Imperial vs. Heirs of Bayaban

The burden of proving that a negligent act of an employee was performed within the scope of his or her assigned tasks rests with the plaintiff; once discharged, the presumption that the employer was negligent arises, and the employer must present evidence of due diligence of a good father of a family in the selection and supervision of the employee to avoid solidary liability under Article 2180 of the Civil Code.

Raul S. Imperial employed William Laraga as his family's stay-in driver. Imperial owned a Mitsubishi L-300 van registered in his name. The case involves the application of Articles 2176 and 2180 of the Civil Code on quasi-delicts and vicarious liability of employers, which were derived from Articles 1902 and 1903 of the Spanish Civil Code of 1889. The legal fiction of vicarious liability holds employers morally responsible for the negligence of their employees, but only when the employees act within the scope of their assigned tasks.

On December 14, 2003, at about 3:00 p.m., a Mitsubishi L-300 van with plate number USX 931, owned and registered under the name of Raul S. Imperial and driven by his employee William Laraga, figured in an accident with a tricycle with plate number DU 8833 driven by Gerardo Mercado along Sumulong Highway, Antipolo City. On board the tricycle were spouses Neil Bayaban and Mary Lou Bayaban, who sustained injuries and were brought to Unciano Hospital. Neil suffered a fracture open type III-B, complete comminuted, displaced middle third tibia, a fracture closed, complete comminuted displaced middle third femur on the right, and a fracture closed, complete displaced lateral tibial plateau knee joint on the left. Mary Lou suffered a fracture closed, complete, comminuted, displaced distal radius on the left, dislocation of the ulnocarpal/ulnoradial joint on the left, and a fracture closed, complete, transverse, displaced middle-distal third humerus on the right. Both had to undergo therapy and post-medical treatment.

The Bayaban Spouses demanded compensation from Imperial, Laraga, and Mercado for hospital bills and loss of income. When no one heeded their demand, they filed a Complaint for damages before the Regional Trial Court of Antipolo City, praying for P311,760.75 as actual damages, US$1,900.00 per month representing Neil's unearned income as a second-mate seaman, P7,600.00 per month representing Mary Lou's unearned income as a pharmacist, P200,000.00 as moral damages, and P20,000.00 as attorney's fees.

In his Answer, Imperial denied liability, contending that the van was under the custody of one Rosalia Habon Pascua, to whom he had lent the van for fixing the greenhouse and water line pipes in Imperial's garden in Antipolo. Imperial admitted that he had employed Laraga as family driver but contended that he had exercised due diligence in the selection and supervision of Laraga, allegedly sponsoring Laraga's formal driving lessons. He further alleged that Laraga was acting outside the scope of his duties when the accident happened because it was a Sunday, his rest day. Before the case proceeded to trial, Neil died on May 23, 2006, and was substituted by his heirs: Mary Lou and their children, Donna Grace and Dan Geofrey.

The Regional Trial Court found Laraga negligent and the proximate cause of the accident, specifically for overtaking another vehicle and colliding with the tricycle on the other side of the road. It ruled that Imperial failed to prove that he exercised due diligence in the selection and supervision of Laraga, and was thus presumed negligent and held liable. The trial court found the official receipts substantiated the claim for medical and hospital expenses but found the certificates of employment inadequate to prove unearned income; nevertheless, it awarded P100,000.00 as temperate damages, plus moral damages, exemplary damages, and attorney's fees. The Court of Appeals maintained Imperial's liability, ruling that the registered owner of a motor vehicle is primarily and directly responsible for the consequences of its operation, and that Imperial could not escape liability by arguing that it was Laraga's day off or that the van was in Pascua's custody because neither was presented in court. The appellate court deleted the award of temperate damages, holding that temperate and actual damages were mutually exclusive.

• Scope of Assigned Tasks: Petitioner maintained, citing Castilex Industrial Corporation vs. Vasquez, Jr., that he is not liable because respondents failed to discharge their burden of proving that Laraga was acting within the scope of his assigned tasks at the time of the accident.
• Authentication of Receipts: Petitioner argued that the official receipts of the medical and hospital bills, though original, were not authenticated as required under Rule 132, Section 20 of the Rules of Court, and therefore were not competent evidence of the actual damages sustained.

• Scope of Assigned Tasks: Respondents pointed out Imperial's admission that Laraga was his employee, specifically his family's stay-in driver, and contended that it was not far-fetched to conclude that Laraga had always been utilized as a driver during Sundays, as this was the common practice under the Philippine set up; they maintained that Laraga was acting within the scope of his assigned tasks when the accident happened.
• Due Diligence: Respondents contended that petitioner failed to prove that he exercised due diligence in the selection and supervision of Laraga by failing to present original receipts showing that he had enrolled Laraga in a formal driving school, and that shouldering Laraga's expenses in obtaining a driver's license is hardly the due diligence of a good father of a family required to absolve him from liability.
• Authentication of Receipts: Respondents argued that original receipts of medical and hospital bills are sufficient proof of the actual damages sustained and need not be authenticated to be competent proof of their claims.

• Burden of Proof on Scope of Employment: Whether the Court of Appeals shifted the burden on petitioner to prove that his employee, William Laraga, was not acting within the scope of his assigned tasks.
• Authentication of Official Receipts: Whether the original receipts of the medical and hospital bills presented by respondents are not competent evidence of the actual damages sustained considering that the receipts were not authenticated.

• Burden of Proof on Scope of Employment: No. The burden of proving that the employee was acting within the scope of his assigned tasks rests with the plaintiff under the maxim "ei incumbit probatio qui dicit, non qui negat." Respondents discharged this burden, and the presumption of employer negligence arose, which petitioner failed to rebut.
• Authentication of Official Receipts: No. The official receipts were private documents that were duly authenticated when respondent Mary Lou testified as to their execution and issuance, and being originals, they were the best evidence of their contents.

• Burden of Proof on Scope of Employment: Under Article 2180 of the Civil Code, employers are liable for damages caused by their employees acting within the scope of their assigned tasks. An act is deemed an assigned task if it is done by an employee in furtherance of the interests of the employer or for the account of the employer at the time of the infliction of the injury or damage. Citing Castilex Industrial Corporation vs. Vasquez, Jr., the Court reiterated that the burden of proving the existence of an employer-employee relationship and that the employee was acting within the scope of his or her assigned tasks rests with the plaintiff. Once the plaintiff establishes the requisite facts, the presumption that the employer was negligent in the selection and supervision of the employee arises, disputable with evidence that the employer observed all the diligence of a good father of a family. In this case, there was no question that Laraga was petitioner's driver, as this fact was admitted. The Court found that respondents established that Laraga was acting within the scope of his assigned tasks: it was 3:00 p.m., and Laraga was driving in Antipolo City, where petitioner's greenhouse and garden were located. The logical conclusion was that Laraga was driving the van in connection with the upkeep of petitioner's Antipolo greenhouse and garden, in furtherance of petitioner's interests. The defense that Sunday was Laraga's day off failed because there was no proof of this allegation, with Laraga not having appeared in court to testify. With respondents having discharged their burden, the disputable presumption of negligence in selection and supervision arose. There was no shifting of burden; rather, petitioner had to present evidence of due diligence to be relieved of liability. Petitioner miserably failed, presenting only self-serving testimonies without documentary proof that he enrolled Laraga in a formal driving school. At best, he only established that he financed the fees for Laraga's driver's license, which is hardly the due diligence contemplated in Article 2180. The accident happened because Laraga tried to overtake another vehicle and drove to the opposite lane, colliding with the approaching tricycle. Citing Pleyto vs. Lomboy, the Court noted that a driver abandoning his proper lane to overtake another vehicle has the duty to see that the road is clear and must not proceed if he cannot do so safely.
• Authentication of Official Receipts: Under the rules of evidence, documents are either public or private. Public documents, enumerated in Rule 132, Section 19 of the Rules of Court, need not be authenticated. Official receipts of hospital and medical expenses are not among those enumerated and are therefore private documents, which may be authenticated either by presenting as witness anyone who saw the document executed or written, or by presenting evidence of the genuineness of the signature or handwriting of the maker. Respondent Mary Lou testified as to the circumstances of the accident and the expenses she and Neil had incurred. The official receipts were issued to her and Neil upon payment of the expenses. Since the receipts were issued to her, her testimony was competent evidence of their execution. With Mary Lou testifying as to the execution and issuance of the receipts, they were duly authenticated. Being originals, they were the best evidence of their contents, specifically of the actual damages incurred. The Regional Trial Court correctly admitted the receipts in evidence.
• Temperate Damages: The Court found that respondents were entitled to temperate damages for loss of earning capacity. Temperate or moderate damages may be recovered when the court finds that some pecuniary loss has been suffered, but its amount cannot, from the nature of the case, be proved with certainty. While respondents failed to put forward definite proof of income lost during confinement and post-therapy, they still suffered pecuniary loss when they were incapacitated to work. The P100,000.00 awarded by the Regional Trial Court was reasonable to compensate them for the income they could have earned as a second-mate seaman and a pharmacist. Contrary to the Court of Appeals' ruling, temperate damages may still be awarded despite a previous award of actual damages because the damages cover distinct pecuniary losses: the temperate damages cover loss of earning capacity while the actual damages cover medical and hospital expenses.

• Vicarious liability of employers under Article 2180 of the Civil Code — Employers are liable for damages caused by their employees acting within the scope of their assigned tasks, even though the former are not engaged in any business or industry. The liability ceases when the employer proves that he or she observed all the diligence of a good father of a family to prevent damage. The liability is personal and direct, though vicarious in nature. In this case, the employer was held solidarily liable with his employee-driver because the plaintiff proved the employee was acting within the scope of his assigned tasks, and the employer failed to rebut the presumption of negligence in selection and supervision.
• Burden of proof in employer vicarious liability — The burden of proving the existence of an employer-employee relationship and that the employee was acting within the scope of his or her assigned tasks rests with the plaintiff under the Latin maxim "ei incumbit probatio qui dicit, non qui negat" (he who asserts, not he who denies, must prove). It is not incumbent on the employer to prove that the employee was not acting within the scope of his assigned tasks. Once the plaintiff establishes the requisite facts, the presumption that the employer was negligent in the selection and supervision of the employee arises, which the employer may dispute with evidence of due diligence.
• Scope of assigned tasks — An act is deemed an assigned task if it is done by an employee in furtherance of the interests of the employer or for the account of the employer at the time of the infliction of the injury or damage. In this case, the employee-driver was driving the employer's van in Antipolo City, where the employer's greenhouse and garden were located, leading to the logical conclusion that he was driving in connection with the upkeep of the employer's property and thus in furtherance of the employer's interests.
• Authentication of private documents — Official receipts of hospital and medical expenses are private documents under Rule 132, Section 20 of the Rules of Court, which may be authenticated either by anyone who saw the document executed or written, or by evidence of the genuineness of the signature or handwriting of the maker. A party to whom the receipts were issued may testify as to their execution and issuance, thereby authenticating them.

• "The burden of proving that a negligent act of an employee was performed within the scope of his or her assigned tasks rests with the plaintiff. When the plaintiff has discharged this burden, as in this case, the presumption that the employer was negligent arises, and the employer must put forward evidence showing that he or she had exercised the due diligence of a good father of a family in the selection and supervision of the employee. Failing to dispute this presumption renders the employer solidarily liable with the employee for the quasi-delict." — This passage states the ratio decidendi of the case, articulating the burden of proof framework and the consequence of failing to rebut the presumption of employer negligence.
• "An act is deemed an assigned task if it is 'done by an employee, in furtherance of the interests of the employer or for the account of the employer at the time of the infliction of the injury or damage.'" — This defines the canonical test for determining whether an employee's act falls within the scope of assigned tasks for purposes of vicarious liability under Article 2180.
• "With respondent Mary Lou testifying as to the execution and issuance of the official receipts, they were duly authenticated, contrary to petitioner's claim. There being no question that the official receipts were all in the original, they were the best evidence of their contents, specifically, of the actual damages incurred by the Bayaban Spouses." — This resolves the evidentiary issue on authentication of private documents, holding that the testimony of the party to whom the receipts were issued suffices to authenticate them.

• Castilex Industrial Corporation vs. Vasquez, Jr., 378 Phil. 1009 (1999) — Controlling precedent on the burden of proof in employer vicarious liability; cited for the rule that the plaintiff bears the burden of proving that the employee was acting within the scope of his or her assigned tasks, and that it is not incumbent on the employer to prove the negative.
• Cangco vs. Manila Railroad Co., 38 Phil. 768 (1918) — Explained the legal fiction of vicarious liability and the rationale for holding employers morally responsible for the negligence of their employees; cited for the principle that the employer's liability is personal and direct, though vicarious.
• Filamer Christian Institute vs. Court of Appeals, 268 Phil. 516 (1990) and Filamer Christian Institute vs. Intermediate Appellate Court, 287 Phil. 704 (1992) — Explained when an act is within the scope of an employee's assigned tasks; the employee driving the school jeep was found to be acting within the scope because he was not on a joy ride but driving for the service for which the jeep was intended.
• Pleyto vs. Lomboy, 476 Phil. 373 (2004) — Cited for the rule on overtaking: a driver abandoning his proper lane to overtake another vehicle has the duty to see that the road is clear and must not proceed if he cannot do so safely.
• Philtranco Service Enterprises, Inc. vs. Paras, 686 Phil. 736 (2012) — Cited to support the award of temperate damages despite a previous award of actual damages, as the damages cover distinct pecuniary losses.
• Nacar vs. Gallery Frames, 716 Phil. 267 (2013) — Cited for the imposition of legal interest at the rate of six percent (6%) per annum from the finality of the Decision until full payment.

• Article 2176, Civil Code — Defines quasi-delict as the fault or negligence that causes damage to another, there being no pre-existing contractual relation between the parties; applied as the basis for the claim for damages arising from the negligent act of the employee-driver.
• Article 2180, Civil Code — Provides that employers shall be liable for damages caused by their employees and household helpers acting within the scope of their assigned tasks, and that the responsibility ceases when the employer proves that he or she observed all the diligence of a good father of a family to prevent damage; applied to hold the employer solidarily liable with his employee-driver.
• Article 2224, Civil Code — Defines temperate or moderate damages as those more than nominal but less than actual or compensatory damages, recoverable when the court finds that some pecuniary loss has been suffered but its amount cannot be proved with certainty; applied to award P100,000.00 for loss of earning capacity.
• Article 2225, Civil Code — Provides that temperate damages must be reasonable under the circumstances; applied to assess the reasonableness of the award.
• Rule 132, Section 20, Rules of Court — Requires that before any private document offered as authentic is received in evidence, its due execution and authenticity must be proved either by anyone who saw the document executed or written, or by evidence of the genuineness of the signature or handwriting of the maker; applied to determine the authentication requirement for official receipts.
• Rule 132, Section 19, Rules of Court — Enumerates public documents that need not be authenticated; applied to distinguish official receipts as private documents.
• Rule 132, Section 23, Rules of Court — Provides that public documents are prima facie evidence of the facts stated therein; applied in contrast to the authentication requirement for private documents.
• Rule 130, Section 3, Rules of Court — The best evidence rule; applied to hold that original official receipts were the best evidence of their contents.

Peralta (Chairperson), A. Reyes, Jr., and J. Reyes, Jr., JJ., concurred. Gesmundo, J., was on official business.