G.R. No. 188072 ; October 19, 2011
EMERITA M. DE GUZMAN, Petitioner, vs. ANTONIO M. TUMOLVA, Respondent.

FACTS

On September 6, 2004, petitioner Emerita M. De Guzman, represented by her attorneys-in-fact, and respondent Antonio Tumolva, doing business as A.M. Tumolva Engineering Works, entered into a Construction Agreement for an orphanage in Cavite for a contract price of ₱15,982,150.39. The agreement included the plan and specifications for a perimeter fence. The Contractor made deviations from the agreed plan regarding the perimeter fence. After the project’s completion on September 6, 2005, De Guzman issued a Certificate of Acceptance, and the Contractor issued a quitclaim. In November 2006, during typhoon “Milenyo,” a portion of the perimeter fence collapsed and other portions tilted. De Guzman demanded repair in accordance with the plan. The Contractor claimed the destruction was an act of God. De Guzman filed a Request for Arbitration before the Construction Industry Arbitration Commission (CIAC), alleging the Contractor defrauded her by using undersized materials and omitting necessary features like weepholes. The Contractor denied liability, claiming deviations were made with the consent of De Guzman’s representatives and that the claim was barred by a 12-month period from the Certificate of Acceptance. The CIAC issued an Award in favor of De Guzman, ordering the Contractor to pay actual, moral, and exemplary damages, attorney’s fees, and litigation expenses. The Contractor challenged the award before the Court of Appeals (CA). The CA modified the CIAC Award, deleting the awards for actual, moral, and exemplary damages but awarding temperate damages of ₱100,000.00 for reconstructing the fence. De Guzman’s motion for reconsideration was denied.

ISSUE

1. Whether the Court of Appeals erred in ruling that the evidence failed to sufficiently establish the amount of actual damages recoverable.
2. Whether the Court of Appeals erred in ruling that petitioner is not entitled to awards of moral and exemplary damages.

RULING

The Supreme Court DENIED the petition and AFFIRMED the Decision and Resolution of the Court of Appeals.
1. On Actual Damages: The CA correctly held that the award of actual damages was not proper. De Guzman failed to establish the extent of her pecuniary loss with reasonable certainty. The computation presented was deemed insufficient to constitute substantial evidence. However, the CA appropriately awarded temperate damages in the amount of ₱100,000.00. The Court sustained the CA’s finding that the Contractor was negligent for failing to place sufficient weepholes on the collapsed portion of the fence, which contributed to its failure. This negligence established the Contractor’s liability, justifying an award for the pecuniary loss suffered, but the exact amount could not be determined with certainty.
2. On Moral and Exemplary Damages: The CA correctly deleted these awards. For moral damages, De Guzman’s claim of anxiety over the safety of the children in the orphanage was insufficient to justify the award under the circumstances. For exemplary damages, there was no showing that the Contractor acted in a wanton, reckless, fraudulent, oppressive, or malevolent manner. The Contractor’s deviations from the plan, while negligent, did not rise to the level of conduct required for exemplary damages.