G.R. No. L-21569 February 28, 1966
ESTATE OF THE DECEASED MR. AND MRS. FLORENCIO P. BUAN, represented by BIENVENIDO P. BUAN and A. NATIVIDAD PARAS, co-administrators, doing business under the name and style of PHILIPPINE RABBIT BUS LINES, petitioners, vs. PRISCILLO CAMAGANACAN, respondent.

FACTS

On the night of December 14, 1954, respondent Priscillo Camaganacan, a paying passenger bound for Grace Park, Caloocan, Rizal, boarded a Philippine Rabbit Bus (No. 79) owned by the Estate of Mr. and Mrs. Florencio P. Buan at San Fernando, Pampanga. In Malolos, Bulacan, the bus attempted to overtake a La Mallorca bus, leading to a race between the two vehicles. While overtaking at a fast speed in Guiguinto, Bulacan, the Philippine Rabbit bus collided with a Delbros trailer traveling in the opposite direction. As a result of the accident, Camaganacan suffered physical injuries including a fractured right wrist, a crushing injury on the second finger of his left hand, and a lacerated wound on his right leg. He was initially treated at the Malolos Provincial Hospital and then transferred to the National Orthopedic Hospital, where he was discharged on January 22, 1955, and received further treatment until April 15, 1955. The bus company paid for his hospital expenses. Camaganacan filed a suit for damages on July 22, 1955. The Court of First Instance of Rizal ordered the defendants (the Estate) to pay P2,680.00 as actual damages and P2,000.00 as attorney’s fees. The Court of Appeals affirmed this decision. The petitioners elevated the case to the Supreme Court, contesting only the award of attorney’s fees.

ISSUE

Whether the Court of Appeals erred in affirming the award of attorney’s fees in the amount of P2,000.00 to the respondent.

RULING

The Supreme Court ruled in favor of the petitioners and deleted the award of attorney’s fees. The Court held that the award of attorney’s fees is exceptional under Article 2208 of the Civil Code and requires an express factual, legal, or equitable justification by the court. In this case, neither the trial court nor the Court of Appeals provided any reasoning in the text of their decisions to justify the award. The trial court’s decision only mentioned the award in its dispositive portion, and the Court of Appeals merely stated that the trial court exercised its discretion under Article 2208(11) without demonstrating why it was just and equitable. The Supreme Court emphasized that what is “just and equitable” must be based on findings of fact and law, not mere feeling, and that the attorney’s fees must be reasonable. The Court found the award of P2,000.00 in attorney’s fees for a recovery of P2,680.00 in actual damages to be hardly reasonable. Consequently, the decision was modified by deleting the award of attorney’s fees.