Rakes vs. Atlantic, Gulf and Pacific Company

An employer's liability to an employee for injuries caused by the employer's negligence in maintaining safe working conditions arises from the contractual obligation implied in the employment relationship, and the contributory negligence of the injured employee does not bar recovery but operates only to reduce the damages in proportion to his fault.

The plaintiff, M. H. Rakes, was one of a gang of laborers employed by the Atlantic, Gulf and Pacific Company to transport iron rails from a barge in Manila's harbor to the company's yard near the malecon. The work involved moving hand cars loaded with heavy rails along a tramway constructed from the water's edge to the yard. The legal framework governing employer liability for workplace injuries in the Philippines at the time drew upon the Spanish Civil Code and Penal Code, neither of which had been supplemented by special compensation legislation, leaving the courts to develop the applicable standard of duty through general principles of civil law.

The plaintiff, M. H. Rakes, was one of a gang of eight laborers in the employment of the defendant, the Atlantic, Gulf and Pacific Company, engaged in transporting iron rails from a barge in Manila's harbor to the company's yard near the malecon. The rails, each weighing 560 pounds, were piled lengthwise on one or two hand cars running along a tramway, with the ends of the rails resting on crosspieces or sills secured to the cars but without side pieces or guards to prevent them from slipping off. The tramway itself was constructed of wooden blocks or crosspieces laid on the ground, supporting stringers at right angles, upon which ties held the rails. Where the track extended over the water, the blocks were replaced by piling capped by timbers. The joints between the rails sat directly above the joints between the underlying stringers, and there were no fish plates at these joints.

A recent typhoon had raised the waters of the bay, dislodging a crosspiece or piling under the stringer at a point near the water's edge. This caused the track to sag. A fellow workman of the plaintiff, Ellis, testified that on the day before the accident he called the attention of McKenna, the foreman, to the depression in the track and suggested repairs, but McKenna dismissed the warning. No effort was made to repair the injury, and no inspection of the track after the typhoon was proven. The plaintiff had worked at this job for less than two days and was not familiar with the track's construction.

On the day of the accident, the loaded car reached the point where the track had sagged. The tie broke, the car canted or upset, and the rails slid off, catching the plaintiff and breaking his leg, which was subsequently amputated at about the knee. The plaintiff and his witnesses testified that the men were at the rear or sides of the car, while the defendant maintained that some were also in front hauling by rope. The defendant's officers and three workmen testified that a general prohibition against walking alongside the car had been made known to the gang, and the foreman stated he repeated the prohibition before this particular load was moved. The plaintiff and his witnesses denied any such prohibition and claimed they were expressly directed by the foreman to walk alongside.

The trial court found that the plaintiff did not know the cause of one rail being lower than the other and that he did not know the stringers and rails joined at the same place. The court awarded ₱5,000 in damages, equivalent to $2,500 U.S., based on the defendant's failure to repair the weakened track after notice of its condition.

• Criminal Action as Condition Precedent: The defendant argued that under Articles 1092 and 1093 of the Civil Code and Articles 19 and 20 of the Penal Code, the remedy for injuries through negligence lies only in a criminal action in which the criminally responsible employee must be made primarily liable and the employer held only subsidiarily, so that the plaintiff should have procured the arrest and prosecution of the company representative responsible for failing to repair the track.
• Assumption of Risk: The defendant contended that the injury resulted from a risk incident to the plaintiff's employment and was therefore one assumed by him.
• Fellow-Servant Rule: The defendant argued that the negligence leading to the accident was that of a fellow servant of the injured man, which should relieve the employer from liability.
• Contributory Negligence as Complete Bar: The defendant maintained that the plaintiff's own carelessness — in continuing to work after noticing the depression in the track and in walking on the ends of the ties at the side of the car instead of along the boards — constituted contributory negligence that should bar his recovery entirely under the common-law rule.

• Standard of Employer Liability: What standard of duty does the law impose upon an employer toward an employee for injuries caused by the employer's negligence, and does that liability arise from criminal or civil law?
• Fellow-Servant Rule: Whether the fellow-servant doctrine, which relieves an employer from liability for injuries caused by a fellow employee's negligence, should be adopted in Philippine jurisprudence.
• Effect of Contributory Negligence: Whether the contributory negligence of the injured employee bars recovery entirely under the common-law rule, or merely reduces the damages under the civil-law principle of proportional damages.

• Standard of Employer Liability: The employer's duty arises from the contractual obligation implied in the employment relationship, not from criminal law, and the employer is independently liable in a civil action without need for prior criminal prosecution of any employee.
• Fellow-Servant Rule: No. The fellow-servant rule was rejected and declared inapplicable to Philippine jurisprudence.
• Effect of Contributory Negligence: Contributory negligence does not bar recovery but reduces the damages in proportion to the injured party's fault, following the civil-law principle rather than the common-law complete bar.

• Standard of Employer Liability: The defendant's argument that civil liability for negligence requires prior criminal prosecution misconceived the structure of the Spanish codes. Article 1093 of the Civil Code subjects obligations arising from fault or negligence "not punished by the law" to the provisions of Chapter II, Title XVI, of the Civil Code, specifically Articles 1902 and 1903, which impose liability on any person who by an act or omission causes damage through fault or negligence, and extend that liability to owners and directors of enterprises for damages caused by their employees. The employer's obligation to provide safe appliances for workmen is not penalized by any general statute and thus falls under civil rather than criminal jurisprudence. Moreover, the distinction drawn by Manresa between culpa as an independent source of obligation (culpa aquiliana) and culpa as an incident in the performance of a preexisting obligation (culpa contractual) is controlling. Where a relation already exists between the parties — such as the contract of employment — breaches of duties arising from that relation are governed by Articles 1101, 1103, and 1104, not by Articles 1902 and 1903. The employer's contractual obligation, implied from the employment relationship and perhaps inherent in its nature, binds the employer to provide safe appliances and to maintain the workplace in reasonably sound condition. The defendant failed in this duty by not repairing the track or inspecting it after the typhoon, and its negligence was thereby established.

• Fellow-Servant Rule: The doctrine that an employer is relieved from liability for injuries caused by a fellow employee's negligence was rejected as unsuited to Philippine jurisprudence. The rule, originating in England in Prescott vs. Fowler (1837), had been abrogated in England by Employers' Liability Acts and Compensation Laws, was being progressively eliminated in American jurisdictions, and had never formed part of the civil law of continental Europe. The intervention of a third person cannot relieve the employer from performing its duty nor impose upon the employee the consequences of an act or omission not his own.

• Effect of Contributory Negligence: The Court declined to adopt the common-law rule that any contributory negligence, however slight, bars recovery entirely. That rule was traced to the institution of jury trial, which demanded an inflexible standard. By contrast, the civil-law tradition — as reflected in French jurisprudence (Marquant, Recullet, Laugier), Quebec provincial law (Luttrell vs. Trottier), the Portuguese Civil Code (Article 2398), the Austrian Code (Article 1304), and the Swiss Code (Article 51) — treats contributory negligence as reducing rather than extinguishing the award. The Court found this theory most consistent with the history and principles of Philippine law. A distinction was drawn between the accident — the event without which there could have been no injury, here the displacement of the crosspiece — and the plaintiff's own acts contributing only to his own injury, here his walking alongside the car. The plaintiff's act did not contribute to the principal occurrence but only to the damage he suffered. Accordingly, the plaintiff may recover from the defendant responsible for the event, less a sum deemed a suitable equivalent for his own imprudence. The trial court's award of ₱5,000 was accepted, but ₱2,500 was deducted as fairly attributable to the plaintiff's negligence in disobeying the general order against walking alongside the car, yielding a judgment of ₱2,500.

• Culpa Contractual vs. Culpa Aquiliana — The Court adopted Manresa's distinction between two species of negligence: (1) culpa substantive and independent, which arises as an obligation between persons not formerly bound by any other obligation (culpa aquiliana or extra-contractual negligence, governed by Articles 1902 and 1903 of the Civil Code), and (2) culpa as an incident in the performance of a preexisting obligation (culpa contractual, governed by Articles 1101, 1103, and 1104). Where an employment relationship already exists, the employer's failure to provide safe working conditions constitutes culpa contractual, not culpa aquiliana, because the duty arises from the contract of employment itself.

• Employer's Contractual Duty to Provide Safe Appliances — The contractual obligation implied from the employment relationship, and perhaps so inherent in its nature as to be invariable by the parties, binds the employer to provide safe appliances for the use of the employee and to maintain the workplace in reasonably sound condition so as to protect workmen from unnecessary danger. This obligation closely corresponds to English and American law and is independent of any criminal prosecution.

• Rejection of the Fellow-Servant Rule — The doctrine that an employer is not liable for injuries caused by a fellow employee's negligence was declared inapplicable to Philippine jurisprudence, as it had never formed part of the civil law of continental Europe and was being progressively abolished in common-law jurisdictions.

• Proportional or Comparative Damages for Contributory Negligence — Under the civil-law principle adopted by the Court, the contributory negligence of the injured party does not bar recovery but operates only to reduce the damages in proportion to the injured party's fault. The test distinguishes between the accident (the event giving occasion for damages) and the injury (the damage suffered by the victim). Where the plaintiff's act contributes to the principal occurrence as one of its determining factors, he cannot recover; but where his act contributes only to his own injury in conjunction with the occurrence, he may recover the amount the defendant should pay, less a sum representing his own imprudence.

• "This contractual obligation, implied from the relation and perhaps so inherent in its nature to be invariable by the parties, binds the employer to provide safe appliances for the use of the employee, thus closely corresponding to English and American Law." — This passage articulates the ratio decidendi on the source and nature of employer liability: it arises from the contract of employment itself, not from extra-contractual culpa or criminal law.

• "This doctrine, known as 'the fellow-servant, rule,' we are not disposed to introduce into our jurisprudence." — This sentence marks the express rejection of the fellow-servant doctrine from Philippine law, a position grounded in the civil-law tradition.

• "Where, in conjunction with the occurrence, he contributes only to his own injury, he may recover the amount that the defendant responsible for the event should pay for such injury, less a sum deemed a suitable equivalent for his own imprudence." — This formulation states the Court's adopted rule on contributory negligence: it reduces but does not extinguish recovery, distinguishing between contribution to the accident and contribution to the injury.

• "We should be reluctant, under any conditions, to adopt a forced construction of these scientific codes, such as is proposed by the defendant, that would rob some of these articles of effect, would shut out litigants their will from the civil courts, would make the assertion of their rights dependent upon the selection for prosecution of the proper criminal offender, and render recovery doubtful by reason of the strict rules of proof prevailing in criminal actions." — This passage explains why the Court rejected the defendant's argument that civil liability must be preceded by criminal prosecution, preserving independent access to civil remedies.

• Prescott vs. Fowler, 3 Meeson & Welsby 1 (1837) — The English case in which Lord Abinger first adopted the fellow-servant rule; cited as the origin of a doctrine the Court declined to introduce into Philippine jurisprudence.
• Grand Trunk Railway Company vs. Ives, 144 U.S. 408 (1892) — Cited for the authoritative American statement of the common-law contributory negligence rule, including the qualification (from Davies vs. Mann) that contributory negligence does not bar recovery if the defendant could have avoided the consequences by reasonable care. The Court used this as a point of contrast in adopting the civil-law proportional damages rule.
• De la Rama case, 201 U.S. 303 — Cited for the standard governing appellate review of trial court findings of fact under Section 497, paragraph 3 of the Code of Civil Procedure: findings are binding unless "plainly and manifestly against the weight of evidence."
• Reygasse, French Cour de Cassation, June 28, 1841 — Cited as the French decision that laid down the principle contrary to the fellow-servant rule, which the Cour de Cassation has since adhered to.
• Marquant, French Cour de Cassation, August 20, 1879 — Cited for the principle that the carelessness of the victim does not relieve the person without whose fault the accident could not have happened, but only reduces the damages.
• Luttrell vs. Trottier, La Revue de Jurisprudence, vol. 6, p. 90 — Cited as a Quebec case in which the Court of King's Bench held that contributory negligence does not exonerate the defendant whose fault was the immediate cause of the accident, but entitles him to a reduction of damages.

• Article 1092, Civil Code (Spanish) — Provides that civil obligations arising from crimes or misdemeanors shall be governed by the Penal Code. The Court held this provision inapplicable because the employer's obligation to maintain safe working conditions is not penalized by law and thus falls under civil rather than criminal jurisprudence.
• Article 1093, Civil Code (Spanish) — Provides that obligations arising from fault or negligence "not punished by the law" are subject to the provisions of Chapter II, Title XVI of the Civil Code. The Court interpreted this as referring only to culpa aquiliana — negligence arising independently of any preexisting obligation — and not to culpa contractual, which is governed by Articles 1101, 1103, and 1104.
• Articles 1902 and 1903, Civil Code (Spanish) — Article 1902 imposes liability on any person who by act or omission causes damage through fault or negligence. Article 1903 extends that liability to owners or directors of enterprises for damages caused by their employees, with a defense if they employed all the diligence of a good father of a family. The Court noted these govern extra-contractual negligence but held the employer's liability in this case arose from the contractual relationship.
• Articles 1101, 1103, and 1104, Civil Code (Spanish) — Govern negligence as an incident in the performance of a preexisting obligation (culpa contractual). The Court held that because the employment relationship already existed, the employer's duty to provide safe appliances and maintain the tramway arose from the contract of employment and was governed by these articles.
• Articles 19 and 20, Penal Code (Spanish) — Declare the liability of owners and employers for the faults of their servants and representatives to be civil and subsidiary in character. The Court held this subsidiary liability applies only in the context of criminal actions against employees and does not bar an independent civil action.
• Articles 568 and 590, Penal Code (Spanish) — Define reckless negligence and simple imprudence causing injury. The Court held that the employer's obligation to provide safe appliances is not among the acts penalized by these articles, and thus the employer's liability is civil, not criminal.
• Article 827, Code of Commerce (Spanish) — Provides that in maritime collisions where both vessels are at fault, each bears its own damage. The dissent cited this as an express recognition that contributory negligence is a defense under Spanish law; the majority distinguished it as a narrow provision limited to a single class of maritime accidents.

Arellano, C.J., Torres, J., and Mapa, J. concurred in the majority opinion.

• Willard, J. (joined by Carson, J.) — Justice Willard dissented on the ground that the plaintiff was guilty of contributory negligence that should bar recovery entirely. He argued that the trial court's finding that the plaintiff did not know the exact cause of the track's depression was "plainly and manifestly against the weight of evidence," citing the testimony of Ellis and the plaintiff himself showing that both stood directly over the defective point on the morning of the accident and observed the displaced 8-by-8 timber. Willard maintained that the plaintiff, having full knowledge of the dangerous condition and without any promise of repair by the foreman, was negligent in placing himself alongside the loaded car. He further argued that contributory negligence is a complete defense under Philippine law, citing Roman law maxims, the Partidas, Article 827 of the Code of Commerce, and a decision of the Spanish Supreme Court of March 7, 1902, which held that when the immediate cause of injury is the negligence of the injured party himself, the defendant has no obligation to repair the damage. Willard contended that the majority's adoption of the French rule of proportional damages was unwarranted in light of these authorities and that the judgment should be reversed and the defendant acquitted of the complaint.