G.R. No. L-59919 November 26, 1986
MALAYAN INSURANCE CO., INC., petitioner-appellant, vs. THE HONORABLE COURT OF APPEALS and AURELIO LACSON, respondents-appellees.

FACTS

Plaintiff Aurelio Lacson owned a Toyota Land Cruiser insured under a comprehensive policy with Malayan Insurance Co., Inc. from December 3, 1974, to December 3, 1975. On December 1, 1975, Lacson delivered the vehicle to the shop of Carlos Jamelo for repairs. The following day, Jamelo’s employees, including Rogelio Mahinay, took the vehicle without permission, drove it, and met with an accident in Bacolod City, causing extensive damage. Jamelo reported the incident to the police and filed a criminal case for Qualified Theft against his employees.
Lacson filed a claim with Malayan Insurance under the theft coverage of his policy. The insurer refused payment, contending the claim was not covered because the driver at the time of the accident was not duly licensed. This prompted Lacson to file a civil case for damages. The trial court ruled in favor of Lacson, ordering Malayan to pay the maximum coverage of P20,000.00 less deductible, with interest and attorney’s fees. The Court of Appeals affirmed this decision.

ISSUE

The core issues are: (1) whether the loss is compensable under the “theft” coverage of the insurance policy without a final conviction for theft; (2) whether the award of actual damages has sufficient evidentiary basis; (3) whether the suit was prosecuted by the real party in interest; and (4) whether the imposition of interest from the filing of the complaint is correct.

RULING

The Supreme Court denied the petition and affirmed the appellate court’s decision. On the first issue, the Court held that a final conviction for theft is not a prerequisite for indemnity under the insurance policy. The taking of the vehicle by another without the owner’s permission or authority is sufficient to place the loss within the ambit of “theft” as contemplated in the policy. The fact that Rogelio Mahinay pleaded guilty to theft in the criminal case reinforced this conclusion. The damages were sustained in the course of the unlawful taking, making the claim compensable.
Regarding the award of damages, the Court found sufficient evidentiary basis. The damage was estimated at P21,849.62 by Fidelity Motor Company, and the policy’s maximum liability was P20,000.00 less a deductible. Actual repair was not necessary for the claim; the insured could wait for the insurance proceeds. On the third issue, the Court ruled that Lacson was the real party in interest. While the policy contained a loss payable clause in favor of Bacolod Industrial Finance Corporation (BIFC), its interest was only P2,000.00 compared to Lacson’s P26,000.00 interest. BIFC’s inaction showed it was not interested in intervening, and its non-joinder was not fatal. Finally, the award of interest from the date of judicial demand (filing of the complaint) was proper under Articles 1169, 1170, and 2209 of the Civil Code, as the insurer was in delay or default from that point.