G.R. No.

L-6913

November 21, 1913

THE ROMAN CATHOLIC BISHOP OF JARO, plaintiff-appellee,

vs.
GREGORIO DE LA PEA, administrator of the estate of Father Agustin de la Pea, defendant-appellant.
J. Lopez Vito, for appellant.
Arroyo and Horrilleno, for appellee.

MORELAND, J.:
This is an appeal by the defendant from a judgment of the Court of First Instance of Iloilo, awarding to the plaintiff the sum of
P6,641, with interest at the legal rate from the beginning of the action.
It is established in this case that the plaintiff is the trustee of a charitable bequest made for the construction of a leper
hospital and that father Agustin de la Pea was the duly authorized representative of the plaintiff to receive the legacy. The
defendant is the administrator of the estate of Father De la Pea.
In the year 1898 the books Father De la Pea, as trustee, showed that he had on hand as such trustee the sum of P6,641,
collected by him for the charitable purposes aforesaid. In the same year he deposited in his personal account P19,000 in the
Hongkong and Shanghai Bank at Iloilo. Shortly thereafter and during the war of the revolution, Father De la Pea was
arrested by the military authorities as a political prisoner, and while thus detained made an order on said bank in favor of the
United States Army officer under whose charge he then was for the sum thus deposited in said bank. The arrest of Father
De la Pea and the confiscation of the funds in the bank were the result of the claim of the military authorities that he was an
insurgent and that the funds thus deposited had been collected by him for revolutionary purposes. The money was taken
from the bank by the military authorities by virtue of such order, was confiscated and turned over to the Government.
While there is considerable dispute in the case over the question whether the P6,641 of trust funds was included in the
P19,000 deposited as aforesaid, nevertheless, a careful examination of the case leads us to the conclusion that said trust
funds were a part of the funds deposited and which were removed and confiscated by the military authorities of the United
States.
That branch of the law known in England and America as the law of trusts had no exact counterpart in the Roman law and
has none under the Spanish law. In this jurisdiction, therefore, Father De la Pea's liability is determined by those portions of
the Civil Code which relate to obligations. (Book 4, Title 1.)
Although the Civil Code states that "a person obliged to give something is also bound to preserve it with the diligence
pertaining to a good father of a family" (art. 1094), it also provides, following the principle of the Roman law, major casus est,
cui humana infirmitas resistere non potest, that "no one shall be liable for events which could not be foreseen, or which
having been foreseen were inevitable, with the exception of the cases expressly mentioned in the law or those in which the
obligation so declares." (Art. 1105.)
By placing the money in the bank and mixing it with his personal funds De la Pea did not thereby assume an obligation
different from that under which he would have lain if such deposit had not been made, nor did he thereby make himself liable
to repay the money at all hazards. If the had been forcibly taken from his pocket or from his house by the military forces of
one of the combatants during a state of war, it is clear that under the provisions of the Civil Code he would have been
exempt from responsibility. The fact that he placed the trust fund in the bank in his personal account does not add to his
responsibility. Such deposit did not make him a debtor who must respond at all hazards.
We do not enter into a discussion for the purpose of determining whether he acted more or less negligently by depositing the
money in the bank than he would if he had left it in his home; or whether he was more or less negligent by depositing the
money in his personal account than he would have been if he had deposited it in a separate account as trustee. We regard

such discussion as substantially fruitless, inasmuch as the precise question is not one of negligence. There was no law
prohibiting him from depositing it as he did and there was no law which changed his responsibility be reason of the deposit.
While it may be true that one who is under obligation to do or give a thing is in duty bound, when he sees events
approaching the results of which will be dangerous to his trust, to take all reasonable means and measures to escape or, if
unavoidable, to temper the effects of those events, we do not feel constrained to hold that, in choosing between two means
equally legal, he is culpably negligent in selecting one whereas he would not have been if he had selected the other.
The court, therefore, finds and declares that the money which is the subject matter of this action was deposited by Father De
la Pea in the Hongkong and Shanghai Banking Corporation of Iloilo; that said money was forcibly taken from the bank by
the armed forces of the United States during the war of the insurrection; and that said Father De la Pea was not
responsible for its loss.
The judgment is therefore reversed, and it is decreed that the plaintiff shall take nothing by his complaint.
Arellano, C.J., Torres and Carson, JJ., concur.

Separate Opinions
TRENT, J., dissenting:
I dissent. Technically speaking, whether Father De la Pea was a trustee or an agent of the plaintiff his books showed that in
1898 he had in his possession as trustee or agent the sum of P6,641 belonging to the plaintiff as the head of the church.
This money was then clothed with all the immunities and protection with which the law seeks to invest trust funds. But when
De la Pea mixed this trust fund with his own and deposited the whole in the bank to his personal account or credit, he by
this act stamped on the said fund his own private marks and unclothed it of all the protection it had. If this money had been
deposited in the name of De la Pea as trustee or agent of the plaintiff, I think that it may be presumed that the military
authorities would not have confiscated it for the reason that they were looking for insurgent funds only. Again, the plaintiff
had no reason to suppose that De la Pea would attempt to strip the fund of its identity, nor had he said or done anything
which tended to relieve De la Pea from the legal reponsibility which pertains to the care and custody of trust funds.
The Supreme Court of the United States in the United State vs. Thomas (82 U. S., 337), at page 343, said: "Trustees are
only bound to exercise the same care and solicitude with regard to the trust property which they would exercise with regard
to their own. Equity will not exact more of them. They are not liable for a loss by theft without their fault. But this exemption
ceases when they mix the trust-money with their own, whereby it loses its identity, and they become mere debtors."
If this proposition is sound and is applicable to cases arising in this jurisdiction, and I entertain no doubt on this point, the
liability of the estate of De la Pea cannot be doubted. But this court in the majority opinion says: "The fact that he (Agustin
de la Pea) placed the trust fund in the bank in his personal account does not add to his responsibility. Such deposit did not
make him a debtor who must respond at all hazards. . . . There was no law prohibiting him from depositing it as he did, and
there was no law which changed his responsibility, by reason of the deposit."
I assume that the court in using the language which appears in the latter part of the above quotation meant to say that there
was no statutory law regulating the question. Questions of this character are not usually governed by statutory law. The law
is to be found in the very nature of the trust itself, and, as a general rule, the courts say what facts are necessary to hold the
trustee as a debtor.
If De la Pea, after depositing the trust fund in his personal account, had used this money for speculative purposes, such as
the buying and selling of sugar or other products of the country, thereby becoming a debtor, there would have been no doubt
as to the liability of his estate. Whether he used this money for that purpose the record is silent, but it will be noted that a
considerable length of time intervened from the time of the deposit until the funds were confiscated by the military

authorities. In fact the record shows that De la Pea deposited on June 27, 1898, P5,259, on June 28 of that year P3,280,
and on August 5 of the same year P6,000. The record also shows that these funds were withdrawn and again deposited all
together on the 29th of May, 1900, this last deposit amounting to P18,970. These facts strongly indicate that De la Pea had
as a matter of fact been using the money in violation of the trust imposed in him.
lawph!1.net

If the doctrine announced in the majority opinion be followed in cases hereafter arising in this jurisdiction trust funds will be
placed in precarious condition. The position of the trustee will cease to be one of trust.

G.R. No. 102970 May 13, 1993

LUZAN SIA, petitioner,
vs.
COURT OF APPEALS and SECURITY BANK and TRUST COMPANY, respondents.
Asuncion Law Offices for petitioner.
Cauton, Banares, Carpio & Associates for private respondent.

DAVIDE, JR., J.:

The Decision of public respondent Court of Appeals in CA-G.R. CV No. 26737, promulgated on 21 August 1991, 1reversing

and setting aside the Decision, dated 19 February 1990, 2 of Branch 47 of the Regional Trial Court (RTC)
of Manila in Civil Case No. 87-42601, entitled "LUZAN SIA vs. SECURITY BANK and TRUST CO.," is
challenged in this petition for review on certiorari under Rule 45 of the Rules Court.
Civil Case No. 87-42601 is an action for damages arising out of the destruction or loss of the stamp collection of the plaintiff
(petitioner herein) contained in Safety Deposit Box No. 54 which had been rented from the defendant pursuant to a contract
denominated as a Lease Agreement. 3 Judgment therein was rendered in favor of the dispositive portion of

which reads:
WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiff and against the
defendant, Security Bank & Trust Company, ordering the defendant bank to pay the plaintiff the sum of
a) Twenty Thousand Pesos (P20,000.00), Philippine Currency, as actual damages;
b) One Hundred Thousand Pesos (P100,000.00), Philippine Currency, as moral damages; and
c) Five Thousand Pesos (P5,000.00), Philippine Currency, as attorney's fees and legal expenses.
The counterclaim set up by the defendant are hereby dismissed for lack of merit.
No costs.
SO ORDERED. 4

The antecedent facts of the present controversy are summarized by the public respondent in its
challenged decision as follows:
The plaintiff rented on March 22, 1985 the Safety Deposit Box No. 54 of the defendant bank at its
Binondo Branch located at the Fookien Times Building, Soler St., Binondo, Manila wherein he placed his
collection of stamps. The said safety deposit box leased by the plaintiff was at the bottom or at the lowest
level of the safety deposit boxes of the defendant bank at its aforesaid Binondo Branch.
During the floods that took place in 1985 and 1986, floodwater entered into the defendant bank's
premises, seeped into the safety deposit box leased by the plaintiff and caused, according to the plaintiff,
damage to his stamps collection. The defendant bank rejected the plaintiff's claim for compensation for
his damaged stamps collection, so, the plaintiff instituted an action for damages against the defendant
bank.
The defendant bank denied liability for the damaged stamps collection of the plaintiff on the basis of the
"Rules and Regulations Governing the Lease of Safe Deposit Boxes" (Exhs. "A-1", "1-A"), particularly
paragraphs 9 and 13, which reads (sic):
"9. The liability of the Bank by reason of the lease, is limited to the exercise of the diligence to prevent the
opening of the safe by any person other than the Renter, his authorized agent or legal representative;
xxx xxx xxx
"13. The Bank is not a depository of the contents of the safe and it has neither the possession nor the
control of the same. The Bank has no interest whatsoever in said contents, except as herein provided,
and it assumes absolutely no liability in connection therewith."
The defendant bank also contended that its contract with the plaintiff over safety deposit box No. 54 was
one of lease and not of deposit and, therefore, governed by the lease agreement (Exhs. "A", "L") which
should be the applicable law; that the destruction of the plaintiff's stamps collection was due to a calamity
beyond obligation on its part to notify the plaintiff about the floodwaters that inundated its premises at
Binondo branch which allegedly seeped into the safety deposit box leased to the plaintiff.
The trial court then directed that an ocular inspection on (sic) the contents of the safety deposit box be
conducted, which was done on December 8, 1988 by its clerk of court in the presence of the parties and
their counsels. A report thereon was then submitted on December 12, 1988 (Records, p. 98-A) and
confirmed in open court by both parties thru counsel during the hearing on the same date (Ibid., p. 102)
stating:
"That the Safety Box Deposit No. 54 was opened by both plaintiff Luzan Sia and the
Acting Branch Manager Jimmy B. Ynion in the presence of the undersigned, plaintiff's
and defendant's counsel. Said Safety Box when opened contains two albums of
different sizes and thickness, length and width and a tin box with printed word 'Tai
Ping Shiang Roast Pork in pieces with Chinese designs and character."
Condition of the above-stated Items
"Both albums are wet, moldy and badly damaged.
1. The first album measures 10 1/8 inches in length, 8 inches in width and 3/4 in thick. The leaves of the
album are attached to every page and cannot be lifted without destroying it, hence the stamps contained
therein are no longer visible.

2. The second album measure 12 1/2 inches in length, 9 3/4 in width 1 inch thick. Some of its pages can
still be lifted. The stamps therein can still be distinguished but beyond restoration. Others have lost its
original form.
3. The tin box is rusty inside. It contains an album with several pieces of papers stuck up to the cover of
the box. The condition of the album is the second abovementioned album." 5

The SECURITY BANK AND TRUST COMPANY, hereinafter referred to as SBTC, appealed the trial
court's decision to the public respondent Court of Appeals. The appeal was docketed as CA-G.R. CV No.
26737.
In urging the public respondent to reverse the decision of the trial court, SBTC contended that the latter erred in (a) holding
that the lease agreement is a contract of adhesion; (b) finding that the defendant had failed to exercise the required
diligence expected of a bank in maintaining the safety deposit box; (c) awarding to the plaintiff actual damages in the amount
of P20,000.00, moral damages in the amount of P100,000.00 and attorney's fees and legal expenses in the amount of
P5,000.00; and (d) dismissing the counterclaim.
On 21 August 1991, the respondent promulgated its decision the dispositive portion of which reads:
WHEREFORE, the decision appealed from is hereby REVERSED and instead the appellee's complaint
is hereby DISMISSED. The appellant bank's counterclaim is likewise DISMISSED. No costs. 6

In reversing the trial court's decision and absolving SBTC from liability, the public respondent found and
ruled that:
a) the fine print in the "Lease Agreement " (Exhibits "A" and "1" ) constitutes the terms and conditions of the contract of lease
which the appellee (now petitioner) had voluntarily and knowingly executed with SBTC;
b) the contract entered into by the parties regarding Safe Deposit Box No. 54 was not a contract of deposit wherein the bank
became a depositary of the subject stamp collection; hence, as contended by SBTC, the provisions of Book IV, Title XII of
the Civil Code on deposits do not apply;
c) The following provisions of the questioned lease agreement of the safety deposit box limiting SBTC's liability:
9. The liability of the bank by reason of the lease, is limited to the exercise of the diligence to prevent the
opening of the Safe by any person other than the Renter, his authorized agent or legal representative.
xxx xxx xxx
13. The bank is not a depository of the contents of the Safe and it has neither the possession nor the
control of the same. The Bank has no interest whatsoever in said contents, except as herein provided,
and it assumes absolutely no liability in connection therewith.
are valid since said stipulations are not contrary to law, morals, good customs, public order or public policy; and
d) there is no concrete evidence to show that SBTC failed to exercise the required diligence in maintaining the safety deposit
box; what was proven was that the floods of 1985 and 1986, which were beyond the control of SBTC, caused the damage to
the stamp collection; said floods were fortuitous events which SBTC should not be held liable for since it was not shown to
have participated in the aggravation of the damage to the stamp collection; on the contrary, it offered its services to secure
the assistance of an expert in order to save most of the stamps, but the appellee refused; appellee must then bear the lose
under the principle of "res perit domino."

Unsuccessful in his bid to have the above decision reconsidered by the public respondent, 7 petitioner filed the instant

petition wherein he contends that:

I
IT WAS A GRAVE ERROR OR AN ABUSE OF DISCRETION ON THE PART OF THE RESPONDENT
COURT WHEN IT RULED THAT RESPONDENT SBTC DID NOT FAIL TO EXERCISE THE REQUIRED
DILIGENCE IN MAINTAINING THE SAFETY DEPOSIT BOX OF THE PETITIONER CONSIDERING
THAT SUBSTANTIAL EVIDENCE EXIST (sic) PROVING THE CONTRARY.
II
THE RESPONDENT COURT SERIOUSLY ERRED IN EXCULPATING PRIVATE RESPONDENT FROM
ANY LIABILITY WHATSOEVER BY REASON OF THE PROVISIONS OF PARAGRAPHS 9 AND 13 OF
THE AGREEMENT (EXHS. "A" AND "A-1").
III
THE RESPONDENT COURT SERIOUSLY ERRED IN NOT UPHOLDING THE AWARDS OF THE TRIAL
COURT FOR ACTUAL AND MORAL DAMAGES, INCLUDING ATTORNEY'S FEES AND LEGAL
EXPENSES, IN FAVOR OF THE PETITIONER. 8

We subsequently gave due course the petition and required both parties to submit their respective
memoranda, which they complied with. 9
Petitioner insists that the trial court correctly ruled that SBTC had failed "to exercise the required diligence
expected of a bank maintaining such safety deposit box . . . in the light of the environmental circumstance
of said safety deposit box after the floods of 1985 and 1986." He argues that such a conclusion is
supported by the evidence on record, to wit: SBTC was fully cognizant of the exact location of the safety
deposit box in question; it knew that the premises were inundated by floodwaters in 1985 and 1986 and
considering that the bank is guarded twenty-four (24) hours a day , it is safe to conclude that it was also
aware of the inundation of the premises where the safety deposit box was located; despite such
knowledge, however, it never bothered to inform the petitioner of the flooding or take any appropriate
measures to insure the safety and good maintenance of the safety deposit box in question.
SBTC does not squarely dispute these facts; rather, it relies on the rule that findings of facts of the Court of Appeals, when
supported by substantial exidence, are not reviewable on appeal by certiorari. 10

The foregoing rule is, of course, subject to certain exceptions such as when there exists a disparity
between the factual findings and conclusions of the Court of Appeals and the trial court. 11 Such a disparity
obtains in the present case.
As We see it, SBTC's theory, which was upheld by the public respondent, is that the "Lease Agreement " covering Safe
Deposit Box No. 54 (Exhibit "A and "1") is just that a contract of lease and not a contract of deposit, and that
paragraphs 9 and 13 thereof, which expressly limit the bank's liability as follows:
9. The liability of the bank by reason of the lease, is limited to the exercise of the diligence to prevent the
opening of the Safe by any person other than the Renter, his autliorized agent or legal representative;
xxx xxx xxx

13. The bank is not a depository of the contents of the Safe and it has neither the possession nor the
control of the same. The Bank has no interest whatsoever said contents, except as herein provided, and
it assumes absolutely no liability in connection therewith. 12

are valid and binding upon the parties. In the challenged decision, the public respondent further avers that
even without such a limitation of liability, SBTC should still be absolved from any responsibility for the
damage sustained by the petitioner as it appears that such damage was occasioned by a fortuitous event
and that the respondent bank was free from any participation in the aggravation of the injury.
We cannot accept this theory and ratiocination. Consequently, this Court finds the petition to be impressed with merit.

this Court explicitly rejected the

contention that a contract for the use of a safety deposit box is a contract of lease governed by Title VII,
Book IV of the Civil Code. Nor did We fully subscribe to the view that it is a contract of deposit to be
strictly governed by the Civil Code provision on deposit; 14 it is, as We declared, a special kind of deposit.
The prevailing rule in American jurisprudence that the relation between a bank renting out safe deposit
boxes and its customer with respect to the contents of the box is that of a bailor and bailee, the bailment
for hire and mutual benefit 15 has been adopted in this jurisdiction, thus:
In the recent case CA Agro-Industrial Development Corp. vs. Court of Appeals,

13

In the context of our laws which authorize banking institutions to rent out safety deposit boxes, it is clear
that in this jurisdiction, the prevailing rule in the United States has been adopted. Section 72 of the
General Banking Act [R.A. 337, as amended] pertinently provides:
"Sec. 72. In addition to the operations specifically authorized elsewhere in this Act, banking institutions
other than building and loan associations may perform the following services:
(a) Receive in custody funds, documents, and valuable objects, and rent safety
deposit boxes for the safequarding of such effects.
xxx xxx xxx
The banks shall perform the services permitted under subsections (a), (b) and (c) of this section
asdepositories or as agents. . . ."(emphasis supplied)
Note that the primary function is still found within the parameters of a contract of deposit, i.e., the
receiving in custody of funds, documents and other valuable objects for safekeeping. The renting out of
the safety deposit boxes is not independent from, but related to or in conjunction with, this principal
function. A contract of deposit may be entered into orally or in writing (Art. 1969, Civil Code] and,
pursuant to Article 1306 of the Civil Code, the parties thereto may establish such stipulations, clauses,
terms and conditions as they may deem convenient, provided they are not contrary to law, morals, good
customs, public order or public policy. The depositary's responsibility for the safekeeping of the objects
deposited in the case at bar is governed by Title I, Book IV of the Civil Code. Accordingly, the depositary
would be liable if, in performing its obligation, it is found guilty of fraud, negligence, delay or contravention
of the tenor of the agreement [Art. 1170, id.]. In the absence of any stipulation prescribing the degree of
diligence required, that of a good father of a family is to be observed [Art. 1173, id.]. Hence, any
stipulation exempting the depositary from any liability arising from the loss of the thing deposited on
account of fraud, negligence or delay would be void for being contrary to law and public policy. In the
instant case, petitioner maintains that conditions 13 and l4 of the questioned contract of lease of the
safety deposit box, which read:
"13. The bank is a depositary of the contents of the safe and it has neither the possession nor control of
the same.

"14. The bank has no interest whatsoever in said contents, except as herein expressly provided, and it
assumes absolutely no liability in connection therewith."
are void as they are contrary to law and public policy. We find Ourselves in agreement with this
proposition for indeed, said provisions are inconsistent with the respondent Bank's responsibility as a
depositary under Section 72 (a) of the General Banking Act. Both exempt the latter from any liability
except as contemplated in condition 8 thereof which limits its duty to exercise reasonable diligence only
with respect to who shall be admitted to any rented safe, to wit:
"8. The Bank shall use due diligence that no unauthorized person shall be admitted to
any rented safe and beyond this, the Bank will not be responsible for the contents of
any safe rented from it."
Furthermore condition 13 stands on a wrong premise and is contrary to the actual practice of the Bank. It
is not correct to assert that the Bank has neither the possession nor control of the contents of the box
since in fact, the safety deposit box itself is located in its premises and is under its absolute control;
moreover, the respondent Bank keeps the guard key to the said box. As stated earlier, renters cannot
open their respective boxes unless the Bank cooperates by presenting and using this guard key. Clearly
then, to the extent above stated, the foregoing conditions in the contract in question are void and
ineffective. It has been said:
"With respect to property deposited in a safe-deposit box by a customer of a safedeposit company, the parties, since the relation is a contractual one, may by special
contract define their respective duties or provide for increasing or limiting the liability
of the deposit company, provided such contract is not in violation of law or public
policy. It must clearly appear that there actually was such a special contract, however,
in order to vary the ordinary obligations implied by law from the relationship of the
parties; liability of the deposit company will not be enlarged or restricted by words of
doubtful meaning. The company, in renting safe-deposit boxes, cannot exempt itself
from liability for loss of the contents by its own fraud or negligence or that, of its
agents or servants, and if a provision of the contract may be construed as an attempt
to do so, it will be held ineffective for the purpose. Although it has been held that the
lessor of a safe-deposit box cannot limit its liability for loss of the contents thereof
through its own negligence, the view has been taken that such a lessor may limit its
liability to some extent by agreement or stipulation ."[10 AM JUR 2d., 466]. (citations
omitted) 16
It must be noted that conditions No. 13 and No. 14 in the Contract of Lease of Safety Deposit Box in CA Agro-Industrial
Development Corp. are strikingly similar to condition No. 13 in the instant case. On the other hand, both condition No. 8
in CA Agro-Industrial Development Corp. and condition No. 9 in the present case limit the scope of the exercise of due
diligence by the banks involved to merely seeing to it that only the renter, his authorized agent or his legal representative
should open or have access to the safety deposit box. In short, in all other situations, it would seem that SBTC is not bound
to exercise diligence of any kind at all. Assayed in the light of Our aforementioned pronouncements in CA Agro-lndustrial
Development Corp., it is not at all difficult to conclude that both conditions No. 9 and No. 13 of the "Lease Agreement"
covering the safety deposit box in question (Exhibits "A" and "1") must be stricken down for being contrary to law and public
policy as they are meant to exempt SBTC from any liability for damage, loss or destruction of the contents of the safety
deposit box which may arise from its own or its agents' fraud, negligence or delay. Accordingly, SBTC cannot take refuge
under the said conditions.
Public respondent further postulates that SBTC cannot be held responsible for the destruction or loss of the stamp collection
because the flooding was a fortuitous event and there was no showing of SBTC's participation in the aggravation of the loss
or injury. It states:
Article 1174 of the Civil Code provides:

"Except in cases expressly specified by the law, or when it is otherwise declared by

stipulation, or when the nature of the obligation requires the assumption of risk, no
person shall be responsible for those events which could not be foreseen, or which,
though foreseen, were inevitable.'
In its dissertation of the phrase "caso fortuito" the Enciclopedia Jurisdicada Espaola 17 says: "In a legal
sense and, consequently, also in relation to contracts, a "caso fortuito" prevents (sic) 18 the following essential
characteristics: (1) the cause of the unforeseen ands unexpected occurrence, or of the failure of the debtor to comply
with his obligation, must be independent of the human will; (2) it must be impossible to foresee the event which
constitutes the "caso fortuito," or if it can be foreseen, it must be impossible to avoid; (3) the occurrence must be such
as to render it impossible for one debtor to fulfill his obligation in a normal manner; and (4) the obligor must be free
from any participation in the aggravation of the injury resulting to the creditor." (cited in Servando vs. Phil., Steam
Navigation Co., supra). 19

Here, the unforeseen or unexpected inundating floods were independent of the will of the appellant bank
and the latter was not shown to have participated in aggravating damage (sic) to the stamps collection of
the appellee. In fact, the appellant bank offered its services to secure the assistance of an expert to save
most of the then good stamps but the appelle refused and let (sic) these recoverable stamps inside the
safety deposit box until they were ruined. 20

Both the law and authority cited are clear enough and require no further elucidation. Unfortunately,
however, the public respondent failed to consider that in the instant case, as correctly held by the trial
court, SBTC was guilty of negligence. The facts constituting negligence are enumerated in the petition
and have been summarized in this ponencia. SBTC's negligence aggravated the injury or damage to the
stamp collection. SBTC was aware of the floods of 1985 and 1986; it also knew that the floodwaters
inundated the room where Safe Deposit Box No. 54 was located. In view thereof, it should have lost no
time in notifying the petitioner in order that the box could have been opened to retrieve the stamps, thus
saving the same from further deterioration and loss. In this respect, it failed to exercise the reasonable
care and prudence expected of a good father of a family, thereby becoming a party to the aggravation of
the injury or loss. Accordingly, the aforementioned fourth characteristic of a fortuitous event is absent
Article 1170 of the Civil Code, which reads:
Those who in the performance of their obligation are guilty of fraud, negligence, or delay, and those who
in any manner contravene the tenor thereof, are liable for damages,
thus comes to the succor of the petitioner. The destruction or loss of the stamp collection which was, in the language of the
trial court, the "product of 27 years of patience and diligence" 21 caused the petitioner pecuniary loss; hence, he

must be compensated therefor.

We cannot, however, place Our imprimatur on the trial court's award of moral damages. Since the relationship between the
petitioner and SBTC is based on a contract, either of them may be held liable for moral damages for breach thereof only if
said party had acted fraudulently or in bad faith.

22

There is here no proof of fraud or bad faith on the part of

SBTC.
WHEREFORE, the instant petition is hereby GRANTED. The challenged Decision and Resolution of the public respondent
Court of Appeals of 21 August 1991 and 21 November 1991, respectively, in CA-G.R. CV No. 26737, are hereby SET ASIDE
and the Decision of 19 February 1990 of Branch 47 of the Regional Trial Court of Manila in Civil Case No. 87-42601 is
hereby REINSTATED in full, except as to the award of moral damages which is hereby set aside.
Costs against the private respondent.
SO ORDERED.

JOSEPH CHAN, WILSON CHAN

MACEDA, JR., respondent.

and

LILY

CHAN, petitioners, vs.

BONIFACIO

S.

DECISION
SANDOVAL-GUTIERREZ, J.:
A judgment of default does not automatically imply admission by the defendant of the facts and
causes of action of the plaintiff. The Rules of Court require the latter to adduce evidence in support of his
allegations as an indispensable condition before final judgment could be given in his favor. [1] The trial
judge has to evaluate the allegations with the highest degree of objectivity and certainty. He may sustain

an allegation for which the plaintiff has adduced sufficient evidence, otherwise, he has to reject it. In the
case at bar, judicial review is imperative to avert the award of damages that is unreasonable and without
evidentiary support.
Assailed in this petition for review under Rule 45 of the 1997 Rules of Civil Procedure, as amended,
is the Decision[2] dated June 17, 1999 of the Court of Appeals in CA-G.R. CV No. 57323,
entitled Bonifacio
S.
Maceda,
Jr.
versus
Joseph
Chan,
et.
al.,
affirming intoto the
Decision[3] dated December 26, 1996 of the Regional Trial Court, Branch 160, Pasig City, in Civil Case
No. 53044.
The essential antecedents are as follows:
On July 28, 1976, Bonifacio S. Maceda, Jr., herein respondent, obtained a P7.3 million loan from the
Development Bank of the Philippines for the construction of his New Gran Hotel Project in Tacloban City.
Thereafter, on September 29, 1976, respondent entered into a building construction contract with
Moreman Builders Co., Inc., (Moreman). They agreed that the construction would be finished not later
than December 22, 1977.
Respondent purchased various construction materials and equipment in Manila. Moreman, in turn,
deposited them in the warehouse of Wilson and Lily Chan, herein petitioners. The deposit was free of
charge.
Unfortunately, Moreman failed to finish the construction of the hotel at the stipulated time. Hence, on
February 1, 1978, respondent filed with the then Court of First Instance (CFI, now Regional Trial Court),
Branch 39, Manila, an action for rescission and damages against Moreman, docketed as Civil Case No.
113498.

On November 28, 1978, the CFI rendered its Decision [4] rescinding the contract between Moreman
and respondent and awarding to the latter P 445,000.00 as actual, moral and liquidated
damages; P20,000.00 representing the increase in the construction materials; and P35,000.00 as
attorneys fees. Moreman interposed an appeal to the Court of Appeals but the same was dismissed on
March 7, 1989 for being dilatory. He elevated the case to this Court via a petition for review on
certiorari. In a Decision[5] dated February 21, 1990, we denied the petition. On April 23, 1990,[6] an Entry of
Judgment was issued.
Meanwhile, during the pendency of the case, respondent ordered petitioners to return to him the
construction materials and equipment which Moreman deposited in their warehouse. Petitioners,
however, told them that Moreman withdrew those construction materials in 1977.
Hence, on December 11, 1985, respondent filed with the Regional Trial Court, Branch 160, Pasig
City, an action for damages with an application for a writ of preliminary attachment against petitioners,
[7]
docketed as Civil Case No. 53044.
In the meantime, on October 30, 1986, respondent was appointed Judge of the Regional Trial Court,
Branch 12, San Jose Antique.[8]
On August 25, 1989, or after almost four (4) years, the trial court dismissed respondents complaint
for his failure to prosecute and for lack of interest. [9] On September 6, 1994, or five years thereafter,
respondent filed a motion for reconsideration, but the same was denied in the Order dated September 9,
1994 because of the failure of respondent and his counsel to appear on the scheduled hearing. [10]
On October 14, 1994, respondent filed a second motion for reconsideration. This time, the
motion was granted and the case was ordered reinstated on January 10, 1995, or ten (10) years
from the time the action was originally filed. [11] Thereafter, summons, together with the copies of the
complaint and its annexes, were served on petitioners.

On March 2, 1995, counsel for petitioners filed a motion to dismiss on several grounds.
Respondent, on the other hand, moved to declare petitioners in default on the ground that their motion
to dismiss was filed out of time and that it did not contain any notice of hearing. [13]
[12]

On April 27, 1995, the trial court issued an order declaring petitioners in default. [14]
Petitioners filed with the Court of Appeals a petition for certiorari [15] to annul the trial courts order of
default, but the same was dismissed in its Order [16] dated August 31, 1995. The case reached this Court,
and in a Resolution dated October 25, 1995, [17] we affirmed the assailed order of the Court of Appeals. On
November 29, 1995,[18] the corresponding Entry of Judgment was issued.
Thus, upon the return of the records to the RTC, Branch 160, Pasig City, respondent was allowed to
present his evidence ex-parte.
Upon motion of respondent, which was granted by the trial court in its Order dated April 29, 1996,
the depositions of his witnesses, namely, Leonardo Conge, Alfredo Maceda and Engr. Damiano
Nadera were taken in the Metropolitan Trial Court in Cities, Branch 2, Tacloban City. [20] Deponent
Leonardo Conge, a labor contractor, testified that on December 14 up to December 24, 1977, he was
contracted by petitioner Lily Chan to get bags of cement from the New Gran Hotel construction site and to
store the same into the latters warehouse in Tacloban City. Aside from those bags of cement, deponent
also hauled about 400 bundles of steel bars from the same construction site, upon order of
petitioners. Corresponding delivery receipts were presented and marked as Exhibits A, A-1,A-2,A-3 and
A-4.[21]
[19]

Deponent Alfredo Maceda testified that he was respondents Disbursement and Payroll Officer who
supervised the construction and kept inventory of the properties of the New Gran Hotel. While conducting
the inventory on November 23, 1977, he found that the approximate total value of the materials stored in
petitioners warehouse was P214,310.00. This amount was accordingly reflected in the certification signed
by Mario Ramos, store clerk and representative of Moreman who was present during the inventory.[22]
Deponent Damiano Nadera testified on the current cost of the architectural and structural
requirements needed to complete the construction of the New Gran Hotel. [23]
On December 26, 1996, the trial court rendered a decision in favor of respondent, thus:
WHEREFORE, foregoing considered, judgment is hereby rendered ordering defendants to jointly and severally pay
plaintiff:
1) P1,930,000.00 as actual damages;
2) P2,549,000.00 as actual damages;
3) Moral damages of P150,000.00; exemplary damages of P50,000.00 and attorneys fees of P50,000.00 and to pay
the costs.
SO ORDERED.
The trial court ratiocinated as follows:
The inventory of other materials, aside from the steel bars and cement is found highly reliable based on first, the
affidavit of Arthur Edralin dated September 15, 1979, personnel officer of Moreman Builders that he was assigned
with others to guard the warehouse; (Exhs. M & O); secondly, the inventory (Exh. C) dated November 23, 1977
shows (sic) deposit of assorted materials; thirdly, that there were items in the warehouse as of February 3, 1978 as
shown in the balance sheet of Moremans stock clerk Jose Cedilla.
Plaintiff is entitled to payment of damages for the overhauling of materials from the construction site by Lily Chan
without the knowledge and consent of its owner. Article 20 of the Civil Code provides:

Art. 20. Every person who contrary to law, willfully or negligently caused damage to another, shall indemnify the
latter for the same.
As to the materials stored inside the bodega of defendant Wilson Chan, the inventory (Exh. C) show (sic), that the
same were owned by the New Gran Hotel. Said materials were stored by Moreman Builders Co., Inc. since it was
attested to by the warehouseman as without any lien or encumbrances, the defendants are duty bound to release
it. Article 21 of the Civil Code provides:
Art. 21. Any person who willfully caused loss or injury to another in a manner that is contrary to morals, good
customs or public policy shall compensate the latter for the damage.
Plaintiff is entitled to payment of actual damages based on the inventory as of November 23, 1977 amounting
to P1,930,080.00 (Exhs. Q & Q-1). The inventory was signed by the agent Moreman Builders Corporation and
defendants.
Plaintiff is likewise entitled to payment of 12,500 bags of cement and 400 bundles of steel bars
totaling P2,549,000.00 (Exhs. S & S-1; Exhs. B & B-3).
Defendants should pay plaintiff moral damages of P150,000.00; exemplary damages of P50,000.00 and attorneys
fees of P50,000.00 and to pay the costs.
The claim of defendant for payment of damages with respect to the materials appearing in the balance sheets as of
February 3, 1978 in the amount of P3,286,690.00, not having been established with enough preponderance of
evidence cannot be given weight.[24]
Petitioners then elevated the case to the Court of Appeals, docketed as CA-G.R. CV No. 57323. On
June 17, 1999, the Appellate Court rendered the assailed Decision [25] affirming in toto the trial courts
judgment, ratiocinating as follows:
Moreover, although the prayer in the complaint did not specify the amount of damages sought, the same was
satisfactorily proved during the trial. For damages to be awarded, it is essential that the claimant satisfactorily prove
during the trial the existence of the factual basis thereof and its causal connection with the adverse partys act (PAL,
Inc. vs. NLRC, 259 SCRA 459. In sustaining appellees claim for damages, the court a quo held as follows:
The Court finds the contention of plaintiff that materials and equipment of plaintiff were stored in the warehouse of
defendants and admitted by defendants in the certification issued to Sheriff Borja. x x x
Evidence further revealed that assorted materials owned by the New Gran Hotel (Exh. C) were deposited in the
bodega of defendant Wilson Chan with a total market value of P1,930,000.00, current price.
The inventory of other materials, aside from the steel bars and cement, is highly reliable based on first, the affidavit
of Arthur Edralin dated September 15, 1979, personnel officer of Moreman Builders; that he was assigned, with
others to guard the warehouse (Exhs. M & O); secondly, the inventory (Exh. C) November 23, 1977 shows deposit
of assorted materials; thirdly, that there were items in the warehouse as of February 3, 1978, as shown in the balance
sheet of Moremans stock clerk, Jose Cedilla (pp. 60-61, Rollo).
The Court affirms the above findings.
Well settled is the rule that absent any proper reason to depart from the rule, factual conclusions reached by the trial
court are not to be disturbed (People vs. Dupali, 230 SCRA 62). Hence, in the absence of any showing that serious
and substantial errors were committed by the lower court in the appraisal of the evidence, the trial judges assessment
of the credibility of the witnesses is accorded great weight and respect (People vs. Jain, 254 SCRA 686). And, there
being absolutely nothing on record to show that the court a quo overlooked, disregarded, or misinterpreted facts of

weight and significance, its factual findings and conclusions must be given great weight and should not be disturbed
on appeal.
WHEREFORE, being in accord with law and evidence, the appealed decision is hereby AFFIRMED in toto.
Hence, this petition for review on certiorari anchored on the following grounds:
I
The Court of Appeals acted with grave abuse of discretion and under a misapprehension of the law and the
facts when it affirmed in toto the award of actual damages made by the trial court in favor of respondent in
this case.
II
The awards of moral and exemplary damages of the trial court to respondent in this case and affirmed in
toto by the Court of Appeals are unwarranted by the evidence presented by respondent at the ex parte hearing
of this case and should, therefore, be eliminated or at least reduced.
III
The award of attorneys fees by the trial court to respondent in this case and affirmed by the Court of
Appeals should be deleted because of the failure of the trial court to state the legal and factual basis of such
award.
Petitioners contend inter alia that the actual damages claimed by respondent in the present case
were already awarded to him in Civil Case No. 113498 [26] and hence, cannot be recovered by him
again. Even assuming that respondent is entitled to damages, he can not recover P4,479,000.00 which is
eleven (11) times more than the total actual damages of P365,000.00 awarded to him in Civil Case No.
113498.[27]
In his comment on the petition, respondent maintains that petitioners, as depositaries under the law,
have both the fiduciary and extraordinary obligations not only to safely keep the construction material
deposited, but also to return them with all their products, accessories and accessions, pursuant to Articles
1972,[28] 1979,[29] 1983,[30] and 1988[31] of the Civil Code. Considering that petitioners duty to return the
construction materials in question has already become impossible, it is only proper that the prices of
those construction materials in 1996 should be the basis of the award of actual damages. This is the only
way to fulfill the duty to return contemplated in the applicable laws. [32] Respondent further claims that
petitioners must bear the increase in market prices from 1977 to 1996 because liability for fraud
includes all damages which may be reasonably attributed to the non-performance of the obligation. Lastly,
respondent insists that there can be no double recovery because in Civil Case No. 113498, [33] the parties
were respondent himself and Moreman and the cause of action was the rescission of their building
contract. In the present case, however, the parties are respondent and petitioners and the cause of action
between them is for recovery of damages arising from petitioners failure to return the construction
materials and equipment.

Obviously, petitioners assigned errors call for a review of the lower courts findings of fact.
Succinct is the rule that this Court is not a trier of facts and does not normally undertake the reexamination of the evidence submitted by the contending parties during the trial of the case considering
that findings of fact of the Court of Appeals are generally binding and conclusive on this Court. [34] The
jurisdiction of this Court in a petition for review on certiorari is limited to reviewing only errors of law, [35] not
of fact, unless it is shown, inter alia, that: (1) the conclusion is a finding grounded on speculations,
surmises or conjectures; (2) the inference is manifestly mistaken, absurd and impossible; (3) there is

grave abuse of discretion; (4) the judgment is based on misapprehension of facts; (5) the findings of fact
are conflicting; and (6) the Court of Appeals, in making its findings went beyond the issues of the case
and the same is contrary to the admission of both parties.[36]
Petitioners submit that this case is an exception to the general rule since both the trial court and the
Court of Appeals based their judgments on misapprehension of facts.
We agree.
At the outset, the case should have been dismissed outright by the trial court because of patent
procedural infirmities. It bears stressing that the case was originally filed on December 11, 1985. Four (4)
years thereafter, or on August 25, 1989, the case was dismissed for respondents failure to
prosecute. Five (5) years after, or on September 6, 1994, respondent filed his motion for
reconsideration. From here, the trial court already erred in its ruling because it should have dismissed the
motion for reconsideration outright as it was filed far beyond the fifteen-day reglementary period.
[37]
Worse, when respondent filed his second motion for reconsideration on October 14, 1994, a prohibited
pleading,[38] the trial court still granted the same and reinstated the case on January 10, 1995. This is a
glaring gross procedural error committed by both the trial court and the Court of Appeals.
Even without such serious procedural flaw, the case should also be dismissed for utter lack of merit.

It must be stressed that respondents claim for damages is based on petitioners failure to return or to
release to him the construction materials and equipment deposited by Moreman to their
warehouse. Hence, the essential issues to be resolved are: (1) Has respondent presented proof that the
construction materials and equipment were actually in petitioners warehouse when he asked that the
same be turned over to him? (2) If so, does respondent have the right to demand the release of the said
materials and equipment or claim for damages?
Under Article 1311 of the Civil Code, contracts are binding upon the parties (and their assigns and
heirs) who execute them. When there is no privity of contract, there is likewise no obligation or liability to
speak about and thus no cause of action arises.Specifically, in an action against the depositary, the
burden is on the plaintiff to prove the bailment or deposit and the performance of conditions precedent to
the right of action.[39] A depositary is obliged to return the thing to the depositor, or to his heirs or
successors, or to the person who may have been designated in the contract. [40]
In the present case, the record is bereft of any contract of deposit, oral or written, between
petitioners and respondent. If at all, it was only between petitioners and Moreman. And
granting arguendo that there was indeed a contract of deposit between petitioners and Moreman, it is still
incumbent upon respondent to prove its existence and that it was executed in his favor. However,
respondent miserably failed to do so. The only pieces of evidence respondent presented to prove the
contract of deposit were the delivery receipts.[41] Significantly, they are unsigned and not duly received
or authenticated by either Moreman, petitioners or respondent or any of their authorized
representatives. Hence, those delivery receipts have no probative value at all. While our laws grant a
person the remedial right to prosecute or institute a civil action against another for the enforcement or
protection of a right, or the prevention or redress of a wrong, [42] every cause of action ex-contractu must
be founded upon a contract, oral or written, express or implied.
Moreover, respondent also failed to prove that there were construction materials and equipment in
petitioners warehouse at the time he made a demand for their return.
Considering that respondent failed to prove (1) the existence of any contract of deposit between him
and petitioners, nor between the latter and Moreman in his favor, and (2) that there were construction
materials in petitioners warehouse at the time of respondents demand to return the same, we hold that
petitioners have no corresponding obligation or liability to respondent with respect to those construction
materials.
Anent the issue of damages, petitioners are still not liable because, as expressly provided for in
Article 2199 of the Civil Code, [43] actual or compensatory damages cannot be presumed, but must be

proved with reasonable degree of certainty. A court cannot rely on speculations, conjectures, or
guesswork as to the fact and amount of damages, but must depend upon competent proof that they have
been suffered by the injured party and on the best obtainable evidence of the actual amount thereof. It
must point out specific facts which could afford a basis for measuring whatever compensatory or actual
damages are borne.[44]
Considering our findings that there was no contract of deposit between petitioners and respondent or
Moreman and that actually there were no more construction materials or equipment in petitioners
warehouse when respondent made a demand for their return, we hold that he has no right whatsoever to
claim for damages.
As we stressed in the beginning, a judgment of default does not automatically imply admission by the
defendant of plaintiffs causes of action. Here, the trial court merely adopted respondents allegations in his
complaint and evidence without evaluating them with the highest degree of objectivity and certainty.
WHEREFORE, the petition is GRANTED. The challenged Decision of the Court of Appeals dated
June 17, 1999 is REVERSED and SET ASIDE. Costs against respondent.
SO ORDERED.

TRIPLE-V vs. FILIPINO MERCHANTS

THIRD DIVISION
Gentlemen:
Quoted hereunder, for your information, is a resolution of this Court dated FEB 21 2005.
G.R. No. 160544 (Triple-V Food Services, Inc. vs. Filipino Merchants Insurance Company, Inc.)
Assailed in this petition for review on certiorari is the decision [1]cralaw dated October 21, 2003 of the
Court of Appeals in CA-G.R. CV No. 71223, affirming an earlier decision of the Regional Trial Court at

Makati City, Branch 148, in its Civil Case No. 98-838, an action for damages thereat filed by
respondent Filipino Merchants Insurance, Company, Inc., against the herein petitioner, Triple-V Food
Services, Inc.
On March 2, 1997, at around 2:15 o'clock in the afternoon, a certain Mary Jo-Anne De Asis (De Asis)
dined at petitioner's Kamayan Restaurant at 15 West Avenue, Quezon City. De Asis was using a
Mitsubishi Galant Super Saloon Model 1995 with plate number UBU 955, assigned to her by her
employer Crispa Textile Inc. (Crispa). On said date, De Asis availed of the valet parking service of
petitioner and entrusted her car key to petitioner's valet counter. A corresponding parking ticket was
issued as receipt for the car. The car was then parked by petitioner's valet attendant, a certain
Madridano, at the designated parking area. Few minutes later, Madridano noticed that the car was not
in its parking slot and its key no longer in the box where valet attendants usually keep the keys of cars
entrusted to them. The car was never recovered. Thereafter, Crispa filed a claim against its insurer,
herein respondent Filipino Merchants Insurance Company, Inc. (FMICI). Having indemnified Crispa in
the amount of P669.500 for the loss of the subject vehicle, FMICI, as subrogee to Crispa's rights, filed
with the RTC at Makati City an action for damages against petitioner Triple-V Food Services, Inc.,
thereat docketed as Civil Case No. 98-838 which was raffled to Branch 148.
In its answer, petitioner argued that the complaint failed to aver facts to support the allegations of
recklessness and negligence committed in the safekeeping and custody of the subject vehicle, claiming
that it and its employees wasted no time in ascertaining the loss of the car and in informing De Asis of
the discovery of the loss. Petitioner further argued that in accepting the complimentary valet parking
service, De Asis received a parking ticket whereunder it is so provided that "[Management and staff
will not be responsible for any loss of or damage incurred on the vehicle nor of valuables contained
therein", a provision which, to petitioner's mind, is an explicit waiver of any right to claim indemnity
for the loss of the car; and that De Asis knowingly assumed the risk of loss when she allowed
petitioner to park her vehicle, adding that its valet parking service did not include extending a contract
of insurance or warranty for the loss of the vehicle.
During trial, petitioner challenged FMICI's subrogation to Crispa's right to file a claim for the loss of
the car, arguing that theft is not a risk insured against under FMICI's Insurance Policy No. PC-5975 for
the subject vehicle.
In a decision dated June 22, 2001, the trial court rendered judgment for respondent FMICI, thus:
WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiff (FMICI) and
against the defendant Triple V (herein petitioner) and the latter is hereby ordered to pay plaintiff the
following:
1. The amount of P669,500.00, representing actual damages plus compounded (sic);
2. The amount of P30,000.00 as acceptance fee plus the amount equal to 25% of the total amount
due as attorney's fees;
3. The amount of P50,000.00 as exemplary damages;
4. Plus, cost of suit.
Defendant Triple V is not therefore precluded from taking appropriate action against defendant
Armando Madridano.

SO ORDERED.
Obviously displeased, petitioner appealed to the Court of Appeals reiterating its argument that it was
not a depositary of the subject car and that it exercised due diligence and prudence in the safe
keeping of the vehicle, in handling the car-napping incident and in the supervision of its employees. It
further argued that there was no valid subrogation of rights between Crispa and respondent FMICI.
In a decision dated October 21, 2003, [2]cralaw the Court of Appeals dismissed petitioner's appeal and
affirmed the appealed decision of the trial court, thus:
WHEREFORE, based on the foregoing premises, the instant appeal is hereby DISMISSED. Accordingly,
the assailed June 22, 2001 Decision of the RTC of Makati City - Branch 148 in Civil Case No. 98-838 is
AFFIRMED.
SO ORDERED.
In so dismissing the appeal and affirming the appealed decision, the appellate court agreed with the
findings and conclusions of the trial court that: (a) petitioner was a depositary of the subject vehicle;
(b) petitioner was negligent in its duties as a depositary thereof and as an employer of the valet
attendant; and (c) there was a valid subrogation of rights between Crispa and respondent FMICI.
Hence, petitioner's present recourse.
We agree with the two (2) courts below.
When De Asis entrusted the car in question to petitioners valet attendant while eating at
petitioner'sKamayan Restaurant, the former expected the car's safe return at the end of her meal.
Thus, petitioner was constituted as a depositary of the same car. Petitioner cannot evade liability by
arguing that neither a contract of deposit nor that of insurance, guaranty or surety for the loss of the
car was constituted when De Asis availed of its free valet parking service.
In a contract of deposit, a person receives an object belonging to another with the obligation of safely
keeping it and returning the same. [3]cralaw A deposit may be constituted even without any
consideration. It is not necessary that the depositary receives a fee before it becomes obligated to
keep the item entrusted for safekeeping and to return it later to the depositor.
Specious is petitioner's insistence that the valet parking claim stub it issued to De Asis contains a clear
exclusion of its liability and operates as an explicit waiver by the customer of any right to claim
indemnity for any loss of or damage to the vehicle.
The parking claim stub embodying the terms and conditions of the parking, including that of relieving
petitioner from any loss or damage to the car, is essentially a contract of adhesion, drafted and
prepared as it is by the petitioner alone with no participation whatsoever on the part of the customers,
like De Asis, who merely adheres to the printed stipulations therein appearing. While contracts of
adhesion are not void in themselves, yet this Court will not hesitate to rule out blind adherence
thereto if they prove to be one-sided under the attendant facts and circumstances. [4]cralaw
Hence, and as aptly pointed out by the Court of Appeals, petitioner must not be allowed to use its
parking claim stub's exclusionary stipulation as a shield from any responsibility for any loss or damage
to vehicles or to the valuables contained therein. Here, it is evident that De Asis deposited the car in

question with the petitioner as part of the latter's enticement for customers by providing them a safe
parking space within the vicinity of its restaurant. In a very real sense, a safe parking space is an
added attraction to petitioner's restaurant business because customers are thereby somehow assured
that their vehicle are safely kept, rather than parking them elsewhere at their own risk. Having
entrusted the subject car to petitioner's valet attendant, customer De Asis, like all of petitioner's
customers, fully expects the security of her car while at petitioner's premises/designated parking
areas and its safe return at the end of her visit at petitioner's restaurant.
Petitioner's argument that there was no valid subrogation of rights between Crispa and FMICI because
theft was not a risk insured against under FMICI's Insurance Policy No. PC-5975 holds no water.
Insurance Policy No. PC-5975 which respondent FMICI issued to Crispa contains, among others things,
the following item: "Insured's Estimate of Value of Scheduled Vehicle- P800.000".[5]cralaw On the
basis of such item, the trial court concluded that the coverage includes a full comprehensive insurance
of the vehicle in case of damage or loss. Besides, Crispa paid a premium of P10,304 to cover theft.
This is clearly shown in the breakdown of premiums in the same policy. [6]cralaw Thus, having
indemnified CRISPA for the stolen car, FMICI, as correctly ruled by the trial court and the Court of
Appeals, was properly subrogated to Crispa's rights against petitioner, pursuant to Article 2207 of the
New Civil Code[7].
Anent the trial court's findings of negligence on the part of the petitioner, which findings were affirmed
by the appellate court, we have consistently ruled that findings of facts of trial courts, more so when
affirmed, as here, by the Court of Appeals, are conclusive on this Court unless the trial court itself
ignored, overlooked or misconstrued facts and circumstances which, if considered, warrant a reversal
of the outcome of the case. [8]cralaw This is not so in the case at bar. For, we have ourselves reviewed
the records and find no justification to deviate from the trial court's findings.
WHEREFORE, petition is hereby DENIED DUE COURSE.
SO ORDERED.