G.R. No. 183198 ; November 25, 2009
LUZ PALANCA TAN, Petitioner, vs. JAM TRANSIT, INC., Respondent.

FACTS

Petitioner Luz Palanca Tan owned a jitney loaded with eggs, driven by Alexander Ramirez. On March 14, 1997, at around 5:00 a.m., the jitney collided with a passenger bus owned by respondent JAM Transit, Inc. and driven by its employee, Eddie Dimayuga, along Maharlika Highway in Calauan, Laguna. Tan alleged the bus driver was negligent in overtaking the jitney at an intersection within a “no overtaking” zone marked by double yellow lines, causing the jitney to turn turtle, destroying its cargo, and injuring its occupants. JAM Transit countered that the accident was due to the gross negligence of Ramirez, the jitney driver.
The Regional Trial Court (RTC) ruled in favor of Tan, finding the bus driver negligent. The Court of Appeals (CA) reversed the RTC decision, holding that Tan failed to prove the bus driver’s negligence by preponderance of evidence. The CA gave more weight to the police report, which indicated the jitney attempted a sudden left turn without proper signal, and found that Tan failed to prove the existence of a “no overtaking” zone at the accident site.

ISSUE

Whether the Court of Appeals erred in reversing the RTC’s finding that respondent JAM Transit, through its driver, was negligent and thus liable for damages.

RULING

The Supreme Court granted the petition, reversed the CA decision, and reinstated the RTC judgment with modification on damages. The Court held that the CA erred in disregarding the RTC’s factual findings, which are generally binding, especially on the credibility of witnesses. The RTC correctly found the bus driver negligent. The testimony of PO3 Escares established that the accident occurred in a “no overtaking” zone, a factual finding the CA improperly contradicted. The police report, while admissible, constituted hearsay as to the narration of events since the investigating officer did not witness the accident. The positive testimony of the police officer on the physical evidence (the double yellow lines) carries more weight.
Furthermore, the bus driver violated traffic rules by overtaking in a prohibited zone and at an intersection. This violation gives rise to a presumption of negligence under the doctrine of res ipsa loquitur. JAM Transit failed to rebut this presumption. As the employer, it is solidarily liable for the damages caused by its employee acting within the scope of his assigned task. The Court awarded actual damages for the jeepney and cargo as substantiated by evidence, but deleted the awards for moral damages and attorney’s fees due to lack of factual and legal basis for bad faith.