Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 148737

June 16, 2004

ERNESTO PLEYTO and PHILIPPINE RABBIT BUS LINES, INC., petitioners,

vs.
MARIA D. LOMBOY and CARMELA LOMBOY, respondents.
DECISION
QUISUMBING, J.:
For review on certiorari is the Decision 1 dated October 31, 2000 of the Court of Appeals in CA-G.R. CV No.
61300, which affirmed with modification the Decision 2 dated June 26, 1998 of the Regional Trial Court
(RTC) of Dagupan City, Branch 42, in Civil Case No. 95-00724-D. The RTC ordered herein petitioners to
solidarily pay damages to respondents. Petitioners likewise assail the Resolution 3 dated June 21, 2001 of
the appellate court, which denied their Motion for Reconsideration.
Petitioner Philippine Rabbit Bus Lines, Inc. (PRBL), with principal office at Tarlac City, Tarlac, is a public
carrier, engaged in carrying passengers and goods for a fare. It serviced various routes in Central and
Northern Luzon. Petitioner Ernesto Pleyto was a bus driver employed by PRBL at the time of the incident in
question.
Respondent Maria D. Lomboy of Calasiao, Pangasinan, is the surviving spouse of the late Ricardo
Lomboy, who died in Pasolingan, Gerona, Tarlac, in a vehicular accident at around 11:30 a.m. of May 16,
1995. The accident was a head-on collision between the PRBL bus driven by petitioner Pleyto and the car
where Ricardo was a passenger. Respondent Carmela Lomboy is the eldest daughter of Ricardo and Maria
Lomboy. Carmela suffered injuries requiring hospitalization in the same accident which resulted in her
fathers death.
On November 29, 1995, herein respondents, as pauper-litigants, filed an action for damages against PRBL
and its driver, Pleyto, with the RTC of Dagupan City. In their complaint, which was docketed as Civil Case
No. 95-00724-D, the Lomboys prayed that they be indemnified for the untimely death of Ricardo Lomboy,
his lost earnings, the medical and hospitalization expenses of Carmela, and moral damages.
The facts, established during trial and affirmed by the appellate court, are as follows:
At approximately 11:30 a.m. of May 16, 1995, PRBL Bus No. 1539, with Plate No. CVD 556, driven
by petitioner Pleyto, was traveling along MacArthur Highway in Gerona, Tarlac bound for Vigan,
Ilocos Sur. It was drizzling that morning and the macadam road was wet. Right in front of the bus,
headed north, was the tricycle with Plate No. CX 7844, owned and driven by one Rodolfo Esguerra.
According to Rolly Orpilla, a witness and one of the bus passengers, Pleyto tried to overtake Esguerras
tricycle but hit it instead. Pleyto then swerved into the left opposite lane. Coming down the lane, some fifty
meters away, was a southbound Mitsubishi Lancer car, with Plate No. PRS 941, driven by Arnulfo
Asuncion. The car was headed for Manila with some passengers. Seated beside Arnulfo was his brother-inlaw, Ricardo Lomboy, while in the back seat were Ricardos 18-year old daughter Carmela and her friend,
one Rhino Daba. PRBL Bus No. 1539 smashed head-on the car, killing Arnulfo and Ricardo instantly.
Carmela and Rhino suffered injuries, but only Carmela required hospitalization.
In their Answer, petitioners PRBL and Ernesto Pleyto both claimed that the bus was running slowly at the
time of the accident. They pointed out that Bus No. 1539 had been inspected by driver Pleyto and
examined by a mechanic prior to the trip, in accordance with the companys standard operating procedure.
It was found in good working condition. Pleyto claimed that while cruising along the highway at Gerona,
Tarlac, he noticed Esguerras tricycle and followed it at a safe distance after he was unable to overtake it.
Suddenly and without warning, the tricycle stopped in the middle of the road. Pleyto stepped on the brakes
and the bus lost speed. But, since it skidded towards the direction of the tricycle, he swerved the bus to the
other lane to avoid hitting it, only to collide with the Manila-bound Mitsubishi car.

On June 26, 1998, the trial court decided Civil Case No. 95-00724-D as follows:
WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiffs and
against the defendants ordering the defendants to pay solidarily the plaintiffs the following amounts:
1) P50,000.00 as indemnification for the death of Ricardo Lomboy;
2) P1,642,521.00 for lost earnings of Ricardo Lomboy;
3) P59,550.00 as actual damages for the funeral, wake, religious services and prayer for the
soul of the departed;
4) P52,000.00 for the medical treatment and medicine of Carmela Lomboy;
5) P500,000.00 as moral damages for the wife and children excluding Carmela Lomboy;
6) P50,000.00 as moral damages for Carmela Lomboy; and
7) To pay costs.
The filing fee the plaintiffs should have paid is hereby ordered to be paid by the plaintiffs to the
Clerk of Court of this Court upon satisfaction of the foregoing amounts to the plaintiffs by the
defendants.
SO ORDERED.4
In ruling for respondents, the RTC found Pleyto negligent and lacking in precaution when he overtook the
tricycle with complete disregard of the approaching car in the other lane. It found the testimony of Rolly
Orpilla credible and persuasive as against Pleytos self-serving and unbelievable testimony. The court
found that Pleyto should have been more prudent in overtaking a tricycle, considering that it was drizzling,
the road was slippery, and another vehicle was approaching from the opposite direction. The RTC found
that Pleyto had clearly violated traffic rules and regulations, and thus was negligent under Article 2185 5 of
the Civil Code of the Philippines because petitioner Pleyto failed to present any proof to rebut the
presumption. The lower court likewise held co-petitioner PRBL equally liable under Article 2180 6 of the Civil
Code for its failure to show that it had maintained proper supervision of its employees notwithstanding strict
standards in employee selection.
Petitioners appealed the judgment of the trial court to the Court of Appeals in CA-G.R. CV No. 61300. The
appellate court, however, affirmed the decision of the trial court, with modification in the award of damages,
thus:
Wherefore, with the MODIFICATION that the award for actual damages is reduced to P39,550.00
for funeral and religious services and P27,000.00 for medical expenses of Carmela Lomboy; and
the award for loss of earning capacity is accordingly corrected to P1,152,000.00, the appealed
decision is AFFIRMED.
SO ORDERED.7
The Court of Appeals affirmed the findings of the RTC with respect to Pleytos fault and negligence. The
appellate court noted that this was evident in his overtaking Esguerras tricycle despite the drizzle, the
slippery road, and an oncoming car a mere fifty meters away. The court reasoned that the bus must have
been speeding since despite braking, the bus still hit the tricycle, and then rammed the car in the opposite
lane with such force as to throw the car off the road. The appellate court also found petitioner PRBL liable
as owner of the bus and as employer of Pleyto pursuant to Article 2180 of the Civil Code, for its failure to
observe the required diligence in its supervision of its employees and the safe maintenance of its buses. In
modifying the award of damages, the appellate court took note of the amounts that were duly supported by
receipts only.
Petitioners then moved for reconsideration, but the appellate court denied it.
Hence, the instant petition, premised on the following grounds:
A. THE SUPREME COURT MAY REVIEW THE CONCLUSION DRAWN BY THE COURT OF
APPEALS, NAMELY, THAT THE PRBL BUS OVERTOOK A TRICYCLE THUS CAUSING THE
ACCIDENT, SINCE IT WAS MADE IN DISREGARD OF FACTS UNDISPUTED BY THE PARTIES.

B. THE COURT OF APPEALS DISREGARDED THE DOCTRINE LAID DOWN IN VILLA REY
TRANSIT, INC. v. COURT OF APPEALS, G.R. NO. L-25499, FEBRUARY 18, 1970, 31 SCRA 511,
WHEN IT ARBITRARILY PEGGED THE MONTHLY LIVING EXPENSES AT 50% OF GROSS
EARNINGS.8
At the outset, it appears that petitioners call for this Court to review the factual findings and conclusions of
the Court of Appeals. Petitioners assail the appellate courts affirmance of the finding by the trial court that
Pleyto was negligent. The issue of negligence is factual and, in quasi-delicts, crucial in the award of
damages.9 But it is well established that under Rule 45 of the 1997 Rules of Civil Procedure, only
questions of law, not of fact, may be raised before the Supreme Court. It must be stressed that this Court is
not a trier of facts, and it is not its function to re-examine and weigh anew the respective evidence of the
parties.10 Factual findings of the trial court, especially those affirmed by the Court of Appeals, are
conclusive on this Court when supported by the evidence on record. 11 In the present petition, no
compelling reason is shown by petitioners whatsoever for this Court to reverse those findings. Our
examination of the records shows that the evidence clearly supports the following findings of the appellate
court:
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-appellants claim that he was driving at a mere 30 to 35
kilometers per hour 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
(Paragraph 8, Affidavit of Rolly Orpilla marked Exh. "D" and Traffic Report marked Exh. "E", Folder of
Exhibits)....12
Indeed, petitioner Pleyto violated traffic rules and regulations when he overtook the tricycle despite the
presence of an oncoming car in the other lane. Article 2185 of the Civil Code 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 Court of Appeals 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. 13
The Court of Appeals found PRBL liable for Pleytos negligence pursuant to Article 2180 in relation to Article
217614 of the Civil Code. 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.15
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. 16 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. 17
In the present case, petitioners presented several documents 18 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 petitioner PRBL exercised due diligence
in the supervision of its employees, including Pleyto. Citing precedents, the Court of Appeals opined,

"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. (Metro
Manila Transit Corp. vs. CA (223 SCRA 521). The trial court ratiocinated:
...
Indeed, the testimony of the said two witnesses of the PRBL would impress one to believe
that the PRBL has always exercised the strictest standard of selecting its employees and of
maintaining its vehicles to avoid injury or damage to the life and limb of people on the road
whether of its own passengers or pedestrians or occupants or other vehicles. It has not
however, shown to the satisfaction of the Court that it has maintained proper supervision of
its employees, especially drivers while in the actual operation of its buses. While it has a list
of procedures and testing when it comes to recruitment and another list of what should be
done with its buses before they are allowed to run on the road, it has no list of procedures
and duties to be followed by a driver while he is operating a vehicle to prevent injury to
persons and damage to property. Neither has it proved to the Court that there are people
employed by it to supervise its drivers so that it can be seen to it that all the safety
procedures to prevent accident or damage to property or injury to people on the road have
been in place. It is in this aspect of supervising its employees where this Court has found
the defendant PRBL deficient." (Decision p. 29, Rollo)19
In our view, no reversible error was committed by the Court of Appeals when it sustained what the trial
court found after trial that PRBL had failed to rebut the presumption of negligence on its part. Said finding
binds us now in this review on certiorari.
Hence, the only remaining issue relevant for our resolution concerns the award to herein respondents for
damages as well as the loss of earning capacity of the victim, Ricardo Lomboy.
Petitioners argue that the award of loss of earning capacity to respondents is devoid of legal basis. They
fault the appellate court for pegging the monthly living expenses at 50% of gross earnings since, they
claim, this runs contrary to Villa Rey Transit, Inc. v. Court of Appeals,20 which held that "the amount
recoverable is not loss of the entire earning, but rather the loss of that portion of the earnings which the
beneficiary would have received." Petitioners also point out that respondents failed to prove the gross
income of the deceased Ricardo Lomboy, thus, making the computations of the appellate court doubtful, to
say the least.
Respondents counter that the deduction of 50% of the gross income as reasonable and necessary living
expenses by the appellate court is in accord with established jurisprudence, pointing to our decision
in Negros Navigation Co., Inc. v. Court of Appeals.21
Petitioners, in our view, misread the Villa Rey Transit case, where we emphasized that:
"Thus, it has been consistently held that earning capacity, as an element of damages to ones
estate for his death by wrongful act is necessarily his net earning capacity or his capacity to acquire
money, "less the necessary expense for his own living". Stated otherwise, the amount recoverable
is not loss of theentire earning, but rather the loss of that portion of the earnings which the
beneficiary would have received. In other words, only net earnings, not gross earning, are to be
considered that is, the total of the earningsless expenses necessary in the creation of such
earnings or income and less living and other incidental expenses."22
In considering the earning capacity of the victim as an element of damages, the net earnings, which is
computed by deducting necessary expenses from the gross earnings, and not the gross earnings, is to be
utilized in the computation. Note that in the present case, both the Court of Appeals and the trial court used
net earnings, not gross earnings in computing loss of earning capacity. The amount of net earnings was
arrived at after deducting the necessary expenses (pegged at 50% of gross income) from the gross annual

income. This computation is in accord with settled jurisprudence, including the Villa Rey case.
Petitioners claim that no substantial proof was presented to prove Ricardo Lomboys gross income lacks
merit. Failure to present documentary evidence to support a claim for loss of earning capacity of the
deceased need not be fatal to its cause. Testimonial evidence suffices to establish a basis for which the
court can make a fair and reasonable estimate of the loss of earning capacity. 23 Hence, the testimony of
respondent Maria Lomboy, Ricardos widow, that her husband was earning a monthly income of P8,000 is
sufficient to establish a basis for an estimate of damages for loss of earning capacity.
It is well-settled in jurisprudence that the factors that should be taken into account in determining the
compensable amount of lost earnings are: (1) the number of years for which the victim would otherwise
have lived; and (2) the rate of loss sustained by the heirs of the deceased. Jurisprudence provides that the
first factor,i.e., life expectancy, is computed by applying the formula (2/3 x [80 - age at death]) adopted in
the American Expectancy Table of Mortality or the Actuarial Combined Experience Table of Mortality. As to
the second factor, it is computed by multiplying the life expectancy by the net earnings of the
deceased, i.e., the total earnings less expenses necessary in the creation of such earnings or income and
less living and other incidental expenses. The net earning is ordinarily computed at fifty percent (50%) of
the gross earnings.24 Thus, the formula used by this Court in computing loss of earning capacity is: Net
Earning Capacity = [2/3 x (80 age at time of death) x (gross annual income reasonable and
necessary living expenses)].25
It was established that Ricardo Lomboy was 44 years old at the time of his death and is earning a monthly
income of P8,000 or a gross annual income (GAI) of P96,000.26 Using the cited formula, the Court of
Appeals correctly computed the Loss of Net Earning Capacity as P1,152,000, net of and after considering a
reasonable and necessary living expenses of 50% of the gross annual income or P48,000. A detailed
computation is as follows:
NET
EARNING
CAPACITY
(X)

GROSS
LIFE EXPECTANCY
ANNUAL
= [2/3 (80-age at the
x
INCOME
time of death)]
(GAI)

EXPENSES

= [2/3 (80-44)]

x [P96,000

xP96,000)

= [2/3 (36)]

x [P96,000

48,000]

= 24

x 48,000

= P 1,152,000.00

LIVING

(50% of GAI)
(50%

Thus, no reversible error may be attributed to the court a quo in fixing the loss of earning capacity at said
amount.
We likewise sustain the reduction of the award of actual damages from P59,550 for funeral and burial
expenses of Ricardo and P52,000 for medical expenses of Carmela Lomboy to P39,55027 and P27,000,
respectively, as only these latter amounts were duly supported by receipts. 28 To justify an award of actual
damages, there must be competent proof of the actual amount of loss, credence can be given only to
claims which are duly supported by receipts.29
However, while the award of P50,000 as moral damages to Carmela Lomboy is sustained, the award for
moral damages of P500,000 to the heirs of Ricardo Lomboy should be reduced for being excessive.
Under Article 2206 of the Civil Code, the spouse, legitimate children and illegitimate descendants and
ascendants of the deceased may demand moral damages for mental anguish by reason of the death of the
deceased.30 However, we must stress that moral damages, though incapable of pecuniary estimation, are
in the category of an award designed to compensate the claimant for actual injury and are not meant to
enrich complainant at the expense of defendant.31 Moral damages are awarded to enable the injured party
to obtain means, diversions or amusements that will serve to alleviate the moral suffering he/she has
undergone, by reason of the defendants culpable action. Its award is aimed at restoration, as much as
possible, of the spiritualstatus quo ante; thus it must be proportionate to the suffering inflicted. 32 Under the

circumstances of this case, an award of P100,000 to the heirs of Ricardo Lomboy would be justified and in
keeping with the purpose of the law and jurisprudence in allowing moral damages. 33
The indemnification award of P50,000 is also sustained.
WHEREFORE, the assailed Decision of the Court of Appeals in CA-G.R. CV No. 61300
is AFFIRMED, with the sole MODIFICATION that the award of moral damages to the heirs of Ricardo
Lomboy is reduced fromP500,000.00 to P100,000.00. No pronouncement as to costs.
SO ORDERED.
Puno, Austria-Martinez, Callejo, Sr., and Tinga, JJ., concur.
Footnotes
1 Rollo, pp. 32-43. Penned by Associate Justice Portia Alio-Hormachuelos, with Associate Justices

Angelina Sandoval-Gutierrez (now a member of this Court), and Elvi John S. Asuncion.
2 CA Rollo, pp. 39-55.
3 Rollo, p. 44.
4 CA Rollo, p. 55.
5 Art. 2185. Unless there is proof to the contrary, it is presumed that a person driving a motor

vehicle has been negligent if at the time of the mishap, he was violating any traffic regulation.
6 Art. 2180. The obligation imposed by Article 2176 is demandable not only for ones own acts or

omissions, but also for those of persons for whom one is responsible.
The father and, in case of his death or incapacity, the mother, are responsible for the
damages caused by the minor children who live in their company.
Guardians are liable for damages caused by the minors or incapacitated persons who are
under their authority and live in their company.
The owners and managers of an establishment or enterprise are likewise responsible for
damages caused by their employees in the service of the branches in which the latter are
employed or on the occasion of their functions.
Employers shall be liable for the damages caused by their employees and household
helpers acting within the scope of their assigned tasks, even though the former are not
engaged in any business or industry.
The State is responsible in like manner when it acts through a special agent; but not when
the damage has been caused by the official to whom the task done properly pertains, in
which case what is provided in Article 2176 shall be applicable.
Lastly, teachers or heads of establishments of arts and trades shall be liable for damages
caused by their pupils and students or apprentices, so long as they remain in their custody.
The responsibility treated of in this article shall cease when the persons herein mentioned
prove that they observed all the diligence of a good father of a family to prevent damage.
7 Rollo, p. 42.
8 Id. at 17-18.
9 Pestao v. Sumayang, G.R. No. 139875, 4 December 2000, 346 SCRA 870, 878.
10 Langkaan Realty Development, Inc. v. United Coconut Planters Bank, G.R. No. 139437, 8

December 2000, 347 SCRA 542, 549.

11 Viron Transportation Co., Inc. v. Delos Santos, G.R. No. 138296, 22 November 2000, 345 SCRA

509, 514.

12 Rollo, p. 37.
13 Mallari, Sr. v. Court of Appeals, G.R. No. 128607, 31 January 2000, 324 SCRA 147, 153.
14 Art. 2176. Whoever by act or omission causes damage to another, there being fault or

negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no preexisting contractual relation between the parties, is called a quasi-delict and is governed by the
provisions of this Chapter.
15 Pestao v. Sumayang, supra, at 878-879.
16 Viron Transportation Co., Inc. v. Delos Santos, supra, at 517-518.
17 Victory Liner, Inc. v. Heirs of Andres Malecdan, G.R. No. 154278, 27 December 2002, 394 SCRA

520, 526.
18 Exhibits for Defendants, pp. 1-28, Exhibits 1-27-A.
19 Rollo, pp. 38-39.
20 No. L-25499, 18 February 1970, 31 SCRA 511, 517.
21 G.R. No. 110398, 7 November 1997, 281 SCRA 534.
22 Supra, note 20 at 517-518.
23 People v. Bangcado, G.R. No. 132330, 28 November 2000, 346 SCRA 189, 209; See also

People v. Garcia, G.R. No. 135666, 20 July 2001, 361 SCRA 598, 611.
24 People v. Bantiling, G.R. No. 136017, 15 November 2001, 369 SCRA 47, 63; People v. Langit,

G.R. Nos. 134757-58, 4 August 2000, 337 SCRA 323, 345.

25 People v. Sia, G.R. No. 137457, 21 November 2001, 370 SCRA 123, 140.
26 Rollo, p. 41, CA Decision, p. 10, citing TSN, May 30, 1996, p. 4.
27 The actual total amount per receipts and as stated in the decretal portion of the CA decision

(Rollo, p. 42), but erroneously stated as P39,500 in the body of the CA Decision, (Rollo, p. 39).
28 Exhibits for Plaintiff, pp. 9-10.
29 Viron Transportation Co., Inc. v. Delos Santos, supra, at 519.
30 Victory Liner, Inc. v. Heirs of Andres Malecdan, supra, at 527.
31 Kierulf v. Court of Appeals, G.R. Nos. 99301 & 99343, 13 March 1997, 269 SCRA 433, 448-449.
32 Id. at 452.
33 Supra, note 30 at 527-528, citing Fortune Express, Inc. v. Court of Appeals, G.R. No. 119756, 18

March 1999, 305 SCRA 14, 24-25.