G.R. No. L-25142. March 25, 1975.
PHILIPPINE RABBIT BUS LINES, INC. and FELIX PANGALANGAN, plaintiffs-appellants, vs. PHIL-AMERICAN FORWARDERS, INC., ARCHIMEDES J. BALINGIT and FERNANDO PINEDA, defendants-appellees.

FACTS

Plaintiffs-appellants Philippine Rabbit Bus Lines, Inc. and its driver, Felix Pangalangan, filed a complaint for damages based on quasi-delict against Phil-American Forwarders, Inc., its manager Archimedes J. Balingit, and its employee-driver Fernando Pineda. The complaint alleged that on November 24, 1962, Pineda recklessly drove a freight truck owned by Phil-American Forwarders, Inc., causing a collision with the plaintiffs’ bus. This resulted in injuries to Pangalangan, damage to the bus, and loss of income for the bus company.
Defendant Balingit, as manager of the corporate defendant, moved to dismiss the complaint against him personally. The Court of First Instance of Tarlac granted the motion and dismissed the action as to Balingit. The court held that Balingit, as a corporate manager, was not the “manager of an establishment” contemplated under Article 2180 of the Civil Code for purposes of direct liability in a quasi-delict. The plaintiffs appealed this order of dismissal.

ISSUE

Whether a corporate manager, as an officer of a corporation, falls within the term “owners and managers of an establishment or enterprise” under Article 2180 of the Civil Code, thereby making him personally and directly liable for damages arising from a quasi-delict committed by a corporate employee.

RULING

No. The Supreme Court affirmed the dismissal, holding that the terms “employers” and “owners and managers of an establishment or enterprise” in Article 2180 do not include a corporate manager for the purpose of imposing direct tort liability. The legal logic is that the term “manager” (director) in the context of Article 2180 is used synonymously with “employer.” A corporate manager, regardless of rank, is considered an employee or dependiente of the corporation itself. The corporation, as a juridical entity, is the employer and the one vicariously liable under the law for the torts of its employees, provided the act was done within the scope of their assigned tasks. The manager is not the employer and thus not personally liable under this article based solely on his managerial position.
The Court also refused to consider a new argument raised by appellants on appeal—that the corporate veil should be pierced because Balingit and his wife owned most of the corporate stock. This theory was not alleged in the complaint nor raised in the trial court. A party cannot change its theory on appeal, as it would be unfair to the adverse party and contrary to procedural rules. The case was correctly decided on the pleadings, which treated the corporation as having a separate personality from Balingit. Therefore, no cause of action for quasi-delict was stated against Balingit personally.