Eastern Shipping Lines vs. Court of Appeals

GRN 97412  July 12, 1994.

EASTERN SHIPPING LINES, INC., petitioner, vs. HON. COURT OF APPEALS AND MERCANTILE INSURANCE COMPANY, INC., respondents. 

 PETITION for review of a decision of the Court of Appeals.

The facts are stated in the opinion of the Court.

Alojado & Garcia and Jimenea, Dala & Zaragoza for petitioner.

Zapa Law Office for private respondent.

VITUG, J.:

The issues, albeit not completely novel, are: (a) whether or not a claim for damage sustained on a shipment of goods can be a solidary, or joint and several, liability of the common carrier, the arrastre operator and the customs broker; (b) whether the payment of legal interest on an award for loss or damage is to be computed from the time the complaint is filed or from the date the decision appealed from is rendered; and (c) whether the applicable rate of interest, referred to above, is twelve percent (12%) or six percent (6%).

The findings of the court a quo, adopted by the Court of Appeals, on the antecedent and undisputed facts that have led to the controversy are hereunder reproduced:

'This is an action against defendants shipping company, arrastre operator and broker-forwarder for damages sustained by a shipment while in defendants' custody, filed by the instirer-subrogee who paid the consigne the value of such losses/damages,

"On December 4, 1981, two Fiber drums of iboflavin were shipped from Yokohama, Japan for delivery vessel 'SS EASTERN COMET owned by defendant Eastern Shipping Lines, Inc. under Bill of Lading No. YMA-8 (Exh. B). The shipment was insured under plaintiffs Marine Insurance, Policy No. 81401177 for P36, 382, 466.38.

'Upon arrival of the shipment in Manila on December 12, 1981, it was discharged unto the custody of defendant Metro Port Service, Inc.

The latter excepted to one drum, said to be in bad order, which damage, was unknown to plaintiff.

"On January 7, 1982 defendant Allied Brokerage Corporation received the shipment from defendant Metro Port Service, Inc., one drum opened and without seal (per 'Request for Bad Order Survey.' (Exh. D).

"On January 8 and 14, 1982, defendant Allied Brokerage Corporation made deliveries of the shipment to the consignee's warehouse. The latter excepted to one drum which contained spillages, while the rest of the contents was adulterated/fake (per 'Bad Order Waybill' No. 10649, Exh. E).

"Plaintiff contended that due to the losses/damage sustained by said drum, the consignee suffered losses totaling P19,032.95, due to the fault and negligence of defendants. Claims were presented against defendants who failed and refused to pay the same (Exhs. H, I, J, K, L).

"As a consequence of the losses sustained, plaintiff was compelled to pay the consignee P19,032.95 under the aforestated marine insurance policy, so that it became subrogated to all the rights of action of said consignee against defendants (per 'Form of Subrogation,"Release' and Philbanking check, Exhs. M, N, and O)." (pp. 85-86, Rollo.)

There were, to be sure, other factual issues that confronted both courts. Here, the appellate court said:

"Defendants riled their respective answers, traversing the material allegations of the complaint contending that: As for defendant Eastern Shipping it alleged that the shipment was discharged in good order from the vessel unto the custody of Metro Port Service so that any damage/losses incurred after the shipment was incurred after the shipment was turned over to the latter, is no longer its liability (p. 17, Record); Metroport averred that although subject shipment was discharged unto its custody, portion of the same was already in bad order (p. 11, Record); Allied Brokerage alleged that plaintiff has no cause of action against it, not having negligent or at fault for the shipment was already in damage and bad order condition when received by it, but nonetheless, it still exercised extra ordinary care and diligence in the handling/delivery of the cargo to consignee in the same condition shipment was received by it.

"From the evidence the court found the following:

"'The issues are:

'1 . Whether or not the shipment sustained losses/damages;

'2. Whether or not these losses/damages were sustained.

while in the custody of defendants (in whose respectived,  if determinable);

'3. Whether or not defendant(s) should be held liable for the losses/damages (see plaintiffs pre-Trial Brief, Records, p.34; Allied's pre-Trial Brief, adapting plaintiffs Records, p. 38),'

'As to the first issue, there can be no doubt that the shipment sustained losses/damages. The two, drums were shipped in good order and condition, as clearly shown by the Bill of Lading and Commercial Invoice which do not indicate any damages drum that was shipped (Exhs. B and C). But when on December 12, 1981 the shipment was delivered to defendant Metro Port Service, Inc., it excepted to one drum in bad order.

'Correspondingly, as to the second issue, it follows that the losses/damages were sustained while in the respective and/or successive custody and possession of defendants carrier (Eastern), arrastre operator (Metro Port) and broker (Allied Brokerage). This becomes evident when the Marine Cargo Survey Report (Exh. G), with its 'Additional Survey Notes,' am considered. In the latter notes, it is stated that when the shipment was 'landed on vessel' to dock of Pier # 15, South Harbor, Manila on December 12, 1981,' it was observed that 'one (1) fiber drum (was) in damaged condition, covered by the vessel's Agent's Bad Order Tally Sheet No. 86427.' The report further states that when defendant Allied Brokerage withdrew the shipment from defendant arrastre operator's custody on January 7, 1982, one drum was found opened without seal, cello bag partly torn but contents intact. Net unrecovered spillage was 15 kgs. The report went on to state that when the drums reached the consignee, one drum was found with adulterated/faked contents. It is obvious, therefore, that these losses/damages occurred before the shipment reached the consignee while under the successive custodies of defendants. Under Art. 1737 of the New Civil Code, the common carrier's duty to observe extraordinary diligence in the vigilance of goods remains in full force and effect even if the goods are temporarily unloaded and stored in transit in the warehouse of the carrier at the place of destination, until the consignee has been advised and has had reasonable opportunity to remove or dispose of the goods (Art. 1738, NCC). Defendant Eastern Shipping's own exhibit, the Turn-Over Survey of Bad Order Cargoes' (Exhs. 3-Eastern) states that on December 12, 1981 one drum was found 'open.'

"and thus held:

'WHEREFORE, PREMISES CONSIDERED, judgment is hereby rendered:

A. Ordering defendant- to pay plaintiff, jointly and severally:

1. The amount of P19,032.95, with the present legal interest of 12% per annum from October 1, 1982, the date of filing of this complaints, until fully paid (the liability of defendant Eastern Shipping, Inc. shall not exceed US$500 per case or the CIE value of the loss, whichever is lesser, while the liability of defendant Metro Port Service, Inc. shall be to the extent of the actual invoice value of each package, crate box or container in no case to exceed P5,000.00 each, pursuant to Section 6. 01 of the Management Contract);

2. P3,000.00 as attorney's fees, and 3. Costs.

B. Dismissing the counterclaims and crossclaim of defendant/cross-claimant Allied Brokerage Corporation.

SO ORDERED.' (p. 207, Record).

'Dissatisfied, defendant's recourse to US. 'no appeal  is devoid of merit,

"After a careful scrutiny of the evidence on record. We find that the conclusion drawn therefrom is correct. As there is sufficient evidence that the shipment sustained damage while in the successive possession of appellants, and therefore they are liable to the appellee, as subrogee for the amount it paid to the consignee." (pp. 87-89, Rollo.)

The Court of Appeals thus affirmed in toto the judgment of the court a quo.

In this petition, Eastern Shipping Lines, Inc., the common carrier, attributes error and grave abuse of discretion on the part of the appellate court when I. IT HELD PETITIONER CARRIER JOINTLY AND SEVERALLY LL433LE WITH THE ARRASTRE OPERATOR AND CUSTOMS BROKER FOR THE CLAIM OF PRIVATE RESPONDENT AS GRANTED IN THE QUESTIONED DECISION;

II. IT HELD THAT THE GRANT OF INTEREST ON THE CLAIM OF PRIVATE RESPONDENT SHOULD COMMENCE FROM THE DATE OF THE FILING OF THE COMPLAINT AT THE RATE OF TWELVE PFRCENT FOR ANNUM INSTEAD OF FROM THE DATE OF THE DECISION OF THE TRIAL COURT AND ONLY AT THE RATE OF SIX PERCENT PER ANNUM, PRIVATE RESPONDENTS CLAIM BEING INDISPUTABLY UNLIQUIDATED.

The petition is, in part, granted.

In this decision, we have begun by saying that the questions raised by petitioner carrier are not all that novel. Indeed, we do have a fairly good number of previous decisions this Court can merely tack to.

The common carrier's duty to observe the requisite diligence in the shipment of goods lasts from the time the articles are surrendered to or unconditionally placed in the possession of, and received by, the carrier for transportation until delivered to, or until the lapse of a reasonable time for their acceptance by, the person entitled to receive them (Arts. 1736-1738, Civil Code; Ganzon vs. Court of Appeals, 161 SCRA 646; Kui Bai vs. Dollar Steamship Lines, 62 Phil. 863). When the goods shipped either are lost or arrive in damaged condition, a presumption arises against the carrier of its failure to observe that diligence, and there need not be an express finding of negligence to hold it liable (Art. 1735, Civil Code; Philippine National Railways vs. Court of Appeals, 139 SCRA 87; Metro Port Service, Inc. vs. Court of Appeals, 131 SCRA 365). There are, of course, exceptional cases when such presumption of fault is not observed but these cases, enumerated in Article 17341 of the Civil Code, are exclusive, not one of which can be applied to this case.

The question of charging both the carrier and the arrastre operator with the obligation of properly delivering the goods to Art. 1734. Common carriers are responsible for the loss, destrution, or deterioration of the goods, unless the same is due to any of the following causes only:

(1) Flood, storm, earthquake, lightning, or other natural disaster or calamity;

(2) Act of the public enemy in war, whether international or civil;

(3) Act or omission of the shipper or owner of the goods;

(4) The character of the goods or defects in the packing or in the containers;

(5) Order or act ompetent public authority.

the consignee has, too, be passed upon by the Court. In Fireman's Fund Insurance, Co. vs. Metro Port Service, Inc. (182 SCRA 455), we have explained, in holding the carrier and the arrastre operator liable in solidum, thus:

"The legal relationship between the consignee and the arrastre operator is akin to that of a depositor and warehouseman (Lua Klan v. Manila Railroad Co., 19 SCRA 5 [1967]. The relationship between the consignee and the common carrier is similar to that of the consignee and the arastre operator (Northern Motors, Inc. v. Prince Line, et al., 107 Phil. 253 [1960]). Since it is the duty of the ARRASTRE to take good care of the goods that are in its, custody and to deliver them in good condition to the consignee, such responsibility also devolves upon the CARRIER. Both the ARRASTRE and the CARRIER are therefore charged with the obligation to deliver the goods in good condition to the consignee."

We do not, of course, imply by the above pronouncement that the arrastre operator and the customs broker are themselves always and neccessarily liable solidarily with the carrier, or viceversa, no,r that attendant facts in a given case may not vary the rule. The instant petition has been brought solely by Eastern Shipping Lines which, being the carrier and not having been able to rebut the presumption of fault, is, in any event, to be held liable in this particular case. A factual finding of both the court a quo and the appellate court, we take note, is that "there is sufficient evidence that the shipment sustained damage while in the successive possession of appellants" (the herein petitioner among them). Accordingly, the liability imposed on Eastern Shipping Lines, Inc., the sole petitioner in this case, is inevitable regardless of whether there are others solidarily liable with it.

It is over the issue of legal interest adjudged by the appellate court that deserves more than just a passing remark.

Let us first see a chronological recitation of the major rulings of this Court:

The early case of Malayan Insurance Co., Inc., vs. Manila Port Service,2 decided3 on 15 May 1969, involved a suit for recovery of money arising out of short deliveries and pilferage of good,. In this case, appellee Malayan Insurance (the plaintiff in the lower court) averred in its complaint that the total amount of its claim for the value of the undelivered goods amounted to P3,947.20. This demand, however, was neither established in its totality nor definitely ascertained. In the stipulation of facts later entered into by the parties, in lieu of proof, the amount of P1,447.51 was agreed upon. The trial court rendered judgment ordering the appellants (defendants) Manila Port Service and Manila Railroad Company to pay appellee Malayan Insurance the sum of P1,447.51 with legal interest thereon from the date the complaint was filed on 28 December 1962 until full payment thereof. The appellants then assailed, inter alia, the award of legal interest. In sustaining the appellants, this Court ruled:

"Interest upon an obligation which calls for the payment of money, absent a stipulation, is the legal rate. Such interest normally is allowable from the date of demand, judicial or extrajudicial. The trial court opted for judicial demand as the starting point.

"But then upon the provisions of Article 2213 of the Civil Code, interest 'cannot be recovered upon unliquidated claims or damages, except when the demand can be established with reasonable certainty! And as was held by this Court in Rivera vs. Perez,4 L-6998, February 29, 1956, if the suit were for damages, 'unliquidated and not known until definitely ascertained, assessed and determined by the courts after proof (Montilla c. Corporacion de P. P. Agustinos, 25 Phil. 447, Lichauco v, Guzman, 38 Phil. 302),' then, interest 'should be from the date of the decision."' (Italics supplied)

The case of Reformina vs. Tomol,5 rendered on 11 October 1985, was for "Recovery of Damages for Injury to Person and Loss of Property." After trial, the lower court decreed:

"WHEREFORE, judgment is  hereby rendered in favor of the plaintifs and third pay defendants and against the defendants and third party plaintiffs as follows:

"Ordering defendants and third party plaintiffs Shell and Michael, Incorporated to pay jointly and severally the following persons:

"(a) . . . . .

"x x x x x x "(g) Plaintiffs Pacita F. Reformina and Francisco Reformina the sum of P131,084.00 which is the value of the boat F B Pacita III together with its accessories, fishing gear and equipment minus P80,000.00 which is the value of the insurance recovered and the amount of P10,000.00 a month as the estimated monthly lose suffered by them as a result of the fire of May 6, 1969 up to the time they are actually paid or already the total sum of P379,000.00 as of June 4, 1972 with legal interest from the filing of the complaint until paid and to pay attorney's fees of P5,000.00 with costs against defendants and third party plaintiffs." (Italics supplied.)

On appeal to the Court of Appeals, the latter modified the amount of damages awarded but sustained the trial court in adjudging legal interest from the filing of the complaint until fully paid. When the appellate court's decision became final, the case was remanded to the lower court for execution, and this was when the trial court issued its assailed resolution which applied the 6% interest per annum prescribed in Article 2209 of the Civil Code. In their petition for review on certiorari, the petitioners contended that Central Bank Circular No. 416, providing thus "By virtue of the authority granted to it under Section 1 of Act 2655, as amended, Monetary Board in its Resolution No. 1622 dated July 29, 1974, has prescribed that the rate of interest for the loan, or forbearance of any money, goods, or credits and the rate allowed in judgments, in the absence of express contract as to such rate of interest, shall be twelve (12%) percent per annum. This Circular shall take effect immediately." (Italics found in the text)-

should have, instead, been applied. This Court6 ruled:

The judgment spoken of and reffered to are judgment in litigations involving loans or forbearance of any money, goods or credits. Any other kind of monetary judgement which has nothing to do with, nor involving loans or surbearance of any money, goods or credits does not fall within the coverage of the said law for it is not within the ambit of the authority granted to the Central Bank.

"xxxx  xxx xxx "Coining to the case at bar, the decision herein sought to be executed is one rendered in an Action for Damages for injury to persons and loss of property and does not involve any loan, much less forbearances of any money, goods or credits. As correctly argued by the private respondents, the law applicable to the said case is Article 2209 of the New Civil Code which reads 'Art. 2209.-If the obligation consists in the payment of a sum of money, and the debtor incurs in delay, the indemnity for damages, there being no stipulation to the contrary, shall be the payment of interest agreed upon, and in the absence of stipulation, the legal interest which is six percent per annum.'"

The above rule was reiterated in Philippine Rabbit Bus Lines, Inc., v. Cruz 7 promulgated on 28 July 1986. The case was for damages occasioned by an injury to person and loss of property. The trial court awarded private respondent Pedro Manabat actual and compensatory damages in the amount of P72,500.00 with legal interest thereon from the filing of the complaint until fully paid. Relying on the Reformina v. Tomol case, this Court8 modified the interest award from 12% to 6% interest per annum but sustained the time computation thereof, i.e., from the filing of the complaint until fully paid.

In Nakpil and Sons vs. Court of Appeals,9 the trial court, in an action for the recovery of damages arising from the collapse of a building, ordered, inter alia, the "defendant United Construction Co., Inc. (one of the petitioners) x x x to pay the plaintiff, x x x, the bum of P989,335.68 with interest at the legal rate jrom November 29, 1968, the date of the filing of the complaint until full payment x x x." Save from the modification of the amount granted by the lower court, the Court of Appeals sustained the trial court's decision. When taken to this Court for review, the case, on 03 October 1986, was decided, thus:

"WHEREFORE, the decision appealed from is hereby MODIFIED and considering the special and environmental circumstances of this case, we deem it reasonable to render a decision imposing, as We do hereby impose, upon the defendant and the third-party defendants (with the exception of Roman Ozaeta) a solidary (Art. 1723, Civil Code, Supra, p. 10) indemnity in favor of the Philippine Bar Association of FIVE MILLION (P5,000,000.00) Pesos to cover all damages (with the exception of attorney's fees) occasioned by the loss of the building (including interest charges and lost rentals) and an additional ONE HUNDRED THOUSAND (P100,000.00) Pesos as and for attorney's fees, the total sum being payable upon the finality of this decision. Upon failure to pay on such finality, twelve (12%) per cent interest per annum shall be imposed upon aforementioned amounts from finality until paid. Solidary costs against the defendant and third-party defendants (except Roman Ozaeta)." (Italics supplied)

A motion for reconsideration was filed by United Construction, contending that "the interest of twelve (12%) percent per annum imposed on the total amount of the monetary award was in contravention of law." The Court10 ruled out the applicability of the Reformina and Philippine Rabbit Bus Lines cases and, in its resolution of 15 April 1988, it explained:

"There should be no dispute that the imposition of 12% interest pursuant to Central Bank Circular No. 416 x x x is applicable only in the following: (1) loans; (21 forbearance rqny money, moods or credit; and (3) rate allowed in judgments (judgments spoken of refer to judgments involving loans or forbearance of any money, goods or credits. (Philippine Rabbit Bus Lines Inc. v. Cruz, 143 SCRA 160-161 [1986]; Reformina v. Tomol, Jr., 139 SCRA 260 [1985]). It is true that in the instant case, there is neither a loan or a forbearance, but then no interest is actually imposed provided the sums referred to in the judgment are paid upon the finality of the judgment. It is delay in the payment of such final judgment, that will muse the imposition of the interest.

"It will be noted that in the cases already adverted to, the rate of interest is imposed on the total sum, from the filing of the complaint until paid; in other words, as art of the judgment for damages. Clearly, they are not applicable to the instant case." (Italics supplied)

The subsequent case of American Express International, Inc., vs. Intermediate Appellate Court11 was a petition for review on certiorari from the decision, dated 27 February 1985, of the then Intermediate Appellate Court reducing the amount of moral and exemplary damages awarded by the trial court, to P240,000.00 and P100,000.00, respectively, and its resolution, dated 29 April 1985, restoring the amount of damages awarded by the trial court, i.e., P2,000,000.00 as moral damages and P400,000.00 as exemplary damages with interest thereon at 12% per annum. from notice of judgment, plus costs of suit. In a decision of 09 November 1988, this Court, while recognizing the right of the private respondent to recover damages, held the award, however, for moral damages by the trial court, later sustained by the IAC, to be inconceivably large. The Court" thus set aside the decision of the appellate court and rendered a new one, "ordering the petitioner to pay private respondent the sum of One Hundred Thousand (P100,000.00) Pesos as moral damages, with six (6%) percent interest thereon computed from the finality of this decision until paid." (Italics supplied)

Reformina came into fore again in the 21 February 1989 case of Florendo v. Ruiz13 which arose from a breach of employment contract, For having been illegally dismissed, the petitioner was awarded by the trial court moral and exemplary damages without, however, providing any legal interest thereon. When the decision was appealed to the Court of Appeals, the latter held:

"WHEREFORE, except as modified hereinabove the decision of the CFI of Negros Oriental dated October 31, 1972 is affirmed in all respects, with the modification that defendants-appellants, except defendantappellant Merton Munn, are ordered to pay, jointly and severally, the amounts stated in the dispositive portion of the decision, including the sum of P1,400.00 in concept of compensatory damages, With interest at the legal rate from the date of the filing of the complaint until fully paid." (Italics supplied)

The petition for review to this Court was denied. The records were thereupon transmitted to the trial court, and an entry of judgment was made. The writ of execution issued by the trial court directed that only compensatory damages should earn interest at 6% per annum from the date of the filing of the complaint. Ascribing grave abuse of discretion on the part of the trial judge, a petition for certiorari assailed the said order. This Court said:

"x x x, it is to be noted that the Court of Appeals ordered the payment of interest 'at the legal rate' from the time of the filing of the complaint. x x x. Said circular [Central Bank Circular No. 416] does not apply to actions based on a breach of employment contract like the case at bar." (Italics supplied)

The Court reiferated that the 6% interest per annum on the damages should be computed from the time the complaint was filed until the amount is fully paid.

Quite recently, the Court had another occasion to rule an the matter. National Power Corporation vs. Angas,14 decided on 08 May 1992, involved the expropriation of certain parcels of land. After conducting a hearing on the complaints foreminent domain,

are trial court ordered the petitioner to pay the private respondents certain sums of money as just compensation for their lands so expropriated "with legal interest thereon x x x until fully paid."

Again, in applying the 6% legal interest per annum under the Civil Code, the Court15 declared:

"x x x, Miss transaction involved is clearly not a loan or forbearance of money, goods or credits but expropriation of certain parcels of land for a public purpose, the payment of which is without stipulation regarding interest, and the interest adjudged by the trial court is in the nature of indemnity for damages. The legal interest required to be paid on the amount of just compensation for the properties expropriated is manifestly in the form of indemnity for damages for the delay in the payment thereof. Therefore, since the kind of interest involved in the joint judgment of the lower court sought to be enforced in this case is interest by way of damages, and not by way of earnings from loans, etc. Art. 2209 of the Civil Code shall apply."

Concededly, there have been seeming variances in the above holdings. The cases can perhaps be classified into two groups according to the similarity of the issues involved and the corresponding rulings rendered by the court. The "first group" would consist of the cases of Reformina v. Tomol (1985), Philippine Rabbit Bus Lines v. Cruz (1986), Florendo v. Ruiz (1989) and National Power Corporation v. Angas (1992). In the "second group" would be Malayan Insurance Company v. Manila Port Service (1969), Nakpil and Sons v. Court of Appeals (1988), and American Express International v. Intermediate Appellate Court (1988).

In the 'first group," the basic issue focuses on the application of either the 6% (under the Civil Code) or 12% (under the Central Bank Circular) interest per annurn. It is easily discernible in these cases that there has been a consistent holding that the Central Bank Circular imposing the 12% interest per annum applies only to loans or forbearance16 of money, goods or credits,

on the equities of each case, on the award of interest. Nonetheless, it may not be unwise, by way of clarification and reconciliation, to suggest the following rules of thumb for future guidance.

 I -. When an obligation, regardless of its source, i.e., law, contracts, quasicontracts, delicts or quasi-delicts18 is breached, the contravenor can be held liable for damages.19 The provisions under Title XVIII on "Damages" of the Civil Code govern in determining the measure of recoverable damages.20

II.- With regard particularly to an award of interest in the concept of actual and compensatory damages, the rate of interest, as well as the accrual thereof, is imposed, as follows:

1. When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money, the interest due should be that which may have been stipulated in writing.21 Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded.22 In the absence of stipulation, the rate of interest shall be 12% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 116923 of the Civil Code.

When an obligation, no constituting loans or forbearance of money is breached an interest on the amount of damages awarded may he imposed at the discretion of the court24 at the rate of 6% per a annum.25 No interest, however, shall be adjudged on unliquidated claims or damages except when or until the demand can be established with reasonable certainy.26 Accordingly, where the demand is established with reasonable certainty, the interest shah begin to run from the time the claim is made judicially or extrajudicially (Art. 1169, Civil Code) but when such certainty cannot be so reasonably established at the time the demand is made, the interest shall begin to run only from the date the Judgment of the court is made (at which time the quantification of damages maybe deemed to have been reasonably ascertain. 1). The actual  base for the computation of legal interest shall, in any case, be on the amount finally adjudged.

When the judgment of the court awarding a sum of money becomes final and executory, the rate of legal  interest, whether the case falls under paragraph 1 or paragraph 2, above, shall be 12%  per annum from such finality until its satisfaction on, this interim period being deemed to be by then an equivalent to a forbearance of credit.

WHEREFORE, the petition is partly GRANTED. The appealed decision is AFFIRMED with the MODIFICATION that the legal interest to be paid is SIX PERCENT (6%) on the amount due computed from the decision, dated 03 February 1988, of the court a quo. A TWELVE PERCENT (12%) interest, in lieu of SIX PERCENT (6%), shall be imposed on such amount upon finality or this decision until the payment thereof.

SO ORDERED.

Narvasa (C.J.), Cruz, Feliciano, Padilla, Bidin, Regalado, Davide, Jr., Romero, Bellosillo, Melo, Quiason, Puno and Kapunan, JJ., concur.

Mendoza, J., Took no part in deliberations.

Petition partly granted.

Picart vs. Smith

GRN 12219  March 15, 1918

AMADO PICART, plaintiff and appellant, vs. FRANK SMITH, jr., defendant and appellee.

1. NEGLIGENCE; CRITERION FOR DETERMINING EXISTENCE OF NEGLIENCE.-The test for determining whether a person is negligent in doing an act whereby injury or damage results to the person or property of another is this: Would a prudent man, in the position of the person to whom negligence is attributed, foresee harm to the person injured as a reasonable consequence of the course about to be Pursued. If so, the law imposes a duty on the actor to refrain from that course or to take precaution against its mischievous results, and the failure to do so constitutes negligence. Reasonable foresight of harm, followed by the ignoring of the admonition born of this prevision, is the constitutive fact in negligence.

2. ID.; CONTRIBUTORY NEGLIGENCE; SUCCESSIVE NEGLIGENT ACTS. - Where both parties are guilty of negligence, but the negligent act of one succeeds that of the other by an appreciable interval of time, the one who has the last reasonable opportunity to avoid the impending harm and fails to do so is chargeable with the consequences, without reference to the prior negligence of the other party.

3. ID.; ID.; ID.; CASE AT BAR.-The plaintiff was riding a pony on a bridge. Seeing an automobile ahead he improperly pulled his horse over to the railing on the right. The driver of the automobile, however, guided his car toward the plaintiff without diminution of speed until he was only a few feet away. He then turned to the right but passed so closely to the horse that the latter being frightened, jumped around and was killed by the passing car. Held: That although the plaintiff was guilty of negligence in being on the wrong side of the bridge, the defendant was nevertheless civilly liable for the legal damages resulting from the collision, as he had a fair opportunity to avoid the accident after he realized the situation created by the negligence of the plaintiff and failed to avail himself of that opportunity; while the plaintiff could by no means then place himself in a position of greater safety.

APPEAL from a judgment of the Court of First Instance of La Union. Camus, J.

The facts are stated in the opinion of the court.

Alejo Mabanag for appellant.

G . E. Campbell for appellee.

STREET, J.

In this action the plaintiff, Amado Picart, seeks to re cover of the defendant, Frank Smith, jr., the sum of P31,100, as damages alleged to have been caused by an automobile driven by the defendant. From a judgment of the Court of First Instance of the Province of La Union absolving the defendant from liability the plaintiff has appealed.

The occurrence which gave rise to the institution of this action took place on December 12, 1912, on the Carlatan Bridge, at San Fernando, La Union. It appears that upon the occasion in question the plaintiff was riding on his pony over said bridge. Before he had gotten half way across, the defendant approached from the opposite direction in an automobile, going at the rate of about ten or twelve miles per hour. As the defendant neared the bridge he saw a horseman on it and blew his horn to give warning of his approach. He continued his course and after he had taken the bridge he gave two more successive blasts, as it appeared to him that the man on horseback before him was not observing the rule of the road.

The plaintiff, it appears, saw the automobile coming and heard the warning signals. However, being perturbed by the novelty of the apparition or the rapidity of the approach, he pulled the pony closely up against the railing on the right side of the bridge instead of going to the left. He says that the reason he did this was that he thought he did not have sufficient time to get over to the other side. The bridge is shown to have a length of about 75 meters and a width of 4.80 meters. As the automobile approached, the defendant guided it toward his left, that being the proper side of the road for the machine. In so doing the defendant assumed that the horseman would move to the other side. The pony had not as yet exhibited fright, and the rider had made no sign for the automobile to stop. Seeing that the pony was apparently quiet, the defendant, instead of veering to the right while yet some distance away or slowing down, continued to approach directly toward the horse without diminution of speed. When he had gotten quite near, there being then no possibility of the horse getting across to the other side, the defendant quickly turned his car sufficiently to the right to escape hitting the horse alongside of the railing where it was then standing; but in so doing the automobile passed in such close proximity to the animal that it became frightened and turned its body across the bridge with its head toward the railing. In so doing, it was struck on the hock of the left hind leg by the flange of the car and the limb was broken. The horse fell and its rider was thrown off with some violence. From the evidence adduced in the case we believe that when the accident occurred the free space where the pony stood between the automobile and the railing of the bridge was probably less than one and one half meters. As a result of its injuries the horse died. The plaintiff received contusions which caused temporary unconsciousness and required medical attention for several days.

The question presented for decision is whether or not the defendant in maneuvering his car in the manner above described was guilty of negligence such as gives rise to a civil obligation to repair the damage done; and we are of the opinion that he is so liable. As the defendant started across the bridge, he had the right to assume that the horse and rider would pass over to the proper side; but as he moved toward the center of the bridge it was de monstrated to his eyes that this would not be done; and he must in a moment have perceived that it was too late for the horse to cross with safety in front of the moving vehicle. In the nature of things  this change of situation occurred while the automobile was yet some distance away; and from this moment it was not longer within the power of the plaintiff to escape being run down by going to a place of greater safety. The control of the situation had then passed entirely to the defendant; and it was his duty either to bring his car to an immediate stop or, seeing that there were no other persons on the bridge, to take the other side and pass sufficiently far away from the horse to avoid the danger of collision. Instead of doing this, the defendant ran straight on until he was almost upon the horse. He was, we think, deceived into doing this by the fact that the horse had not yet exhibited fright.

But in view of the known nature of horses, there was an appreciable risk that, if the animal in question was un acquainted with automobiles, he might get excited and jump under the conditions which here confronted him.

When the defendant exposed the horse and rider to this danger he was, in our opinion, negligent in the eye of the law.

The test by which to determine the existence of negligence in a particular case may be stated as follows: Did the defendant in doing the alleged negligent act use that reasonable care and caution which an ordinarily prudent person would have used in the same situation? If not, then he is guilty of negligence. The law here in effect adopts the standard supposed to be supplied by the imaginary conduct of the discreet paterfamilias of the Roman law. The existence of negligence in a given case is not determined by reference to the personal judgment of the actor in the situation before him. The law considers what would be reckless, blameworthy, or negligent in the man of ordinary intelligence and prudence and determines liability by that.

The question as to what would constitute the conduct of a prudent man in a given situation must of course be always determined in the light of human experience and in view of the facts involved in the particular case. Abstract speculation cannot here be of much value but this much can be profitably said: Reasonable men govern their conduct by the circumstances which are before them or known to them. They are not, and are not supposed to be, omniscient of the future. Hence they can be expected to take care only when there is something before them to suggest or warn of danger. Could a prudent man, in the case under consideration, foresee harm as a result of the course actually pursued? If so, it was the duty of the actor to take precautions to guard against that harm. Reasonable foresight of harm, followed by the ignoring of the suggestion born of this prevision, is always necessary before negligence can be held to exist. Stated in these terms, the proper criterion for determining the existence of negligence in a given case is this: Conduct is said to be negligent when a prudent man in the position of the tortfeasor would have foreseen that an effect harmful to another was sufficiently probable to warrant his foregoing the conduct or guarding against its consequences.

Applying this test to the conduct of the defendant in the present case we think that negligence is clearly established.

A prudent man, placed in the position of the defendant, would, in our opinion, have recognized that the course which he was pursuing was fraught with risk, and would therefore have foreseen harm to the horse and rider as a reasonable consequence of that course. Under these circumstances the law imposed on the defendant the duty to guard against the threatened harm.

It goes without saying that the plaintiff himself was not free from fault, for fie was guilty of antecedent negligence in planting himself on the wrong side of the road. But as we have already stated, the defendant was also negligent; and in such case the problem always is to discover which agent is immediately and directly responsible. It will be noted that the negligent acts of the two parties were not contemporaneous, since the negligence of the defendant succeeded the negligence of the plaintiff by an appreciable interval. Under these circumstances the law is that the person who has the last fair chance to avoid the impending harm and fails to do so is chargeable with the consequences, without reference to the prior negligence of the other party.

The decision in the case of Rakes vs. Atlantic, Gulf and Pacific Co. (7 Phil. Rep., 359) should perhaps be mentioned in this connection. This Court there held that while contributory negligence on the part of the person injured did not constitute a bar to recovery, it could be received in evidence to reduce the damages which would otherwise have been assessed wholly against the other party. The defendant company had there employed the plaintiff, a laborer, to assist in transporting iron rails from a barge in Manila harbor to the company's yards located not far away. The rails were conveyed upon cars which were hauled along a narrow track. At a certain spot near the water's edge the track gave way by reason of the combined effect of the weight of the car and the insecurity of the road bed. The car was in consequence upset; the rails slid off; and the plaintiff's leg was caught and broken. It appeared in evidence that the accident was due to the effects of a typhoon which had dislodged one of the supports of the track. The court found that the defendant company was negligent in having failed to repair the bed of the track and also that the plaintiff was, at the moment of the accident, guilty of contributory negligence in walking at the side of the car instead of being in front or behind. It was held that while the defendant was liable to the plaintiff by reason of its negligence in having failed to keep the track in proper repair, nevertheless the amount of the damages should be reduced on account of the contributory negligence of the plaintiff. As will be seen the defendant's negligence in that case consisted in an omission only. The liability of the company arose from its responsibility for the dangerous condition of its track. In a case like the one now before us, where the defendant was actually present and operating the automobile which caused the damage, we do not feel constrained to attempt to weigh the negligence of the respective parties in order to apportion the damage according to the degree of their relative fault. It is enough to say that the negligence of the defendant was in this case the immediate and determining cause of the accident and that the antecedent negligence of the plaintiff was a more remote factor in the case.

A point of minor importance in the case is indicated in the special defense pleaded in the defendant's answer, to the effect that the subject matter of the action had been previously adjudicated in the court of a justice of the peace. In this connection it appears that soon after the accident in question occurred, the plaintiff caused criminal proceedings to be instituted before a justice of the peace charging the defendant with the infliction of serious injuries (lesiones graves). At the preliminary investigation the defendant was discharged by the magistrate and the proceedings were dismissed. Conceding that the acquittal of the defendant at a trial upon the merits in a criminal prosecution for the offense mentioned would be res adjudicata upon the question of his civil liability arising from negligence-a point upon which it is unnecessary to express an opinion-the action of the justice of the peace in dismissing the criminal proceeding upon the preliminary hearing can have no such effect. (See U. S. vs. Banzuela and Banzuela, 31 Phil. Rep., 564.)

From what has been said it results that the judgment of the lower court must be reversed, and judgment is here rendered that the plaintiff recover of the defendant the sum of two hundred pesos (P200), with costs of both instances. The sum here awarded is estimated to include the value of the horse, medical expenses of the plaintiff, the loss or damage occasioned to articles of his apparel, and lawful interest on the whole to the date of this recovery. The other damages claimed by the plaintiff are remote or otherwise of such character as not to be recoverable. So ordered.

Arellano, C. J., Torres, Carson, Araullo, Avanceña, and Fisher, JJ., concur.

Johnson, J., reserves his vote. MALCOLM, J., concurring:

After mature deliberation, 1 have finally decided to concur with the judgment in this case. I do so because of my understanding of the "last clear chance" rule of the law of negligence as particularly applied to automobile accidents. This rule cannot be invoked where the negligence of the plaintiff is concurrent with that of the defendant. Again, if a traveller when he reaches the point of collision is in a situation to extricate himself and avoid injury, his negligence at that point will prevent a recovery. But Justice Street finds as a fact that the negligent act of. the defendant succeeded that of the plaintiff by an appreciable interval of time, and that at that moment the plaintiff had no opportunity to avoid the accident. Consequently, the "last clear chance" rule is applicable. In other words, when a traveller has reached a point where he cannot extricate himself and vigilance on his part will not avert the injury, his negligence in reaching that position becomes the condition and not the proximate cause of the injury and will not preclude a recovery. (Note especially Aiken vs. Metcalf [1917], 102 Atl., 330.)

Judgment reversed. 

Glan People's Lumber and Hardware vs. Intermediate Appellate Court

GRN 70493  May 18, 1989

GLAN PEOPLE'S LUMBER AND HARDWARE, GEORGE LIM, FABIO S. AGAD, FELIX LIM and PAUL ZACARIAS y INFANTE, petitioners, vs. INTERMEDIATE APPELLATE COURT, CECILIA ALFEREZ VDA. DE CALIBO, Minors ROYCE STEPHEN, JOYCE JOAN, JANISE MARIE, JACQUELINE BRIGITTE, JOCELINE CORAZON, JULIET GERALDINE, JENNIFER JILL, all surnamed CALIBO, represented by their mother, CECILIA A. VDA. DE CALIBO, respondents.

PETITION for certiorari to review the judgment of the Court of Appeals.

The facts are stated in the opinion of the Court.

Rulino Mayor and Isidro M. Ampig for petitioners.

Manuel L. Hontanosas for private respondents.

NARVASA, J.:

There is a two-fold message in this judgment that bears stating at the outset. The first, an obvious one, is that it is the objective facts established by proofs presented in a controversy that determine the verdict, not the plight of the persons involved, no matter how deserving of sympathy and commiseration because, for example, an accident of which they are the innocent victims has brought them to, reduced circumstances or otherwise tragically altered their lives. The second is that the doctrine laid done many, many years ago in Picart vs. Smith,1 continues to be good law to this day.

The facts giving rise to the controversy at bar are tersely and quite accurately recounted by the Trial Court as follows:2

"Engineer Orlando T. Calibo, Agripino Roranes, and Maxima Paws were on the jeep owned by the Bacnotan Consolidated Industries, Inc., with Calibo at the wheel, as it approached from the South Lizada Bridge going towards the direction of Davao City at about 1:45 in the afternoon of July 4, 1979. At about that time, the cargo truck, loaded with cement bags, GI sheets, plywood, driven by defendant Paul Zacarias y Infante, coming from the opposite direction of Davao City and bound for Glan, South Cotabato, had just crossed said bridge. At about 59 yards after crossing the bridge, the cargo truck and the jeep collided as a consequence of which Engineer Calibo died while Roranes and Patos sustained physical injuries. Zacarias was unhurt. As a result of the impact, the left side of the truck was slightly damaged while the left side of the jeep, including its fender and hood, was extensively damaged. After the impact, the jeep fell and rested on its right side on the asphalted road a few meters to the rear of the truck, while the truck stopped on its wheels on the road.

On November 27, 1979, the instant case for damages was filed by the surviving spouse and children of the late Engineer Calibo who are residents of Tagbilaran City against the driver and owners of the cargo truck.

For failure to file its answer to the third party complaint, third party defendant, which insured the cargo truck involved, was declared in default."

The case filed by the heirs of Engineer Calibo-his widow and minor children, private respondents herein-was docketed as Civil Case No. 3283 of the Court of First Instance of Bohol.3 Named defendants in the complaint were "Felix S. Agad, George Lim and Felix Lim x x (who) appear to be the co-owners of the Glan People's Lumber and Hardware x x (and) Paul Zacarias y Infante."4 The defendants' answer however alleged that the lumber and hardware business was exclusively owned by George Y. Lim, this being evidenced by the Certificate of Registration issued by the Bureau of Domestic Trade; Fabio S. Agad was not a co-owner thereof but "merely employed by x x George Y. Lim as bookkeeper"; and Felix Lim had no connection whatever with said business, "he being a child only eight (8) years of age."5

"After (trial, and) a careful evaluation of the evidence, both testimonial and documentary," the Court reached the conclusion "that the plaintiffs failed to establish by preponderance of evidence the negligence, and thus the liability, of the defendants." Accordingly, the Court dismissed the complaint (and defendants' counterclaim) "for insufficiency of evidence." Likewise dismissed was third-party complaint presented by the defendants against the insurer of the truck. The circumstances leading to the Court's conclusion just mentioned, are detailed in the Court's decision, as follows:

1. Moments before its collision with the truck being operated by Zacarias, the jeep of the deceased Calibo was "zigzagging."6

2. Unlike Zacarias who readily submitted himself to investigation by the police, Calibo's companions, Roranes (an accountant), and Patos, who suffered injuries on account of the collision, refused to be so investigated or give statements to the police officers. This, plus Roranes' waiver of the right to institute criminal proceedings against Zacarias, and the fact that indeed no criminal case was ever instituted in Court against Zacarias, were "telling indications that they did not attribute the happening to defendant Zacarias' negligence or fault."7

3. Roranes' testimony, given in plaintiffs' behalf, was "not as clear and detailed as that of x x Zacarias," and was "uncertain and even contradicted by the physical facts and the police investigators Dimaano and Esparcia."8

4. That there were skid marks left by the truck's tires at the scene, and none by the jeep, demonstrates that the driver of the truck had applied the brakes and the jeep's driver had not; and that the jeep had on impact fallen on its right side is indication that it was running at high speed. Under the circumstances, according to the Court, given "the curvature of the road and the descending grade 6f the jeep's lane, it was negligence on the part of the driver of the jeep, Engr. Calibo, for not reducing his speed upon sight of the truck and failing to apply the brakes as he got within collision range with the truck."

5. Even if it be considered that there was some antecedent negligence on the part of Zacarias shortly before the collision, in that he had caused his truck to run some 25 centimeters to the left of the center of the road, Engr. Calibo had the last clear chance of avoiding the accident because he still had ample room in his own lane to steer clear of the truck, or he could simply have braked to a fall stop.

The Court of Appeals saw things differently. It rendered judgment' on the plaintiffs' appeal,10 reversing the decision of the Trial Court. It found Zacarias to be negligent on the basis of the following circumstances, to wit:

1) "the truck driven by defendant Zacarias occupied the lane of the jeep when the collision occurred," and although Zacarias saw the jeep from a distance of about 150 meters, he "did not drive his truck back to his lane in order to avoid collision with the oncoming jeep x x x"11 what is worse, "the truck driver suddenly applied his brakes even as he knew that he was still within the lane of the jeep;"2 had both vehicles stayed in their respective lanes, the collision would never have occurred, they would have passed "alongside each other safely;"13

2) Zacarias had no license at the time; what he handed to M, Esparcia, on the latter's demand, was the "driver's license of his co. driver Leonardo Baricuatro;"14

3) the waiver of the right to file criminal charges against Zacarias should not be taken against "plaintiffs" Roranes and Patos who had the right, under the law, to opt merely to bring a civil suit.15

The Appellate Court opined that Zacarias' negligence "gave rise to the presumption of negligence on the part of his employer, and their liability is both primary and solidary." It therefore ordered "the defendants jointly and solidarily, to indemnify the plaintiffs the following arnounts:

(1) P30,000.00 for the death of Orlando Calibo;

(2) P378,000.00 for the loss of earning capacity of the deceased (3) P15,000.00 for attorney's fees;

(4) Cost of suit."16

The defendants George Lim, Felix Lim, Fabio S. Agad and Paul Zacarias have appealed to this Court on certiorari and pray for a reversal of the judgment of the Intermediate Appellate Court which, it is claimed, ignored or ran counter to the established facts. A review of the record confirms the merit of this assertion and persuades this Court that said judgment indeed disregarded facts clearly and undisputably demonstrated by the proofs. The appealed judgment, consequently, will have to be reversed.

The finding that "the truck driven by defendant Paul Zacarias occupied the lane of the jeep when the collision occurred" is a loose one, based on nothing more than the showing that at the time of the accident, the truck driven by Zacarias had edged over the painted center line of the road into the opposite lane by a width of twenty-five (25) centimeters. It ignores the fact that by the uncontradicted evidence, the actual center line of the road was not that indicated by the painted stripe but, according to measurements made and testified by Patrolman Juanito Dimaano, one of the two officers who investigated the accident, correctly lay thirty-six (36) centimeters farther to the left of the truck's side of said stripe.

The unimpugned testimony of Patrolman Dimaano, a witness for the private respondents, is to the effect that the jeep's lane was three (3) meters and seventy-five (75) centimeters wide, and that of the truck three (3) meters and three (3) centimeters, measured from the center stripe to the corresponding side lines or outer edges of the road." The total width of the road being, therefore, six (6) meters and seventy-eight (78) centimeters, the true center line equidistant from both side lines would divide the road into two lanes each three (meters) and thirty-nine (39) centimeters wide. Thus, although it was not disputed that the track overrode the painted stripe by twenty-five (25) centimeters, it was still it least eleven (11) centimeters away from its side of the true center line of the road and well inside its own lane when the accident occurred. By this same reckoning, since it was unquestionably the jeep that rammed into the stopped truck, it may also be deduced that it (the jeep) was at the time travelling beyond its own lane and intruding into the lane of the truck by at least the same 11-centimeter width of space.

Not only was the truck's lane, measured from the incorrectly located center stripe uncomfortably narrow, given that vehicle's width of two (2) meters and forty-six (46) centimeters; the adjacent road shoulder was also virtually impassable, being about three (3) inches lower than the paved surface of the road and "soft"-not firm enough to offer traction for safe passagebesides which, it sloped gradually down to a three foot-deep ravine with a river below.18 The truck's lane as erroneously demarcated by the center stripe gave said vehicle barely half a meter of clearance from the edge of the road and the dangerous shoulder and little room for maneuver, in case this was made necessary by traffic contingencies or road conditions, if it always kept to said lane. It being also shown that the accident happened at or moor the point of the truck's approach to a curve,19 which called for extra precautions against driving too near the shoulder, it could hardly be accounted negligent on the part of its driver to intrude temporarily, and by only as small as a twenty-five centimeter-wide space (less than ten inches), into the opposite lane in order to insure his vehicle's safety. This, even supposing that said maneuver was in fact an intrusion into the opposite lane, which was not the case at all as just pointed out.

Nor was the Appellate Court correct in finding that Paulino Zacarias had acted negligently in applying his brakes instead of getting back inside his lane upon espying the approaching jeep. Being well within his own lane, as has already been explained, he had no duty to swerve out of the jeep's way as said Court would have had him do. And even supposing that he was in fact partly inside the opposite lane, coming to a full stop with the jeep still thirty (30) meters away cannot be considered an unsafe or imprudent action, there also being uncontradicted evidence that the jeep was "zigzagging"20 and hence no way of telling in which direction it would go as it approached the truck.

Also clearly erroneous is the finding of the Intermediate Appellate Court that Zacarias had no driver's license at the time. The traffic accident report attests to the proven fact that Zacarias voluntarily surrendered to the investigating officers his driver's license, valid for 1979, that had been renewed just the day before the accident, on July 3, 1979.21 The Court was apparently misled by the circumstance that when said driver was first asked to show his license by the investigators at the scene of the collision, he had first inadvertently produced the license of a fellow driver, Leonardo Baricuatro, who had left said license in Davao City and had asked Zacarias to bring it back to him in Glan, Cotabato.22

The evidence not only acquits Zacarias of any negligence in the matter; there are also quite a few significant indicators that it was rather Engineer Calibo's negligence that was the proximate cause of the accident. Zacarias had told Patrolman Dimaano at the scene of the collision and later confirmed in his written statement at the police headquarters23 that the jeep had been "zigzagging," which is to say that it was travelling or being driven erratically at the time. The other investigator, Patrolman Jose Esparcia, also testified that eyewitnesses to the accident had remarked on the jeep's "zigzagging."24 There is moreover more than a suggestion that Calibo had been drinking shortly before the accident. The decision of the Trial Court adverts to further testimony of Esparcia to the effect that three of Calibo's companions at the beach party he was driving home from when the collision occurred, who, having left ahead of him went to the scene when they heard about the accident, had said that there had been a drinking spree at the party and, referring to Calibo, had remarked: "Sabi na huag nang mag drive . . . . pumipilit," (loosely translated, "He was advised not to drive, but he insisted.")

It was Calibo whose driver's license could not be found on his person at the scene of the accident, and was reported by his companions in the jeep as having been lost with his wallet at said scene, according to the traffic accident report, Exhibit "J". Said license unexplainedly found its way into the record some two years later.

Reference has already been made to the finding of the Trial Court that while Zacarias readily submitted to interrogation and gave a detailed statement to the police investigators immediately after the accident, Calibo's two companions in the jeep and supposed eyewitnesses, Agripino Roranes and Maximo Patos, refused to give any statements. Furthermore, Roranes who, together with Patos, had sustained injuries as a result of the collision, waived his right to file a criminal case against Zacarias.25

Even, however, ignoring these telltale indicia of negligence on the part of Calibo, and assuming some antecedent negligence on the part of Zacarias in failing to keep within his designated lane, incorrectly demarcated as it was, the physical facts, either expressly found by the Intermediate Appellate Court or which may be deemed conceded for lack of any dispute, would still absolve the latter of any actionable responsibility for the accident under the rule of the last clear chance.

Both drivers, as the Appellate Court found, had had a full view of each other's vehicle from a distance of one hundred fifty meters. Both vehicles were travelling at a speed of approximately thirty kilometers per hour.26 The private respondents have admitted that the truck was already at a full stop when the jeep plowed into it. And they have not seen fit to deny or impugn petitioners' imputation that they also admitted the truck had been brought to a stop while the jeep was still thirty meters away.27 From these facts the logical conclusion emerges that the driver of the jeep had what judicial doctrine has appropriately called the last clear chance to avoid the accident, while still at that distance of thirty meters from the truck, by stopping in his turn or swerving his jeep away from the truck, either of which he had sufficient time to do while running at a speed of only thirty kilometers per hour. In those circumstances, his duty was to seize that opportunity of avoidance, not merely rely on a supposed right to expect, as the Appellate Court would have it, the truck to swerve and leave him a clear path.

The doctrine of the last clear chance provides as valid and complete a defense to accident liability today as it did when invoked and applied in the 1918 case of Picart vs. Smith, supra, which involved a similar state of facts. Of those facts, which should be familiar to every student of law, it is only necessary to recall the summary made in the syllabus of this Court's decision that:

"(t)he plaintiff was riding a pony on a bridge. Seeing an automobile ahead he improperly pulled his horse over to the railing on the right. The driver of the automobile, however guided his car toward the plaintiff without diminution of speed until he was only few feet away. He then turned to the right but passed so closely to the horse that the latter being frightened, jumped around and was killed by the passing car. x x x."

Plaintiff Picart was thrown off his horse and suffered contusions which required several days of medical attention. He sued the defendant Smith for the value of his animal, medical expenses and damage to his apparel and obtained judgment from this Court which, while finding that there was negligence on the part of both parties, held that that of the defendant was the immediate and determining cause of the accident and that of the plaintiff "x x x the more remote factor in the case":

"It goes without saying that the plaintiff himself was not free from fault, for he was guilty of antecedent negligence in planting himself on the wrong side of the road. But as we have already stated, the defendant was also negligent; and in such case the problem always is to discover which agent is immediately and directly responsible. It will be noted that the negligent acta of the two parties were not contemporaneous, since the negligence of the defendant succeeded the negligence of the plaintiff by an appreciable interval. Under these circumstances the law is that the person who has the last fair chance to avoid the impending harm and falls to do so is chargeable with the consequences, without reference to the prior negligence of the other party."

Since said ruling clearly applies to exonerate petitioner Zacarisa and his employer (and co-petitioner) George Lim, an inquiry into whether or not the evidence supports the latter's additional defense of due diligence in the selection and supervision of said driver is no longer necessary and win not be undertaken. The fact is that there is such evidence in the record which has not been controverted.

It must be pointed out, however, that the Intermediate Appellate Court also seriously erred in holding the petitioners Pablo S. Agad and Felix Lim solidarily liable for the damages awarded in its appealed decision, as alleged owners, with petitioner George Lim, of Glen People's Lumber and Hardware, employer of petitioner Zacarias. This manifestly disregarded, not only the certificate of registration issued by the Bureau of Domestic Trade identifying Glan People's Lumber and Hardware as a business name registered by George Lim,28 but also unimpugned allegations into the petitioners' answer to the Complaint that Pablo S. Agad was only an employee of George Lim and that Felix Lim, then a child of only eight (8) years, was in no way connected with the business.

In conclusion, it must also be stated that there is no doubt of this Court's power to review the assailed decision of the Intermediate Appellate Court under the authority of precedents recognizing exceptions to the familiar rule binding it to observe and respect the latter's findings of fact. Many of those exceptions may be cited to support the review here undertaken, but only the most obvious-that said findings directly conflict with those of the Trial Court-will suffice.29 In the opinion of this Court and after a careful review of the record, the evidence singularly fails to support the findings of the Intermediate Appellate Court which, for all that appears, seem to have been prompted rather by sympathy for the heirs of the deceased Engineer Calibo than by an objective appraisal of the proofs and a correct application of the law to the established facts. Compassion for the plight of those whom an accident has robbed of the love and support of a husband and father is an entirely natural and understandable sentiment. It should not, however, be allowed to stand in the way of, much less to influence, a just verdict in a suit at law.

WHEREFORE, the appealed judgment of the Intermediate Appellate Court is hereby REVERSED, and the complaint against herein petitioners in Civil Case No. 3283 of the Court of First Instance of Bohol, Branch IV, is DISMISSED. No pronouncement as to costs.

SO ORDERED.

Cruz, Gancayco, Griño-Aquino and Medialdea, JJ., concur.

Judgment reversed..