LECTURE ON TORTS

February14, 2010
TORT LIABILITY UNDER SPECIAL LAWS

What are the sources of tort liability for damages?

o

Civil Code Human Relations (19-36) and Quasi-Delicts (2176-2194)

Special Laws for Quasi-Delicts under Special Laws

Penal Laws for Civil Liablity from Delict

Can an OFFENDED PARTY in CRIME file an INDEPENDENT CIVIL ACTION of

CULPA AQUILIANA?
Yes. It is the prerogative of the offended party.

REFERENCES IN PRODUCT COMPLAINTS CASE?

Consumer Act of the Philippines (RA 7394 April 13, 1992)

Arts. 2187 & 2188 CC (manufacture/process of defective products)

Art. 33 CC

Arts 1547, 1561-1571 CC (Sales Warranties)

Art 2176 CC

Note:

The civil liability (for damages) of the MANUFACTURER or SELLER

may be based on the RPC, if punishable under the RPC, or on the
SPECIAL LAW, if punishable under that SPECIAL LAW.

CONSUMER ACT OF THE PHILIPPINES

(RA 7394 April 13, 1992)
Q

What is this DOCTRINE OF STRICT LIABILITY under the Consumer Act in case of
DEFECTIVE PRODUCTS and SERVICES?
Proof of FAULT or NEGLIGENCE is unnecessary. The liability of
MANUFACTURER/PROCESSOR is imposed by law as pure matter of public policy.

the

WHAT ARE THE USUAL DEFENSES OF the MANUFACTURER or PROCESSOR of

PRODUCTS in PRODUCT COMPLAINTS CASES?

1.

Validity of Contract; (e.g. Our contract is invalid)

2.

Lack of Privity; (e.g. There is no contract between us)

3.

Lack of Reliance on a Warranty; (e.g. There is no such warranty)

4.

Lack of Notice to D of Breach of Warranty; (e.g. You did not notify me of the
Breach of Warranty)

5.

Waiver of Implied Warranties

Can the MANUFACTURER or PROCESSOR of PRODUCTS interpose the above

DEFENSES:
NO, under the DOCTRINE OF STRICT LIABILITY such privilege is absent as a matter
of public policy;

When does a SELLER become liable for the defective products

When is the product considered defective?

Mfger Not Identified;

Product is Supplied w/o clear ID of Mfger;
Negligence of Seller in preserving perishable goods;

When its safety as expected not ensured by looking into:

Presentation of product;
Use & hazards expected;
Time line in circulation

Can a product be considered DEFECTIVE because a product of better quality exists?

No.

PRESCRIPTION IN CONSUMER ACT CASES

2 years:
From transaction consummation;
From commission of deceptive or unfair and unconscionable act or

o
o
practice;
o

From discovery (for hidden defects)

GENERAL BANKING LAW

(RA 8791 May 23, 2000)

Are liabilities for prohibited transactions under the GBL limited to the GBL itself?

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NO. Damages under Art. 2176 CC and the RPC may also be claimed by the P, w/o
prejudice to the penalties and admin sanctions against the violator provided under
Sections 66 and 70 of GBL, and Sections 34-37 of the CENTRAL BANK ACT RA 7653,.
Q

CITE PROHIBITED TRANSACTIONS BY DOEA

a) Falsifying Entries in Bank Reports/Statement;
b) Taking part in Fraudulent Transaction causing D to bank or TP;
c)

Undue Disclosure (w/o Court Order) of Info affecting FUNDS or PROPERTIES in

custody of bank;

d) Receive Gifts/Commission in bank transactions affecting bank loan or accommodation.

Q

CITE PROHIBITED TRANSACTIONS BY BANK BORROWER

a) Fraudulent Overvaluation of Collateral property in loan or Credit Transaction;
b) False Representation or Misrepresentation re loan/credit transactions;
c)

Attempt to Defraud in Banks court action against him for recovery;

d) Offering DOEA to influence action of bank;

Q

CITE PROHIBITED TRANSACTIONS BY CENTRAL BANK EXAMINER, EE OR

OFFICER
Same as enumerated above.

What is the relation between BANK and DEPOSITOR

One of Loan. Not Deposit. Art. 1980 CC Fixed, Saving, and current deposits of money in
banks and similar institutions shall be governed by the provisions concerning simple loan.

What is QUANTUM OF DILIGENCE required from banks pertaining to accounts of

DEPSITORS?
Highest Degree of Care. Because of the FIDUCIARY NATURE of relationship between
B and D and banking business is imbued with PUBLIC INTEREST.

CORPORATION CODE OF THE PHILIPPINES

(BP 68 May 1, 1980)
(Law that governs private corporations)
Q

CITES INSTANCES WHERE TORT LIABILITY ARISES UNDER CORP CODE.

a) Corporation by Estoppel (Ostensible Corporation). Effect: Liable as General Partners;

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b) DTO Voting for Patently Unlawful Act of the Corp or Gross Negligence / BF;
c)

Ultra Vires Acts of Corp (Engaged in unauthorized Acts);

d) Issuance of Watered Stocks (Price is less than par or issued value, excess of fair value);
e) Close Corporation Directors for Corporate Tort (Solidary unless LIABILITY INSURANCE
exists)

NATURE OF LIABILITY OF DTO:

Joint and Solidary

Can a corporation be liable for crime?

No. Only its DTOA. Corporation is by fiction of law so no criminal intent can be ascribed.

CODE OF COMMERCE
(BP 68 May 1, 1980)
(Law that governs private corporations)
Shipowners & Ship Agents for acts of Captain;

Ship Agents for acts of Captain in vigilance over goods (To excuse: Abandon the
ship with the implements)

Defense of SO/SA: Captain acted beyond his authority unless such action
redounded to the benefit of the Vessel.

Q-

Liabilities of Captain:
a) Lack of Skill/Negligence; Crimes in Boat;
b) Theft Robberies by Crew;
c)

Losses or Fines for violating regulations of customs, police, health and navigation;

d) Mutinies on board;
e) Misuse of power or non-fulfillment of duties;
f)

Unreasonable change of sea course;

g) Entering wrong port;

h) Non-observance of regulation in Lights & Maneuver

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Q-

What is a Charter Party? Is it a person or what?

A Charter Party is not actually a party or person but a CONTRACT.
It is a contract whereby the SO/A leases a portion or whole of a vessel for the transport of
goods or persons from one port to another.

Q-

What is a Partial or Whole Charter?

Partial the Vessel may carry cargo of others or other passengers
Whole exclusive to the chatterer.

Q-

Liabilities in Charter Party (Damage arising from)

1.
2.
3.
4.
5.
6.
7.

Q-

Over-capacity;
Substitution of Vessel
Extra-loading of non-charterers cargo despite whole charter party
Delay in putting to sea the chartered vessel.
Charterers loading of cargo other than the stated cargo in the CP;
Loading of goods for purpose of Illicit Commerce.
Pre-arrival unloading of goods by Charterer unless under FORCE MAJEURE
situation.

What is BILL OF LADING

Both a CONTRACT and a RECEIPT

Q-

Liabilities in BILL OF LADING

o

o
Q-

Captain obliged to unload cargo upon arrival and to release to holder of the BL
or consignee upon presentment of the BL.
Shipper liable for storage if cargo not claimed within designated period.

What is COLLISION OF VESSELS

The impact of 2 moving vessels.

Q-

What is ALLISION OF VESSELS

The impact between a moving vessel against a stationary vessel

Q-

Liabilities in COLLISION OF VESSELS

o
o

The vessel at fault is liable for damages

If the fault is indeterminable like under fortuitous event, each vessel bears her
own damage.

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Q-

What is SHIPWRECK?
o
o

Q-

Incapacitating a vessel for navigation;

Loss of vessel at sea

Who is liable in SHIPWRECK?

The one whose negligence causes the shipwreck.

LABOR CODE OF THE PHILIPPINES

(PD 442 Nov. 1, 1974 Several amendments thereafter followed)

Q-

ILLEGAL RECRUITMENT

PROHIBITED ACTIVITIES of Recruiter (Art. 34)

Excess (beyond 10%) Attorneys Fees (Art. 111)
Withholding of Wages thru FIST (force, intimidation, stealth & threat) (Art. 116)
Illegal deduction to ensure employment or retention thereof. (Art. 117)
Retaliatory Measures of ER due EEs complaint or testimony (Art 118)
Discrimination against women on account of her SEX (Art 135)
Maltreatment of Househelpers (Art. 147)
ULP (Art. 247)

INTELLECTUAL PROPERTY CODE

(Laws on Copyright & Patent and Trademarks & Trade Names; RA 8293)
(Effectivity Jan I, 1998)
Q-

Elements of Patent Infringement

Q-

Effect if Damages cannot be reasonably determined

o

Q-

Sum equivalent to Reasonable Royalty

Maximum ACTUAL DAMAGES AWARD in INFRINGEMENT CASES

o

Q-

Making, using, offering for sale or importing patented product

Without the authorization for patentee

Not exceeding 3 x the actual damages.

Liability of INDUCER or PROVIDER of COMPONENT for

INFRINGING patented products.
Joint and Solidary with Direct Infringer.

Q-

May infringement happen even without a sale yet?

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YES.
Q-

Other examples of INFRINGEMENT.

unfair competition,
false designation of origin;
false description of products or representation
LOCAL GOVERNMENT CODE
(RA 7160 Effective January 1, 1992)

Q-

Are LGUs exempt from liability for DAMAGES?

NO. (Sec. 24 & Sec. 60)
LAND TRASPORTATION & TRAFFIC CODE CODE
(RA 4136 Effective June 20, 1994)

Criminal Action for Reckless Imprudence does not bar QD case.

Q-

Duties of Driver in case of Accident

1.
2.
3.
4.
5.

Q-

Stop upon accident;

Aid Victim if any.
Present Drivers License if asked by anybody
Give His True Full Name & Address
Give Owners Full Name & Address

EXCEPTIONS TO DUTY TO AID VICTIM

a) Imminent danger of serious harm from other persons by reason of the accident;
b) Reporting incident to nearest Law Enforcer;
c) Calling Doctor or Nurse;

WAREHOUSE RECEIPTS LAW

(Act 2137 as amended - Effective Feb 5, 1912)
Q-

WAREHOUSEMANS LIAIBLITY
a) Misdelivery of goods (to the wrong person)
b) Despite authorized Delivery - if there is Stop Order from the rightful owner or
possessor of the goods;
c) Non-existence of goods
d) Failure of goods to correspond to the description in the WR.
e) Loss or Damage of goods due to negligence

CODE OF PROFESSIONAL RESPONSIBILITY

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Q-

WHAT ARE THE FOUR MAJOR DUTIES OF A LAWYER

a)
b)
c)
d)

Duty to Society
Duty to Legal Profession
Duty to Courts
Duty to Clients

Note: Any breach of this responsibility shall be cause for prosecution, if the act
amounts to a crime, for action for damages, and for disbarment.

THE CHILD AND YOUTH WELFARE CODE

(PD 603, Dec 10, 1974, as amended by RA 7610)
Q-

Are Parents liable for the Torts committed by their children below 21 years old?
Yes, if the children are under their parental authority.

TRUST RECEIPTS LAW

(PD 115- effective Jan 29,1973)
Q-

What is the gravamen of the offense?

Failure of the entrustee to turn over the goods to the entrustor not sold or to turn over the
proceeds of the goods not sold upon demand.

Q-

Where does TORT come in under this law?

The ENTRUSTEE assumes risk of loss of goods received in trust. (Note even fortuitous
event cannot exempt him from such liability)
GENERAL BONDED WAREHOUSE ACT
(Act 3893- effective Nov 16, 1931)

Q-

Liability of Warehouseman? (Storage)

o

Aggrieved party may sue on the bond to recover the damage suffered by
him due to the negligence of the Warehouseman.

ANTI-SEXUAL HARASSMENT ACT OF 1995

(RA 7877- effective February 14, 1995)
Q-

Essence of this crime?

Undue exercise of authority or abuse of power, or moral ascendancy over the

victim who is placed under such authority or power;
Sexual favor is demanded or requested by the abuser

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Q-

What is the setting?

Q-

Who are the offenders?

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.

Note:

Q-

Work, Education or Training-Related Sexual Harassment

Employer
Employee
Manager
Supervisor
Agent of Employer
Teacher,
Instructor
Professor
Coach
Trainor
Any other person
Common element
over victim.

= exercising authority / influence / moral ascendancy

Liability for Damages of EMPLOYER, HEAD OF OFFICE, EDUCATIONAL OR

TRAINING INSTITUTION
Joint and solidary with the offender,

PROVIDED:

Employer etc is duly informed of the SH

ER etc took no action.

LECTURE ON TORTS AND DAMAGES

March 7, 2010

DAMAGES
Q

What is the scope of the provisions of damages?

o
o

Civil Code Art 2195 to 2235

All obligations mentioned in Art 1157. CC

Concept of Damages
General

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Pecuniary compensation, recompense or satisfaction for an injury

sustained;

Pecuniary consequences imposed by law for breach of duty or

violation of rights;

Depreciation in Value.

Civil Code

Monetary award for injury to person because of the legal harm;

Monetary award for loss he suffered for violation of his rights.

INJURY, DAMAGE, DAMAGES distinguished

Injury
Damage Damages -

Invasion of legal right

Loss or harm arising from injury
Compensation for the damage suffered

Bases for award of TORT DAMAGES

1. Breach of duty by defendant;
2. Injury to plaintiff proximately caused by Ds breach;
3. Compensation to Plaintiff commensurate to loss

DAMAGES distinguished from RESTITUTION & INJUNCTION

o
o
o

Damages
Restitution
Injunction

Compensation for the damage suffered;

Restoration of gains he obtained
Forbids threatened action
Requires Positive Action of D to change course.

Special Provisions and Laws on Damages

If there are special provisions on damages elsewhere in the CC,

they govern;

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Provisions on damages under special laws suppletory only must

not conflict with 2195-2235 CC.

Workmens Compensation due to work-related DEATH, ILLNESS

OR INJURY, Workmens Compensation prevails.

Elements of Damages Recoverable

1.

Time Losses Value if lost time or earning capacity

2.

Injury Expense expenses incurred due to injury

3.

Personal Injury (Medical expenses and related items)

Property Injury (Loss in Value, Lesser Cost to Repair/Replace)

Pain & Suffering Intangible Losses, Emotional Distress &

Consciousness of Loss

Evidence of Fact, Amount and Cause of Damage must be established:

o

Damage is not presumed; it must be proved including the

amount and cause of damage.

Principle applicable here:

The fact that the damages suffered cannot be calculated with absolute exactness
or mathematical accuracy is not a bar to recovery

Workmens Compensation for Work-Related DII?

Governed by Labor Code , not Civil Code.

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Q

KINDS OF DAMAGES UNDER CIVIL CODE

1.
2.
3.
4.
5.
6.

Actual or Compensatory
Moral
Nominal
Temperate or Moderate
Liquidated
Exemplary/Corrective

What is the concept of ACTUAL or COMPENSATORY Damages?

ACTUAL or COMPENSATORY Damages damages awarded as
compensation/indemnity for the proven Pecuniary Loss suffered.
Pecuniary means something related to money or money value.

BRIEF RULINGS ON ACTUAL DAMAGES.

1.

2.
3.

4.

Actual Damages need to be specifically PLEADED in the complaint

and PROVED in trial.
AD Award may be executed pending appeal.
Purpose of Award for AD is to make good or to replace the loss
caused by wrong.
Interest may be recovered in sum of money cases.

5.

An injured passenger cannot recover for services gratuitously

rendered or for medical services not suited to his injury.

6.

Plaintiff who did not appeal from a judgment giving him lesser
award cannot be granted higher award than what has become final.

7.

The victims mother receiving an amount from insurance does not

affect award of AD.

Kinds of Actual Damages

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1.
2.

Actual Loss
Unrealized Profit

(Damnum Emergens)
(Lucrum Cesans - (if based on Reasonable
Estimate valid)

Note: Very common in business, property, profession (Damage to Biz

goodwill)

DAMAGES IN CONTRACTS AND QUASI-CONTRACTS (ART. 2201)

Obligor in GF -

liable for natural and probable consequences of

breach which is foreseeable at the time of the
obligation constitution.

Obligor in BF -

liable for all damages that can be reasonably

attributed to the breach. (Note: Must be specially
pleaded and proved to obtain possible award)

DAMAGES IN CRIMES AND QUASI-DELICTS (ART. 2202)

liable for the natural and probable consequences of the act

(regardless of the doers foreseeablity)

for QD, the CONTRIBUTORY NEGLIGENCE of P reduces the

recoverable damages. (Art. 2214)

Does the injured party have the duty to exercise DUE DILIGENCE to
MINIMIZE the damage?
Yes, under Article 2203. But the Defendant must prove that the damage
could have been mitigated or that the amount thereof reduced.

What is the Doctrine of Avoidable Consequences?(Article 2203)

Injured victims have responsibility to act reasonably to limit or mitigate
losses incurred.

What is the principle of Single Recovery? (Art. 2205)

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(The plaintiff gets only a single recovery, providing compensation for past and
future losses.)
Loss of earning capacity. (Discounting awards to present value)

What are the usual damages that may be recovered from CRIME
resulting in death?
1.
2.
3.
4.
5.
6.

Indemnity for death (P50,000);

Indemnity for Loss of Earning Capacity;
Moral Damages;
Exemplary Damages;
Attorneys Fees and expenses of litigation;
Interest in proper cases.

SUBROGATION RIGHTS of INSURER to the RIGHTS of INSURED in

PROPERTY INSURANCE. (Art. 2207)
P cannot recover anymore from D unless there is deficiency in insurance
indemnity.
Reason for no recovery vs. D is because the INSURER is subrogated to Ps
rights.

ATTORNEYS FEES and EXPENSES of LITIGATION

General Rule:
No attorneys fees (unless stipulated by the parties) or EXCEPT:
1.
2.
3.
4.
5.
6.
7.
8.

Exemplary Damages
P is Compelled to Litigate
Malicious Prosecution vs. P
Unfounded Civil Action vs. P
Gross & Evident BF to satisfy valid claim of P
Action for Legal Support
Recovery of Wages of workers
Action for Indemnity under Workmens Compensation

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9. Separate Civil Action for crimes
10. Double judicial costs are awarded
11. Court discretion

Damages in Obligation for Sum of Money

Based on interest agreed upon

If none, legal interest (now 12 % per annum based on C.B. Circ. No.
416 (7.29.74)
May be awarded by court in breach of contract.

Stipulated interest may earn legal interest from judicial demand

Case of compounding interest from judicial demand.

Not applicable to non-stipulated interest situation

Guidelines for application of Proper Interest Rates

Please read Eastern Shipping lines, Inc. vs. CA, 234 SCRA 78, (1994) or 53
SCAD 207.

JUDICIAL EQUITABLE MITIGATION OF DAMAGES, in C, QC & QD

1.
2.
3.
4.
5.

Ps contravention of C
Ps partial benefit from C
In exemplary damages where P acted on Counsels advice
Loss will happen as a matter of course
D does best to lessen Ps loss or injury

Distinguish Doctrine of Avoidable Consequence from Doctrine of

Contributory Negligence.
DAC
DCN

comes into picture after cause of action arises

comes before or simultaneously with the cause

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OTHER KINDS OF DAMAGES

MORAL DAMAGES (Art. 2217)

Q

OTHER DAMAGES at DISCRETION OF COURT

Liquidated Damages must be stipulated otherwise even COURT

has no power to award it.

MENT subject to Judicial Discretion. No pecuniary proof is

necessary but facts supporting such claim must be shown.

CONCEPT OF MORAL DAMAGES

1.
2.
3.
4.
5.
6.
7.
8.
9.

Physical Suffering
Mental Anguish
Fright
Serious Anxiety
Besmirched Reputation
Wounded Feelings.
Moral Shock
Social Humiliation
and Similar Injury

Not capable of pecuniary computation but

PROXIMATE RESULT of wrongful act or omission.

RECOVERABLE

if

Rationale of Moral Damages

When there is a wrong, there is a remedy. Layda vs. CA 90 Phil. 724
(1952)
Note: Award of moral damages is mandatory even in the absence of proof
other than death of victim.

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Q

MORAL DAMAGES CANNOT BE EXECUTED PENDING APPEAL.

Because these kinds of damages are uncertain until there is finality of the
case.

INSTANCES WHERE MORAL DAMAGES ARE AWARDED?

i)
j)
k)
l)
m)
n)
o)
p)
q)

Stubborn to pay just obligation

Anguish suffered by parents due to abortion;
Refusing to implement decision by school to give honor to deceased
student
Unwarranted power disconnection by MERALCO
Use of house as AD Material without consent of owner;
Veto in BF by Mayor of Resolution appropriating salary of VM;
Breach of promise to marry
Double Sale of real property;
Telegram not sent to US in time for news of death of relative in Phil.

MORAL DAMAGES IN PROPERTY LOSS.

Sentimental Value may be considered by the court. (Art. 2218)

CAUSES to award MORAL DAMAGES.

Please read the enumeration in Art. 2219

Does a JURIDICAL PERSON have the RIGHT TO RECOVER MD?

No, because it has no nervous system no feelings, no emotions, no

senses. (ABS-CBN vs. CA 301 SCRA 572, [1999]

NOMINAL DAMAGES (Art. 2221)

Q-

What is the concept of NOMINAL DAMAGES?

18

The vindication or recognition of a right that has been violated but not
an indemnification of any loss.
Even if the violation is simply technical, the award of ND is still proper.
Q-

What is the effect of an AWARD of NOMINAL DAMAGES?

The award precludes the award of ATM. (LRTA vs. Navidad, 397 SCRA
75 [2003])

TEMPERATE or MODERATE DAMAGES (Art.

2224)

Q-

What is the concept of TEMPERATE or MODERATE DAMAGES?

There is PECUNIARY LOSS but its amount cannot be proved with

certainty by nature of the case. (Art. 2224)

LIQUIDATED DAMAGES (Art. 2226)

Q-

What is the concept of LIQUIDATED DAMAGES?

Priorly agreed by parties in a contract to the effect that any breach

thereof gives rise to entitlement.

May be reduced by the court if found to be INIQUITOUS or

UNCONSCIONABLE.

Attorneys fees not stipulated are treated as AD but if priorly

stipulated regarded as LIQUIDATED DAMAGES.

EXEMPLARY OR CORRECTIVE DAMAGES

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Q-

What is the concept of EXEMPLARY OR CORRECTIVE DAMAGES?

Imposed by way of example or correction for the public good in addition
to ATML
Accessory to ATML, without which no award of ED is proper.

GOOD LUCK TO THE FINALS!