Jarco Marketing Corporation vs. Court of Appeals

A business establishment is liable for the death of a child caused by a structurally dangerous and unsecured fixture on its premises where it was repeatedly warned of the danger but failed to remedy it, and a child below nine years of age is conclusively presumed incapable of contributory negligence as a matter of law.

Petitioner Jarco Marketing Corporation owned Syvel's Department Store in Makati City. Petitioners Leonardo Kong, Jose Tiope, and Elisa Panelo were the store's branch manager, operations manager, and supervisor, respectively. Private respondents Conrado and Criselda Aguilar were spouses and the parents of Zhieneth Aguilar, a six-year-old child. The dispute arose from a quasi-delict claim for damages arising from the death of Zhieneth after a gift-wrapping counter inside the store collapsed and pinned her.

Petitioner Jarco Marketing Corporation owned Syvel's Department Store in Makati City. Petitioners Leonardo Kong, Jose Tiope, and Elisa Panelo served as the store's branch manager, operations manager, and supervisor, respectively. Private respondents Conrado and Criselda Aguilar were spouses and the parents of Zhieneth Aguilar, a six-year-old child.

In the afternoon of 9 May 1983, Criselda and Zhieneth were on the second floor of Syvel's Department Store. Criselda was signing her credit card slip at the payment and verification counter when she felt a sudden gust of wind and heard a loud thud. She turned to find Zhieneth on the floor, pinned beneath the store's gift-wrapping counter. Zhieneth was crying and screaming for help. Although shocked, Criselda quickly asked the people around to help lift the counter and retrieve Zhieneth from the floor.

Zhieneth was rushed to the Makati Medical Center where she was operated on. The next day she lost her speech and communicated with Criselda by writing on a magic slate. The injuries she sustained — which included severe shock secondary to intra-abdominal injuries, massive hemorrhage from liver laceration, rupture of the stomach walls, complete transection of the duodenum, extensive retroperitoneal hematoma, and severe lung contusion — took their toll on her young body. She died fourteen days after the accident, on 22 May 1983, at the age of six.

After the burial of their daughter, private respondents demanded that petitioners reimburse the hospitalization, medical bills, and wake and funeral expenses they had incurred. Petitioners refused. Private respondents then filed a complaint for damages, docketed as Civil Case No. 7119, seeking payment of P157,522.86 for actual damages, P300,000 for moral damages, P20,000 for attorney's fees, and an unspecified amount for loss of income and exemplary damages. Petitioners denied any liability, claiming that Criselda was negligent in allowing Zhieneth to freely roam around the store and that Zhieneth herself was guilty of contributory negligence by climbing the counter. They also maintained that the counter was made of sturdy wood with strong support and had never fallen or collapsed in the fifteen years since its construction.

The trial court dismissed the complaint, finding that the proximate cause of the counter's fall was Zhieneth's act of clinging to it, crediting petitioners' witnesses who testified that Zhieneth clung to the counter, causing both the structure and the girl to fall. The trial court also held that Criselda's negligence contributed to the accident and that the counter could not be considered an attractive nuisance because it was situated at a corner as a precautionary measure. The Court of Appeals, however, reversed this judgment, finding that the counter was structurally dangerous — shaped like an inverted "L" with a top wider than its base, making it top-heavy and unstable — and that two former employees had previously warned management of the danger but were ignored. The appellate court declared Zhieneth, being below seven years old, absolutely incapable of negligence, and absolved Criselda of any contributory negligence.

• Proximate Cause: Petitioners argued that the proximate cause of Zhieneth's death was her own act of clinging to the counter, which caused it to fall on her, and that this act, together with Criselda's contributory negligence in failing to provide proper care and attention to her child while inside the store, nullified private respondents' claim for damages.
• Factual Findings of Trial Court: Petitioners maintained that the Court of Appeals erred in disregarding the factual findings and conclusions of the trial court, stressing that since the action was based on tort, any finding of negligence on the part of private respondents would necessarily negate their claim for damages.
• Credibility of Witness: Petitioners assailed the credibility of Gerardo Gonzales, who had already been separated from Syvel's at the time he testified, suggesting his testimony might have been tainted by ill feelings against them.
• Due Diligence: Petitioners asserted that they exercised due diligence, noting that the counter had been in existence for several years without any prior accident, was deliberately placed at a corner to avoid accidents, and that nailing it to the ground was not necessary. They also pointed out that the criminal case for homicide through simple negligence filed against the individual petitioners had been dismissed with a verdict of acquittal.

• Incapacity for Negligence: Private respondents asserted that Zhieneth, being below nine years of age, was entitled to the conclusive presumption that a child of such age is incapable of contributory negligence, and that even if she were capable, it was physically impossible for her to have propped herself on the counter given her small frame and the counter's greater height and weight.
• Res Gestae: Private respondents argued that Gonzales' testimony regarding Zhieneth's spontaneous declaration at the emergency room — that she did nothing and the counter just fell on her — should be admitted as part of the res gestae and accorded credit, as it belied petitioners' theory that Zhieneth climbed the counter.
• Absence of Parental Negligence: Private respondents maintained that no negligence could be imputed to Criselda, as it was reasonable for her to momentarily let go of Zhieneth at the precise moment she was signing the credit card slip.
• Petitioners' Negligence: Private respondents vigorously maintained that the proximate cause of Zhieneth's death was petitioners' negligence in failing to institute measures to have the counter permanently nailed to the ground, despite prior warnings from employees.

• Nature of the Incident: Whether the death of Zhieneth was accidental or attributable to negligence.
• Attribution of Negligence: In case of a finding of negligence, whether the same was attributable to petitioners for maintaining a defective counter, or to Criselda and Zhieneth for failing to exercise due and reasonable care while inside the store premises.

• Nature of the Incident: No. The tragedy was not an accident but was attributable to negligence, petitioners having failed to use reasonable care and caution in maintaining the structurally dangerous gift-wrapping counter.
• Attribution of Negligence: Negligence was attributable to petitioners. Zhieneth, being below nine years of age, was conclusively presumed incapable of contributory negligence, and Criselda was not negligent in momentarily releasing her child's hand to sign a credit card slip.

• Nature of the Incident: An accident is an unforeseen event in which no fault or negligence attaches to the defendant, while negligence is the omission to do something which a reasonable man would do, or the doing of something which a prudent man would not do. The two are intrinsically contradictory. Applying the test from Plicart vs. Smith, the question is whether the defendant used that reasonable care and caution which an ordinarily prudent person would have used in the same situation. The evidence showed that the gift-wrapping counter was shaped like an inverted "L," was top-heavy with a top wider than its base, and was not nailed to the floor. Two former employees — Gerardo Gonzales and Ramon Guevarra — had separately warned management, including petitioner Panelo, about the counter's instability, but no action was taken until after the accident. Petitioners thus failed to discharge the due diligence required of a good father of a family. The tragedy was therefore not an accident but the result of petitioners' negligence.

• Attribution of Negligence: Zhieneth, who was six years old at the time of the incident, was conclusively presumed incapable of contributory negligence as a matter of law, since a child under nine years of age is conclusively presumed to have acted without discernment and is exempt from criminal liability; by analogy, the same presumption applies to negligence in quasi-delicts. Even assuming Zhieneth climbed the counter, no injury should have occurred if the counter were truly stable and sturdy, as petitioners claimed — a frail six-year-old could not have caused a stable counter to collapse. The physical evidence proved otherwise: the counter was heavy, huge, top-laden with formica, protruding toward the customer area, and its base was unsecured. As for Criselda, she was absolved of contributory negligence because it was reasonable and usual for her to momentarily release her child's hand to sign a credit card slip. At the time Zhieneth was pinned, she was only a foot away from her mother, and the gift-wrapping counter was just four meters away — significant indicators that Zhieneth had not loitered. Zhieneth's own statement, admitted as part of the res gestae, confirmed that she did nothing to cause the counter to fall. The testimonies of Gonzales and Guevarra were given credence, petitioners having failed to establish that their testimonies were biased or tainted with partiality merely because they were former employees.

• Conclusive Presumption of Incapacity for Negligence (Children Below Nine) — A child under nine years of age is conclusively presumed incapable of contributory negligence as a matter of law. The doctrine rests on the analogy with the criminal law rule that a person under nine years of age is conclusively presumed to have acted without discernment and is exempt from criminal liability. Since negligence may be a felony and a quasi-delict and requires discernment as a condition of liability, a child under nine is conclusively presumed incapable of negligence. The presumption is irrebuttable for children below nine; for children over nine but under fifteen, the presumption of lack of discernment or incapacity for negligence is rebuttable. In this case, Zhieneth was six years old and thus conclusively presumed incapable of contributory negligence.

• Res Gestae — Under Section 42, Rule 130 of the Rules of Court, statements made by a person while a startling occurrence is taking place, or immediately prior or subsequent thereto, with respect to the circumstances thereof, may be given in evidence as part of the res gestae. The requisites for admissibility are that the statements be made or uttered under the influence of a startling event before the declarant had time to think and concoct a falsehood, as witnessed by the person who testifies in court. In this case, Zhieneth's statement to the doctor at the emergency room — that she did not come near the counter and the counter just fell on her — was admitted as part of the res gestae, it being unthinkable for a child of tender age in extreme pain to lie to a doctor she trusted with her life.

• Test for Negligence (Plicart vs. Smith) — The test for determining the existence of negligence is whether the defendant in doing the alleged negligent act used that reasonable care and caution which an ordinarily prudent person would have used in the same situation. If not, the defendant is guilty of negligence. In this case, petitioners failed this test by ignoring repeated warnings about the unstable counter and taking no action to secure it.

• Diligence of a Good Father of a Family — Employers and business establishments must observe the diligence of a good father of a family in the selection, supervision, and control of their employees and in the maintenance of their premises. Petitioners failed to discharge this duty by disregarding employee warnings about the structurally dangerous counter.

• "Accident and negligence are intrinsically contradictory; one cannot exist with the other. Accident occurs when the person concerned is exercising ordinary care, which is not caused by fault of any person and which could not have been prevented by any means suggested by common prudence." — This passage defines the conceptual distinction between accident and negligence, establishing the framework within which the Court analyzed whether the tragedy was accidental or attributable to petitioners' fault.

• "The test in determining the existence of negligence is enunciated in the landmark case of Plicart v. Smith, thus: 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." — This is the canonical formulation of the test for negligence as adopted in Philippine jurisprudence, derived from Plicart vs. Smith, and applied in this case to conclude that petitioners were negligent.

• "The rule, therefore, is that a child under nine years of age must be conclusively presumed incapable of contributory negligence as a matter of law." — This passage states the conclusive presumption of incapacity for negligence applicable to children below nine, as articulated by former Judge Cezar S. Sangco and adopted by the Court, which was dispositive of the issue whether Zhieneth could be charged with contributory negligence.

• "Without doubt, petitioner Panelo and another store supervisor were personally informed of the danger posed by the unstable counter. Yet, neither initiated any concrete action to remedy the situation nor ensure the safety of the store's employees and patrons as a reasonable and ordinary prudent man would have done." — This passage establishes the factual basis for the Court's finding of negligence, demonstrating that petitioners had actual knowledge of the danger and failed to act, thereby failing the standard of the diligence of a good father of a family.

• Plicart vs. Smith, 37 Phil. 809 (1918) — Controlling precedent for the test of negligence. The Court applied the test formulated in this case — whether the defendant used that reasonable care and caution which an ordinarily prudent person would have used in the same situation — to conclude that petitioners were negligent.
• Novo & Co. vs. Ainsworth, 26 Phil. 380 (1913) — Cited for the definition of accident as an unforeseen event in which no fault or negligence attaches to the defendant.
• McKee vs. Intermediate Appellate Court, 211 SCRA 517 (1992) — Cited for the definition of negligence as the omission to do something which a reasonable man would do, or the doing of something which a prudent man would not do.
• Hidalgo Enterprises, Inc. vs. Balandan, 488, 490 (1952) — Cited in the trial court's discussion of the attractive nuisance doctrine, which the trial court invoked to absolve petitioners by reasoning that the counter was not an attractive nuisance.

• Section 42, Rule 130, Rules of Court — Defines the res gestae exception to the hearsay rule, allowing statements made by a person while a startling occurrence is taking place or immediately prior or subsequent thereto, with respect to the circumstances thereof, to be given in evidence. Applied to admit Zhieneth's spontaneous declaration to the doctor at the emergency room that she did not come near the counter and the counter just fell on her.
• Article 2176, Civil Code (implied) — The case is premised on quasi-delict liability for damages caused by negligence, the action having been filed as a complaint for damages based on tort. While not explicitly cited by article number, the entire framework of the case rests on the principle that whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done.

Puno, Kapunan, Pardo, and Ynares-Santiago, JJ., concurred.