Baliwag Transit, Inc. vs. Court of Appeals

An employer is solidarily liable for damages caused by the negligence of its employee acting within the scope of assigned tasks, absent proof that it exercised the diligence of a good father of a family in the selection and supervision of the employee. The presumption of employer negligence arises instantly when injury is caused by an employee's negligence, and the employer bears the burden to rebut it with clear showing of due diligence in both selection and supervision.

Baliwag Transit, Inc. is a common carrier engaged in the transportation business, operating buses including Bus No. 117. The deceased, Mario Dionisio, was employed as a mechanic by the petitioner, while Juanito Fidel was employed as a bus driver. The case involves the application of Articles 2176 and 2180 of the Civil Code on quasi-delicts, which impose liability on employers for the negligent acts of their employees acting within the scope of their assigned tasks. The statutory framework also includes Articles 1764, 2206, 2208, and 2231 of the Civil Code governing damages for death, moral damages, attorney's fees, and exemplary damages respectively.

Mario Dionisio was a mechanic employed by Baliwag Transit, Inc., and the sole breadwinner of his family, which included his wife Divina and their minor children Mark Angelo and Ma. Liza. On 2 November 1990, at about 3:30 in the afternoon, petitioner's Baliwag Transit Bus No. 117 was driven by Juanito Fidel to its terminal on 2nd Avenue, Caloocan City, for repair of its brake system. Fidel instructed Dionisio to inform the headman about the matters so that proper orders to the mechanics could be made. Fidel then alighted from the bus and told the gasman to fill up the gas tank.

Shortly after, Juanito Fidel returned to the bus and sat on the driver's seat. Suddenly the bus moved, and Fidel felt that something was hit. When he went down to investigate, he saw Mario Dionisio lying on the ground bleeding and convulsive, sandwiched between Bus No. 117 and another bus parked thereat owned by the same petitioner. Fidel summoned his co-employees, and they all helped to extricate Mario Dionisio. They rushed him to St. Luke's Hospital in Quezon City, but on 6 November 1990, he expired, as evidenced by his Certificate of Death issued 22 November 1990.

The deceased was only 29 years old at the time of his death. He earned a gross annual income of ₱33,273.60 (₱2,772.80 per month), a gross annual allowance of ₱4,244.64 (₱353.72 per month), and a 13th month pay of ₱3,199.00, for a total annual income of ₱40,717.24. His annual expenses were ₱6,000.00 (₱500.00 per month), and he paid an annual pension of ₱13,776.00 (₱1,148.00 per month), leaving a total annual net income of ₱20,941.24.

Petitioner maintained that the deceased was contributorily negligent for failing to take necessary precaution while doing repair work on the brake system of Bus No. 117. The trial court found the driver negligent and ordered the employer and employee jointly and severally liable. The Court of Appeals modified the award, increasing the damages, which prompted the petitioner to seek review before the Supreme Court.

• Contributory Negligence: Petitioner maintained that the Court of Appeals erred in affirming the appealed judgment despite the contributory negligence of the deceased Mario Dionisio, specifically in failing to take the necessary precaution while doing repair work on the brake system of Bus No. 117.
• Unreasonable Damages: Petitioner argued that the increase of the award of damages was unreasonable, being unsupported by law and the evidence.

N/A — The decision does not recount the respondents' specific arguments on appeal.

• Contributory Negligence: Whether the deceased Mario Dionisio was contributorily negligent such as to absolve or mitigate the liability of the petitioner and its driver.
• Reasonableness of Damages: Whether the Court of Appeals' increase of the award of damages was reasonable and supported by law and the evidence.

• Contributory Negligence: No. The proximate cause of the death of Mario Dionisio was the negligence of driver Juanito Fidel, who failed to take the necessary precaution to prevent the accident. The deceased was not contributorily negligent, as he was performing his assigned task of repairing the brake system when the bus moved and pinned him.
• Reasonableness of Damages: Partially. The award of damages was modified, with the loss of earning capacity recomputed from ₱1,429,050.00 to ₱712,002.16 using the correct formula, and moral damages reduced from ₱60,000.00 to ₱40,000.00, exemplary damages from ₱30,000.00 to ₱15,000.00, and attorney's fees from ₱50,000.00 to ₱20,000.00.

• Contributory Negligence: The circumstances clearly showed that the proximate cause of the death of Mario Dionisio was the negligence of driver Juanito Fidel. Fidel boarded his bus, sat on the driver's seat, and was at the steering wheel when the bus moved, pinning down the deceased who was repairing the defective brake system below. Fidel should have parked the bus properly and safely, and after alighting to tell the gasman to fill the tank, he should have placed a stopper or any hard object against a tire or two of the bus. Without taking the necessary precaution, he boarded Bus No. 117, causing it to move and roll, pinning down the deceased, which resulted in his serious injuries and eventual death. The reckless imprudence of Juanito Fidel made him liable to the heirs of the offended party for damages together with his employer under Article 2176 of the Civil Code, which provides that whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done.

• Employer Liability: Article 2180, in relation to Article 2176, of the Civil Code provides that the employer of a negligent employee is liable for the damages caused by the latter. When an injury is caused by the negligence of an employee, there instantly arises a presumption of law that there was negligence on the part of the employer either in the selection of the employee or in the supervision over him after such selection. The presumption, however, may be rebutted by a clear showing on the part of the employer that it had exercised the care and diligence of a good father of a family in the selection and supervision of the employee. To escape solidary liability for quasi-delict committed by an employee, the employer must adduce sufficient proof that it exercised such degree of care. Petitioner's failure to prove that it exercised the due diligence of a good father of a family in the selection and supervision of its driver Juanito Fidel made it solidarily liable with the latter for damages caused by him.

• Loss of Earning Capacity: Under Article 1764, in conjunction with Article 2206, of the Civil Code, as well as established jurisprudence, several factors are considered in computing damages: (a) life expectancy (considering the health of the deceased and the mortality table being deemed conclusive) and loss of earning capacity; (b) pecuniary loss, loss of support and service; and (c) moral and mental sufferings. The loss of earnings capacity is based mainly on two factors: the number of years on the basis of which the damages shall be computed, and the rate at which the loss sustained by the heirs should be fixed. The Court found discrepancies in the computation of the Court of Appeals and applied the correct formula: 2/3 x 51 (80 - 29 [age at time of death]) = life expectancy. Thus, the total loss of earning capacity was computed as ₱712,002.16.

• Moral and Exemplary Damages: Article 2206 grants the spouse, legitimate descendants, and ascendants of the deceased moral damages for mental anguish by reason of death. The heirs of Mario suffered no small amount of mental anguish brought about by the manner he died, bearing in mind that he was the sole breadwinner of the family. Article 2231 also awards exemplary damages if the defendant acted with gross negligence, as Juanito did, when he moved Bus No. 117 without first ascertaining if the repair of its brake system was already undertaken. Exemplary damages having been awarded, recovery of attorney's fees follows under Article 2208, par. (1), of the Civil Code.

• Presumption of Employer Negligence in Quasi-Delicts — When an injury is caused by the negligence of an employee, there instantly arises a presumption of law that there was negligence on the part of the employer either in the selection of the employee or in the supervision over him after such selection. The presumption may be rebutted by a clear showing on the part of the employer that it exercised the care and diligence of a good father of a family in the selection and supervision of the employee. In this case, the petitioner failed to adduce sufficient proof of such diligence, making it solidarily liable with its driver.

• Proximate Cause in Quasi-Delicts — The proximate cause of an injury is that cause which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces the injury, and without which the result would not have occurred. Here, the proximate cause of the death of Mario Dionisio was the negligence of driver Juanito Fidel, who failed to take the necessary precaution to prevent the accident by not parking the bus properly or placing a stopper against a tire.

• Formula for Loss of Earning Capacity — The loss of earning capacity is computed using the formula: life expectancy (2/3 x [80 - age at time of death]) multiplied by the total annual net income (gross annual income plus allowances and 13th month pay, less annual expenses and pension). The Court applied this formula to compute the loss of earning capacity at ₱712,002.16.

• "The circumstances clearly show that the proximate cause of the death of Mario Dionisio was the negligence of driver Juanito Fidel when he failed to take the necessary precaution to prevent the accident." — This passage establishes the Court's finding on proximate cause, which is the foundation for the entire liability determination in the case.

• "When an injury is caused by the negligence of an employee there instantly arises a presumption of the law that there was negligence on the part of the employer either in the selection of his employee or in the selection of his employee or in the supervision over him after such selection." — This is the canonical statement of the presumption of employer negligence under Article 2180, which is central to the Court's holding on solidary liability.

• "Petitioner's failure to prove that it exercised the due diligence of a good father of a family in the selection and supervision of its driver Juanito Fidel will make it solidarily liable with the latter for damages caused by him." — This passage articulates the burden on the employer to rebut the presumption of negligence and the consequence of failing to do so.

• China Air Lines, Ltd. vs. Court of Appeals, No. L-45985 and Philippine Air Lines, Inc. vs. Court of Appeals, No. L-46036, 18 May 1990, 185 SCRA 449 — Cited for the proposition that the employer must adduce sufficient proof that it exercised the due diligence of a good father of a family in the selection and supervision of its employee to escape solidary liability for quasi-delict.
• Bachelor Express Incorporated vs. Court of Appeals, G.R. No. 85691, 31 July 1990, 188 SCRA 213 — Cited for the factors considered in computing damages for death, including life expectancy and loss of earning capacity.
• Villa Rey Transit, Inc. vs. Court of Appeals, No. L-25499, 18 February 1970, 31 SCRA 511 — Cited for the factors considered in computing damages for death, including pecuniary loss, loss of support and service, and moral and mental sufferings.

• Article 2176, Civil Code — Provides that whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done. This is the basis for liability in quasi-delicts, applied to hold the driver liable for the death of the mechanic.
• Article 2180, Civil Code — Provides that employers shall be liable for the damages caused by their employees acting within the scope of their assigned tasks, and that the responsibility shall cease when the employers prove that they observed all the diligence of a good father of a family to prevent damage. This is the basis for the solidary liability of the petitioner employer.
• Article 1764, Civil Code — Cited in conjunction with Article 2206 for the factors considered in computing damages for death, including life expectancy and loss of earning capacity.
• Article 2206, Civil Code — Grants the spouse, legitimate descendants, and ascendants of the deceased moral damages for mental anguish by reason of death. Applied to award moral damages to the heirs of the deceased.
• Article 2208, par. (1), Civil Code — Provides for the recovery of attorney's fees in actions for quasi-delicts. Applied because exemplary damages were awarded.
• Article 2231, Civil Code — Awards exemplary damages if the defendant acted with gross negligence. Applied because the driver acted with gross negligence in moving the bus without ascertaining if the repair was completed.

Padilla, Vitug, Kapunan, and Hermosisima, Jr., JJ., concurred.

N/A — No dissenting opinions were noted in the decision.