ZENITH INSURANCE CORP. vs.

COURT OF APPEALS
FACTS:
Lawrence Fernandez insured his car for own damage with Zenith. The car figured in
an accident and suffered actual damages In the amount of P3,640. After being given
a run around by Zenith for two months, Fernandez filed a complaint with the RTC for
sum of money and damages. He was allowed to present evidence while Zenith was
not due to its non-appearance in the pre-trial. Judgment was rendered in favor of
Fernandez. Zenith filed petition for certiorari before the CA but this was dismissed.
Zenith filed for a MR alleging that the award of actual damages of P3,460 is
erroneous and what it is liable for is only P1,927, the amount arrived at after
deducting P250 and P274 as deductible franchise and 20% depreciation on the
parts as agreed upon in the contract.
ISSUE:

W/N actual damages should be deducted as claimed by Zenith.

HELD:
NO. As regards the actual damages incurred by private respondent, the
amount of P3,640.00 had been established before the trial court and affirmed by the
appellate court. Respondent appellate court correctly ruled that the deductions of
P250.00 and P274.00 as deductible franchise and 20% depreciation on parts,
respectively claimed by petitioners as agreed upon in the contract, had no basis.
Any doubt that may arise for failure of the contract to provide with respect to a
particular matter should be resolved against the insurer. In this case, the policy
does not mention any deductible franchise.

COL. C. CASTRO vs. INSURANCE COMMISSION

FACTS:
Castro applied for insurance on the life of his driver. On the basis of such
application, Insular Life issued policy No. 934943 effective July 18, 1979. The policy
applied for and issued was on a 20-yr endowment plan for the sum of P25K with
double indemnity in case of accidental death. Castro paid the first quarterly
premium of P309.95. About 3 months later, on Oct. 16, 1959, the insured driver
was allegedly shot to death by unknown persons. Castro then filed a claim for the
total benefits of 50K under the policy. Insular life denied the claim on the ground
that the policy was VOID. Insular instead refunded to Castro the premiums he had
paid.
ISSUE:

W/N Castro has an insurable interest in his driver.

HELD: NO. The requirement of insurable interest to support a contract of insurance

is based upon consideration of public policy which renders wager policies INVALID.
To sustain a contract of this character it must appear that there is a real concern in
the life of the party whose death would be the cause of substantial loss to those
who are named as a beneficiary. Mere relationship of uncle and nephew, employer
and employee is NOT sufficient to provide an insurable interest on the life of the

insured. It must be shown that the destruction of the life of the insured would cause
pecuniary loss to the complainant. This, Castro failed to prove.