Facts: Philippine Rabbit (PRBL) is a public carrier, servicing various routes in Central and Northern Luzon. Pleyto was one of its drivers. Pleyto‘s bus figured in a head on collision with a car, killing Ricardo Lomboy and injuring Carmela Lomboy. It was 11:30 am, and it was drizzling. According to one of the bus passengers, Pleyto tried to overtake a tricycle, but hit it instead. He swerved to the opposite lane, smashing head-on into the Mitsubishi Lancer, resulting in the above hassles. Carmela and Maria, the widow, filed an action for damages against PRBL and Pleyto.
PRBL and Pleyto argue that the bus was running slowly, and was inspected prior to the trip. Pleyto was merely following the trike, when it suddenly stopped in the middle of the road. He stepped on the brakes, but the bus still skidded; he swerved to avoid the trike, only to collide with the Lancer.
The RTC held petitioners solidarily liable. It found Pleyto negligent in its disregard of the other car. It believed the passenger‘s testimony as against petitioners‘ self-serving story. Further, it found that Pleyto clearly violated traffic rules
and regulations, and thus was negligent under Article 2185, having failed to present any proof to the contrary. PRBL was liable under Article 2180. The CA affirmed the decision.
Issue: Whether or not Pleyto was negligent.
Held: YES. The negligence and fault of appellant driver is manifest. He overtook the tricycle despite the oncoming car only fifty (50) meters away from him. Defendant-appellant‘s claim that he was driving at a mere 30 to 35 KPH does not deserve credence as it would have been easy to stop or properly maneuver the bus at this speed. The speed of the bus, the drizzle that made the road slippery, and the proximity of the car coming from the opposite direction were duly established by the evidence. The speed at which the bus traveled, inappropriate in the light of the aforementioned circumstances, is evident from the fact despite the application of the brakes, the bus still bumped the tricycle, and then proceeded to collide with the incoming car with such force that the car was pushed beyond the edge of the road to the ricefield.
Indeed, Pleyto violated traffic rules and regulations when he overtook the tricycle despite the presence of an oncoming car in the other lane. Article 2185 lays down the presumption that a person driving a motor vehicle has been negligent if at the time of the mishap, he was violating any traffic regulation. As found by both the CA and the trial court, petitioners failed to present any convincing proof rebutting such presumption.
A driver abandoning his proper lane for the purpose of overtaking another vehicle in an ordinary situation has the duty to see to it that the road is clear and not to proceed if he cannot do so in safety. When a motor vehicle is approaching or rounding a curve, there is special necessity for keeping to the right side of the road and the driver does not have the right to drive on the left hand side relying upon having time to turn to the right if a car approaching from the opposite direction comes into view.
The CA found PRBL liable for Pleyto‘s negligence pursuant to Article 2180 in relation to Article 2176. Under Article 2180, when an injury is caused by the negligence of a servant or an employee, the master or employer is presumed to be negligent either in the selection or in the supervision of that employee. This presumption may be overcome only by satisfactorily showing that the employer exercised the care and the diligence of a good father of a family in the selection and the supervision of its employee.
In fine, when the employee causes damage due to his own negligence while performing his own duties, there arises the juris tantum presumption that the employer is negligent, rebuttable only by proof of observance of the diligence of a good father of a family. Thus, in the selection of prospective employees, employers are required to examine them as to their qualifications, experience and service records. With respect to the supervision of employees, employers must formulate standard operating procedures, monitor their implementation and impose disciplinary measures for breaches thereof. These facts must be shown by concrete proof, including documentary evidence.
Regarding PRBL‘s negligence, PRBL presented several documents in evidence to show the various tests and pre- qualification requirements imposed upon petitioner Pleyto before his hiring as a driver by PRBL. However, no documentary evidence was presented to prove that PRBL exercised due diligence in the supervision of its employees, including Pleyto. It was held that ―in order that the defense of due diligence in the selection and supervision of employees may be deemed sufficient and plausible, it is not enough for the employer to emptily invoke the existence of company guidelines and policies on hiring and supervision. As the negligence of the employee gives rise to the presumption of negligence on the part of the employer, the latter has the burden of proving that it has been diligent not only in the selection of employees but also in the actual supervision of their work. The mere allegation of the existence of hiring procedures and supervisory policies without anything more is decidedly not sufficient to overcome such presumption.
9. PCI Leasing and Finance, Inc., v. UCPB General Insurance Co., Inc., 557 SCRA 141 (2008)
Facts: A Mitsubishi Lancer car owned by UCPB and insured by UCPB General Insurance Inc. was traversing the Laurel Highway in Lipa City when the car, then driven by Flaviano Isaac with Conrado Geronimo, the Asst. Manager of said bank, was hit and bumped by an 18-wheeler Fuso Tanker Truck owned by PCI Leasing allegedly leased to and operated by Superior Gas & Equitable Co., Inc. (SUGECO), and driven by its employee, defendant appellant Renato Gonzaga. The impact caused heavy damage to the Mitsubishi Lancer car resulting in an explosion of the rear part of the car. The driver and passenger suffered physical injuries as well. Worse, the driver Gonzaga continued on his way to his destination and did not bother to bring his victims to the hospital. Plaintiff-appellee paid the assured UCPB representing the insurance coverage of the damaged car.
As the 18-wheeler truck is registered under the name of PCI Leasing, repeated demands were made by UCPB for payment of the aforesaid amounts. No payment was made so UCPB filed the present case.
PCI Leasing, interposed the defense that it could not be held liable for the collision, since the driver of the truck, Gonzaga, was not its employee, but that of its co-defendant SUGECO since it was SUGECO, and not petitioner, that was the actual
operator of the truck, pursuant to a Contract of Lease signed by PCI and SUGECO. Petitioner, however, admitted that it was the owner of the truck in question.
RTC ruled in favor of UCPB General Insurance. CA affirmed. MR was denied hence this petition.
Issue: Whether PCI Leasing, as registered owner of a motor vehicle that figured in a quasi-delict may be held liable, jointly and severally, with the driver thereof, for the damages caused to third parties.
Held: YES. The registered owner of the vehicle driven by a negligent driver may still be held liable under applicable jurisprudence involving laws on compulsory motor vehicle registration and the liabilities of employers for quasi-delicts under the CC.
The principle of holding the registered owner of a vehicle liable for quasi-delicts resulting from its use is well-established in jurisprudence. Registration is required not to make said registration the operative act by which ownership in vehicles is transferred, as in land registration cases, because the administrative proceeding of registration does not bear any essential relation to the contract of sale between the parties but to permit the use and operation of the vehicle upon any public highway.
The main aim of motor vehicle registration is to identify the owner so that if any accident happens, or that any damage or injury is caused by the vehicle on the public highways, responsibility therefor can be fixed on a definite individual, the registered owner.
PRINCIPAL PURPOSE of motor vehicles regislation: (1) Identification of the vehicle and of the operator, in case of accident; and (2) As a deterrent from lax observance of the law and of the rules of conservative and safe operation.
Should not the registered owner be allowed at the trial to prove who the actual and real owner is, and in accordance with such proof escape or evade responsibility and lay the same on the person actually owning the vehicle? NO. a registered owner allowed to evade responsibility by proving who the supposed transferee or owner is, it would be easy for him, by collusion with others or otherwise, to escape said responsibility and transfer the same to an indefinite person, or to one who possesses no property with which to respond financially for the damage or injury done. A registered owner who has already sold or transferred a vehicle has the recourse to a third-party complaint, in the same action brought against him to recover for the damage or injury done, against the vendee or transferee of the vehicle. The inconvenience of the suit is no justification for relieving him of liability; said inconvenience is the price he pays for failure to comply with the registration that the law demands and requires.
The registered owner, the PCI Leasing, is primarily responsible for the damage caused to the vehicle of UCPB, but he PCI Leasing has a right to be indemnified by the real or actual owner of the amount that he may be required to pay as damage for the injury caused to the UCPB.
For damage or injuries arising out of negligence in the operation of a motor vehicle, the registered owner may be held civilly liable with the negligent driver either 1) subsidiarily, if the aggrieved party seeks relief based on a delict or crime under Articles 100 and 103 of the RPC; or 2) solidarily, if the complainant seeks relief based on a quasi-delict under Articles 2176 and 2180.
In case a separate civil action is filed, the long-standing principle is that the registered owner of a motor vehicle is primarily and directly responsible for the consequences of its operation, including the negligence of the driver, with respect to the public and all third persons. In contemplation of law, the registered owner of a motor vehicle is the employer of its driver, with the actual operator and employer, such as a lessee, being considered as merely the owner‘s agent. This being the case, even if a sale has been executed before a tortious incident, the sale, if unregistered, has no effect as to the right of the public and third persons to recover from the registered owner. The public has the right to conclusively presume that the registered owner is the real owner, and may sue accordingly.
In this case, there is not even a sale of the vehicle involved, but a mere lease, which remained unregistered up to the time of the occurrence of the quasi- delict that gave rise to the case. Since a lease, unlike a sale, does not even involve a transfer of title or ownership, but the mere use or enjoyment of property, there is more reason, therefore, in this instanc e to uphold the policy behind the law, which is to protect the unwitting public and provide it with a definite person to make accountable for losses or injuries suffered in vehicular accidents. It is also important to emphasize that such principles apply to all vehicles in general, not just those offered for public service or utility.
Court recognizes that the business of financing companies has a legitimate and commendable purpose. In earlier cases, it considered a financial lease or financing lease a legal contract though subject to the restrictions of the so-called Recto Law or Articles 1484 and 1485. PCI Leasing presented a lengthy discussion of the purported trend in other jurisdictions, which apparently tends to favor absolving financing companies from liability for the consequences of quasi-delictual acts or omissions involving financially leased property and adds that these developments have been legislated in our jurisdiction
in RA 8556 which provides that ―Financing companies shall not be liable for loss, damage or injury caused by a motor vehicle, aircraft, vessel, equipment, machinery or other property leased to a third person or entity except when the motor vehicle, aircraft, vessel, equipment or other property is operated by the financing company, its employees or agents at the time of the loss, damage or injury.‖
However, the new law, R.A. No. 8556, notwithstanding developments in foreign jurisdictions, do not supersede or repeal the law on compulsory motor vehicle registration. No part of the law expressly repeals Section 5(a) and (e) of R.A. No. 4136, as amended, otherwise known as the Land Transportation and Traffic Code, to wit:
―Sec. 5. Compulsory registration of motor vehicles.—
(a) All motor vehicles and trailer of any type used or operated on or upon any highway of the Philippines must be registered with the Bureau of Land Transportation for the current year in accordance with the provisions of this Act.
(e) Encumbrances of motor vehicles.—Mortgages, attachments, and other encumbrances of motor vehicles, in order to be valid against third parties must be recorded in the Bureau (now the Land Transportation Office).
Neither is there an implied repeal of R.A. No. 4136. Thus, the rule remains the same: a sale, lease, or financial lease, for that matter, that is not registered with the Land Transportation Office, still does not bind third persons who are aggrieved in tortious incidents, for the latter need only to rely on the public registration of a motor vehicle as conclusive evidence of ownership.
A lease such as the one involved in the instant case is an encumbrance in contemplation of law, which needs to be registered in order for it to bind third parties. The non-registration of the lease contract between petitioner and its lessee precludes the former from enjoying the benefits under Section 12 of R.A. No. 8556. However they are not without recourse. They may resort to third-party complaints against their lessees or whoever are the actual operators of their vehicles. In the case at bar, there is, in fact, a provision in the lease contract between petitioner and SUGECO to the effect that the latter shall indemnify and hold the former free and harmless from any ―liabilities, damages, suits, claims or judgments‖ arising from the latter‘s use of the motor vehicle. Whether petitioner would act against SUGECO based on this provision is its own option.
The burden of registration of the lease contract is minuscule compared to the chaos that may result if registered owners or operators of vehicles are freed from such responsibility. PCI Leasing pays the price for its failure to obey the law on compulsory registration of motor vehicles for registration is a pre-requisite for any person to even enjoy the privilege of putting a vehicle on public roads.