G.R. No. L-49699 August 8, 1988
PERLA COMPANIA DE SEGUROS, INC., petitioner, vs. HON. CONSTANTE A. ANCHETA, Presiding Judge of the Court of First Instance of Camarines Norte, Branch III, ERNESTO A. RAMOS and GOYENA ZENAROSA-RAMOS, for themselves and as Guardian Ad Litem for Minors JOBET, BANJO, DAVID and GRACE all surnamed RAMOS, FERNANDO M. ABCEDE, SR., for himself and Guardian Ad Litem for minor FERNANDO G. ABCEDE, JR., MIGUEL JEREZ MAGO as Guardian Ad Litem for minors ARLEEN R. MAGO, and ANACLETA J. ZENAROSA., respondents.

FACTS

On December 27, 1977, a collision occurred between an IH Scout and a Superlines bus in Camarines Norte. The private respondents, who sustained physical injuries, were occupants of the IH Scout. The Superlines bus was insured by petitioner Perla Compania de Seguros, Inc., while the IH Scout was insured by Malayan Insurance Co. The private respondents filed a complaint for damages against Superlines, its driver, and the petitioner insurer.
Even before summons were served, the respondent judge issued an order on March 1, 1978, directing petitioner Perla Compania de Seguros to pay the private respondents the amount of P5,000.00 under the “no fault indemnity” clause of Section 378 of the Insurance Code within five days. Petitioner moved for reconsideration, arguing that under the clear language of Section 378, the claim for no-fault indemnity by an occupant of a vehicle must lie against the insurer of the vehicle in which the occupant was riding—in this case, Malayan Insurance Co., not the insurer of the other vehicle involved in the accident.

ISSUE

Whether the petitioner, as the insurer of the Superlines bus, is the liable insurer to indemnify the private respondents under the “no fault indemnity” provision of Section 378 of the Insurance Code.

RULING

No. The Supreme Court granted the petition, annulling the orders of the respondent judge. The legal logic is anchored on the plain, mandatory language of Section 378 of the Insurance Code. The provision establishes a clear rule: where the victim is an occupant of a vehicle, the claim for no-fault indemnity “shall lie against the insurer of the vehicle in which the occupant is riding, mounting or dismounting from.” The use of the word “shall” makes this directive compulsory. The law allows a claim against only one motor vehicle under this provision.
The Court emphasized that the identity of the vehicle at fault is irrelevant for the purpose of the immediate no-fault indemnity. The provision is designed to provide victims with prompt, albeit limited, compensation without proof of negligence, pending the final determination of liability. The mechanism to allocate ultimate financial responsibility is preserved by the law itself, which maintains the right of the insurer who pays the no-fault claim to recover from the owner of the vehicle ultimately responsible for the accident.
Since the private respondents were undisputedly occupants of the IH Scout, the mandatory statutory rule dictates that their claim must be made against Malayan Insurance Co., the insurer of that vehicle. The respondent judge’s order compelling payment from the insurer of the other vehicle (petitioner) constituted a grave abuse of discretion amounting to lack of jurisdiction, as it contravened the explicit terms of the law. The writs of certiorari and prohibition were therefore warranted.