G.R. No. 182705 July 18, 2014
VICENTE JOSEFA, Petitioner, vs. MANILA ELECTRIC COMPANY, Respondent.

FACTS

On April 21, 1991, a dump truck, a jeepney, and a car figured in an accident along Ortigas Avenue, Pasig City, damaging a Meralco wooden electricity post and transformers. Meralco’s investigation revealed the truck, registered in the name of Vicente Josefa, was involved. After Josefa refused a demand for reimbursement, Meralco filed a complaint for damages against Josefa and the driver, Pablo Manojo Bautista, alleging reckless driving and Josefa’s negligence in selection and supervision. Bautista was later dropped as a defendant for failure to serve summons. At trial, Meralco presented witnesses, including the jeepney driver who testified the truck hit his jeepney and then the post, and a Meralco accountant who testified on the cost of damages. Josefa denied Bautista was his employee and claimed he exercised due diligence. After the RTC denied his demurrer to evidence, Josefa failed to present his evidence-in-chief due to numerous delays, leading the RTC to submit the case for decision without his evidence. The RTC dismissed the complaint, finding Meralco failed to prove the truck hit the post and failed to substantiate the claim for actual damages. The CA reversed, holding Josefa vicariously liable, finding the truck hit the post based on testimonial evidence and a stipulation at pre-trial, and that Josefa failed to rebut the presumption of negligence in selection and supervision by not presenting evidence. The CA awarded actual damages, attorney’s fees, and litigation expenses.

ISSUE

1. Whether the truck hit the electricity post.
2. Whether Bautista exercised due diligence in driving when the truck hit the electricity post.
3. Whether Josefa is vicariously liable for Bautista’s negligence under Article 2180 of the Civil Code.
a. Whether there is an employer-employee relationship between Bautista and Josefa.
b. Whether Josefa exercised the diligence of a good father of a family in the selection and supervision of Bautista.
4. Whether Meralco is entitled to actual damages, attorney’s fees, and expenses of litigation.

RULING

1. Yes, the truck hit the electricity post. The Supreme Court found the CA erred in stating the parties stipulated to this fact at pre-trial, as the pre-trial order only stated the truck was “involved in an accident.” However, based on the evidence, particularly the testimony of the jeepney driver, Elmer Albio, who witnessed the truck hit his jeepney, lose control, and then hit the electricity post, the Court concluded the truck was the proximate cause of the damage to the post. The RTC’s disregard of this testimony was erroneous.
2. No, Bautista did not exercise due diligence. The fact that the truck hit the jeepney and then the post established Bautista’s negligence. No evidence was presented to show he exercised due care.
3. Yes, Josefa is vicariously liable.
a. An employer-employee relationship existed. Josefa did not specifically deny this material allegation in the amended complaint, and the sheriff’s return indicated Bautista was under Josefa’s employ until 1993. Josefa’s general denial was insufficient.
b. Josefa failed to prove he exercised the diligence of a good father of a family in the selection and supervision of Bautista. As the employer, Josefa was presumed negligent under Article 2180 of the Civil Code. This presumption was not rebutted because Josefa failed to present any evidence-in-chief during trial.
Furthermore, even if no employer-employee relationship was proven, Josefa, as the registered owner of the truck, would still be primarily and directly liable under the principle of respondent superior for the damage caused by the operation of the vehicle.
4. Regarding damages:
* Actual Damages: The award of ₱384,846.00 was deleted. Meralco failed to substantiate this claim with competent evidence. The testimony of the accountant was based on documents not presented in court, making the computation hearsay. Actual damages require proof of actual loss with a reasonable degree of certainty, supported by evidence such as receipts.
* Temperate Damages: In lieu of actual damages, the Court awarded ₱100,000.00 as temperate damages. While the exact amount of loss could not be proven, it was undisputed that Meralco suffered some damage due to the destroyed post and transformers. Temperate damages are justified when some pecuniary loss has been proven but its exact amount cannot be ascertained.
* Attorney’s Fees and Litigation Expenses: The awards of ₱50,000.00 as attorney’s fees and ₱10,000.00 as litigation expenses were deleted. The Court found no sufficient basis for these awards under Article 2208 of the Civil Code, as Meralco also contributed to delays in the proceedings.
* Costs of Suit: Josefa was ordered to pay the costs of suit.
The CA decision was AFFIRMED with MODIFICATION. Josefa was held liable to pay Meralco ₱100,000.00 as temperate damages and the costs of suit. All other awards were deleted.