G.R. No. L-28256 March 17, 1982
SEVERO DEL CASTILLO, plaintiff-appellant, vs. LORENZO JAYMALIN, MANUEL SABIT, BITRANCO and A. L. AMMEN TRANS. CO., INC., defendants-appellees.

FACTS

On June 29, 1960, Mario del Castillo, a deaf-mute passenger, died after falling while alighting from a bus owned by defendant transportation companies. His father, Severo del Castillo, a widower and sole heir, filed a damages suit on September 5, 1962. The defendants claimed the bus was solely owned by Bicol Transportation Co. and asserted they exercised due diligence, contending the proximate cause was Mario’s own negligence in jumping from the moving vehicle. During trial, after plaintiff had rested his case, defendants discovered Severo had actually died on February 1, 1965.
Plaintiff’s counsel subsequently filed a Motion to Admit Amended Complaint to substitute Wenceslao Haloc, Severo’s son-in-law, as party plaintiff. This was based on a “Deed of Assignment” dated August 13, 1960, wherein Severo, citing health and age, transferred all his rights and privileges regarding the case to Haloc. The trial court admitted the amended complaint. However, after defendants closed their evidence, the court dismissed the case, ruling that the action died with Severo and that Haloc lacked personality to continue as he was not an heir.

ISSUE

Whether the trial court erred in dismissing the case upon the death of the original plaintiff, Severo del Castillo, despite the prior execution of a Deed of Assignment transferring his rights to Wenceslao Haloc.

RULING

Yes, the trial court committed reversible error. The Supreme Court reversed the dismissal. This is not governed by the rules on death of a party, which would require substitution by a legal heir. Instead, it is a situation governed by assignment of rights. The Deed of Assignment executed by Severo in 1960, while he was alive, validly transferred his cause of action to Haloc. An assignable right, such as a claim for damages, is transferable.
The legal logic is that upon assignment, the transferee becomes the real party in interest. The failure to effect a formal substitution of party plaintiff immediately after the assignment was a mere procedural formality. Substantively, after the assignment, Severo was litigating as a sort of trustee for Haloc’s benefit. Consequently, Severo’s subsequent death did not extinguish the action, as the right had already vested in Haloc. The Court cited precedent establishing that where an assignment is made pendente lite, substitution is proper, and the original plaintiff holds any recovery in trust for the assignee.
On the merits, the Court affirmed the trial court’s finding of carrier liability, noting the conductor, aware of the passenger’s disability, failed to exercise extraordinary care. To end the 13-year litigation, the Supreme Court itself quantified damages, awarding P12,000.00 for death and P2,000.00 as attorney’s fees, but disallowing the claim for loss of earning capacity for lack of proof. Defendants were ordered to pay Haloc jointly and severally.