GR 83491; (August, 1990) (Digest)
G.R. No. 83491 , August 27, 1990
MA-AO SUGAR CENTRAL CO., INC. and GUILLERMO ARANETA, petitioners, vs. HON. COURT OF APPEALS and HERMINIA FAMOSO, respondents.
FACTS
On March 22, 1980, Julio Famoso, an employee of Ma-ao Sugar Central, was riding in the caboose of a company cargo train when the locomotive derailed. He jumped off but was pinned and killed by the overturned train. His widow, Herminia Famoso, filed a damages suit after the company denied her claims. The Regional Trial Court ruled in her favor, awarding P76,000.00 in total damages but deducted 25% for the deceased’s alleged contributory negligence and the total value of Social Security System (SSS) death benefits payable to the family over five years, leaving a net award of P16,382.40.
Both parties appealed. The Court of Appeals sustained the trial court’s findings on liability and the award amounts but modified the decision by disallowing the two deductions made by the trial court. The appellate court held the employer solely negligent and ruled that SSS benefits could not be deducted from the damages awarded. The petitioners then elevated the case to the Supreme Court.
ISSUE
The core issues were: (1) whether Ma-ao Sugar Central was negligent and liable for damages arising from the death of Julio Famoso; and (2) whether the deductions for contributory negligence and SSS benefits from the damage award were legally permissible.
RULING
The Supreme Court denied the petition and affirmed the Court of Appeals decision. On the first issue, the Court found the petitioner employer negligent. Investigation revealed the derailment was caused by loose, protruding rails missing their connecting fish plates, which were the company’s responsibility to maintain. Testimony indicated frequent prior derailments in the milling district. The Court applied the doctrine of res ipsa loquitur, as the accident, under the employer’s management, would not ordinarily occur without negligence. The employer’s defense of due diligence, citing required employee reports on track defects, was rejected because the duty to act on such reports was paramount. No contributory negligence was attributable to the deceased.
On the second issue, the Court upheld the disallowance of both deductions. The deduction for SSS benefits was erroneous. The Court distinguished social security benefits, which arise from membership and contributions to a common fund, from damages awarded under the Civil Code, which are indemnity for loss caused by a wrongful act. Citing precedent, the Court ruled these benefits are separate, accrued rights of the member and cannot be applied to reduce an employer’s civil liability for negligence. The award of P76,000.00 for death indemnity, actual, moral, and exemplary damages, loss of earnings, funeral expenses, and attorney’s fees was thus reinstated in full.