REVIEWER: DAMAGES
TITLE XVIII – DAMAGES
CHAPTER 1: General Provisions Articles 2195 – 2235
Damage – includes any and all damages that a human being may suffer in any and all the manifestations of his life: physical or material, moral or psychological, mental or spiritual, financial, economic, social, political, religious.
WHAT IS THE EFFECT OF NON-PAYMENT OF FILING FEES ON CLAIMS FOR DAMAGES?
GR. The court acquired no jurisdiction over the claims if the plaintiff failed to pay filing fees for the damages claimed.
ETR. In compulsory counterclaims for damages and attorney’s fees are not subject to payment of filing fees.
NOTE: No filing fee is required for actual damages under 2000 Revised Rules on Criminal Procedure.
ARTICLE 2195
WHAT ARE THE SOURCES OF OBLIGATION UNDER ARTILCE 1157?
Article 1157. Obligations arise from:
Law;
Contracts;
Quasi-contracts;
Acts or omissions punished by law; and
Quasi-delicts.
Thus, damages may be imposed on all obligations arising from the 5 sources of civil obligations.
WHAT IS THE EFFECT OF FRAUD, NEGLIGENCE, DELAY OR CONTRAVENTION OF OBLIGATIONS?
Persons who committed FNDC are liable for damages.
Article 1170. Those who in the performance of their obligations are guilty of fraud, negligence, delay, and those who in any manner contravene the tenor thereof are liable for damages.
ARTICLE 2196
WHAT RULE SHALL PREVAIL IN CASE OF CONFLICT?
BETWEEN CIVIL CODE AND SPECIAL LAWS:
GR. Civil Code prevails insofar as issues of damages are concerned.
ETR. Compensation for workmen and other employees in case of death, injury or illness shall be regulated by special laws.
NOTE: The SC held that the employee may either sue under Workmen’s Compensation Act or under the Civil Code.
However, this in alternative and not cumulative. Meaning after having chosen one he cannot choose the other.
CAN LABOR ARBITER OR NLRC ENTERTAIN AND DECIDE CLAIMS FOR DAMAGES?
Yes. The jurisdiction of LA and the NLRC is comprehensive enough to include claims for actions for all forms of damages arising from the “employer-employee” relations under Article 217 of RA 6715.
Article 217 (a) of the Labor Code, as amended, clearly bestows upon the LA original and exclusive jurisdiction over the claims for damages arising from employer-employee relations.
Thus, LA has jurisdiction to award:
the reliefs provided by the laws; and
damages governed by the Civil Code.
RULE ON CONSTRUCTION:
If doubt exist between the evidence presented by the employer and employee the following rules must be followed:
the scale on justice must be tilted in favor of the employee; and
the employer must affirmatively show rationally adequate evidence that the dismissal was for a justifiable cause.
Thus, burden of proof lies on the part of the employer.
Notes:
Moral damages are recoverable where the dismissal of the employee was:
attended by bad faith or fraud or constituted an act oppressive to labor; or
done in a manner contrary to morals, good customs or public policy.
Exemplary damages may be awarded if the dismissal is effected in a wanton, oppressive, or malevolent manner.
WHAT IS THE EFFECT IF EMPLOYEE-EMPLOYER RELATIONSHIP IS MERELY INCIDENTAL?
Regular courts have jurisdiction over actions for damages where the EER is merely incidental and the cause of action proceeds from a different source of obligation.
Any award of moral damages of LA should be grounded on the Civil Code.
ARTICLE 2197. Damages may be:
Actual or compensatory;
Moral;
Nominal;
Temperate or moderate;
Liquidated; or
Exemplary or corrective
WHAT IS THE CONCEPT OF DAMAGES?
Damages refers to the pecuniary consequences imposed by law or by
agreement of the parties for breach of some duty or violation of some right.
➢
It may be defined as a
pecuniary compensation, recompense or satisfaction for an injury sustained.
➢
In legal
contemplation, DAMAGES is the sum of
money which the law awards or imposes as
a pecuniary compensation, a recompense or satisfaction for an injury done or a
wrong sustained as a consequence of either a breach of a contractual obligation
or a tortious act.
|
Damages
versus Damage or Injury |
|
|
Damages |
Damage
or Injury |
|
The
pecuniary compensation or recompense to be paid to the injured party. It is a
measure of recovery. |
The
wrongful act or tortious act or the legal wrong which caused the loss or harm
to the aggrieved party. |
|
DAMAGES |
DAMAGE |
INJURY |
|
The
recompense or compensation awarded for the damage suffered. |
The
loss, hurt, or harm which results from the injury. |
The
illegal invasion of a legal right. |
Notes:
Damages are NOT DEBT. An action to recover damages is not an action to recover costs.
Damages is intended to repair the damages done by putting the plaintiff in the same position had the damage not been inflicted and the wrong not committed as far as pecuniary compensation can do.
CHAPTER 2 ACTUAL COMPENSATORY DAMAGES
ARTICLE 2199
WHAT IS THE CONCEPT OF ACTUAL OR COMPENSATORY DAMAGES?
Actual or compensatory damages are those awarded to the aggrieved party as adequate compensation only for such pecuniary loss suffered by him as he alleged and duly proved.
Pecuniary loss is a measurement in terms of money.
PL may be in business, trade, property, profession, job or occupation.
Indemnity provided in criminal law as civil liability is the equivalent of actual or compensatory damages in civil law.
It is separate and distinct from any award of moral damages.
HOW CAN ACTUAL DAMAGES BE RECEIVED?
The claimant must produce competent proof or the best evidence obtainable such as receipts to justify an award.
Only expenses supported by receipts and which appear to have been actually expended should be allowed.
WHAT IS THE PURPOSE OF ACTUAL DAMAGES?
ACD simply make good or replace the loss caused by the wrong. They are designed to repair that of which one has been deprived by the wrong of another.
Actual damages are synonymous to compensatory damages.
Notes:
ALLEGATION AND PROOF; GENERAL PRAYER.
Claims for ACD must be especially alleged and substantiated by proof. Generally, what is not alleged, may not be proved.
HOW TO PROVE AD?
The best evidence available to the party must be presented and the court cannot rely on uncorroborated testimony whose truth is suspect but must depend upon competent proof that damages have been actually suffered.
WHAT MUST BE PROVED BY THE CLAIMANT?
He must prove the actual amount of loss with a reasonable certainty premised upon competent proof and on the best evidence obtainable.
AD cannot be anchored on mere surmises, speculations or conjectures.
Claimants need not prove damages in any specific or certain amount in order to recover damages.
The ascertainment of the amount of damaged should be the plainest, easiest, and most accurate measure which will do justice in the premises.
Award for AD cannot simply based on the mere allegations of a witness without any tangible claim, such as receipts or other documentary proofs to support such claim.
GR. One is entitled only to such pecuniary loss as he has duly proved.
ETR. As provided by law or by stipulation.
If in the complaint there is no specific mention of ACD, it is deemed included if there is a general prayer for “such further relief” as may be just and equitable under the premises, if and when they are proved.
IS THERE A NEED FOR A FILING FEE FOR AD?
No. There is no filing fee required for filing a claim for actual damages in criminal cases. [Rule 111 Section 1 (4-5) Revised Rules of Criminal procedure]
ARE ACD PRESUMED OR NOT?
GR. ACD must be proved. They are not presumed. But absolute certainty as to the amount is not required. It is enough that the loss is proved and if the amount awarded by the court is fair and reasonable, this will be allowed.
Good faith is presumed and the burden of proving bad faith rests on the one alleging it.
Temperate damages may be awarded where the amount of actual damages cannot be determined because of the absence of documentary evidence to prove the same, but it is shown that the heirs of the victims are entitled thereto.
WHAT IS THE EFFECT OF ABSENCE OF PROOF OR WHEN PROOF IS FLIMSY OR UNSUBSTANTIAL?
The rule is that damages should not be awarded:
If there is no proof of the actual loss; or
When the proof is flimsy and unsubstantial.
NOTES:
ACD cannot be left to the sole discretion of the court.
The court cannot rely on mere assertions, speculations, conjectures, or guesswork in determining the amount of actual damages.
WHAT IS THE LIMITATION ON THE AWARD FOR DAMAGES?
The judge cannot grant damages more than what had been proved in court.
REASON: It is well-settled that ACD must be duly proved and proven with reasonable degree of certainty.
WHAT IS THE EFFECT WHEN PROOF IS NOT CLEAR OR UNSATISFACTORY?
The appellate court may remand the case to the court of the origin for new trial in order to ascertain the amount of damages if the plaintiff adduced proof to establish the sufferance of damage but the same is not clear or satisfactory.
NOTE: Damages may not be awarded on the basis of hearsay evidence.
GR. ACD to be awarded need to be proved.
ETR. Except by law or stipulation.
Damages need not be proved in the following cases:
When a penalty clause is agreed upon in the contract between the parties (Article 1226)
When liquidated damages have been agreed upon (Article 2226)
When loss is presumed as when a child or spouse dies as a result of the act or omission of a person
Forfeiture of bonds in favor of the Government for the purpose of promoting public policy or interest
Death caused within the contemplation of Article 2206 (caused by a crime or quasi-delict)
WHAT IS THE EFFECT OF RESERVATION TO FILE CIVIL ACTION INDEPENDENTLY OF THE CRIMINAL CASE?
The grant of moral damages in the criminal case is improper if the civil action is reserved.
REASON: The claim for civil liability in the criminal case is waived.
MAY AN AWARD FOR ACTUAL DAMAGES BE EXECUTED PENDING APPEAL?
GR. YES. An award for AD may be executed pending appeal.
ETR. HOWEVER, award for moral or exemplary damages cannot be executed pending appeal because the same cannot be regarded as a fixed or definite until there is a final judgment. Since the grant depends upon the result of the main case.
CAN A PERSON INJURED DUE TO BREACH OF CONTRACT RECOVER DAMAGES?
NO. He cannot recover for any loss which he might have avoided with ordinary care at reasonable expense.
ARTICLE 2200
KINDS OF ACTUAL OR COMPENSATORY DAMAGES. (COVERAGE OF ACD)
ACD are classified AS FOLLOWS:
Damnun Emergens (or dano emergente) – this is the value of the actual pecuniary loss for what the claimant already possess before the incident which must be supported by receipts or the best evidence available.
Loss of what a person already possess.
Lucrum cessans (or lucro cessante) – this refers to the expected profits which were not realized by reason of the act of the offender or tortfeasor.
Failure to receive as a benefit that which would have pertained to him.
Damages consisting of unrealized profits are not to be granted on the basis of mere speculation, conjecture, or surmise.
LCs are granted in reference to some reasonably definite standard such as:
Market value;
Established experience; or
Direct interference form known circumstances.
NOTE: ABSOLUTE CERTAINTY is NOT necessary to establish the amount of LC when the existence of loss is established.
GR. Indemnification for loss of earning capacity partakes of the nature of actual damages which must be duly proven by competent proof and the best obtainable evidence thereof.
ETRs.
Self-employed, earning less than the minimum wage under current labor laws, and judicial notice may be taken of that fact that the victim’s line of work, no documentary evidence is available; or
employed on a daily-wage worker earning less than the minimum wage under current labor laws.
JUSTIFICATION OF GRANT OF ACD: Prove the amount of loss with a reasonable degree of certainty, based upon competent proof and the best evidence obtainable by the injured party.
WHAT ARE INCLUDED IN THE INDEMNIFICATION FOR ACTUAL DAMAGES? (COVERAGE OF ACD)
Indemnification comprehends:
the value of the loss suffered; and
the profits which the obligee failed to obtain.
CAN THE INSURER SHOULDER THE LOSS OF PROFIT?
NO. The assured’s loss cannot be shouldered by the insurer whose obligation is limited to the object of insurance.
CAN BOTH ACTUAL (DAMNUM EMERGENS) AND COMPENSATORY DAMAGES (LUCRUM CESSANS) BE GRANTED AT THE SAME TIME TO THE PLAINTIFF?
YES. As provided by Article 2200. Thus there are two components to actual or compensatory damages.
NOTE: Unbiased proof is needed to determined the amount of lost income due to death. self-serving being unreliable statement is not enough.
WHAT IS THE BASIS OF LOSS OF EARNING CAPACITY (NOT LOST EARNINGS OR INCOME)?
The computation must be based on the gross annual income of the deceased minus the necessary and incidental expenses which the victim would have incurred if he were alive, estimated at 50 % of the gross annual income.
THE FOLLOWING MUST BE TAKEN INTO ACCOUNT IN DETERMINING THE ACCOUNT OF LOSS:
The number of years for the victim would have otherwise have lived; and
the rate of loss sustained by the heirs of the deceased.
NOTE: Award for loss of earning capacity partake of damages which must be proven not only by credible and satisfactory evidence, but also by unbiased proof.
GR. Documentary evidence should be presented to substantiate the claim for damages for loss of earning capacity
ETR. Damages for loss of EC may be awarded despite the absence of documentary evidence provided that:
there is testimony either that the victim self-employed earning less than the minimum wage under the current labor laws and judicial notice may be taken of the fact that in the victim’s line of work, no documentary evidence is available; or
that the victim was employed as a daily;
working less than the minimum wage under current labor laws.
CAN DAMAGES BE PAID IN KIND?
NO. It cannot be paid in kind. The payment must be of legal tender currency in the Philippines.
WHAT IS THE BEST EVIDENCE TO PROVE ACTUAL DAMAGES?
RECEIPTS. Credence can be given only to claims which are duly prove by receipts or other credible evidence.
ARTICLE 2201
WHAT ARE THE CONSEQUENCES OF GOOD FAITH AND BAD FAITH OF DEPENDANT?
ARTICLE 2202
WHAT IS THE CIVIL LIABILITY OF DEFENDANT IN CRIMES AND QUASI-DELICTS?
He is liable for ALL damages which are the natural and probable consequences of the act or omission complained of.
Note: it is not necessary that the consequences or damages have been foreseen or could have reasonably been foreseen by the defendant.
ARTICLE 2203
WHAT IS THE DUTY IMPOSED UPON THE VICTIM?
The injured party is obliged to undertake measure that will alleviate his condition after the infliction of the injury or nuisance, and places upon him the burden of explaining why he did not do so.
Such measure as prudent men usually take under such circumstances as would reduce the damage as much as possible.
WHO HAS THE BURDEN OF PROOF?
THE DEFENDANT. He must establish:
that the victim by the exercise of the diligence of a good father of a family could have mitigated the damages; and
prove the amount of damages which could have been avoided.
WHAT IS THE EFFECT OF THE ABSENCE OF PROOF?
The amount of damages cannot be reduced.
WHAT ACTS ARE TO BE EXPECTED TO THE VICTIM IN MINIMIZING HIS DAMAGE?
ONLY REASONABLE MEASURES. He is required only to take such steps as an ordinary prudent man would reasonably adopt for his own interest.
he is not required to execute acts which will imperil his life or health.
ARTICLE 2204
WHAT IS THE EFFECT OF LACK OF AGGRAVATING CIRCUMSTANCES?
EXEMPLARY DAMAGES NOT BE IMPOSED if there is no aggravating circumstance.
Article 2205. Damages may be recovered:
For loss or impairment of earning capacity in cases of temporary or permanent personal injury;
For injury to the plaintiff’s business standing or commercial credit.
WHERE CAN ACD BE RECOVERABLE?
ACD are recoverable in:
crimes;
quasi-delicts;
contracts; and
quasi-contracts
NOTE: It is not enough that the damage be capable of proof but must be actually proved with reasonable degree of certainty, pointing out specific facts that afford a basis for measuring whatever compensatory damages are borne.
WHAT IS THE COVERAGE OF ACTUAL DAMAGES?
Actual pecuniary loss which has to be proved;
Loss or impairment of earning capacity in cases of temporary or permanent personal injury; and
Injury to plaintiff’s business standing or credit.
LOSS OR IMPAIRMENT OF EARNING CAPACITY IN CASES OF TEMPORARY OR PERMANENT PERSONAL INJURY.
FORMULA for the computation of unearned income:
Net income (X) = Life expectancy x Gross annual income - living expenses (50% of gross annual income)
Life expectancy is determined in accordance with the formula - ⅔ x (80 - age of the deceased)
INJURY TO PLAINTIFF’S BUSINESS STANDING OR COMMERCIAL CREDIT.
It consist the loss of goodwill and loss of customer.
Article 2206. The amount of damages for death caused by a crime or quasi-delict shall be at least three thousand pesos, even though there may have been mitigating circumstances. In addition:
The defendant shall be liable for the loss of the earning capacity of the deceased, and the indemnity shall be paid to the heirs of the latter; such indemnity shall in every case be assessed and awarded by the court, unless the deceased on account of permanent physical disability not caused by the defendant, had no earning capacity at the time of his death;
If the deceased was obliged to give support to the provisions of Article 291, the recipient who is not an heir called to the decedent’s inheritance by the law of the testate or intestate succession, may demand support from the person causing the death, for the period not exceeding five years, the exact duration to be fixed by the court.
The spouse, legitimate and illegitimate descendants and ascendants of the deceased may demand moral damages for mental anguish by reason of the death of the deceased.
WHEN ARTICLE 2206 APPLICABLE?
it applies only in case of death of a person by reason of a :
crime; or
quasi delict
HOWEVER, if the victim is merely injured this will not apply. But, he is entitled to moral damages:
if the physical injuries are caused by a crime;
if the injuries are caused by a quasi-delict; or
if caused by breach of contract if the defendant acted fraudulently or in bad faith.
WHAT IS THE MEASUREMENT OF VALUE OF HUMAN LIFE?
There can be no exact uniform rule for measuring the value of human life and the measure of damages cannot be arrived at by precise mathematical calculation but the amount recoverable depends on the particular facts and circumstances of each case.
WHAT IS THE EFFECT OF MITIGATING CIRCUMSTANCES ON THE AMOUNT OF ACTUAL DAMAGES OR INDEMNITY PAYABLE FOR THE DEATH OF A PERSON?
The presence of mitigating circumstance is immaterial. it cannot affect the grant of civil indemnity for the death of the victim.
NOTE: Civil indemnity ex delicto can be awarded without need of further proof other than the commission of the felony itself unlike actual or compensatory damages.
WHAT ARE THE OTHER ITEMS RECOVERABLE IN ADDITION TO COMPENSATORY DAMAGES?
INDEMNITY FOR LOSS OF EARNING CAPACITY
WHAT ARE THE FACTORS CONSIDERED BY THE SC FOR THE AWARD OF INDEMNITY FOR LEC?
the salary which the deceased would have been entitled to had he lived;
his life expectancy;
the state of the health at the time of his death;
expenses of litigation; and
interest in proper cases
NOTE: The court cannot grant damages for loss of income in the absence of unbiased proof of the deceased’s average income and not the gross income.
WHAT ARE THE REQUISITES FOR THE DAMAGES MAY BE AWARDED?
Alleged expenses must be supported by receipts; and
expenses should have been genuinely incurred
WHAT ARE TWO FACTORS TO BE CONSIDERED FOR LOSS OF EARNING CAPACITY?
The number of years on the basis of which the damages shall be computed; and
the rate at which the losses sustained
NOTE: Earning capacity will not be considered if the deceased had no earning capacity at the time of his death. but the reason for the lack of earning capacity must not be due to the defendant’s fault.
WHAT IS THE FORMULA IN COMPUTING THE LOSS OF EARNING CAPACITY?
⅔ X (80 - age of the victim at the time of the death) x (50 % of gross annual income)
NOTES:
Life expectancy remains at 80.
The net income is computed by deducting the living expenses of the victim from the amount of gross income. but if there is no proof of such expenses the net income is estimated to be 50% of the gross annual income.
MORAL DAMAGES
Under Article 2217, MD are recoverable from the offender or tortfeasor.
The determination of MD depends upon the sound discretion of the court after the evidence had been presented establishing the factual basis thereof.
GR. Indemnity for LEC cannot be awarded in the absence of documentary evidence.
ETRs.
If the deceased is self-employed earning less than the minimum wages under current labor laws; or
if the deceased is employed as a daily worker earning less than the minimum wage under the current laws.
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