannotbe truthfully said thatdefendant is definitely guilty of the felony charged againsthim. Not that the meaning thus given to final judgment is without reason.For where, as in this case,the rightto institutea separatecivil action isnotreserved, the decision to be rendered must, of necessity, cover "both the criminal and thecivil aspects of the case." People vs. Yusico (November 9, 1942),2 O.G., No. 100, p. 964. See also:People vs. Moll, 68 Phil.,626, 634; Francisco, Criminal Procedure,1958 ed., Vol. I,pp. 234,236. Correctly, Judge Kapunan observed that as "the civil action isbased solely on the felony committed and of which the offender might be found guilty, the death of the offender extinguishes the civil liability."I Ka punan,Revised Penal Code, Annotated, supra. Here is the situation obtainingin the present case:Castillo's criminal liability is out.His civil liability is soughtto be enforced by reason of that criminal liability.But then, if we dismiss,as wemust, the criminal action and letthe civil aspectremain, we will be faced with the anomalous situation whereby we will becalled upon to clamp civil liability
- 13. in a casewherethe sourcethereof — criminal liability — does not exist. And, as was well stated in Bautista, et al. vs. Estrella, et al., CA-G.R. No. 19226-R, September 1, 1958, "no party can be found and held criminally liablein a civil suit,"which solely would remain if we are to divorceitfrom the criminal proceeding." This rulingof the Court of Appeals in the Castillo case3 was adopted by the Supreme Court in the cases ofPeopleof the Philippines v. Bonifacio Alison, et al., 4 People of the Philippines v. Jaime Jose, et al. 5 and People of the Philippines v. Satorre 6 by dismissingthe appeal in view of the death of the accused pending appeal of said cases. As held by then Supreme Court JusticeFernando in the Alison case: The death of accused-appellantBonifacio Alison havingbeen established,and consideringthatthere is as yet no final judgment in view of the pendency of the appeal, the criminal and civil liability of the said accused-appellant Alison was extinguished by his death (Art. 89,Revised Penal Code; Reyes' Criminal Law,1971 Rev. Ed., p. 717, citing People v. Castillo and Ofemia C.A., 56 O.G. 4045);consequently, the caseagainsthimshould bedismissed. On the other hand, this Court in the subsequent cases of Buenaventura Belamala v. Marcelino Polinar 7 andLamberto Torrijos v. The Honorable Court of Appeals 8 ruled differently. In the former, the issuedecided by this court was:Whether the civil liability of one accused of physical injuries who died before final judgment is extinguished by his demiseto the extent of barringany claim therefore againsthis estate.It was the contention of the administrator-appellanttherein that the death of the accused prior to final judgment extinguished all criminal and civil liabilities resultingfromthe offense, in view of Article89, paragraph 1 of the Revised Penal Code. However, this court ruled therein: We see no merit in the plea that the civil liability has been extinguished, in view of the provisionsof the Civil Code of the Philippines of 1950 (Rep. Act No. 386) that became operative eighteen years after the revised Penal Code. As pointed out by the Court below, Article33 of the Civil Codeestablishes a civil action for damages on accountof physical injuries,entirely separate and distinct from the criminal action. Art. 33. In cases of defamation, fraud,and physical injuries,a civil action for damages,entirely separateand distinctfromthe criminal action,may be brought by the injured party. Such civil action shall proceed independently of the criminal prosecution,and shall requireonly a preponderance of evidence. Assumingthat for lack of express reservation,Belamala's civil action for damages was to be considered instituted together with the criminal action still,sinceboth proceedings were terminated without final adjudication,the civil action of the offended party under Article 33 may yet be enforced separately. In Torrijos, the Supreme Court held that: xxx xxx xxx It should be stressed that the extinction of civil liability follows theextinction of the criminal liability under Article 89, only when the civil liability arises fromthe criminal actas its only basis. Stated differently, where the civil liability does not existindependently of the criminal responsibility,the extinction of the latter by death, ipso facto extinguishes the former, provided, of course, that death supervenes before final judgment. The said principle does not apply in instantcasewherein the civil liability springs neither solely nor originally fromthe crime itself but from a civil contractof purchaseand sale.(Emphasis ours) xxx xxx xxx In the above case,the court was convinced that the civil liability of the accused who was charged with estafa could likewise trace its genesis to Articles 19,20 and 21 of the Civil Codesincesaid accused had swindled thefirstand second vendees of the property subjectmatter of the contract of sale. Ittherefore concluded: "Consequently, whilethe death of the accused herein extinguished his criminal liability includingfine,his civil liability based on the laws of human relations remains." Thus itallowed the appeal to proceed with respect to the civil liability of the accused,notwithstandingthe extinction of his criminal liability dueto his death pending appeal of his conviction. To further justify its decision to allowthecivil liability to survive,the court relied on the following ratiocination:SinceSection 21, Rule 3 of the Rules of Court 9 requires the dismissal of all money claims againstthe defendant whose death occurred prior to the final judgment of the Court of FirstInstance(CFI),then it can be inferred that actions for recovery of money may continue to be heard on appeal,when the death of the defendant supervenes after the CFI had rendered its judgment. In such case, explained this tribunal,"the name of the offended party shall beincluded in the titleof the caseas plaintiff-appelleeand the legal representative or the heirs of the deceased-accused should be substituted as defendants-appellants."
- 14. It is,thus, evidentthat as jurisprudenceevolved from Castillo to Torrijos,the ruleestablished was thatthe survival of the civil liability depends on whether the same can be predicated on sources of obligations other than delict.Stated differently, the claimfor civil liability is also extinguished together with the criminal action if itwere solely based thereon, i.e., civil liability ex delicto. However, the Supreme Court in People v. Sendaydiego, et al. 10 departed from this long-established principleof law.In this case, accused Sendaydiego was charged with and convicted by the lower court of malversation thru falsification of public documents. Sendaydiego's death supervened duringthe pendency of the appeal of his conviction. This court in an unprecedented move resolved to dismissSendaydiego's appeal butonly to the extent of his criminal liability.His civil liability was allowed to survivealthough itwas clear that such claimthereon was exclusively dependent on the criminal action already extinguished.The legal importof such decision was for the court to continue exercisingappellatejurisdiction over the entire appeal,passingupon the correctness of Sendaydiego's conviction despitedismissal of the criminal action,for the purpose of determining if he is civilly liable.In doingso, this Court issued a Resolution of July 8, 1977 statingthus: The claimof complainantProvinceof Pangasinan for the civil liability survived Sendaydiego becausehis death occurred after final judgmentwas rendered by the Court of FirstInstanceof Pangasinan,which convicted himof three complex crimes of malversation through falsification and ordered him to indemnify the Provincein the total sum of P61,048.23 (should be P57,048.23). The civil action for the civil liability is deemed impliedly instituted with the criminal action in theabsence of express waiver or its reservation in a separate action (Sec. 1, Rule 111 of the Rules of Court). The civil action for the civil liability isseparateand distinctfromthe criminal action (Peopleand Manuel vs. Coloma,105 Phil.1287;Roa vs. De la Cruz, 107 Phil.8). When the action is for the recovery of money and the defendant dies before final judgment in the Court of First Instance,it shall bedismissed to be prosecuted in the manner especially provided in Rule87 of the Rules of Court (Sec. 21, Rule 3 of the Rules of Court). The implication isthat,if the defendant dies after a money judgment had been rendered againsthimby the Court of FirstInstance,the action survives him.Itmay be continued on appeal (Torrijos vs.Courtof Appeals,L-40336, October 24, 1975; 67 SCRA 394). The accountablepublic officer may still becivilly liablefor the funds improperly disbursed although hehas no criminal liability (U.S. vs. Elvina,24 Phil.230;PhilippineNational Bank vs.Tugab, 66 Phil.583). In view of the foregoing, notwithstandingthe dismissal of the appeal of the deceased Sendaydiego insofar as his criminal liability is concerned,the Court Resolved to continueexercisingappellatejurisdiction over his possiblecivil liability for the money claims of the Provinceof Pangasinan arisingfromthe alleged criminal acts complained of,as if no criminal casehad been instituted againsthim,thus making applicable,in determininghis civil liability,Article 30 of the Civil Code. . . and, for that purpose, his counsel is directed to i nformthis Court within ten (10) days of the names and addresses of the decedent's heirs or whether or not his estate is under administration and has a duly appointed judicial administrator.Said heirs or administrator will besubstituted for the deceased insofar as thecivil action for the civil liability is concerned (Secs.16 and 17, Rule 3, Rules of Court). Succeeding cases 11 raisingthe identical issuehavemaintained adherence to our rulingin Sendaydiego; in other words,they were a reaffirmanceof our abandonment of the settled rulethat a civil liability solely anchored on the criminal (civil liability ex delicto) is extinguished upon dismissal of the entire appeal due to the demise of the accused. But was itjudicious to haveabandoned this old ruling? A re-examination of our decision in Sendaydiego impels us to revert to the old ruling. To restate our resolution of July 8, 1977 in Sendaydiego: The resolution of the civil action impliedly instituted in the criminal action can proceed irrespectiveof the latter's extinction due to death of the accused pendingappeal of his conviction,pursuantto Article 30 of the Civil Codeand Section 21, Rule 3 of the Revised Rules of Court. Article30 of the Civil Codeprovides: When a separatecivil action isbroughtto demand civil liability arisingfroma criminal offense,and no criminal proceedings are instituted duringthe pendency of the civil case,a preponderance of evidence shall likewisebe sufficientto prove the act complained of. Clearly,the text of Article30 could not possibly lend supportto the rulingin Sendaydiego. Nowhere in its text is there a grant of authority to continue exercisingappellatejurisdiction over the accused's civil liability ex delictowhen his death supervenes during appeal.What Article30 recognizes is an alternativeand separatecivil action which may be brought to demand civil liability arising from a criminal offenseindependently of any criminal action.In the event that no criminal proceedings areinstituted during the
- 15. pendency of saidcivil case,the quantum of evidence needed to prove the criminal actwill haveto be that which is compatibl ewith civil liability and thatis,preponderance of evidence and not proof of guiltbeyond reasonabledoubt. Citingor invokingArticle30 to justify the survival of the civil action despiteextinction of the criminal would in effect merely beg the question of whether civil liability ex delicto survives upon extinction of the criminal action dueto death of the accused duringappeal of his conviction.This is because whether asserted in the criminal action or in a separatecivil action,civil liability ex delicto is extinguished by the death of the accused whilehis conviction is on appeal.Article89 of the Revised Penal Code is clear on this matter: Art. 89. How criminal liability is totally extinguished. — Criminal liability is totally extinguished: 1. By the death of the convict, as to the personal penalties;and as to pecuniary penalties,liability therefor is extinguished only when the death of the offender occurs before final judgment; xxx xxx xxx However, the rulingin Sendaydiego deviated from the expressed intent of Article89. It allowed claims for civil liability ex delicto to surviveby ipso facto treating the civil action impliedly instituted with the criminal,as onefiled under Article30, as though no criminal proceedings had been filed but merely a separatecivil action.This had the effect of converting such claims fromone which is dependent on the outcome of the criminal action to an entirely new and separateone, the prosecution of which does not even necessitatethe filingof criminal proceedings. 12Onewould be hard put to pinpointthe statutory authority for such a transformation. It is to be borne in mind that in recovering civil liability ex delicto, the samehas perforce to be determined in the criminal action, rooted as itis in the court's pronouncement of the guiltor innocence of the accused.This is but to render fealty to the intendment of Article100 of the Revised Penal Code which provides that "every person criminally liablefor a felony is also civilly liable."In such cases,extinction of the criminal action dueto death of the accused pending appeal inevitably signifies theconcomitantexti nction of the civil liability.Mors Omnia Solvi. Death dissolves all things. In sum, in pursuingrecovery of civil liability arisingfromcrime, the final determination of the criminal liability is a condition precedent to the prosecution of the civil action,such thatwhen the criminal action isextinguished by the demise of accused- appellantpendingappeal thereof, said civil action cannotsurvive.The claimfor civil liability springs outof and is dependent upon facts which,if true, would constitute a crime. Such civil liability is an inevitableconsequenceof the criminal liability and is to be declared and enforced in the criminal proceeding.This is to be distinguished fromthat which is contemplated under Article 3 0 of the Civil Codewhich refers to the institution of a separate civil action thatdoes not draw its lifefrom a criminal proceeding.The Sendaydiego resolution of July 8, 1977,however, failed to take note of this fundamental distinction when itallowed the survival of the civil action for the recovery of civil liability ex delicto by treating the same as a separatecivil action referred to under Article30. Surely, itwill take more than justa summary judicial pronouncement to authorize the conversion of said civil action to an independent one such as that contemplated under Article 30. Ironically however, the main decision in Sendaydiego did not apply Article30, the resolution of July 8, 1977 notwithstanding.Thus, it was held in the main decision: Sendaydiego's appeal will beresolved only for the purposeof showing his criminal liability which is thebasis of the civil liability for which his estatewould be liable. 13 In other words, the Court, in resolvingthe issueof his civil liability,concomitantly madea determination on whether Senda ydiego, on the basis of evidenced adduced, was indeed guilty beyond reasonabledoubt of committing the offense charged. Thus, it upheld Sendaydiego's conviction and pronounced the same as the source of his civil liability.Consequently, although Article30 was not applied in the final determination of Sendaydiego's civil liability,there was a reopening of the criminal action already extinguished which served as basis for Sendaydiego's civil liability.Wereiterate: Upon death of the accused pendingappeal of his conviction,the criminal action isextinguished inasmuch as there is no longer a defendant to stand as the accused;the civil action instituted therein for recovery of civil liability ex delicto is ipso facto extinguished,grounded as itis on the criminal. Section 21, Rule 3 of the Rules of Court was also invoked to serve as another basis for the Sendaydiegoresolution of July 8, 1977.In citingSec. 21, Rule 3 of the Rules of Court, the Court made the inference that civil actionsof the type involved in Sendaydiego consistof money claims,the recovery of which may be continued on appeal if defendant dies pending appeal of his conviction by holdinghis estate liabletherefor. Hence, the Court's conclusion: "When the action is for the recovery of money" "and the defendant dies before final judgment in the court of First Instance,it shall bedismissed to be prosecuted in the manner especially provided"in Rule87 of the Rules of Court (Sec. 21, Rule 3 of the Rules of Court). The implication isthat,if the defendant dies after a money judgment had been rendered againsthimby the Court of FirstInstance,the action survives him.Itmay be continued on appeal.
- 16. Sadly,relianceon this provisionof lawis misplaced.From the standpointof procedural law,this coursetaken inSendaydiego cannot be sanctioned.As correctly observed by JusticeRegalado: xxx xxx xxx I do not, however, agree with the justification advanced in both Torrijos and Sendaydiego which,relyingon the provisionsof Section 21, Rule 3 of the Rules of Court, drew the strained implication therefrom that where the civil liability instituted together with the criminal liabilities had already passed beyond the judgment of the then Court of FirstInstance(now the Regional Trial Court),the Court of Appeals can continue to exercise appellatejurisdiction thereover despite the extinguishment of the component criminal liability of the deceased. This pronouncement, which has been followed in the Court's judgments subsequent and consonantto Torrijos and Sendaydiego, should be set asideand abandoned as being clearly erroneous and unjustifiable. Said Section 21 of Rule 3 is a ruleof civil procedurein ordinary civil actions.There is neither authority nor justification for its application in criminal procedureto civil actions instituted together with and as partof criminal actions.Nor is there any authority in lawfor the summary conversion from the latter category of an ordinary civil action upon the death of the offender. . . . Moreover, the civil action impliedly instituted in a criminal proceedingfor recovery of civil liability ex delicto can hardly be categorized as an ordinary money claimsuch as thatreferred to in Sec. 21, Rule 3 enforceable before the estate of the decea sed accused. Ordinary money claims referred to in Section 21, Rule3 must be viewed in lightof the provisions of Section 5, Rule 86 invol ving claims againstthe estate, which in Sendaydiego was held liablefor Sendaydiego's civil liability."Whatare contemplated in Section 21 of Rule 3, in relation to Section 5 of Rule 86, 14 arecontractual money claims whilethe claims involved in civil liability ex delicto may includeeven the restitution of personal or real property." 15Section 5, Rule 86 provides an exclusive enumeration of what claims may be filed againsttheestate. These are: funeral expenses, expenses for the lastillness,judgments for money and claimarisingfrom contracts,expressed or implied.It is clear thatmoney claims arisingfromdelictdo not form partof this exclusiveenumeration. Hence, there could be no legal basis in (1) treatinga civil action ex delicto as an ordinary contractual money claimreferred to in Section 21, Rule 3 of the Rules of Court and (2) allowingitto surviveby filinga claimtherefor before the estate of the deceased accused.Rather, itshould be extinguished upon extinction of the criminal action engendered by the death of the accused pend ing finality of his conviction. Accordingly,we rule: if the privateoffended party, upon extinction of the civil liability ex delicto desires to recover damages from the same act or omission complained of, he must subjectto Section 1, Rule 111 16 (1985 Rules on Criminal Procedureas amended) filea separate civil action,this timepredicated not on the felony previously charged but on other sources of obligation.Thesource of obligation upon which the separatecivil action ispremised determines againstwhom the same shall beenforced. If the sameact or omission complained of also arises fromquasi-delict or may, by provision of law,resultin an injury to person or property (real or personal),the separatecivil action mustbe filed againstthe executor or administrator 17 of the estate of the accused pursuantto Sec. 1, Rule 87 of the Rules of Court: Sec. 1. Actions which may and which may not be brought against executor or administrator. — No action upon a claimfor the recovery of money or debt or interest thereon shall becommenced againstthe executor or administrator;butactions to recover real or personal property, or an interest therein, from the estate, or to enforce a lien thereon, and actions to recover damages for an injury to person or property, real or personal, may be commenced againsthim. This is in consonancewith our rulingin Belamala 18 where we held that, in recoveringdamages for injury to persons thru an independent civil action based on Article33 of the Civil Code, the same must be filed againstthe executor or administrator of the estate of deceased accused and not againstthe estate under Sec. 5, Rule 86 because this ruleexplicitly limitstheclaimto those for funeral expenses, expenses for the lastsickness of the decedent, judgment for money and claims arisingfromcontract,expres s or implied.Contractual money claims,westressed,refers only to purely personal obligations other than those which have their source in delictor tort. Conversely, if the same actor omission complained of also arises fromcontract,the separate civil action mustbe filed againstthe estate of the accused,pursuantto Sec. 5, Rule 86 of the Rules of Court. From this lengthy disquisition,we summarizeour rulingherein: 1. Death of the accused pending appeal of his conviction extinguishes hiscriminal liability as well as thecivil liability based solely thereon. As opined by JusticeRegalado,in this regard, "the death of the accused prior to final judgment terminates his criminal
- 17. liability and onlythe civil liability directly arisingfromand based solely on the offense committed, i.e., civil liability ex delicto in senso strictiore." 2. Corollarily,the claimfor civil liability survives notwithstandingthedeath of accused,if the same may also be predicated on a sourceof obligation other than delict. 19 Article1157 of the Civil Codeenumerates these other sources of obligation fromwhich the civil liability may ariseas a resultof the sameact or omission: a) Law 20 b) Contracts c) Quasi-contracts d) . . . e) Quasi-delicts 3. Where the civil liability survives,as explained in Number 2 above, an action for recovery therefor may be pursued but only by way of filinga separatecivil action and subjectto Section 1, Rule 111 of the 1985 Rules on Criminal Procedureas amended. This separate civil action may be enforced either againstthe executor/administrator or the estate of the accused,depending on the sourceof obligation upon which the same is based as explained above. 4. Finally,theprivate offended party need not fear a forfeiture of his rightto filethis separa tecivil action by prescription,in cases where during the prosecution of the criminal action and prior to its extinction,the private-offended party instituted together therewith the civil action.In such case,the statute of limitationson the civil liability is deemed interrupted duringthe pendency of the criminal case,conformably with provisionsof Article115521 of the Civil Code, that should thereby avoid any apprehension on a possibleprivation of rightby prescription.22 Applyingthis set of rules to the caseatbench, we hold that the death of appellantBayotas extinguished his criminal liability and the civil liability based solely on the actcomplained of, i.e., rape. Consequently, the appeal is hereby dismissed withoutqualification. WHEREFORE, the appeal of the late Rogelio Bayotas is DISMISSED with costs de oficio. SO ORDERED. Narvasa, C.J., Feliciano, Padilla, Bidin, Regalado, Davide, Jr., Bellosillo, Melo, Quiason, Puno,Vitug, Kapunan and Mendoza, JJ., concur. Cruz, J., is on leave. 12 JusticeBarredo in his concurringopinion observed that: . . . this provision contemplates prosecution of the civil liability arisingfroma criminal offensewithout the need of any criminal proceedingto prove the commission of the crime as such,that is without havingto prove the criminal liability of the defendant so longas his actcausingdamageor prejudiceto the offended party is proven by preponderance of evidence. 13 Supra, p. 134. 14 Sec. 5. Claims which must be filed under the notice. If not filed, barred; exceptions. — All claimsfor money againstthe decedent, arisingfromcontract,express or implied,whether the same be due, not due, or contingent, all claims for funeral expenses and expenses for the lastsicknessof the decedent, and judgment for money against the decedent, must be filed within the time limited in the notice; otherwise they arebarred forever, except that they may be set forth as counterclaims in any action thatthe executor or administrator may bringagainstthe claimants.Wherean executor or administrator commences an action,or prosecutes an action already commenced by the deceased in his lifetime, the debtor may set forth by answer the claims hehas againstthedecedent, instead of presenting them independently to the court as herein provided,and mutual claims may be set off againsteach other in such action;and if final judgmentis rendered in favor of the defendant, the amount so determined shall be considered the true balanceagainstthe estate, as though the claimhad been presented directly before the court in the administration proceedings.Claims notyet due, or contingent, may be approved attheir present value. 15 As explained by J. Regalado in the deliberation of this case. 16 Sec. 1. Institute of criminal and civil actions. — When a criminal action isinstituted,the civil action for the recovery of civil liability is impliedly instituted with the criminal action,unless theoffended party waives the civil action,reserves his rightto instituteit separately, or institutes the civil action prior to the criminal action. Such civil action includes recovery of indemnity under the Revised Penal Code, and damages under Article32, 33, 34 and 2176 of the Civil Codeof the Philippines arisingfromthe same actor omis sion of the accused.
- 18. A waiver ofany of the civil actions extinguishes theothers. The institution of,or the reservation of the rightto file, any of said civil actionsseparately waives theothers. The reservation of the right to institute the separatecivil actionsshall bemade before the prosecution starts to present its evidence and under circumstances affordingthe offended party a reasonableopportunity to make such reservation. In no casemay the offended party recover damages twice for the same actor omission of the accused. When the offended party seeks to enforce civil liability againstthe accused by way of moral,nominal,temperate or exemplary damages,the filingfees for such civil action as provided in these Rules shall constitutea firstl ien on the judgment except in an award for actual damages. In cases wherein the amount of damages, other than actual,is alleged in the complaintor information,the correspondingfilingfees shall bepaid by the offended party upon the filingthereof in court for trial. 17 JusticeRegalado cited the Court's rulingin Belamala that sincethe damages sought, as a resultof the felony committed amounts to injury to person or property, real or personal,the civil liability to be recovered must be claimed againsttheexecutor/administrator and not againstthe estate. 18 Ibid. 19 JusticeVitug who holds a similar viewstated: "The civil liability may still bepursued in a separatecivil action but it must be predicated on a sourceof obligation other than delict, except when by statutory provision an independent civil action isauthorized such as,to exemplify, in the instanceenumerated in Article 33 of the Civil Code." JusticeRegalado stressed that: Conversely, such civil liability is notextinguished and survives the deceased offender where it also arises simultaneously fromor exists as a consequence or by reason of a contract, as in Torrijos; or from law,as stated in Torrijos and in the concurringopinion in Sendaydiego,such as in reference to the Civil Code; or from a quasi- contract; or is authorized by law to be pursued in an independent civil action,as in Belamala.Indeed, without these exceptions, itwould be unfair and inequitableto deprive the victimof his property or recovery of damages therefor, as would have been the fate of the second vendee in Torrijos or the provincial government in Sendaydiego." G.R. No. 74886 December 8, 1992 PRUDENTIAL BANK, petitioner, vs. INTERMEDIATE APPELLATE COURT, PHILIPPINE RAYON MILLS, INC. and ANACLETO R. CHI, respondents. DAVIDE, JR., J.: Petitioner seeks to review and set asidethe decision 1 of public respondent; Intermediate Appellate Court (now Court of Appeals), dated 10 March 1986, in AC-G.R. No. 66733 which affirmed in toto the 15 June 1978 decision of Branch 9 (Quezon City) of the then Court of FirstInstance(now Regional Trial Court) of Rizal in Civil CaseNo. Q-19312.The latter involved an action instituted by the petitioner for the recovery of a sum of money representing the amount paid by itto the Nissho Company Ltd. of Japan for textile machinery imported by the defendant, now privaterespondent, PhilippineRayon Mills,Inc.(hereinafter PhilippineRayon), represented by co-defendant Anacleto R. Chi. The facts which gave riseto the instant controversy are summarized by the public respondent as follows: On August 8, 1962,defendant-appellantPhilippineRayon Mills,Inc.entered into a contractwith Nissho Co., Ltd. of Japan for the importation of textile machineries under a five-year deferred payment plan (ExhibitB, Plaintiff's Folder of Exhibits,p 2). To effect payment for said machineries,the defendant-appellantapplied for a commercial letter of credit with the Prudential Bank and Trust Company in favor of Nissho.By virtue of said appli cation,the Prudential Bank opened Letter of Credit No. DPP-63762 for $128,548.78 (ExhibitA, Ibid., p. 1). Againstthis letter of credit, drafts were drawn and issued by Nissho (Exhibits X,X-1 to X-11, Ibid., pp. 65, 66 to 76), which were all paid by the Prudential Bank through its correspondentin Japan, the Bank of Tokyo, Ltd. As indicated on their faces, two of these drafts (ExhibitX and X-1, Ibid., pp. 65-66) were accepted by the defendant-appellantthrough its president, Anacleto R. Chi,whilethe others were not (Exhibits X-2 to X-11, Ibid., pp. 66 to 76). Upon the arrival of the machineries,the Prudential Bank indorsed the shippingdocuments to the defendant- appellantwhich accepted delivery of the same. To enable the defendant-appellantto take delivery of the
- 19. machineries,itexecuted, by priorarrangement with the Prudential Bank,a trust receipt which was signed by Anacleto R. Chi in his capacity as President(sic) of defendant-appellantcompany (ExhibitC, Ibid., p. 13). At the back of the trust receipt is a printed form to be accomplished by two sureties who, by the very terms and conditions thereof, were to be jointly and severally liableto the Prudential Bank should the defendant-appellant fail to pay the total amount or any portion of the drafts issued by Nissho and paid for by Prudential Bank. The defendant-appellantwas ableto take delivery of the textile machineries and installed the same at its factory siteat 69 Obudan Street, Quezon City. Sometime in 1967, the defendant-appellantceased business operation (sic). On December 29, 1969,defendant- appellant's factory was leased by Yupangco Cotton Mills for an annual rental of P200,000.00 (ExhibitI, Ibid., p. 22). The leasewas renewed on January 3, 1973 (ExhibitJ, Ibid., p. 26). On January 5, 1974,all the textile machineries in the defendant-appellant's factory were sold to AIC Development Corporation for P300,000.00 (ExhibitK, Ibid., p. 29). The obligation of the defendant-appellantarisingfromthe letter of creditand the trustreceipt remained unpaid and unliquidated.Repeated formal demands (Exhibits U, V, and W, Ibid.,pp. 62,63, 64) for the payment of the said trust receipt yielded no result Hence, the present action for the collection of the principal amountof P956,384.95 was filed on October 3, 1974 againstthedefendant-appellant and Anacleto R. Chi.In their respective answers,the defendants interposed identical special defenses, viz., the complaintstates no causeof action; if there is,the same has prescribed;and the plaintiff is guilty of laches. 2 On 15 June 1978, the trial courtrendered its decision thedispositiveportion of which reads: WHEREFORE, judgment is hereby rendered sentencing the defendant PhilippineRayon Mills,Inc.to pay plaintiff the sum of P153,645.22,the amounts due under Exhibits "X" & "X-1", with interest at 6% per annum beginning September 15, 1974 until fully paid. Insofar as the amounts involved in drafts Exhs. "X" (sic) to "X-11", inclusive,the same not havingbeen accepted by defendant PhilippineRayon Mills,Inc.,plaintiff'scauseof action thereon has not accrued, hence, the instantcaseis premature. Insofar as defendant Anacleto R. Chi is concerned, the caseis dismissed.Plaintiff is ordered to pay defendant Anacleto R. Chi the sum of P20,000.00 as attorney's fees. With costs againstdefendant PhilippineRayon Mills,Inc. SO ORDERED. 3 Petitioner appealed the decision to the then Intermediate Appellate Court. In urgingthe said courtto reverse or modify the decision, petitioner alleged in its Brief that the trial courterred in (a) disregardingits rightto reimbursement from the privaterespondents for the entire unpaid balanceof the imported machines,the total amount of which was paid to the Nissho Company Ltd., thereby violatingthe principleof the third party payor's rightto reimbursement provided for in the second paragraph of Article 1236 of the Civil Codeand under the ruleagainstunjustenrichment; (b) refusingto hold Anacleto R. Chi,as the responsibleofficer of defendant corporation,liableunder Section 13 of P.D No 115 for the entire unpaid balanceof the imported machines covered by the bank 's trust receipt (Exhibit"C"); (c) findingthat the solidary guaranty clausesigned by Anacleto R. Chi is not a guaranty at all ;(d) controverting the judicial admissionsof Anacleto R. Chi that he is at leasta simpleguarantor of the said trustreceiptobl igation;(e) contravening, based on the assumption thatChi is a simpleguarantor,Articles 2059,2060 and 2062 of the Civil Cod eand the related evidence and jurisprudencewhich providethat such liability had already attached;(f) contravening the judicial admissionso f PhilippineRayon with respect to its liability to pay the petitioner the amounts involved in the drafts (Exhibi ts "X", "X-l"to "X-11''); and (g) interpreting "sight" drafts as requiringacceptanceby PhilippineRayon before the latter could be held liablethereon. 4 In its decision,public respondentsustained the trial courtin all respects.As to the firstand l astassigned errors,itruled that the provision on unjustenrichment, Article2142 of the Civil Code,applies only if there is no express contractbetween the parties and there is a clear showingthat the payment is justified.In the instantcase,the rel ationship existingbetween the petitioner and PhilippineRayon is governed by specific contracts,namely the application for letters of credit,the promissory note, the dr afts and the trust receipt. With respect to the lastten (10) drafts (Exhibits "X-2"to "X-11") which had not been presented to and were not accepted by PhilippineRayon,petitioner was not justified in unilaterally payingthe amounts stated therein. The public respondent did not agree with the petitioner's claimthatthe drafts were sight drafts which did not require presentment for acceptanceto PhilippineRayon becauseparagraph 8 of the trust receipt presupposes prior acceptanceof the drafts.Sincethe ten (10) drafts were not presented and accepted, no valid demand for payment can be made.
- 20. Public respondentalso disagreedwith the petitioner's contention that privaterespondent Chi is solidarily liablewith Phili ppine Rayon pursuantto Section 13 of P.D. No. 115 and based on his signatureon the solidary guaranty clauseatthe dorsal s ideof the trust receipt. As to the firstcontention, the public respondent ruled that the civil liability provided for in said Section 13 attaches only after conviction.As to the second, it expressed misgivingsas to whether Chi's signatureon the trust receipt made the latter automatically liablethereon because the so-called solidary guaranty clauseatthe dorsal portion of the trust receipt is to be signed not by one (1) person alone,but by two (2) persons;the lastsentence of the same is incomplete and unsigned by witnesses; and itis not acknowledged before a notary public.Besides,even grantingthat it was executed and acknowledged before a notary public, Chi cannot be held liabletherefor because the records fail to show that petitioner had either exhausted the properties of Philippine Rayon or had resorted to all legal remedies as required in Article2058 of the Civil Code. As provided for under Articles 205 2 and 2054 of the Civil Code, the obligation of a guarantor is merely accessory and subsidiary,respectively.Chi's liability would therefore ariseonly when the principal debtor fails to comply with his obligation. 5 Its motion to reconsider the decision havingbeen denied by the public respondentin its Resolution of 11 June 1986, 6 petitioner filed the instantpetition on 31 July 1986 submittingthe followinglegal issues: I. WHETHER OR NOT THE RESPONDENT APPELLATE COURT GRIEVOUSLY ERRED IN DENYING PETITIONER'S CLAIM FOR FULL REIMBURSEMENT AGAINST THE PRIVATE RESPONDENTS FOR THE PAYMENT PETITIONER MADE TO NISSHO CO. LTD. FOR THE BENEFIT OF PRIVATE RESPONDENT UNDER ART. 1283 OF THE NEW CIVIL CODE OF THE PHILIPPINES AND UNDER THE GENERAL PRINCIPLE AGAINST UNJUST ENRICHMENT; II.WHETHER OR NOT RESPONDENT CHI IS SOLIDARILY LIABLE UNDER THE TRUST RECEIPT (EXH. C); III.WHETHER OR NOT ON THE BASIS OF THE JUDICIAL ADMISSIONS OF RESPONDENT CHI HE IS LIABLE THEREON AND TO WHAT EXTENT; IV. WHETHER OR NOT RESPONDENT CHI IS MERELY A SIMPLE GUARANTOR; AND IF SO; HAS HIS LIABILITY AS SUCH ALREADY ATTACHED; V. WHETHER OR NOT AS THE SIGNATORY AND RESPONSIBLE OFFICER OF RESPONDENT PHIL. RAYON RESPONDENT CHI IS PERSONALLY LIABLE PURSUANT TO THE PROVISION OF SECTION 13, P.D. 115; VI. WHETHER OR NOT RESPONDENT PHIL. RAYON IS LIABLE TO THE PETITIONER UNDER THE TRUST RECEIPT (EXH. C); VII. WHETHER OR NOT ON THE BASIS OF THE JUDICIAL ADMISSIONS RESPONDENT PHIL. RAYON IS LIABLE TO THE PETITIONER UNDER THE DRAFTS (EXHS. X, X-1 TO X-11) AND TO WHAT EXTENT; VIII.WHETHER OR NOT SIGHT DRAFTS REQUIRE PRIOR ACCEPTANCE FROM RESPONDENT PHIL. RAYON BEFORE THE LATTER BECOMES LIABLE TO PETITIONER. 7 In the Resolution of 12 March 1990, 8 this Court gave due course to the petition after the filingof the Comment thereto by private respondent Anacleto Chi and of the Reply to the latter by the petitioner; both parties were also required to submit their respective memoranda which they subsequently complied with. As We see it, the issues may be reduced as follows: 1. Whether presentment for acceptanceof the drafts was indispensableto make Philippine Rayon liablethereon; 2. Whether PhilippineRayon is liableon the basis of the trust receipt; 3. Whether private respondent Chi is jointly and severally liablewith PhilippineRayon for the obligation soughtto be enforced and if not, whether he may be considered a guarantor; in the latter situation,whether the caseshould havebeen dismissed on the ground of lack of causeof action as there was no prior exhaustion of PhilippineRayon's properties. Both the trial courtand the public respondentruled that PhilippineRayon could be held liablefor the two (2) drafts,Exhibits "X" and "X-1", becauseonly these appear to have been accepted by the latter after due presentment. The liability for the remainingten (10) drafts (Exhibits "X-2"to "X-11" inclusive) did not arisebecausethe same were not presented for acceptance. In short,both courts concluded that acceptance of the drafts by PhilippineRayon was indispensableto make the latter liablethereon. We areunabl eto agree with this proposition.The transaction in thecaseat bar stemmed from PhilippineRayon's application for a commercial letter of credit with the petitioner in the amount of $128,548.78 to cover the former's contractto purchaseand import loomand tex tile machinery from Nissho Company,Ltd. of Japan under a five-year deferred payment plan.Petitioner approved the application.As correctly ruled by the trial courtin its Order of 6 March 1975: 9 . . . By virtue of said Application and Agreement for Commercial Letter of Credit, plaintiff bank 10 was under obligation to pay through its correspondent bank in Japan the drafts that Nisso (sic) Company, Ltd., periodically
- 21. drew againstsaid letterof credit from 1963 to 1968,pursuantto plaintiff'scontractwith the defendant Philippine Rayon Mills,Inc.In turn,defendant PhilippineRayon Mills,Inc.,was obligated to pay plaintiff bank the amounts of the drafts drawn by Nisso (sic) Company, Ltd. againstsaid plaintiff bank together with any accruingcommercial charges,interest, etc. pursuantto the terms and conditions stipulated in the Application and Agreement of Commercial Letter of CreditAnnex "A". A letter of creditis defined as an engagement by a bank or other person made at the request of a customer that the issuer will honor drafts or other demands for payment upon compliancewith the conditions specified in the credit. 11 Through a letter of credit, the bank merely substitutes its own promise to pay for one of its customers who in return promises to pay the bank the amount of funds mentioned in the letter of creditplus creditor commitment fees mutually agreed upon. 12 In the instantcasethen, the drawee was necessarily theherein petitioner. It was to the latter that the drafts were presented for payment. In fact, there was no need for acceptanceas the issued drafts aresightdrafts.Presentment for acceptance is necessary only in the cases expressly provided for in Section 143 of the Negotiable Instruments Law (NIL). 13 The said section reads: Sec. 143.When presentment for acceptance must be made. — Presentment for acceptancemust be made: (a) Where the bill is payableafter sight,or in any other case,where presentment for acceptance is necessary in order to fix the maturity of the instrument; or (b) Where the bill expressly stipulates thatitshall bepresented for acceptance; or (c) Where the bill isdrawn payableelsewherethan at the residence or placeof business of the drawee. In no other caseis presentment for acceptancenecessary in order to render any party to the bill liable. Obviously then, sight drafts do not require presentment for acceptance. The acceptance of a bill is thesignification by the drawee of his assentto the order of the drawer; 14 this may be done in writingby the drawee in the bill itself,or in a separateinstrument. 15 The parties herein agree, and the trial courtexplicitly ruled,thatthe subject,drafts are sightdrafts.Said the latter: . . . In the instantcasethe drafts being at sight,they aresupposed to be payableupon acceptance unless plaintiff bank has given the PhilippineRayon Mills Inc.timewithin which to pay the same. The firsttwo drafts (Annexes C & D, Exh. X & X-1) were duly accepted as indicated on their face (sic), and upon such acceptance should have been paid forthwith. These two drafts were not paid and although PhilippineRayon Mills ought to have paid the same, the fact remains that until now they are still unpaid. 16 Corollarily,they are, pursuantto Section 7 of the NIL, payableon demand. Secti on 7 provides: Sec. 7. When payable on demand. — An instrument is payableon demand — (a) When so it is expressed to be payableon demand, or at sight, or on presentation; or (b) In which no time for payment in expressed. Where an instrument is issued,accepted, or indorsed when overdue, itis,as regards the person so issuing, accepting,or indorsingit,payableon demand. (emphasis supplied) Paragraph 8 of the Trust Receipt which reads:"My/our liability for payment at maturity of any accepted draft,bill of exchange or indebtedness shall notbe extinguished or modified" 17 does not, contrary to the holdingof the public respondent, contemplate prior acceptanceby PhilippineRayon,but by the petitioner. Acceptance, however, was not even necessary in the firstplacebecausethe drafts which were eventually issued were sightdrafts And even if these were not sightdrafts,thereby necessitatingacceptance,itwould be the petitioner — and not PhilippineRayon — which had to accept the same for the latter was not the drawee. Presentment for acceptanceis defined an the production of a bill of exchange to a drawee for acceptance. 18 The trial courtand the public respondent, therefore, erred in rulingthat presentment for acceptance was an indispensablerequisitefor PhilippineRayon's liability on the drafts to attach.Contrary to both courts' pronouncements, PhilippineRayon immediately became liablethereon upon petitioner's payment thereof. Such is the essence of the letter of creditissued by the petitioner. A different conclusion would violatethe principleupon which commercial letters of creditare founded because in such a case,both the beneficiary and the issuer,Nissho Company Ltd. and the petitioner, respectively, would be placed at the mercy of Phili ppineRayon even if the latter had already received the imported machinery and the petitioner had fully paid for it. The typical settingand purpose of a letter of credit are described in Hibernia Bank and Trust Co. vs. J. Aron & Co., Inc., 19 thus:
- 22. Commercial letters ofcredit have come into general use in international sales transactionswhere much time necessarily elapses between the saleand the receipt by a purchaser of the merchandise,duringwhich interval great pricechanges may occur.Buyers and sellers strugglefor the advantage of position.The seller is desirousof being paid as surely and as soon as possible,realizingthatthe vendee at a distantpoint has itin his power to reject on trivial grounds merchandiseon arrival,and causeconsiderablehardship to the shipper.Letters of credit meet this condition by affordingcelerity and certainty of payment. Their purpose is to insureto a seller payment of a definite amount upon presentation of documents. The bank deals only with documents. It has nothingto do with the quality of the merchandise. Disputes as to the merchandiseshipped may ariseand be litigated later between vendor and vendee, but they may not impede acceptance of drafts and payment by the issuingbank when the proper documents arepresented. The trial courtand the public respondent likewiseerred in disregardingthetrust receipt and in not holdingthat Philippine Rayon was liablethereon. In People vs. Yu Chai Ho, 20 this Court explains thenature of a trust receipt by quoting In re Dunlap Carpet Co., 21 thus: By this arrangement a banker advances money to an intendingimporter, and thereby lends the aid of capital,of credit, or of business facilities and agencies abroad,to the enterprise of foreign commerce. Much of this trade could hardly be carried on by any other means, and therefore itis of the firstimportancethat the fundamental factor in the transaction,the banker's advanceof money and credit, should receive the amplestprotection. Accordingly,in order to secure that the banker shall berepaid atthe critical point — that is,when the imported goods finally reach the hands of the intended vendee — the banker takes the full titleto the goods atthe very beginning; he takes it as soon as the goods are bought and settled for by his payments or acceptances in the foreign country, and he continues to hold that title as his indispensablesecurity until the goods are sold in the United States and the vendee is called upon to pay for them. This security is notan ordinary pledge by the importer to the banker, for the importer has never owned the goods, and moreover he is not ableto deliver the possession;butthe security is the complete title vested originally in thebankers,and this characteristicof the transaction has again and again been recognized and protected by the courts. Of course,the title is atbottom a security title, as ithas sometimes been called,and the banker is always under the obligation to reconvey; but only after his advances havebeen fully repaid and after the importer has fulfilled the other terms of the contract. As further stated in National Bank vs. Viuda e Hijos de Angel Jose, 22 trust receipts: . . . [I]n a certain manner, . . . partakeof the nature of a conditional saleas provided by the Chattel Mortgage Law, that is,the importer becomes absoluteowner of the imported merchandiseas soon an he has paid its price.The ownership of the merchandisecontinues to be vested in the owner thereof or in the person who has advanced payment, until he has been paid in full,or if the merchandisehas already been sold,the proceeds of the sale should be turned over to himby the importer or by his representativeor successor in interest. Under P.D. No. 115,otherwise known an the Trust Receipts Law, which took effect on 29 January 1973,a trust receipt transaction is defined as "any transaction by and between a person referred to in this Decree as the entruster, and another person referred to in this Decree as the entrustee, whereby the entruster, who owns or holds absolutetitleor security interests' over certain specified goods, documents or instruments, releases the same to the possession of the entrustee upon the latter's execution and deliver y to the entruster of a signed document called the "trust receipt" wherein the entrustee binds himself to hold the designated goods, documents or instruments in trust for the entruster and to sell or otherwise disposeof the goods, documents or instruments with the obligation to turn over to the entruster the proceeds thereof to the extent of the amount owing to the entruster or as appears in the trust receipt or the goods, instruments themselves if they are unsold or not otherwise disposed of,in accordancewith the terms and conditions specified in the trusts receipt, or for other purposes substantially equivalentto any one of the following:. . ." It is alleged in the complaintthat privaterespondents "not only have presumably put said machinery to good use and have pro fited by its operation and/or disposition butvery recent information that(sic) reached plaintiff bank thatdefendants already sold the machinery covered by the trust receipt to Yupangco Cotton Mills,"and that "as trustees of the property covered by the trust receipt, . . . and therefore actingin fiduciary (sic) capacity,defendants have willfully violated their duty to account for the whereabouts of the machinery covered by the trust receipt or for the proceeds of any lease,saleor other disposition of the same that they may have made, notwithstandingdemands therefor; defendants have fraudulently misapplied or converted to their own use any money realized from the lease, sale,and other disposition of said machinery." 23 Whilethere is no specific prayer for the delivery to the petitioner by PhilippineRayon of the proceeds of the saleof the machinery covered by the trustreceipt, such relief is covered by the general prayer for "such further and other relief as may be justand equitableon the premises." 24 And although itis true that the
- 23. petitioner commenced acriminal action for theviolation of the Trust Receipts Law, no legal obstacleprevented itfrom enfor cingthe civil liability arisingoutof the trust, receipt in a separate civil action.Under Section 13 of the Trust Receipts Law, the failureof an entrustee to turn over the proceeds of the saleof goods, documents or instruments covered by a trust receipt to the extent of the amount owing to the entruster or as appear in the trustreceipt or to return said goods,documents or instruments if they were not sold or disposed of in accordancewith the terms of the trustreceipt shall constitutethe crime of estafa, punishableunder the provisionsof Article315,paragraph 1(b) of the Revised Penal Code. 25Under Article33 of the Civil Code,a civil action for damages, entirely separateand distinctfrom the criminal action,may be brought by the injured party in cases of defamation, fraud an d physical injuries.Estafa falls underfraud. We also conclude,for the reason hereinafter discussed,and not for that adduced by the public respondent, that private respondent Chi's signaturein the dorsal portion of the trust receipt did not bind him solidarily with PhilippineRayon.The statement a t the dorsal portion of the said trustreceipt, which petitioner describes as a "solidary guaranty clause",reads: In consideration of the PRUDENTIAL BANK AND TRUST COMPANY complyingwith the foregoing, we jointly and severally agreeand undertake to pay on demand to the PRUDENTIAL BANK AND TRUST COMPANY all sums of money which the said PRUDENTIAL BANK AND TRUST COMPANY may call upon us to pay arisingoutof or pertainingto, and/or in any event connected with the default of and/or non-fulfillmentin any respect of the undertaking of the aforesaid: PHILIPPINE RAYON MILLS, INC. We further agree that the PRUDENTIAL BANK AND TRUST COMPANY does not have to take any steps or exhaustits remedy againstaforesaid: before making demand on me/us. (Sgd.) Anacleto R. Chi ANACLE TO R. CHI 26 Petitioner insiststhatby virtueof the clear wordingof the statement, specifically theclause". . . we jointly and severally agreeand undertake . . .," and the concludingsentence on exhaustion,Chi's liability therein is solidary. In holdingotherwise, the public respondent ratiocinates as follows: With respect to the second argument, we have our misgivings as to whether the mere signatureof defendant- appelleeChi of (sic) the guaranty agreement, Exhibit"C-1", will makeit an actionabledocument. It should be noted that Exhibit"C-1" was prepared and printed by the plaintiff-appellant.A perusal of Exhibit"C-1" shows that it was to be signed and executed by two persons.It was signed only by defendant-appellee Chi. Exhibit"C-1" was to be witnessed by two persons,but no one signed in that capacity.The lastsentence of the guaranty clauseis incomplete. Furthermore, the plaintiff-appellantalso failed to have the purported guarantee clauseacknowledged before a notary public.All these show that the alleged guaranty provision was disregarded and,therefore, not consummated. But granting arguendo that the guaranty provision in Exhibit"C-1" was fully executed and acknowledged still defendant-appellee Chi cannot be held liablethereunder becausethe records showthat the pl aintiff-appellanthad neither exhausted the property of the defendant-appellantnor had it resorted to all legal remedies againstthe said defendant-appellantas provided in Article2058 of the Civil Code.The obligation of a guarantor is merely accessory under Article2052 of the Civil Code and subsidiary under Article2054 of the Civil Code.Therefore, the liability of the defendant-appellee arises only when the principal debtor failsto comply with his obligation. 27 Our own readingof the questioned solidary guaranty clauseyieldsno other conclusion than thatthe obligation of Chi is only thatof a guarantor. This is further bolstered by the lastsentence which speaks of waiver of exhaustion,which,nevertheless, is ineffectivein this casebecausethe spacetherein for the party whose property may not be exhausted was not filled up. Under Article2058 of the Civil Code,the defense of exhaustion (excussion) may be raised by a guarantor before he may be held liablefor the obligatio n. Petitioner likewiseadmits thatthe questioned provision isa solidary guaranty clause, thereby clearly distinguishingitfroma contractof surety. It, however, described the guaranty as solidary between the guarantors;this would have been correct if two (2) guarantors had signed it. The clause"we jointly and severally agreeand undertake" refers to the undertaking of the two (2) parties who areto sign itor to the liability existingbetween themselves. It does not refer to the undertakingbetween either one or both of
- 24. them on theone hand and the petitioner on the other with respect to the liability described under the trust receipt. Elsewise stated, their liability isnotdivisibleas between them, i.e., it can be enforced to its full extent againstany one of them. Furthermore, any doubt as to the import, or true intent of the solidary guaranty clauseshould beresolved againstthe petitioner . The trust receipt, together with the questioned solidary guaranty clause,is on a form drafted and prepared solely by the petitioner; Chi's participation therein is limited to the affixingof his signaturethereon. It is,therefore, a contractof adhesion; 28 as such,itmust be strictly construed againstthe party responsiblefor its preparation. 29 Neither can We agree with the reasoningof the public respondent that this solidary guaranty clausewas effectively disregarded simply becauseitwas not signed and witnessed by two (2) persons and acknowledged before a notary public.Whileindeed,the clauseought to have been signed by two (2) guarantors,the fact that it was only Chi who signed the same did not make his actan idleceremony or render the clausetotally meaningless.By his signing,Chi became the soleguarantor.The attestation by witnesses and the acknowledgement before a notary public arenot required by lawto make a party liableon the instrument. The ruleis that contracts shall beobligatory in whatever form they may have been entered into, provided all the essential requisites for their validity arepresent; however, when the lawrequires that a contractbe in some form in order that it may be valid or enforceable,or that it be proved in a certain way, that requirement is absoluteand indispensable. 30 With respectto a guaranty, 31 which is a promiseto answer for the debt or default of another, the lawmerely requires that it, or some note or memorandum thereof, be in writing.Otherwise, itwould be unenforceable unless ratified. 32 Whilethe acknowledgement of a surety before a notary public is required to make the same a public document, under Article1358 of the Civil Code, a contractof guaranty does not have to appear in a public document. And now to the other ground relied upon by the petitioner as basis for the solidary liability of Chi,namely the criminal proceedings againstthe latter for the violation of P.D. No. 115.Petitioner claims thatbecauseof the said criminal proceedings,Chi would be answerablefor the civil liability arisingtherefrom pursuantto Section 13 of P.D. No. 115. Public res pondentrejected this claim because such civil liability presupposes prior conviction ascan begleaned from the phrase"without prejudiceto the civil l iability arisingfromthe criminal offense."Both are wrong. The said section reads: Sec. 13. Penalty Clause. — The failureof an entrustee to turn over the proceeds of the saleof the goods, documents or instruments covered by a trust receipt to the extent of the amount owing to the entruster or as appears in the trustreceipt or to return said goods,documents or instruments if they were not sold or disposed of in accordancewith the terms of the trust receipt shall constitutethe crime of estafa,punishableunder the provisionsof ArticleThree hundred and fifteen, paragraph one (b) of Act Numbered Three thousand eight hundred and fifteen, as amended, otherwise known as the Revised Penal Code. If the violation or offense is committed by a corporation,partnership,association or other juridical entities,the penalty provided for in this Decree shall be imposed upon the directors,officers,employees or other officialsor persons therein responsiblefor the offense, without prejudiceto the civil liabilities arisingfromthe criminal offense. A closeexamination of the quoted provision reveals thatitis the lastsentence which provides for the correctsolution.Itis clear that if the violation or offense is committed by a corporation,partnership,association or other juridical entities,the penalty shall be imposed upon the directors,officers,employees or other officialsor persons therein responsiblefor the offense. The penalty referred to is imprisonment, the duration of which would depend on the amount of the fraud as provided for in Article315 of the Revised Penal Code. The reason for this is obvious:corporations,partnerships,associationsand other juridical entities cannotbe put in jail.However, it is these entities which are made liablefor the civil liability arisingfromthe criminal offense. This is the importof the clause"without prejudiceto the civil liabilities arisingfromthe criminal offense." And, as We stated earlier,sincethat violation of a trustreceipt constitutes fraud under Article33 of the Civil Code, petitioner was actingwell within its rights in fili ngan independent civil action to enforce the civil liability arisingtherefrom againstPhilippineRayon. The remainingissueto be resolved concerns the propriety of the dismissal of the caseagainstprivaterespondent Chi. The tr ial court based the dismissal,and the respondent Court its affirmancethereof, on the theory that Chi is not liableon the trust receipt in any capacity — either as surety or as guarantor — because his signatureatthe dorsal portion thereof was useless;and even if he could be bound by such signatureas a simpleguarantor,he cannot, pursuantto Article2058 of the Civil Code,be compelled to pay until after petitioner has exhausted and resorted to all legal remedies againstthe principal debtor,PhilippineRayon.The records fail to show that petitioner had done so 33 Relianceis thus placed on Article2058 of the Civil Codewhich provides: Art. 2056. The guarantor cannotbe compelled to pay the creditor unless the latter has exhausted all theproperty of the debtor, and has resorted to all the legal remedies againstthe debtor. Simply stated, there is as yet no causeof action againstChi.
- 25. We arenot persuaded.Excussion isnota condition sine qua non for the institution of an action againsta guarantor.In Southern Motors, Inc. vs. Barbosa, 34 this Court stated: 4. Although an ordinary personal guarantor — not a mortgagor or pledgor — may demand the aforementioned exhaustion,the creditor may, prior thereto, secure a judgment againstsaid guarantor,who shall beentitled, however, to a deferment of the execution of said judgment againsthimuntil after the properties of the principal debtor shall havebeen exhausted to satisfy theobligation involved in the case. There was then nothing procedurally objectionablein impleadingprivaterespondent Chi as a co-defendant in Civil CaseNo.Q-19312 before the trial court.As a matter of fact, Section 6, Rule 3 of the Rules of Court on permissivejoinder of parties explici tly allows it.It reads: Sec. 6. Permissive joinder of parties. — All persons in whom or againstwhom any rightto relief in respect to or arisingoutof the same transaction or series of transactions isalleged to exist, whether jointly,severally,or in the alternative,may, except as otherwise provided in these rules,join as plaintiffs or be joined as defendants in one complaint,where any question of lawor factcommon to all such plaintiffsor to all such defendants may arisein the action;but the court may make such orders as may be justto prevent any plaintiff or defendant from being embarrassed or put to expense in connection with any proceedings in which he may have no interest. This is the equity rule relatingto multifariousness.Itis based on trial convenienceand is designed to permit the joinder of plaintiffs or defendants whenever there is a common question of lawor fact. It will savethe parties unnecessary work,trouble and expense. 35 However, Chi's liability is limited to the principal obligation in thetrust receipt plus all theaccessories thereof includi ngjudicial costs; with respect to the latter, he shall only beliablefor those costs incurred after being judicially required to pay. 36 Interest and damages, being accessories of the principal obligation,should also bepaid;these, however, shall run only from the date of the filing of the complaint.Attorney's fees may even be allowed in appropriatecases. 37 In the instantcase,the attorney's fees to be paid by Chi cannotbe the same as that to be paid by PhilippineRayon sinceit is only the trust receipt that is covered by the guaranty and not the full extent of the latter's liability.All things considered,he can be held liable for the sum of P10,000.00 as attorney's fees in favor of the petitioner. Thus, the trial courtcommitted grave abuse of discretion in dismissingthe complaintas againstprivaterespondent Chi and condemning petitioner to pay him P20,000.00 as attorney's fees. In the lightof the foregoing, it would no longer necessary to discussthe other issues raised by the petitioner WHEREFORE, the instantPetition is hereby GRANTED. The appealed Decision of 10 March 1986 of the public respondent in AC-G.R. CV No. 66733 and,necessarily,thatof Branch 9 (Quezon City) of the then Court of FirstInstanceof Rizal in Civil CaseNo. Q-19312 arehereby REVERSED and SET ASIDE and another is hereby entered: 1. Declaringprivaterespondent PhilippineRayon Mills,Inc.liableon the twelve drafts in question (Exhibits "X", "X-1" to "X-11", inclusive) and on the trust receipt (Exhibit"C"), and orderingi t to pay petitioner: (a) the amounts due thereon in the total sum of P956,384.95 as of 15 September 1974,with interest thereon at six percent (6%) per annum from 16 September 1974 until itis fully paid,less whatever may have been applied thereto by virtue of foreclosureof mortgages, if any; (b) a sumequal to ten percent (10%) of the aforesaid amountas attorney's fees; and (c) the costs. 2. Declaringprivaterespondent Anacleto R. Chi secondarily liableon the trust receipt and orderinghim to pay the face valuethereof, with interest at the legal rate, commencing from the date of the filingof the complaintin Civil CaseNo. Q-19312 until the same is fully paid as well as the costs and attorney's fees in the sum of P10,000.00 if the writ of execution for the enforcement of the above awards againstPhilippineRayon Mills,Inc.is returned unsatisfied. Costs againstprivaterespondents. SO ORDERED. Gutierrez, Jr., Bidin, Romero and Melo, JJ., concur.
- 26. G.R. No. L-40486August 29, 1975 PAULINO PADUA and LUCENA BEBIN PADUA, plaintiffs-appellants, vs. GREGORIO N. ROBLES and BAY TAXI CAB, defendants-appellees. Alberto R. de Joya for plaintiffs-appellants. Cardenas & Peralta Law Office for defendants-appellees. CASTRO, J.: Resolving this appeal by the spouses Paulino and Lucena Bebin Padua,we set asidethe order dated October 25, 1972 of the Court of FirstInstanceof Zambales dismissingtheir complaint,in civil case1079-O,and remand this casefor further proceedings. In the early morningof New Year's Day of 1969 a taxicab (bearing1968 plateno.TX-9395 and driven by Romeo N. Punzalan but operated by the Bay Taxi Cab owned by Gregorio N. Robles) struck ten-year old Normandy Padua on the national road in barrio Barretto, Olongapo City. The impacthurled Normandy about forty meters away from the point where the taxicab struck him,as a resultof which he died. Subsequently, Normandy's parents (Paulino and Lucena Bebin Padua),by complaintfiled with the Court of FirstInstanceof Zambales (civil case427-O),soughtdamages from Punzalan and the Bay Taxi Cab; likewise,the city Fiscal of Olongapo,by information filed with the same court (criminal case1158-O),charged Punzalan with homicidethrough reckless imprudence. On October 27, 1969 the court a quo, in civil case427-O,adjudged for the Paduas as follows: WHEREFORE, judgment is hereby rendered ordering the defendant Romeo Punzalan to pay the plaintiffsthesums of P12,000.00 as actual damages,P5,000.00 as moral and exemplary damages, and P10,000.00 as attorney's fees; and dismissing the complaint insofar as the Bay Taxicab Company is concerned. With costs againstthedefendant Romeo Punzalan.(Emphasis supplied) Almost a year later, on October 5, 1970, the court a quo,in criminal case1158-O,convicted Punzalan,as follows: WHEREFORE, the Court finds the accused Romeo Punzalan y Narciso guilty beyond reasonabledoubt of the crime of homicidethrough reckless imprudence, as defined and penalized under Article 365 of the Revised Penal Code, attended by the mitigatingcircumstanceof voluntary surrender,and hereby sentences him to suffer the indeterminate penalty of TWO (2) YEARS, FOUR (4) MONTHS and ONE (1) DAY of prision correccional, as minimum, to SIX (6) YEARS and ONE (1) DAY of prision mayor, as maximum, and to pay the cost. The civil liability of the
- 27. accused has alreadybeen determined and assessed in Civil Case No. 427-O,entitled Paulino Padua, et al. vs. Romeo Punzalan, et al.' (Emphasis supplied) After the judgment in civil case427-O became final,the Paduas soughtexecution thereof. This proved futile; the corresponding court officer returned the writ of execution unsatisfied. Unable to collectthe amount of P27,000 awarded in their favor, the Paduas instituted action in the same court againstGregorio N. Robles to enforce the latter's subsidiary responsibility under the provisionsof article103 of the Revised Penal Code. Robles filed a motion to dismissbased on (1) bar of the causeof action by a prior judgment and (2) failureof the complaintto state a causeof action. Thereafter, the court a quo, in an order dated October 25, 1972,granted Robles' motion to dismisson the ground that the Paduas' complaintstates no causeof action.This order the Paduas questioned in the Court of Appeals which, by resolution dated March 5, 1975,certified the caseto this Court for the reason that the appeal involves only questions of law. The Paduas predicatetheir appeal on eighteen errors allegedly committed by the courta quo. These assigned errors,however, raise only one substantial issue:whether the judgment dated October 5, 1970 in criminal case1158-O includesa determination and adjudication of Punzalan's civil liability arisingfromhis criminal actupon which Robles' subsidiary civil responsibility may be based. The sufficiency and efficacy of a judgment must be tested by its substancerather than its form. In construinga judgment, its legal effects includingsuch effects that necessarily followbecauseof legal implications,rather than the languageused govern. Also,its meaning, operation, and consequences must be ascertained likeany other written instrument. Thus, a judgment rests on the intention of the court as gathered from every part thereof, including the situation to which it applies and the attendant circumstances. It would appear that a plain reading,on its face, of the judgment in criminal case1158-O,particularly its decretal portion,easily results in the same conclusion reached by the court a quo: that the said judgment no civil liability arisingfromthe offense charged againstPunzalan.However, a careful study of the judgment in question,the situation to which it applies,and the attendant circumstances,would yield the conclusion thatthe court a quo, on the contrary,recognized the enforceable rightof the Paduas to the civil liability arisingfromthe offense committed by Punzalan and awarded the correspondingindemnity therefor. Civil liability coexists with criminal responsibility.In negligence cases the offended party (or his heirs) has the option between an action for enforcement of civil liability based on culpa criminal under article100 of the Revised Penal Code and an action for recovery of damages based on culpa aquiliana under article2177 of the Civil Code.The action for enforcement of civil liability based on culpa criminal section 1 of Rule 111 of the Rules of Court deems simultaneously instituted with the criminal action,unless expressly waived or reserved for a separate application by the offended party.Article 2177 of the Civil Code, however, precludes recovery of damages twice for the same negligent actor omission. In the caseatbar, the Court finds itimmaterial thatthe Paduas chose,in the firstinstance,an action for recovery of damages based on culpa aquiliana under articles 2176,2177,and 2180 of the Civil Code,which action proved ineffectual. The Court also takes note of the absence of any inconsistency between the aforementioned action priorly availed of by the Paduas and their subsequent application for enforcement of civil liability arisingfromthe offense committed by Punzalan and consequently, for exaction of Robles' subsidiary responsibility.Allowanceof the latter application involves no violation of the proscription againstdoublerecovery of damages for the same negligent act or omission.For,as hereinbefore stated, the correspondingofficer of the court a quo returned unsatisfied thewrit of execution issued againstPunzalan to satisfy the amount of indemnity awarded to the Paduas in civil case427-O.Article 2177 of the Civil Codeforbids actual doublerecovery of damages for the same negligent act or omission.Finally, the Court notes that the same judge * tried, heard, and determined both civil case427-O and criminal case115-O.Knowledge of an familiarity with all the facts and circumstances relevantand relativeto the civil liability of Punzalan may thus be readily attributed to the judge when he rendered judgment in the criminal action. In view of the above considerations,itcannotreasonably becontended that the court a quo intended, in its judgment in criminal case1158-O,to omit recognition of the right of the Paduas to the civil liability arisingfromthe offense of which Punzalan was adjudged guilty and the corollary award of the correspondingindemnity therefor. Surely,it cannot be said thatthe court intended the statement in the decretal portion of the judgment in criminal case1158-O referringto the determination and assessmentof Punzalan's civil liability in civil case427-O to be pure jargon or "gobbledygook" and to be absolutely of no meaning and effect whatever. The substanceof such statement, taken in the lightof the situation to which it applies and the attendant circumstances, makes unmistakably clear theintention of the court to accord affirmation to the Paduas' rightto the civil liability arising fromthe judgment againstPunzalan in criminal case1158-O.Indeed, by includingsuch statement in the decretal portion of the said judgment, the court intended to adopt the same adjudication and award itmade in civil case427-O as Punzalan'scivil liability in criminal case1158-O.
- 28. There is indeedmuch to be desired in the formulation by Judge Amores of that part of the decretal portion of the judgment in criminal case1158-O referringto the civil liability of Punzalan resultingfromhis criminal conviction.Thejudge could have been forthright and direct instead of circuitousand ambiguous.But, as we have explained,the statement on the civil liability of Punzalan must surely have a meaning and even if the statement were reasonably susceptibleof two or more interpretations,that which achieves moral justiceshould beadopted, eschewing the other interpretations which in effect would negate moral justice. It is not amiss atthis junctureto emphasize to all magistrates in all levels of the judicial hierarchy thatextreme degree of care should be exercisein the formulation of the dispositiveportion of a decision,becauseit is this portion thatis to be executed once the decision becomes final.The adjudication of the rights and obligations of the parties,and the dispositionsmadeas well as the directions and instructionsgiven by the court in the premises in conformity wi th the body of the decision,mustall bespelled out clearly,distinctly and unequivocally,leavingabsolutely no roomfor dispute, debate or interpretation. We therefore hold that the Paduas' complaintin civil case1079-O states a causeof action against Robles whoseconcommitant subsidiary responsibility,per the judgment in criminal case1158-O,subsists. ACCORDINGLY, the order a quo dated October 25, 1972 dismissingthecomplaintin civil case1079-O is setaside,and this caseis hereby remanded to the courta quo for further proceedings conformably with this decision and with law.No pronouncement as to costs. Makalintal, C.J., Teehankee, Makasiar, Esguerra, Aquino,Concepcion Jr. and Martin, JJ., concur. Fernando, J., concurs and submits a brief opinion. Barredo, J., concurs with a separate opinion. Muñoz Palma, J., took no part. Antonio, J., is on leave. Separate Opinions FERNANDO, J., concurring: The clarity and lucidity with which JusticeCastro spelled out the decisiveissueand how to resolve it to achieve the desirablegoal of moral justicein adjudication compels concurrence.I do so. Whatis more, there is to my mind a distinctadvancein the juridical frontiers in the mode in which the novel question raised was settled. If the trend manifestin the view taken by the Court would thereafter be followed, then the protective ramparts the lawthrows ground victims of vehicular accidents,unfortunately of r ather frequent occurrencehere, will be further strengthened. That dissipates whatever doubts I may have originally feltin viewof certain traditional procedural concepts aboutthe correctness of the decision reached.Itis true this is one of those hard cases whi ch,if an old lawis to be believed, may resultin bad law.It need not be so, of course, as pointed out with great persuasiveness in the1971 inaugural lectureatOxford given by Professor Ronald Dworkin,the successor in thechair of jurisprudenceto one of the most eminent men in the field H.L.A. Hart. 1 The more accurateway of viewing the matter is that whenever there is an apparentgap in the lawand settled principles of adjudication may notclearly indicatethe answer, then a judge may rely either on an argument of policy or an argument of principle,the former havingkinship with the sociological school of jurisprudenceand the latter with the analytical.As I hope I may be ableto indicatein this brief concurrence,the decision reached by us is in consonancewith either approach.With the natural lawthinkingmanifestin the opinion of the Court, witness its stress on moral justice,I am comforted by the reflection that the procedural barrier isnotinsurmountable,the decision reached derivingsupportfrom the viewpoint of lawas logic,justice,or social control. 1. Dworkin identifies a matter of principlefromthe standpointof a righteither granted or recognized by law. As was so clearly pointed out in the opinion of Justice Castro:"It would appear that a plain reading,on its face, of the judgment in criminal case1158- O, particularly itsdecretal portion,easily resultsin thesame conclusion reached by the court a quo: that the said judgment assessed no civil liability arisingfromthe offense charged againstPunzalan.However, a careful study of the judgment in question, the situation to which itapplies,and the attendant circumstances,would yield the conclusion thatthe court a quo, on the contrary, recognized the enforceable right of the Paduas to the civil liability arisingfromthe offense committed by Punzalan and awarded the correspondingindemnity therefor." 2 There is much to be said therefor for the view expressed therein that "it cannot reasonably be contended that the court a quo intended, in its judgment in criminal case1158-O,to omit recognition of the right of the Paduas to the civil liability arisingfromthe offense of which Punzalan was adjudged guilty and the corollary award of the correspondi ng indemnity therefor. Surely,it cannotbe said thatthe court intended the statement in the decretal portion of the judgment in criminal case1158-O referringto the determination and assessmentof Punzalan's civil liability in civil case427-O to be pure jargon or 'gobbledygook' and to be absolutely of no meaning and effect whatsoever. The substanceof such statement, taken in the lightof
- 29. the situation towhich itapplies and the attendant circumstances,makes unmistakably cleartheintention of the courtto acc ord affirmation to the Padua's rightto the civil liability arisingfromthe judgment againstPunzalan in criminal case1158-O."3 Whatever misgivings therefore may be felt becausein the civil caseNo.427-O the complaintagainstBay Taxi Cab Co. is dismissed,do not suffice,to my mind, to render nugatory the admitted subsidiary liability arisingfroma decision in criminal caseNo. 1158-O which is necessarily attendantupon the conviction of the driver,Romeo N. Punzalan.Such a difficulty could havebeen avoided had greater carebeen exercised by the lower court, but precisely recoursemay be had to our correctivepowers to avoid a rightgranted in law from being rendered illusory in fact. 2. There is thus the strongest policy consideration thatbuttresses the conclusion reached by us.It would conduce to less respectfor the lawas an agency of social control if therebe recognition in the codes of the rightof next kin to damages arisingfromthe tragic occurrence of young lives beingsnuffed out due to reckless drivingon the part of what had been accurately described as deal ers of death on the road and then by lack of careon the part of a judge assurethat itis nothing more than a barren form of words. This is what Dean Pound referred to as lawin books as distinguished fromlawin action.To recall an expression fromJusticeJackson ,itis comparableto a munificent bequest in a pauper's will.Itis less than realistic to assertthatanyway the guilty driver can be made to pay. The obvious answer is:' With what?" This is not to deny that a previous judgment that certainly lends itself to ambiguity consideringthe facts disclosed and found by the trial courtdoes interpose juristicdifficulty to the imposition of liability on the offending taxicab company.There can be no blinking the fact though that if it did not placesuch vehicles on the road dri ven in such a reckless and culpablemanner resultingin a ten-year old boy being hurled about forty meters away from the point of impact,this tragedy could havebeen avoided.To say now that doubts engendered by the previous rulingin the culpa aquiliana suitcould nullify whatthe lawdecrees as to the subsidiary liability of the employer in the criminal casefindingtheaccused guilty would be fraught with pernicious consequences.The party just as much responsiblefor the mishap,with his operation of the transportation service,would be absolved from liability.Itneed not be so, but certainly for entrepreneurs more enterprisingthan careful,not excessively concerned with the safety of the travelingpublic, it could be a green lightfor less vigilance over the conduct of their drivers.The resultinginjury to public safety is nothard to imagine. Moreover, from the standpointof the feelings of the bereaved parents, and this is justas importanta policy consideration, I feel that no avenue should be left unexplored to mitigate the harshness of fate. To paraphraseJusticeMalcolm,there is not enough money in the entire world to compensate the parents for the loss of their child. 4 To repeat, the decision reached has my full concurrence. BARREDO, J., concurring: On strictly legal considerations,itwould seem possibleto dismissthepetition for review in this case.But there are certa in considerationsof equity and substantial justiceobviously underlyingthecauseof petitioners which I find difficul tto ignore. It would be unfair and unjustto deprive said petitioners of their rightto damages for the death of their child unquestionably caused by the faultof respondent's employee merely because the dispositiveportion of the decision of Judge Amores in the criminal caseappears to be rather equivocal on its faceas to respondent's liability therefor, albeitunder the incontrovertiblefacts extant in the record such liability isindisputablein lawand the languageof Judge Amores' judgment does not a nyway exonerate either respondent's driver or privaterespondent, and what is more, does not exclude the idea that, as explained in the ablemain opinion of Mr. Justice Castro,the judge intended to merely adoptand incorporatein said judgment the assessmentof amount of damages which said judge himself had already made in the civil casehehad previously decided.It is on these fundamental considerations thatI basemy concurrence in the judgment in this case. As I have already indicated,from the standpointof strictadjectivelaw,the petition should be dismissed becausein truth, there is yet no showingthat any attempt has been made by petitioners to have the judgment in the criminal cases,assumingitincludes an imposition of civil liability upon the accused driver,Romeo N. Punzalan,executed. What appears in the record is that itwas the writ of execution issued againstsaid Punzalan in theprevious civil casethatwas returned unsatisfied.Of course,this point is highly technical,becauseall that has to be done is for petitioners to have another execution in the criminal case,which itcan even now be forseen will haveexactly the same result. I am therefore agreeable as a matter of equity that the Court hold that for all legal intents and purposes, We may consider the return of insolvency of Punzalan in the civil caseas in effect the return in the criminal case,since equity considers as donewhat ought to have been done when otherwise injusticewould result.And so,the paramount question arises,was there any civil liability to impose in the criminal judgmentof Judge Amores? As related in the main opinion,the judgment of October 27, 1969 in the civil caseordered Punzalan "to pay plaintiffs (herein petitioners) the sums of P12,000.00 as actu al damages P5,000.00 as moral and exemplary damages, and P10,000.00 as attorney's fees," although absolvingatthe same time the herein privaterespondent, and then, on October 5, 1970,the judgment in the criminal casewas as follows:
- 30. WHEREFORE, the Courtfinds the accused Romeo Punzalan y Narciso guilty beyond reasonabledoubt of the crime of homicidethrough reckless imprudence, as defined and penalized under Article 365 of the Revised Penal Code, attended by the mitigatingcircumstanceof voluntary surrender,and hereby sentences him to suffer the indeterminate penalty of TWO (2) YEARS, FOUR (4) MONTHS and ONE (1) DAY of prision correccional,as minimum, to SIX (6) YEARS and ONE (1) DAY of prision mayor,as maximum,and to pay the costs. The civil liability of the accused has already been determined and assessed in Civil Case No. 427-O,entitled 'Paulino Padua, et al. vs. Romeo Punzalan, et al. (Emphasis supplied) Succintly,the decisiveissuepresented to Us now is whether this judgment justtranscribed i mposes upon Punzalan a civil liability by adoption by reference of the civil liability already a judged in the civil caseor itexonerates him from any civil liability arisingfromthe offense of which he has been found guilty inasmuch as hewas already found civilly liablein the civil case.Itmust be admitted in candor that both constructions areliterally tenable,with the particularity,however, that the firstinterpretation,if adopted could not involvethe assumption thatthe judge committed a grievous and palpableerror of lawwhereas the second would necessarily mean that he did. It is by now settled beyond all cavil asto dispensewith the citation of jurisprudence,that a negligent actsuch as that committed by Punzalan gives riseto at leasttwo separate and independent kinds of liabilities,(1) the civil liability arisingfromcrimeor culpa criminal and (2) the liability arisingfromcivil negligenceor the so-called culpa aquiliana.These two concepts of faultare so distinct from each other that exoneration from one does not resultin exoneration from the other. Adjectively and substantively,they can be prosecuted separately and independently of each other, although Article2177 of the Civil Codeprecludes recovery of damages twice for the same negligent act or omission,which means that should there be varyingamounts awarded in two separate cases,the plaintiff may recover, in effect, only the bigger amount. That is to say,if the plaintiff hasalready been ordered paid an a mount in one caseand in the other casethe amount adjudged is bigger, he shall beentitled in the second caseonly to the excess over the one fixed in the firstcase,but if he has already been paid a bigger amount in the firstcase,he may not recover anymore in the second case.Thus, in the caseatbar, inasmuch as Punzalan had already been sentenced to pay the herein petitioners the amounts abo ve- stated, in the subsequent criminal case,hecould not be adjudged to pay a higher amount. Now, under Article100 of the Revised Penal Code, a person criminally liableis also civilly liable,hence, the judgment in the criminal caseis supposed to includethe imposition of civil liability,unless thebasis therefor has been shown not to exist,which i s notthe casehere. And sincethe judgment in question says that"the civil liability of the accused has already been determined and assessed in Civil CaseNo. 427-O entitled Paulino Padua et al. vs. Romeo Punzalan et al.," it is butlogical to concludethat the meaning of such statement is that the same amounts of damages fixed in the previous casewere being awarded to the offended party in the criminal case.Otherwise, We would have to indulge in the assumption thatJudge Amores committed the grievous and palpableerror of la w of exonerating Punzalan of all civil liabilities in thecriminal casejustbecausehe had already been sentenced to pay damages in the civil case.I am not ready to accept such assumption.The lawand jurisprudenceon the matter are so clear and well -settled that I refuse to believe that a judge of the experience of Judge Amores would not be cognizantthereof. Besides,Judge Amores knew or ought to have known that havingabsolved herein respondent in the civil case,the only possiblerecoursehas leftto petitioners to recover from said respondentdamages for the death of their child caused by the indisputablenegligenceof his employee Punza lan is in the form of the subsidiary liability of the employer under the Penal Code. Indeed, I cannot believe that Judge Amores intended to allowrespondentto escapeliability altogether, itbeing evident under the circumstances which he himself has found in both cases,civil and criminal,thatPunzalan,their employee, had causethe death of the ten-year-old child of petitioners thru reckless imprudence and that in such a situation in the lawexacts liability fromboth the employee and the employer. What is more, I consider itbut equitable to hold that the rather equivocal phraseology of the decision of Judge Amores should be read in the senseit was understood by the petitioners, who in the faith and reliancethat the lawhad been complied with by Judge Amores and that he had accordingly awarded them in the criminal casethecivil liability thatby lawgoes with it, did not anymore move for clarification or reconsideration nor appeal fromsaid decision.My understandingis that the filingof the subject civil action by petitioners proceeded from that assumption,namely, that Punzalan has been found civilly liablefor the sa me amounts adjudged in the civil case and, therefore, respondent is subsidiarily liabletherefor in the face of Punzalan's insolvency. Accordingly,I concur in that the order of dismissal of respondent judge should be set asideand that petitioners' action should be tried on the merits. Separate Opinions FERNANDO, J., concurring:
- 31. The clarity andlucidity with which JusticeCastro spelled out the decisiveissueand how to resolveit to achieve the desira blegoal of moral justicein adjudication compels concurrence.I do so. Whatis more, there is to my mind a distinctadvancein the juridical frontiers in the mode in which the novel question raised was settled. If the trend manifestin the view taken by the Court would thereafter be followed, then the protective ramparts the lawthrows ground victims of vehicular accidents,unfortunately of rather frequent occurrencehere, will be further strengthened. That dissipates whatever doubts I may have originally feltin viewof certain traditional procedural concepts aboutthe correctness of the decision reached.Itis true this is one of those hard cases which,if an old lawis to be believed, may resultin bad law.It need not be so, of course, as pointed out with great persuasiveness in the1971 inaugural lectureatOxford given by Professor Ronald Dworkin,the successor in thechair of jurisprudenceto one of the most eminent men in the field H.L.A. Hart. 1 The more accurateway of viewing the matter is that whenever there is an apparentgap in the lawand settled principles of adjudication may notclearly indicatethe answer, then a judge may rely either on an argument of policy or an argument of principle,the former havingkinship with the sociological school of jurisprudenceand the latter with the analytical.As I hope I may be ableto indicatein this brief concurrence,the decision reached by us is in consonancewith either approach.With the natural lawthinkingmanifestin the opinion of the Court, witness its stress on moral justice,I am comforted by the reflection that the procedural barrier isnotinsurmountable,the decision reached derivingsupportfrom the viewpoint of lawas logic,justice,or social control. 1. Dworkin identifies a matter of principlefromthe standpointof a righteither granted or recognized by law. As was so clearly pointed out in the opinion of Justice Castro:"It would appear that a plain reading,on its face, of the judgment in criminal case1158- O, particularly itsdecretal portion,easily resultsin thesame conclusion reached by the court a quo: that the said judgment assessed no civil liability arisingfromthe offense charged againstPunzalan.However, a careful study of the judgment in question, the situation to which itapplies,and the attendant circumstances,would yield the conclusion thatthe court a quo, on the contrary, recognized the enforceable right of the Paduas to the civil liability arisingfromthe offense committed by Punzalan and awar ded the correspondingindemnity therefor." 2 There is much to be said therefor for the view expressed therein that "it cannot reasonably be contended that the court a quo intended, in its judgment in criminal case1158-O,to omit recognition of the right of the Paduas to the civil liability arisingfromthe offense of which Punzalan was adjudged guilty and the corollary award of the corresponding indemnity therefor. Surely,it cannotbe said thatthe court intended the statement in the decretal portion of the judgment i n criminal case1158-O referringto the determination and assessmentof Punzalan's civil liability in civil case427-O to be pure jargon or 'gobbledygook' and to be absolutely of no meaning and effect whatsoever. The substanceof such statement, taken in the lightof the situation to which itapplies and the attendant circumstances,makes unmistakably cleartheintention of the courtto accord affirmation to the Padua's rightto the civil liability arisingfromthe judgment againstPunzalan in criminal case1158 -O."3 Whatever misgivings therefore may be felt becausein the civil caseNo.427-O the complaintagainstBay Taxi Cab Co. is dismissed,do not suffice,to my mind, to render nugatory the admitted subsidiary liability arisingfroma decision in criminal caseNo. 1158 -O which is necessarily attendantupon the conviction of the driver,Romeo N. Punzalan.Such a difficulty could havebeen avoided had greater carebeen exercised by the lower court, but precisely recoursemay be had to our correctivepowers to avoid a rightgranted i n law from being rendered illusory in fact. 2. There is thus the strongest policy consideration thatbuttresses the conclusion reached by us.It would conduce to less respectfor the lawas an agency of social control if therebe recognition in the codes of the rightof next kin to damages arisingfromthe tragic occurrence of young lives beingsnuffed out due to reckless drivingon the part of what had been accurately described as deal ers of death on the road and then by lack of careon the part of a judge assurethat itis nothing more than a barren form of words. This is what Dean Pound referred to as lawin books as distinguished fromlawin action.To recall an expression fromJusticeJackson ,itis comparableto a munificent bequest in a pauper's will.Itis less than realistic to assertthatanyway the guilty driver can be made to pay. The obvious answer is:' With what?" This is not to deny that a previous judgment that certainly lends itself to ambiguity consideringthe facts disclosed and found by the trial courtdoes interpose juristicdifficulty to the imposition of liability on the offending taxicab company.There can be no blinking the fact though that if it did not placesuch vehicles on the road driven in such a reckless and culpablemanner resultingin a ten-year old boy being hurled about forty meters away from the point of impact,this tragedy could havebeen avoided.To say now that doubts engendered by the previous rulingin the culpa aquilianasuitcould nullify whatthe lawdecrees as to the subsidiary liability of the employer in the criminal casefindingtheaccused guilty would be fraught with pernicious consequences.The party justas much responsiblefor the mishap,with his operation of the transportation service,would be absolved from liability.Itneed not be so, but certainly for entrepreneurs more enterprisingthan careful,not excessively concerned with the safety of the travelingpublic, it could be a green lightfor less vigilanceover the conduct of their drivers.The resultinginjury to public safety i s nothard to imagine. Moreover, from the standpointof the feelings of the bereaved parents, and this is justas importanta policy consideration, I feel that
- 32. no avenue shouldbe left unexplored to mitigate the harshness of fate. To paraphraseJusticeMal colm,there is not enough money in the entire world to compensate the parents for the loss of their child. 4 To repeat, the decision reached has my full concurrence. BARREDO, J., concurring: On strictly legal considerations,itwould seem possibleto dismissthepetition for review in this case.But there are certain considerationsof equity and substantial justiceobviously underlyingthecauseof petitioners which I find difficultto igno re. It would be unfair and unjustto deprive said petitioners of their rightto damages for the death of their child unquestionably caused by the faultof respondent's employee merely because the dispositiveportion of the decision of Judge Amores in the criminal caseappears to be rather equivocal on its faceas to respondent's liability therefor, albeitunder the incontrovertiblefacts extant in the record such liability isindisputablein lawand the languageof Judge Amores' judgment does not anyway exonerate either respondent's driver or privaterespondent, and what is more, does not exclude the idea that, as explained in the ablemain opinion of Mr. Justice Castro,the judge intended to merely adoptand incorporatein said judgment the assessmentof amount of damages which said judge himself had already made in the civil casehehad previously decided.It is on these fundamental considerations thatI basemy concurrence in the judgment in this case. As I have already indicated,from the standpointof strictadjectivelaw,the petition should be dismissed becausein truth, there is yet no showingthat any attempt has been made by petitioners to have the judgment in the criminal cases,assumingitincludes an imposition of civil liability upon the accused driver,Romeo N. Punzalan,executed. What appears in the record is that itwas the writ of execution issued againstsaid Punzalan in theprevious civil casethatwas returned unsatisfied.Of course,this point is highly technical,becauseall thathas to be done is for petitioners to have another execution in the criminal case,which itcan even now be forseen will haveexactly the same result. I am therefore agreeable as a matter of equity that the Court hold that for all legal intents and purposes, We may consider the return of insolvency of Punzalan in the civil caseas in effect the return in the criminal case,since equity considers as donewhat ought to have been done when otherwise injusticewould result.And so,the paramount question arises,was there any civil liability to impose in the criminal judgmentof Judge Amores? As related in the main opinion,the judgment of October 27, 1969 in the civil caseordered Punzalan "to pay plaintiffs (herein petitioners) the sums of P12,000.00 as actu al damages P5,000.00 as moral and exemplary damages, and P10,000.00 as attorney's fees," although absolvingatthe same time the herein privaterespondent, and then, on October 5, 1970,the judgment in the criminal casewas as follows: WHEREFORE, the Court finds the accused Romeo Punzalan y Narciso guilty beyond reasonabledoubt of the crime of homicidethrough reckless imprudence, as defined and penalized under Article 365 of the Revised Penal Code, attended by the mitigatingcircumstanceof voluntary surrender,and hereby sentences him to suffer the indeterminate penalty of TWO (2) YEARS, FOUR (4) MONTHS and ONE (1) DAY of prision correccional,as minimum, to SIX (6) YEARS and ONE (1) DAY of prision mayor,as maximum,and to pay the costs. The civil liability of the accused has already been determined and assessed in Civil Case No. 427-O,entitled 'Paulino Padua, et al. vs. Romeo Punzalan, et al. (Emphasis supplied) Succintly,the decisiveissuepresented to Us now is whether this judgment justtranscribed imposes upon Punzalan a civil liability by adoption by reference of the civil liability already a judged in the civil caseor itexonerates him from any civil liability arisingfromthe offense of which he has been found guilty inasmuch as hewas already found civilly liablein the civil case.Itmust be admitted in candor that both constructions areliterally tenable,with the particularity,however, that the firstinterpretation,if adopted could not involvethe assumption thatthe judge committed a grievous and palpableerror of lawwhereas the second would necessarily mean that he did. It is by now settled beyond all cavil asto dispensewith the citation of jurisprudence,that a negligent actsuch as that committed by Punzalan gives riseto at leasttwo separate and independent kinds of liabilities,(1) the civil liability arisingfromcrimeor culpa criminal and (2) the liability arisingfromcivil negligenceor the so-called culpa aquiliana.These two concepts of faultare so distinct from each other that exoneration from one does not resultin exoneration from the other. Adjectively and substantively,they can be prosecuted separately and independently of each other, although Article2177 of the Civil Codeprecludes recovery of damages twice for the same negligent act or omission,which means that should there be varyingamounts awarded in two separate cases,the plaintiff may recover, in effect, only the bigger amount. That is to say,if the plaintiff hasalready been ordered paid an a mount in one caseand in the other casethe amount adjudged is bigger, he shall beentitl ed in the second caseonly to the excess over the one fixed in the firstcase,but if he has already been paid a bigger amount in the firstcase,he may not recover anymore in the second case.Thus, in the caseatbar, inasmuch as Punzalan had already been sentenced to pay the herein petitioners the amounts above- stated, in the subsequent criminal case,hecould not be adjudged to pay a higher amount.
- 33. Now, under Article100of the Revised Penal Code, a person criminally liableis also civilly liable,hence, the judgment in the criminal caseis supposed to includethe imposition of civil liability,unless thebasis therefor has been shown not to exist,which i s notthe casehere. And sincethe judgment in question says that"the civil liability of the accused has already been determined and assessed in Civil CaseNo. 427-O entitled Paulino Padua et al. vs. Romeo Punzalan et al.," it is butlogical to concludethat the meaning of such statement is that the same amounts of damages fixed in the previous casewere being awarded to the offended party in the criminal case.Otherwise, We would have to indulge in the assumption thatJudge Amores committed the grievous and palpableerror of la w of exonerating Punzalan of all civil liabilities in thecriminal casejustbecausehe had already been sentenced to pay damages in the civil case.I am not ready to accept such assumption.The lawand jurisprudenceon the matter are so clear and well -settled that I refuse to believe that a judge of the experience of Judge Amores would not be cognizantthereof. Besides,Judge Amores knew or ought to have known that havingabsolved herein respondent in the civil case,the only possiblerecoursehas leftto petitioners to recover from said respondentdamages for the death of their child caused by the indisputablenegligenceof his employee Punzalan is in the form of the subsidiary liability of the employer under the Penal Code. Indeed, I cannot believe that Judge Amores i ntended to allowrespondentto escapeliability altogether, itbeing evident under the circumstances which he himself has found in both cases,civil and criminal,thatPunzalan,their employee, had causethe death of the ten-year-old child of petitioners thru reckless imprudence and that in such a situation in the lawexacts liability fromboth the employee and the employer. What is more, I consider itbut equitable to hold that the rather equivocal phraseology of the decision of Judge Amores should be read in the senseit was understood by the petitioners, who in the faith and reliancethat the lawhad been complied with by Judge Amores and that he had accordingly awarded them in the criminal casethecivil liability thatby lawgoes with it, did not anymore move for clar ification or reconsideration nor appeal fromsaid decision.My understandingis that the filingof the subject civil action by petitioners proceeded from that assumption,namely, that Punzalan has been found civilly liablefor the same amounts adjudged in the civi l case and, therefore, respondent is subsidiarily liabletherefor in the face of Punzalan's insolvency. Accordingly,I concur in that the order of dismissal of respondent judge should be set asideand that petitioners' action should be tried on the merits. G.R. No. 91856 October 5, 1990 YAKULT PHILIPPINES AND LARRY SALVADO, petitioner, vs. COURT OF APPEALS, WENCESLAO M. POLO, in his capacity as Presiding Judge of Br. 19 of the RTC of Manila, and ROY CAMASO, respondents. Tomas R. Leonidas for petitioners. David B. Agoncillo for private respondent. GANCAYCO, J.: Can a civil action instituted after the criminal action was filed prosper even if there was no reservation to filea separate civil action? This is the issuein this petition. On December 24, 1982,a five-year old boy, Roy Camaso,while standingon the sidewalk of M. de la Fuente Street, Sampaloc, Manila,was sideswiped by a Yamaha motorcycle owned by Yakult Philippines and driven by its employee, Larry Salvado. Salvado was charged with the crime of reckless imprudenceresultingto slightphysical injuries in an information thatwas filed on January 6, 1983 with the then City Court of Manila,docketed as Criminal CaseNo. 027184.On October 19, 1984 a complaintfor damages was filed by Roy Camaso represented by his father, David Camaso,againstYakultPhilippines and Larry Salvado in the Regional Trial Courtof Manila docketed as Civil CaseNo. 84-27317. In due coursea decision was rendered in the civil caseon May 26, 1989 orderingdefendants to pay jointly and severally the plaintiff the sum of P13,006.30 for actual expenses for medical services and hospital bills;P3,000.00 attorney's fees and the costs of the suit. Although said defendants appealed the judgment, they nevertheless filed a petition for certiorari in the Court of Appeals challenging the jurisdiction of the trial courtover said civil case. Petitioners' thesis is thatthe civil action for damages for injuries arisingfromalleged criminal negligenceof Salvado,being without malice,cannotbe filed independently of the criminal action under Article33 of the Civil Code. Further, itis contended that under Section 1, Rule 111 of the 1985 Rules on Criminal Proceduresuch a separatecivil action may not be filed unless reservation thereof is expressly made. In a decision dated November 3, 1989, the Court of Appeals dismissed the petition. 1 A motion for reconsideration thereof filed by petitioners was denied on January 30,1990. Hence this petition.
- 34. The petition isdevoid of merit. Section 1, Rule 111 of the 1985 Rules of Criminal Procedureprovides as follows: SEC. 1. Institution of criminal and civil actions. — When a criminal action isinstituted,the civil action for the recovery of civil liability is impliedly instituted with the criminal action,unless theoffended party waives the civil action,reserves his rightto instituteit separately,or institutes the civil action prior to the criminal action. Such civil action includes recovery of indemnity under the Revised Penal Code, and damages under Articles 32, 33, 34 and 2176 of the Civil Codeof the Philippines arisingfromthe same actor omission of the accused. A waiver of any of the civil actions extinguishes theothers. The institution of,or the reservation of the rightto file, any of said civil actions separately waives theothers. The reservation of the right to institute the separatecivil actionsshall bemade before the prosecution starts to present its evidence and under circumstances affordingthe offended party a reasonableopportunity to make suc h reservation. In no casemay the offended party recover damages twice for the same actor omission of the accused. When the offended party seeks to enforce civil liability againstthe accused by way of moral,nominal,temperate or exemplary damages,the filingfees for such civil action as provided in these Rules shall constitutea firstlien on the judgment except in an award for actual damages. In cases wherein the amount of damages, other than actual,is alleged in the complaintor information,the correspondingfilingfees shall bepaid by the offended party upon the filingthereof in court for trial.(1a) Although the incidentin question and the actions arisingtherefrom were instituted before the promulgation of the 1985 Rules of Criminal Procedure, its provisions which areprocedural may apply retrospectively to the present case. 2 Under the aforecited provisionsof the rule, the civil action for the recovery of civil liability is impliedly instituted with the criminal action unless the offended party waives the civil action,reserves his rightto instituteit separately or institutes the civil action prior to the criminal action. Such civil action includes recovery of indemnity under the Revised Penal Code, and damages under Articles 32,33, 34 a nd 2176 of the Civil Codeof the Philippines arisingfromthe same actor omission of the accused. It is also provided thatthe reservation of the rightto institutethe separate civil action shall bemade before the prosecution starts to present its evidence and under circumstances affordingthe offended party a reasonableopportunity to make such reservation. In this case,the offended party has not waived the civil action,nor reserved the rightto instituteit separately.Neither has the offended party instituted the civil action prior to the criminal action.However, the civil action in this casewas filed in courtbefore the presentation of the evidence for the prosecution in the criminal action of which the judge presidingon the criminal case was duly informed, so that in the disposition of the criminal action no damages was awarded. The civil liability soughtarisingfromthe actor omission of the accused in this caseis a quasi delict as defined under Article2176 of the Civil Codeas follows: ART. 2176.Whoever by act or omission causes damageto another, there being faultor negligence, is obliged to pay for the damage done. Such faultor negligence, if there is no pre-existingcontractual relation between the parties,is called a quasi-delict and is governed by the provisionsof this Chapter. The aforecited revised rulerequiringsuch previous reservation also covers quasi-delictas defined under Article2176 of the Civil Code arisingfromthe same actor omission of the accused. Although the separatecivil action filed in this casewas withoutprevious reservation in the criminal case,nevertheless sinceitwas instituted before the prosecution presented evidence in the criminal action,and the judge handlingthe criminal casewas informed thereof, then the actual filingof the civil action is even far better than a compliancewith the requirement of an express reservation that should be made by the offended party before the prosecution presents its evidence. The purpose of this rulerequiringreservation is to prevent the offended party from recovering damages twice for the sameact or omission. Thus, the Court finds and so holds thatthe trial courthad jurisdiction over the separate civil action broughtbefore it. WHEREFORE, the petition is DENIED. The questioned decision of the Court of Appeals dated November 3, 1989 and its resolution dated January 30,1990 are hereby AFFIRMED. SO ORDERED. Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Feliciano, Padilla, Bidin, Sarmiento, Cortes, Griño-Aquino, Medialdea and Regalado, JJ., concur. Fernan, C.J. and Paras, J., are on leave.
- 35. G.R. No. 137567June 20, 2000 MEYNARDO L. BELTRAN, petitioner, vs. PEOPLE OF THE PHILIPPINES, and HON. JUDGE FLORENTINO TUAZON, JR., being the Judge of the RTC, Brach 139,Makati City, respondents. BUENA, J.: This petition for review, filed under Rule 45 of the 1997 Rules of Civil Procedure,seeks to review and set asidethe Order dated January 28, 1999 issued by Judge Florentino A. Tuazon, Jr. of the Regional Trial Courtof Makati City, Branch 139 in Special Civil Case No. 98-3056,entitled "Meynardo Beltran vs. People of the Philippines and Hon.Judge Alden Cervantes of the Metropolitan Trial Court of Makati City, Branch 61." The said Order denied petitioner's prayer for the issuanceof a writof preliminary injunction to enjoin Judge Cervantes from proceeding with the trial of Criminal CaseNo. 236176,a concubinagecaseagainstpetitioner on the ground that the pending petition for declaration of nullity of marriagefiled by petitioner againsthis wifeconstitutes a prejudicial question. The antecedent facts of the caseare undisputed: Petitioner Meynardo Beltran and wife CharmaineE. Felix were married on June 16, 1973 at the Immaculate Concepcion Parish Church in Cubao,Quezon City.1 On February 7, 1997, after twenty-four years of marriageand four children,2 petitioner filed a petition for nullity of marriageon the ground of psychological incapacity under Article36 of the Family Code before Branch 87 of the Regional Trial Courtof Quezon City. The casewas docketed as Civil CaseNo. Q-97-30192.3 In her Answer to the said petition,petitioner's wife CharmaineFelix alleged that itwas petitioner who abandoned the conjugal home and lived with a certain woman named Milagros Salting.4 Charmainesubsequently filed a criminal complaintfor concubinage5 under Article 334 of the Revised Penal Code againstpetitioner and his paramour before the City Prosecutor's Officeof Makati who, in a Resolution dated September 16, 1997, found probablecauseand ordered the filingof an Information6 against them. The case, docketed as Criminal CaseNo. 236176,was filed before the Metropolitan Trial Courtof Makati City,Branch 61.1awphi1 On March 20, 1998,petitioner, in order to forestall the issuanceof a warrantfor his arrest,filed a Motion to Defer Proceedings Includingthe Issuanceof the Warrantof Arrest in the criminal case.Petitioner argued that the pendency of the civil casefor declaration of nullity of his marriageposed a prejudicial question to the determination of the criminal case.Judge Alden Va squez
- 36. Cervantes denied theforegoing motion in the Order7dated August 31, 1998.Petitioner's motion for reconsideration of the said Order of denial was likewisedenied in an Order dated December 9, 1998. In view of the denial of his motion to defer the proceedings in the concubinagecase,petitioner went to the Regional Trial Courtof Makati City, Branch 139 on certiorari, questioningthe Orders dated August 31,1998 and December 9, 1998 issued by Judge Cervantes and prayingfor the issuanceof a writof preliminary injunction.8 In an Order9 dated January 28,1999, the Regional Trial Court of Makati denied the petition for certiorari. Said Courtsubsequently issued another Order 10 dated February 23, 1999,denying his motion for reconsideration of the dismissal of his petition. Undaunted, petitioner filed the instantpetition for review. Petitioner contends that the pendency of the petition for declaration of nullity of his marriagebased on psychological incapacity under Article 36 of the Family Code is a prejudicial question thatshould merit the suspension of the criminal casefor concubinage filed againsthimby his wife. Petitioner also contends that there is a possibility thattwo conflicting decisionsmightresultfrom the civil casefor annulment of marriageand the criminal casefor concubinage.In the civil case,the trial courtmight declarethe marriageas valid by dis missing petitioner's complaintbut in the criminal case,the trial courtmight acquitpetitioner becausethe evidence shows that his marriage is void on ground of psychological incapacity.Petitioner submits that the possibleconflictof the courts' rulingregarding petitioner's marriagecan be avoided, if the criminal casewill besuspended, until the court rules on the validity of marriage;that if petitioner's marriageis declared void by reason of psychological incapacity then by reason of the arguments submitted in the subjectpeti tion, his marriagehas never existed; and that, accordingly,petitioner could not be convicted in the criminal casebecausehe was never before a married man. Petitioner's contentions areuntenable. The rationalebehind the principleof prejudicial question is to avoid two conflictingdecisions. Ithas two essential elements: (a) the civil action involves an issuesimilaror intimately related to the issueraised in the criminal action;and (b) the resoluti on of such issuedetermines whether or not the criminal action may proceed. 11 The pendency of the casefor declaration of nullity of petitioner's marriageis nota prejudicial question to the concubinage case.For a civil caseto be considered prejudicial to a criminal action as to causethe suspension of the latter pending the final determination of the civil case,itmust appear not only that the said civil caseinvolves thesame facts upon which the criminal prosecuti on would be based,but also that in the resolution of the issueor issues raised in the aforesaid civil action,theguiltor innocence of the accused would necessarily bedetermined. Art. 40 of the Family Code provides: The absolutenullity of a previous marriagemay be invoked for purposes of remarriageon the basis solely of a final judgment declaringsuch previous marriagevoid. In Domingo vs. Court of Appeals, 12 this Court ruled that the import of said provision isthatfor purposes of remarriage,the only legally acceptablebasisfor declaringa previous marriagean absolutenullity is a final judgmentdeclaringsuch previous ma rriage void,whereas, for purposes of other than remarriage, other evidence is acceptable.The pertinent portions of said Decision read: . . . Undoubtedly, one can conceive of other instances where a party might well invoke the absolutenullity of a previous marriagefor purposes other than remarriage,such as in caseof an action for liquidation,partition,distribution and separation of property between the erstwhilespouses,as well as an action for the custody and supportof their common children and the delivery of the latters' presumptive legitimes. In such cases,evidence needs must be adduced, testimonial or documentary, to prove the existence of grounds rendering such a previous marriagean absolutenullity.These needs not be limited solely to an earlier final judgment of a court declaringsuch previous marri agevoid. So that in a casefor concubinage,the accused,likethe herein petitioner need not present a final judgment declaringhis ma rriage void for he can adduceevidence in the criminal caseof the nullity of his marriageother than proof of a final judgment declaringhis marriagevoid. With regard to petitioner's argument that he could be acquitted of the charge of concubinageshould his marriagebe declared null and void, sufficeitto state that even a subsequent pronouncement that his marriageis void fromthe beginning is not a defense. Analogous to this caseis that of Landicho vs. Relova 1 cited in Donato vs. Luna 14 where this Court held that: . . . Assumingthat the firstmarriagewas null and void on the ground alleged by petitioner, that fact would not be material to the outcome of the criminal case.Parties to the marriageshould not be permitted to judge for themselves its nullity,for the same must be submitted to the judgment of the competent courts and only when the nullity of the marriageis so declared can it be held as void,and so longas there is no such declaration thepresumption is thatthe marriageexists.
- 37. Therefore, he whocontracts a second marriagebefore the judicial declaration of nullity of the firstmarriageassumes the risk of being prosecuted for bigamy. Thus, in the caseat bar it must also beheld that parties to the marriageshould notbe permitted to judge for themselves its nullity, for the same must be submitted to the judgment of the competent courts and only when the nullity of the marriage is so declared can it be held as void,and so longas there is no such declaration thepresumption is thatthe marriageexists for all intents and purposes.Therefore, he who cohabits with a woman not his wife before the judicial declaration of nullity of the marriageassumes the risk of being prosecuted for concubinage.The lower courttherefore, has not erred in affirmingthe Orders of the judge of the Metropolitan Trial Courtrulingthat pendency of a civil action for nullity of marriagedoes not pose a prejudicial question in a criminal casefor concubinage. WHEREFORE, for lack of merit, the instantpetition is DISMISSED. SO ORDERED. Bellosillo, Mendoza, Quisumbing and De Leon, JJ., concur. G.R. No. L-22677 February 28, 1967 PEDRO III FORTICH-CELDRAN, JESUS, MANUEL, MIGUEL and VICENTE, all surnamed FORTICH-CELDRAN; SANTIAGO CATANE and ABELARDO CECILIO, petitioners, vs. IGNACIO A. CELDRAN and HON. COURT OF APPEALS, respondents. San Juan, Africa & Benedicto and Eduardo B. Sinense for petitioners. Casiano U. Laput for respondents. BENGZON, J.P., J.: A suitfor annulment of an extrajudicial partition of properties and for accountingwas filed on February 3, 1954 in the Cour t of First Instanceof Cebu (Civil CaseNo.3397-R). Appearing therein as plaintiffswere: Jose, Francisco,Pedro,Jr., Ignacio,all surnamed Abuton-Celdran (children of the deceased Pedro Celdran by the firstnuptial) and,as the administratrix of Francisco Celdran (another brother), Modesta Rodriguez. Defendants were: Pablo Celdran (child of the deceased by the firstmarriagewho refused to join as plaintiff),Josefa Vda. de Celdran (s pouseof the deceased by the second marriage),Manuel, Antonio, Pedro III,Jesus,Vicente and Miguel,all surnamed Fortich Celdra n (children of the deceased by the second nuptial. After the defendants answered on May 28, 1954,a motion to withdrawas co-plaintiff was filed on May 24, 1957.It was signed "Ignacio Celdran.This motion has been marked as ExhibitB-Josefa.1äwphï1.ñët Subsequently, with leaveof court, the plaintiffs(excludingIgnacio) filed an amended complaintimpleadingIgnacio Celdran as defendant. Ignacio Celdran filed an answer with counterclaimand cross -claim. After trial butbefore judgment, Ignacio Celdran had the document Exh. B-Josefa (the motion to withdraw) examined by the Police Department of Cebu City. The policewere of the view that the same (signaturetherein) was falsified.Allegingnewly discover ed evidence, Ignacio Celdran asked for new trial,which the court denied. All the parties,except Ignacio Celdran,thereafter entered on May 6, 1959 into an amicablesettlement, recognizingas valid the aforementioned extrajudicial partition.RegardingIgnacio Celdran,the court rendered judgment on July 19, 19 61,declaringthe same extrajudicial partition as valid for havingbeen ratified by him (Ignacio).Specifically,thecourt found among other things that Ignacio signed the motion to withdraw (Exh. B-Josefa) after he received P10,000 of the agreed P20,000 and two residential lots to be given to himin return for his aforesaid ratification of the partition.
- 38. Said decision waslater amended to requirePedro III,Antonio, Jesus,Miguel and Vicente, all surnamed Fortich-Celdran,to pay Ignacio the balanceof P20,000 aforestated and to deliver to him the promised two parcels of land. Ignacio Celdran appealed therefrom to the Court of Appeals.And said appeal was docketed as CA-G.R. No. 30499-R,shown in the record before Us as still pending. Now on March 22, 1963, atthe instanceof Ignacio Celdran,an information for falsification of a public document — that is,Exh. B- Josefa or the abovementioned motion to withdraw in the civil case — was filed by the City Fiscal of Ozamis in the Court of First Instanceof Misamis Occidental.Accused therein were: Pedro III,Antonio, Manuel, Vicente, Miguel, and Jesus, all surnamed Celdran (defendants in the civil case);Santiago Catane,as subscribingofficer;Abelardo Cecilio,as theperson who filed the motion. As privatecomplainant,however, Ignacio Celdran on December 12, 1962,moved before trial to suspend the proceedings in the criminal caseon the ground of prejudicial question.Thereason given in supportthereof was that the alleged falsification of the same document is at issuein the civil casependingin the Court of Appeals. Declaringthatthere was no pre-judicial question,the Court of FirstInstanceof Misamis Occidental denied on January 28,1963 the motion to suspend the prosecution.It ruled that the alleged forgery was not an issuein the civil case. Assailingtheabove ruling,Ignacio Celdran filed in theCourt of Appeals on February 21, 1963, a petition for certiorari with preliminary injunction (CA-G.R. No. 31909-R) to enjoin the CFI of Misamis Occidental and the City Fiscal of Ozamis fromproceeding with the prosecution of the criminal case. On February 18, 1964 the Court of Appeals decided said petition for certiorari,orderingthe suspension of the criminal case dueto pre-judicial question. Pedro III,Jesus,Manuel, Miguel and Vicente, all surnamed Fortich-Celdran;Santiago Cataneand Abelardo Cecilio — accused in the criminal suitand respondents in the petition for certiorari — appealed to Us from the decision of the Court of Appeals dated February 18,1964. Appellants would contend that there is no pre-judicial question involved.The record shows that, as aforestated, the Court of First Instanceruled that Ignacio Celdran ratified the partition agreement; among the reasons cited by the trial courtfor said rulingisthat Ignacio Celdran received P10,000 and signed the motion to withdraw as plaintiff in the suit. Disputingthis,Celdran assigned as error in his appeal the findingthat he signed the aforementioned motion (Exh. B-Josefa) and maintains thatthe same is a forgery. Since ratification is principal issuein the civil action pendingappeal in the Court of Appeals,and the falsification or genuineness of the motion to withdraw — presented and marked as evidence in said civil case — is amongthe questions involved in said issue,it follows thatthe civil action poses a pre-judicial question to the criminal prosecution for alleged falsification of the same document, the motion to withdraw (Exh. B-Josefa). Presented as evidence of ratification in thecivil action isthemotion to withdraw; its authenticity is assailed in the same civil action. The resolution of this point in the civil casewill in a sensebedeterminative of the guiltor innocence of the accused in the criminal suitpending in another tribunal.As such,it is a prejudicial question which should firstbe decided before the prosecution can proceed in the criminal case. A pre-judicial question isonethat arises in a case,the resolution of which is a logical antecedent to the issueinvolved therein,and the cognizanceof which pertains to another tribunal;thatis,itis determinative of the casebefore the court and jurisdiction to pass upon the same is lodged in another tribunal.1 It should be mentioned here also thatan administrativecase filed in this CourtagainstSantiago Cataneupon the same chargewas held by Us in abeyance, thus: As itappears that the genuineness of the document allegedly forged by respondent attorneys in AdministrativeCaseNo. 77 (Richard Ignacio Celdran vs. Santiago Catane,etc., et al.) is necessarily involved in Civil CaseNo. R-3397 of the Cebu Court of FirstInstance,action on the herein complaintis withheld until that litigation hasfinally been decided. ComplainantCeldra n shall informtheCourt about such decision.(Supreme Court minute resolution of April 27,1962 in Adm. CaseNo. 77, Richard Ignacio Celdran vs.Santiago Catane,etc., et al.) . Regarding the procedural question on Ignacio Celdran's rightas privateoffended party to filethrough counsel a motion to suspend the criminal case,the same exists where, as herein, the Fiscal,who had direction and control of the prosecution,did not object to the filingof said motion.And its filingin this casecomplied with Sec. 5 of Rule 111 of the Rules of Court which provides: SEC. 5. Suspension by reason of prejudicial question. — A petition for the suspension of the criminal action based upon the pendency of a pre-judicial question in a civil case,may only be presented by any party before or during the trial of the criminal action. Denial of the motion to suspend the prosecution was therefore attended with grave abuseof discretion;and the issuehavingb een squarely and definitely presented before the trial court,a motion for reconsideration,which would but raisethe same points,was
- 39. not necessary.Neither wasappeal the remedy available,sincethe order denying suspension is interlocutory and thus not yet appealable. Wherefore, the decision of the Court of Appeals under review — orderingsuspension of Criminal CASENo. 5719,Peoplevs. Pedro Fortich-Celdran, et al., pending before the Court of FirstInstanceof Misamis Occidental,until after Civil Case,CA-G.R. No. 30499- R, Pedro A. Celdran, et al. vs. Pedro Fortich-Celdran III, et al., shall havebeen decided — is hereby affirmed, with costs against appellant.So ordered. Concepcion, C.J., Reyes, J.B.L., Dizon, Regala, Makalintal, Zaldivar, Sanchez and Castro, JJ., concur. Homework Help https://www.homeworkping.com/ Math homework help https://www.homeworkping.com/ Research Paper help https://www.homeworkping.com/ Algebra Help https://www.homeworkping.com/ Calculus Help https://www.homeworkping.com/ Accounting help https://www.homeworkping.com/ Paper Help https://www.homeworkping.com/ Writing Help https://www.homeworkping.com/ Online Tutor https://www.homeworkping.com/
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