G.R. No. 71137 , October 5, 1989
SPOUSES FEDERICO FRANCO and FELICISIMA R. FRANCO, petitioners, vs. INTERMEDIATE APPELLATE COURT, ANTONIO REYES, MRS. SUSAN CHUAY and LOLITA LUGUE, respondents.

FACTS

On October 18, 1974, a Franco Bus, driven by Macario Yuro, swerved into the opposite lane on MacArthur Highway to avoid a parked truck, colliding head-on with an oncoming Isuzu Mini Bus. The collision resulted in the deaths of both drivers, Yuro and Magdaleno Lugue, and two passengers of the mini bus. The mini bus was totaled. The owners and operators of the Franco Bus, spouses Federico and Felicisima Franco, were sued for damages by the mini bus owner and the heirs of the deceased passengers. The complaint alleged the recklessness of the Franco Bus driver as the cause.
In their defense, the Franco spouses asserted they exercised due diligence in the selection and supervision of their driver, a defense applicable to quasi-delicts under the Civil Code. The trial court, however, ruled the case involved criminal negligence under the Revised Penal Code, making the defense of due diligence irrelevant, and held them subsidiarily liable. It awarded damages to the plaintiffs. The Intermediate Appellate Court affirmed the liability but increased the damages awarded for loss of earning capacity and death indemnity.

ISSUE

The core issues were: (1) whether the action for damages was based on crime (under the Revised Penal Code) or quasi-delict (under the Civil Code), which determines the availability of the due diligence defense; and (2) whether the appellate court could increase the damage awards for parties who did not appeal the trial court’s decision.

RULING

The Supreme Court ruled that the action was based on quasi-delict under Article 2176 of the Civil Code, not on crime. The Court emphasized that the complaint’s allegations, particularly the claim that the employer-employer relationship made the Franco spouses jointly and severally liable, characterized the action as one for quasi-delict. In quasi-delict, the employer’s primary liability is direct and solidary, subject to the defense of having exercised the diligence of a good father of a family in the selection and supervision of employees. The Franco spouses failed to prove this defense during trial. The Court upheld the factual findings of the lower courts on the driver’s negligence, which established the petitioners’ primary civil liability under the Civil Code.
On the second issue, the Court ruled that the appellate court erred in increasing the compensatory damages for loss of earning capacity awarded to the respondents Chuay and Lugue, as they did not appeal the trial court’s judgment. An appellee who does not appeal cannot be granted affirmative relief greater than what the trial court awarded. Therefore, the increased awards for loss of earning capacity were reduced to the amounts originally claimed and awarded by the trial court (P6,000.00 for Lugue and P12,000.00 for Chuay). However, the increase in death indemnity to P30,000.00 each was sustained, as this was a corrective measure based on prevailing jurisprudence due to currency depreciation, not a grant of additional affirmative relief. The decision of the appellate court was modified accordingly.