CH. 6. ACTIONS AND DAMAGES IN CASE OF liable under RPC.

These liabilities are in the nature

BREACH
1. Distinctions. CC - Source is culpa contractual.
Culpa contractual != quasi-delict
Cangco v. MRC. In breach of contract, liability of
defendant is direct and immediate, as compared
from presumptive responsibility for the negligence
of servants, imposed by Art. 1903 of CC, which can
be rebutted by proof of exercise of due care in
selection and supervision. Art. 1903 only applies to
extra-contractual obligations (culpa aquiliana), and
NOT to obligations arising ex contractu (culpa
contractual).
of vicarious liability because negligence of employee
is imputed to employer.
2.01. Concurrence with Third Persons
Liability of third person who was driving another
vehicle or his employer may be based on quasi-
delict.Driver may be criminally and civilly liable.
Employer may be subsidiarily liable.
a. The two drivers/employers are jointly and
severally liable for damages. If one driver/owner
is not impleaded, the carrier may implead them by
filing a third party complaint.

Point of Culpa Contractual Culpa Aquiliana 2.02. Solidary Liability. Jointly and severally
Distinctio liable if negligence of carriers driver and third
n person concurs.
Source of Contract Quasi-Delict
obligatio a. Alternative Causes of Action. Carrier may be
n sued on the alternative causes of action of breach of
Liability No liability, as Solidarily liable contract and quasi-delict, as long as plaintiff does
of there is no privity with Employer NOT recover twice.
Employe of contract
e 2.03. Alternative Compensation Scheme. Special
Availabili Due diligence in Due diligence in laws provide for mandatory insurance coverage of
ty of selection/supervis selection/supervis pax/cargoes.
Defence ion is NOT a ion of employee is
defense a defense under a. Sec. 14, Marine Shipping Devt Act of 2004
Art. 2180. requires mandatory insurance coverage for pax to
In What Liable as Liable as an meet financial responsibility of ship operator for
Capacity contracting party Employer breach of CoC.
Liable Sec. 15, same law Maritime Industry Authority
shall have power to require ship operator to obtain
2. Concurrent Causes of Action. compulsory insurance coverage necessary to cover
The act that breaches the contract may also be a claims.
tort. Hence it may give rise to a liability based on b. Compulsory Motor Vehicle Liability Insurance is
contract and quasi-delict under Art. 2176. In fact, mandated under Sec. 374-389 of Insurance Code.
with respect to employee of carrier, civil liability
may be based on quasi-delict as well as on criminal 3. Elements of CoA against Carrier
liability under Art. 100, RPC. CoA act or omission in violation of right of other
party. Elements:
a. Hence, basis of liability of CC can be culpa 1. right of plaintiff by law
contractual or culpa aquiliana; 2. obligation of defendant to respect it
And basis of liability of driver might be 3. act or omission violates the right of
either culpa delictual or culpa aquiliana. plaintiff
Driver is not liable based on contract If QD, negligence/fraud/delay/act/omission must
because there is no privity between him and be alleged.
pax/shipper. If culpa-contractual, not necessary to allege and
Applicable to prove negligent act. All that is necessary is to allege
captain/officers/crew/personnel the presence of contract and damage/injury,
because breach through negligence is already
b. Shipowner or operator, as employer, may be held presumed in such case.
primarily liable under Art. 2180 CC or subsidiarily
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4. Recoverable Damages.
Damage pecuniary compensation, recompense, or
satisfaction for an injury sustained.
a. Reason for Provision. For compensation
4.01. Extent of Recovery in contractual breach:
Art. 2201, CC. In contracts and quasi-contracts,
damages, for which obligor who acted in good
faith is liable, shall be THOSE that are natural
and probable consequences of breach of
obligation, and which parties could have
foreseen/reasonable foreseen.
In case of fraud/bad faith/malice/wanton
attitude, obligor shall be responsible for ALL
damages which may be reasonably attributed to
non-performance of obligation.
b. Carriers Right of Recourse. Carrier has right of
recourse against employee.
4.02. Kinds of Damages
Art. 2197, CC. MENTAL.
Art. 2216. No proof of pecuniary loss needed for
M/E/N/T/L damages. However, proof of pecuniary
loss if necessary if actual or compensatory damages
are being claimed.
5. Actual or Compensatory Damages.
Art. 2199, CC. Except as otherwise provided by
law/stipulation, one is entitled to an adequate
compensation only for such pecuniary loss suffered
by him as he duly proved.
Art. 2200, CC. Indemnification for damages shall
comprehend xx also that of profits that obligee
failed to obtain.
5.01. Kinds of Actual Damges
1. Loss of what person already possesses (dao
emergente)
2. Failure to receive a benefit which would have
pertained to him (lucro cesante).
Art. 2205. Damages may be recovered:
1. For loss or impairment of earning capacity
in cases of temporary/permanent personal
injury
2. For injury to plaintiffs business standing or
commercial credit.
5.02. Proof. Damages cannot be presumed.
Burden of proof is on plaintiff.
a. Determination of Amount of Liability in Carriage
by Sea
Art. 372, CoC. Value xxx in accordance
with that declared in BoL. Shipper is not
allowed to present proof that the goods
were of greater value.
Horses/vehicles/vessels/equipment/oth
er principal and accessory means of
transportation shall be bound in favor of
shipper; for railroads, liability shall be
subordinated to provisions of laws of
concession with respect to property, and
to what CoC established as to manner and
form of effecting seizures and
attachments against said companies.
b. International Carriage of Goods
Sec. 4, par. 5. COGSA. Neither carrier or
ship shall be liable for loss/damage in
connection with transportation of goods in
amount > $500 per package, per customary
freight unit xxx unless nature/value of
goods have been declared by shipper before
shipment and inserted in BoL. The
declaration in BoL shall be prima facie
evidence, and shall be conclusive against
carrier.
c. Valuation of Goods. Value at time of destruction,
or that which plaintiff would have paid in the
market for identical goods.
d. Damages in Personal Injury Cases. Claimant is
entitled to all medical expenses and other
reasonable expenses that he incurred to treat his
injuries. It may even include plastic surgery.
5.03. Damages in Case of Death. Plaintiff entitled
to amount of wake and funeral. Expenses after
burial are NOT compensable (e.g. 9th day, 40th day,
1st year). However, heirs are entitled to damages
under Art. 2206.
Art. 2206, CC. Amount of death caused by
crime/quasi-delict shall be +P3000, even if
there are mitigating circumstances. In addition:
1. Defendant liable for loss of earning capacity.
2. If deceased was obliged to give support,
recipient may demand support for a period < 5
years.
3. Spouse, leg/illeg desc/ascendants may
demand moral damages.
a. Fixed Damages. P50000.
b. Loss of Earning Capacity.
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Net Earning Capacity = Life Expectancy * (Gross
Annual Income Necessary Living Expenses);
life expectancy = 2/3 * 80 age at death
living expenses = in absence of proof, 50%
of gross income
Applicable in cases of permanent incapacity
Loss of earning capacity must be established
through documentary proof. Exceptions:
1. Self-employed, or
2. <minimum wage
6. Attorneys Fees.
Art. 2208, CC. In absence of stipulation, attorneys
fees and litigation expenses, other than judicial
costs cannot be recovered, EXCEPT:
1. Exemplary damages awarded;
2. Defendants acts/om has compelled
plaintiff to litigate with third persons to
incur expenses and protect his interests
3. Criminal cases of malicious prosecution
against plaintiff
4. Clearly unfounded civil action against
plaintiff
5. Defendant acted in gross/evident bad
faith in refusing to satisfy plaintiffs
claim
6. Legal support
7. Recovery of wages of household
helpers/laborers/skilled workers
8. Indemnity under workmens
compensation laws
9. Separate civil action to recover civil
liability arising from crime
10. When at least double judicial costs are
awarded
11. When court deems it just and equitable
Attorneys fees must be reasonable.
a. Award of attorneys fees is the exception, not
general rule.
b. When Available in CoC. Art. 2208, 1, 2, 4, 5, 10, 11.
7. Interests. 6% per annum from the time of
finality of decision up to its satisfaction.
8. Moral Damages
For physical suffering, mental anguish, fright,
serious anxiety, besmirched reputation, wounded
feelings, moral shock, social humiliation.
In breach of contract of air carriage, MD may be
recovered when:
1. Mishap results in death of pax
2. Carrier is guilty of fraud/bad faith
3. Negligence of carrier is so gross and
reckless
Gross negligence implies a want or absence of or
failure to exercise even slight care or diligence, or
entire absence of care. It evinces a thoughtless
disregard of consequences without exerting any
effort to avoid them.
8.01. Requisites.
Generally, no MD when breach of contract is not
malicious. However, MD is awarded if there is gross
negligence.
Expert Travel vs. CA. Required conditions:
1. Injury
2. Act or omission
3. Act or omission is proximate cause
4.Award of damages is predicated in Art.
2219.
8.02. When Moral Damages were Awarded.
When driver of taxi overtook another taxi while in
fly-over; collision between train and school bus
when the driver played loud music; reckless driving.
a. MD in Air Transportation Cases. Air France v.
Gillego. Luggage of pax was lost and the only action
taken by petitioner to locate it is telex searches.
Inattention.
See other cases in p. 322.
8.03. Cases when there is No Awarded MD
Cathay Pacific vs Reyes. Carrier extended all
possible accomodations to pax who did not have
confirmed booking.
Tan v. Northwest Airlines. Baggage were loaded to
another plain but nonetheless delivered to her on
time.
8.04. Specific Cases when Recoverable.
Art. 2219, CC. MD may be recovered in the
following and analogous cases:
1. Criminal cases resulting in phy injuries
2. QD causing phy injuries
3. Seduction, rape, abduction, lascivious acts
4. Adultery or concubinage
5. Illegal or arbitrary detention or arrest.
6. Illegal search
7. Libel, slander, or other form of
defamation
8. Malicious prosecution
9. Acts mentioned in Art. 309
10. Acts in Art. 21, 26-30, 32, 34, 35.
Parent of female in no. 3 may also recover MD.
Spouse, descendants, ascendants, bros/sis may
bring action in no. 9, in the order named.
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Art. 2220. Willful injury to property may be a legal
ground for awarding moral ground for awarding
damages, if courts shall find that damages are justly
due. Same when defendant acted fraudulently or in
bad faith.
8.05. Factors to Consider.
1. Extent of humiliation
2. Extent of pain or suffering
3. Official, political, social, financial position
4. Age
9. Nominal Damages
Art. 2221. Nominal damages are adjudicated in
order that a right of plaintiff xxx may be vindicated
or recognized, and not for the purpose of
indemnifying the plaintiff for the loss.
Art. 2222. Court may award nominal damages
arising from any source in Art. 1157, or in every
case where property right has been invaded.
Art. 2223. Adjudication of nominal damages shall
preclude further contest upon the right involved
and all accessory questions, as between parties to
suit, or heirs.
Proof of actual damages is not material.
3. Act must be accompanied by bad faith or done in
wanton, fraudulent, oppressive, or malevolent
manner.
Art. 2232, CC. In contracts and quasi-contracts,
court may award exemplary damages if defendant
acted in wanton, fraudulent, reckless, oppressive, or
malevolent manner.
Art. 2233, CC. Exemplary damages cannot be
recovered as matter of right; court will decide.
Art. 2234, CC. While amount of ED need not be
proved, plaintiff must show that he is entitled to
M/T/A damages before the court may consider
whether ED may be awarded.
In case LD have been agreed upon, although no
proof of loss is necessary for LD to be recovered,
nevertheless, before court may consider ED in
addition to LD, plaintiff must show that he would be
entitled M/T/A damages were it not for stipulation
of LD.
Art. 2235. Stipulation where ED are renounced in
advanced shall be null and void.

10. Temperate or Moderate Damages

Art. 2224. Temperate or moderate damages, which
are more than nominal but less than compensatory,
may be recovered when some pecuniary loss has
been suffered, but its amount cannot be ascertained.
Art. 2225. Temperate damages must be
reasonable.

11. Liquidated Damages. Are those agreed upon

by the parties to a contract, to be paid in case of
breach thereof.
Art. 2227. LD, whether intended as indemnity or
penalty, shall be equitably reduced if iniquitous or
unconscionable.
Art. 2228. When breach of contract is not the one
contemplated by parties in agreeing upon the
liquidated damages, law shall determine the
measure of damages, and not stipulation.

12. Exemplary or Corrective Damages.

Requisites:
1. By way of example, in addition to compensatory
damages, and after claimants right to it has been
established;
2. Cannot be recovered as matter of right, their
determination depends upon the amount of
compensatory damages;