G.R. No. 194320 ; February 1, 2012
MALAYAN INSURANCE CO., INC., Petitioner, vs. RODELIO ALBERTO and ENRICO ALBERTO REYES, Respondents.

FACTS

On December 17, 1995, a vehicular accident occurred at the corner of EDSA and Ayala Avenue, Makati City, involving a Nissan Bus, an Isuzu Tanker, a Fuzo Cargo Truck (owned by respondent Rodelio Alberto and driven by respondent Enrico Alberto Reyes), and a Mitsubishi Galant. A Police Report issued by SPO1 Alfredo M. Dungga stated that the Fuzo Cargo Truck simultaneously bumped the rear of the Mitsubishi Galant and the rear left portion of the Nissan Bus, causing the Galant to ram into the Isuzu Tanker. The Mitsubishi Galant was insured against third-party liability and own damage by petitioner Malayan Insurance Co., Inc. under a policy issued to First Malayan Leasing and Finance Corporation. Malayan Insurance paid the assured PhP 700,000 for the damages and, claiming subrogation rights, demanded payment from respondents. Upon refusal, it filed a complaint for damages based on gross negligence.
Respondents denied liability, asserting that the proximate cause was the reckless driving of the Nissan Bus driver, who allegedly cut into their lane and abruptly stopped. They contested the Police Report as biased. During trial, Malayan Insurance presented a motor car claim adjuster as its lone witness. Respondents presented no evidence. The Regional Trial Court ruled in favor of Malayan Insurance, holding respondents jointly and severally liable. The Court of Appeals reversed, dismissing the complaint for lack of merit, holding that the Police Report was inadmissible hearsay as the investigating officer was not presented to identify it, and that Malayan Insurance failed to establish negligence and its right to subrogation.

ISSUE

1. Whether the Police Report is admissible in evidence despite the non-presentation of the investigating police officer.
2. Whether the evidence is sufficient to establish respondents’ negligence.
3. Whether Malayan Insurance validly acquired subrogation rights.

RULING

The Supreme Court granted the petition, reversing the Court of Appeals and reinstating the trial court’s decision.
1. On the admissibility of the Police Report: The Police Report is admissible as an exception to the hearsay rule under Section 44, Rule 130 of the Rules of Court, as an entry in an official record. The requisites for admissibility are: (a) the entry was made by a public officer in the performance of his duties; (b) it was made pursuant to a duty imposed by law; and (c) the public officer had sufficient knowledge of the facts stated, acquired personally or through official information. Here, SPO1 Dungga prepared the report in the performance of his duty as an on-the-spot investigator. While the officer was not presented, the report itself was formally offered in evidence without objection from respondents during trial. Under the rules, evidence not objected to is deemed admitted. Furthermore, the report is prima facie evidence of the facts stated therein. The Court of Appeals erred in disregarding it solely because the investigator did not testify.
2. On the sufficiency of evidence to establish negligence: The Police Report, being admissible, established the facts of the accident, indicating that the Fuzo Cargo Truck bumped the stationary vehicles from behind. This gives rise to the presumption of negligence on the part of the driver of the rear vehicle under the doctrine of res ipsa loquitur. Respondents, having presented no evidence to rebut this presumption, failed to discharge their burden. Their unsubstantiated allegations of the bus driver’s negligence were insufficient.
3. On the validity of subrogation: Subrogation is a normal incident of indemnity insurance. Upon payment of the loss, the insurer is subrogated to the rights of the assured against the wrongdoer. Malayan Insurance presented sufficient evidence, including the insurance policy and proof of payment (official receipt and check), to establish that it paid the assured PhP 700,000 for the damages, thereby acquiring by operation of law the right to recover from the negligent party. The Court of Appeals erred in requiring further proof beyond these documents.
Thus, respondents are jointly and severally liable to Malayan Insurance for the amount paid, with legal interest from the filing of the complaint, attorney’s fees, and costs.