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MHP Garments, Inc. vs. Court of Appeals

*
G.R. No. 86720. September 2, 1994.

MHP GARMENTS, INC., and LARRY C. DE GUZMAN,

petitioners, vs. THE HONORABLE COURT OF APPEALS,
AGNES VILLA CRUZ, MIRASOL LUGATIMAN, and
GERTRUDES GONZALES, respondents.

Constitutional Law; Bill of Rights; Searches and Seizures; The

constitutional provision against unreasonable searches and seizures protects
not only those who appear to be innocent but also those who appear to be
guilty but are nevertheless to be presumed innocent until the contrary is
proved.—Article III, Section 2, of the Constitution protects our people from
unreasonable search and seizures. This provision protects not only those
who appear to be innocent but also those who appear to be guilty but are
nevertheless to be presumed innocent until the contrary is proved. In the
case at bench, the seizure was made without any warrant. Under the Rules
of Court, a warrantless search can only be undertaken under the following
circumstance: “SEC. 12. Search incident to a lawful arrest.—A person
lawfully arrested may be searched for dangerous weapons or anything
which may be used as proof of the commission of an offense, without a
search warrant.”
Same; Same; Same; Damages; Where a warrantless search and seizure
is conducted despite the fact that there is sufficient time to apply for a
judicial warrant, the persons who participate therein take the risk of a suit
for damages in case the seizure would be proved to violate the right against
unreasonable search and seizure.—We hold that the evidence did not justify
the warrantless search and seizure of private respon-dents’ goods. Petitioner
corporation received information that private respondents were illegally
selling Boy Scouts items and paraphernalia in October 1983. The specific
date and time are not established in the evidence adduced by the parties.
Petitioner de Guzman then made a surveillance of the stores of private
respondents. They reported to the Philippine Constabulary and on October
25, 1983, the raid was made on the stores of private respondents and the
supposed illicit goods were seized. The progression of time between the
receipt of the information and the raid of the stores of private respondents
shows there was sufficient time for petitioners and the PC raiding party to

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apply for a judicial warrant. Despite the sufficiency of time, they did not
apply for a warrant and seized the goods of private respondents. In

_________________

* SECOND DIVISION.

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MHP Garments, Inc. vs. Court of Appeals

doing so, they took the risk of a suit for damages in case the seizure would
be proved to violate the right of private respondents against unreasonable
search and seizure.
Same; Same; Same; Same; Words and Phrases; Probable Cause,
defined; Where there is no probable cause for the warrantless search and
seizure, the same is illegal.—In the case at bench, the search and seizure
were clearly illegal. There was no probable cause for the seizure. Probable
cause for a search has been defined as “such facts and circumstances which
would lead a reasonably discreet and prudent man to believe that an offense
has been committed and that the objects sought in connection with the
offense are in the place sought to be searched.” These facts and
circumstances were not in any way shown by the petitioners to justify their
warrantless search and seizure. Indeed, after a preliminary investigation, the
Provincial Fiscal of Rizal dismissed their complaint for unfair competition
and later ordered the return of the seized goods.
Same; Same; Same; Same; Private persons who instigate an illegal
warrantless search and seizure may be held liable for damages.—
Petitioners would deflect their liability with the argument that it was the
Philippine Constabulary that conducted the raid and their participation was
only to report the alleged illegal activity of private respondents. While
undoubtedly, the members of the PC raiding team should have been
included in the complaint for violation of the private respondents’
constitutional rights, still, the omission will not exculpate petitioners. In the
case of Lim vs. Ponce de Leon, we ruled for the recovery of damages for
violation of constitutional rights and liberties from public officer or private
individual.
Same; Same; Same; Same; Private persons who initiate an illegal
warrantless search and seizure, accompany the raiding team and stand by
during the operation, apparently assenting thereto, are liable for damages
to the same extent as the public officers themselves.—Applying the
aforecited provisions and leading cases, the respondent court correctly
granted damages to private respondents. Petitioners were indirectly involved
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in transgressing the right of private respondents against unreasonable search

and seizure. Firstly, they instigated the raid pursuant to their covenant in the
Memorandum Agreement to undertake the prosecution in court of all illegal
sources of scouting supplies. The raid was conducted with the active
participation of their employee. Larry de Guzman did not lift a finger to stop
the seizure of the boy and girl scouts items. By standing by and apparently
assenting thereto, he was liable to the same extent as the officers
themselves. So with the petitioner corporation which even received for
safekeeping the

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MHP Garments, Inc. vs. Court of Appeals

goods unreasonably seized by the PC raiding team and de Guzman, and

refused to surrender them for quite a time despite the dismissal of its
complaint for unfair competition.
Damages; Moral damages are not awarded to penalize the defendant
but to compensate the plaintiff for the injuries he may have suffered.—We
have consistently ruled that moral damages are not awarded to penalize the
defendant but to compensate the plaintiff for the injuries he may have
suffered. Conformably with our ruling in Lim vs. Ponce de Leon, op. cit.,
moral damages can be awarded in the case at bench. There can be no doubt
that petitioners must have suffered sleepless nights, serious anxiety, and
wounded feelings due to the tortious raid caused by petitioners. Private
respondents’ avowals of embarrassment and humiliation during the seizure
of their merchandise were supported by their testimonies.
Same; The award of exemplary damages for the wantonness of the
wrongful seizure also serves as a stern reminder to all and sundry that the
constitutional protection against unreasonable search and seizure is a virile
reality and not a mere burst of rhetoric.—Needless to state, the wantonness
of the wrongful seizure justifies the award of exemplary damages. It will
also serve as a stern reminder to all and sundry that the constitutional
protection against unreasonable search and seizure is a virile reality and not
a mere burst of rhetoric. The all encompassing protection extends against
intrusions directly done both by government and indirectly by private
entities.

PETITION for review on certiorari of a decision of the Court of

Appeals.

The facts are stated in the opinion of the Court.

     Benjamin M. Dacanay for petitioners.
     Emmanuel O. Tansingco for private respondents.

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PUNO, J.:

The constitutional protection of our people against unreasonable

search and seizure is not merely a pleasing platitude. It vouchsafes
our right to privacy and dignity against undesirable intrusions
committed by any public officer or private individual. An
infringement of this right justifies an award for damages.
On February 22, 1983, petitioner MHP Garments, Inc., was
awarded by the Boy Scouts of the Philippines, the exclusive

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franchise to sell and distribute official Boy Scouts uniforms,

supplies, badges, and insignias. In their Memorandum Agreement,
petitioner corporation was given the authority to “undertake or cause
to be undertaken the prosecution in court of all illegal sources of
1
scout uniforms and other scouting supplies.”
Sometime in October 1983, petitioner corporation received
information that private respondents Agnes Villa Cruz, Mirasol
Lugatiman, and Gertrudes Gonzales were selling Boy Scouts items
and paraphernalia without any authority. Petitioner de Guzman, an
employee of petitioner corporation, was tasked to undertake the
necessary surveillance and to make a report to the Philippine
Constabulary (PC).
On October 25, 1983, at about 10:30 A.M., petitioner de
Guzman, Captain Renato M. Peñafiel, and two (2) other
constabulary men of the Reaction Force Battalion, Sikatuna Village,
Diliman, Quezon City went to the stores of respondents at the
Marikina Public Market. Without any warrant, they seized the boy
and girl scouts pants, dresses, and suits on display at respondents’
stalls. The seizure caused a commotion and embarrassed private
respondents. Receipts were issued for the seized items. The items
were then turned over by Captain Peñafiel to petitioner corporation
for safekeeping.
A criminal complaint for 2
unfair competition was then filed
against private respondents. During its pendency, petitioner de
Guzman exacted from private respondent Lugatiman the sum of
THREE THOUSAND ONE HUNDRED PESOS (P3,100.00) in
order to be dropped from the complaint. On December 6, 1983, after
a preliminary investigation, the Provincial Fiscal of Rizal dismissed
the complaint against all the private respondents. On February 6,
1984, he also ordered the return of the seized items. The 3
seized
items were not immediately returned despite demands. Private
respondents had to go personally to petitioners’ place of business to

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recover their goods. Even then, not all the seized items were
returned. The other items returned were of inferior quality.

________________

1 Exhibit “1.”
2 I.S. No. 83-15275 before the Rizal Provincial Fiscal’s Office.
3 Demand letters were sent on March 22, 1984 and April 11, 1984.

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MHP Garments, Inc. vs. Court of Appeals

Private respondents then filed Civil Case No. 4

51144 against the
petitioners for sums of money and damages. In its Decision dated
January 9, 1987, the trial court ruled for the private respondents,
thus:

“WHEREFORE, judgment is hereby rendered in favor of plaintiffs and

against defendants, ordering the latter jointly and severally:

1. To return the amount of P3,100.00 to plaintiff Mirasol Lugatiman

with interest at 12% per annum from January 12, 1984, the date of
the last receipt issued, until fully paid;
2. To pay plaintiff Agnes Villa Cruz the sum of P2,000.00 for the 26
pieces of girl scout items not returned;
3. To pay plaintiffs the amount of P50,000.00 for and as moral
damages and P15,000.00 for and as exemplary damages; and
4. P5,000.00 for and as attorney’s fees and litigation expenses. Costs
against the defendants.

SO ORDERED.”

The decision was appealed5

to the respondent court. On January 18,
1989, its Fifth Division, affirmed the Decision with modification,
thus:

“WHEREFORE, the decision appealed from is AFFIRMED with

MODIFICATION; and, as modified, the dispositive portion thereof now
reads as follows:
Judgment is hereby rendered in favor of plaintiffs (private respondents)
and against defendants (petitioners), ordering the latter jointly and severally;

1. To return the amount of P3,100.00 to plaintiff (respondent) Mirasol

Lugatiman and cancel her application for distributor’s license;
2. To pay plaintiff (respondent) Agnes Villa Cruz the sum of
P2,000.00 for the unreturned 26 pieces of girl scouts items with

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interest at 12% per annum from June 4, 1984 (date the complaint
was filed) until it is fully paid;
3. To pay plaintiffs (respondents) the amount of P10,000.00 each, or a
total of P30,000.00, for and as moral damages; and P5,000.00 each,
or a total of P15,000.00, for and as exemplary damages; and

________________

4 RTC, NJCR, Pasig, Branch 151.

5 Penned by Mr. Justice Jesus M. Elbinias, and concurred by Justices Floreliana C.
Bartolome and Antonio M. Martinez.

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232 SUPREME COURT REPORTS ANNOTATED

MHP Garments, Inc. vs. Court of Appeals

4. To pay plaintiffs (respondents) P5,000.00 for and as attorney’s

fees and litigation expenses.

Costs of the case a quo and the instant appeal are assessed jointly and
severally against defendants-appellants (petitioners) MHP Garments, Inc.
and Larry de Guzman.
SO ORDERED.”

In this petition for certiorari, petitioners contend:

FIRST ASSIGNMENT OF ERROR

THE COURT OF APPEALS ERRED IN IMPUTING LIABILITY FOR

DAMAGES TO THE PETITIONERS WHO DID NOT EFFECT THE
SEIZURE OF THE SUBJECT MERCHANDISE.

SECOND ASSIGNMENT OF ERROR

THE COURT OF APPEALS ERRED WHEN IT MADE A FINDING

THAT THE MANNER WITH WHICH THE CONFISCATION OF
PRIVATE RESPONDENTS WAS TORTIOUS BUT PENALIZED
INSTEAD THE PETITIONERS WHO DID NOT COMMIT THE ACT OF
CONFISCATION.

THIRD ASSIGNMENT OF ERROR

THE COURT OF APPEALS ERRED WHEN IT FOUND FOR THE

PRIVATE RESPONDENTS AND AGAINST THE PETITIONERS.

We affirm.
Article III, section 2, of the Constitution protects our people from
unreasonable search and seizure. It provides:

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“The right of the people to be secure in their persons, houses, papers, and
effects against unreasonable searches and seizures of whatever nature for
any purpose shall be inviolable, and no search warrant or warrant of arrest
shall issue except upon probable cause to be determined personally by the
judge after examination under oath or affirmation of the complainant and the
witnesses he may produce, and particularly describing the place to be
searched and the persons or things to be seized.”

This provision protects not only those who appear to be innocent but
also those who appear to be guilty but are nevertheless to be

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MHP Garments, Inc. vs. Court of Appeals

6
presumed innocent until the contrary is proved. In the case at bench,
the seizure was made without any warrant. Under the Rules of
7
Court, a warrantless search can only be undertaken under the
following circumstance:

“SEC. 12. Search incident to a lawful arrest.—A person lawfully arrested

may be searched for dangerous weapons or anything which may be used as
proof of the commission of an offense, without a search warrant.”

We hold that the evidence did not justify the warrantless search and
seizure of private respondents’ goods. Petitioner corporation
received information that private respondents were illegally selling
Boy Scouts items and paraphernalia in October 1983. The specific
date and time are not established in the evidence adduced by the
parties. Petitioner de Guzman then made a surveillance of the stores
of private respondents. They reported to the Philippine Constabulary
and on October 25, 1983, the raid was made on the stores of private
respondents and the supposed illicit goods were seized. The
progression of time between the receipt of the information and the
raid of the stores of private respondents shows there was sufficient
time for petitioners and the PC raiding party to apply for a judicial
warrant. Despite the sufficiency of time, they did not apply for a
warrant and seized the goods of private respondents. In doing so,
they took the risk of a suit for damages in case the seizure would be
proved to violate the right of private respondents against
unreasonable search and seizure. In the case at bench, the search and
seizure were clearly illegal. There was no probable cause for the
seizure. Probable cause for a search has been defined as “such facts
and circumstances which would lead a reasonably discreet and
prudent man to believe that an offense has been committed and that
the objects sought in connection with the offense are in the place
8
sought to be searched.” These facts and circumstances were not in
any way shown by the petitioners to justify their warrantless
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__________________

6 Bagalihog vs. Fernandez, G.R. No. 96356, June 27, 1991, 198 SCRA 614.
7 Section 12, Rule 126 of the Rules of Court.
8 Burgos, Sr. vs. Chief of Staff, AFP, No. L-64261, December 26,

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MHP Garments, Inc. vs. Court of Appeals

search and seizure. Indeed, after a preliminary investigation, the

Provincial Fiscal of Rizal dismissed their complaint for unfair
competition and later ordered the return of the seized goods.
Petitioners would deflect their liability with the argument that it
was the Philippine Constabulary that conducted the raid and their
participation was only to report the alleged illegal activity of private
respondents.
While undoubtedly, the members of the PC raiding team should
have been included in the complaint for violation of the private
respondents’ constitutional rights, still, the omission will not
exculpate petitioners.
9
In the case of Lim vs. Ponce de Leon, we ruled for the recovery
of damages for violation of constitutional rights and liberties from
public officer or private individual, thus:

“ART. 32. Any public officer or employee, or any private individual, who
directly or indirectly obstructs, defeats, violates or in any manner impedes
or impairs any of the following rights and liberties of another person shall
be liable to the latter for damages.
“x x x     x x x
“(9) The rights to be secure in one’s person, house, papers, and effects
against unreasonable searches and seizures.
“x x x     x x x
“The indemnity shall include moral damages. Exemplary damages may
also be adjudged.”
“ART. 2219. Moral damages may be recovered in the following and
analogous cases:
“x x x      x x x
“(6) Illegal search;
“(1) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34,
and 35.
Pursuant to the foregoing provisions, a person whose constitutional
rights have been violated or impaired is entitled to actual and moral
damages from the public officer or employee responsible therefor. In
addition, exemplary damages may also be awarded.”

x x x      x x x      x x x

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“The very nature of Article 32 is that the wrong may be civil 1984, 133 SCRA
800.

_________________

9 No. L-22554, August 29, 1975, 66 SCRA 299.

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MHP Garments, Inc. vs. Court of Appeals

or criminal. It is not necessary therefore that there should be malice or bad faith. To
make such a requisite would defeat the main purpose of Article 32 which is the
effective protection of individual rights. Public officials in the past have abused their
powers on the pretext of justifiable motives or good faith in the performance of their
duties. Precisely, the object of the Article is to put an end to official abuse by plea of
the good faith. In the United States this remedy is in the nature of a tort.” (emphasis
supplied)
10
In the subsequent case of Aberca vs. Ver, the Court En Banc
explained the liability of persons indirectly responsible, viz:

“[T]he decisive factor in this case, in our view, is the language of Article 32.
The law speaks of an officer or employee or person “directly or indirectly”
responsible for the violation of the constitutional rights and liberties of
another. Thus, it is not the actor alone (i.e. the one directly responsible) who
must answer for damages under Article 32; the person indirectly responsible
has also to answer for the damages or injury caused to the aggrieved party.
x x x      x x x      x x x
While it would certainly be too naive to expect that violators of human
rights would easily be deterred by the prospect of facing damage suits, it
should nonetheless be made clear in no uncertain terms that Article 32 of the
Civil Code makes the persons who are directly, as well as indirectly,
responsible for the transgression joint tortfeasors.
x x x      x x x      x x x
[N]either can it be said that only those shown to have participated
“directly” should be held liable. Article 32 of the Civil Code encompasses
within the ambit of its provisions those directly, as well as indirectly,
responsible for its violations.” (emphasis supplied)

Applying the aforecited provisions and leading cases, the respondent

court correctly granted damages to private respondents. Petitioners
were indirectly involved in transgressing the right of private
respondents against unreasonable search and seizure. Firstly, they
instigated the raid pursuant to their covenant in the Memorandum
Agreement to undertake the prosecution in

_________________

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10 No. L-69866, April 15, 1988, 160 SCRA 590.

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11
court of all illegal sources of scouting supplies. As correctly
observed by respondent court:

“Indeed, the acts committed by the PC soldiers of unlawfully seizing

appellees’ (respondents’) merchandise and of filing the criminal complaint
for unfair competition against appellees (respondents) were for the
protection and benefit of appellant (petitioner) corporation. Such being the
case, it is, thus, reasonably fair to infer from those acts that it was upon
appellant (petitioner) corporation’s instance that the PC soldiers conducted
the raid and effected the illegal seizure. These circumstances should answer
the trial court’s query—posed in its decision now under consideration—as
to why the PC soldiers immediately turned over the seized merchandise to
12
appellant (petitioner) corporation.”

The raid was conducted with the active participation of their

employee. Larry de Guzman did not lift a finger to stop the seizure
of the boy and girl scouts items. By standing by and apparently
assenting thereto,
13
he was liable to the same extent as the officers
themselves. So with the petitioner corporation which even received
for safekeeping the goods unreasonably seized by the PC raiding
team and de Guzman, and refused to surrender them for quite a time
despite the dismissal of its complaint for unfair competition.
Secondly, Letter of Instruction No. 1299 was precisely crafted on
March 9, 1983 to safeguard not only the privilege of franchise
holder of scouting items but also the citizen’s constitutional rights,
to wit:

“TITLE: APPREHENSION OF UNAUTHORIZED MANUFACTURERS

AND DISTRIBUTORS OF SCOUT PARAPHERNALIA AND
IMPOUNDING OF SAID PARAPHERNALIA.

ABSTRACT:

Directs all law enforcement agencies of the Republic of the Philippines,

to apprehend immediately unauthorized manufacturers and distributors of
Scout paraphernalia, upon proper application by the

_________________

11 Supra.
12 Rollo, p. 22, Court of Appeals Decision, p. 9.

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13 Am. Jur., 47 [1943], see Hebrew vs. Pulis, 73 NJL 621, 64 A 121, 7 LRA(NS) 580, 118
Am St Rep 716.

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MHP Garments, Inc. vs. Court of Appeals

Boy Scouts of the Philippines and/or Girl Scouts of the Philippines for
warrant of arrest and/or search warrant with a judge, or such other
responsible officer as may be authorized by law; and to impound the said
paraphernalia to be used as evidence in court or other appropriate
administrative body. Orders the immediate and strict compliance with the
14
Instructions.”

Under the above provision and as aforediscussed, petitioners

miserably failed to report the unlawful peddling of scouting goods to
the Boy Scouts of the Philippines for the proper application of a
warrant. Private respondents’ rights are immutable and cannot be
15
sacrificed to transient needs. Petitioners did not have the unbridled
license to cause the seizure of respondents’ goods without any
warrant.
And thirdly, if petitioners did not have a hand in the raid, they
should have filed a third-party complaint against the raiding team for
16
contribution or any other relief, in respect of respondents’ claim for
Recovery of Sum of Money with Damages. Again, they did not.
We have consistently ruled that moral damages are not awarded
to penalize the defendant but to compensate the plaintiff for the
17
injuries he may have suffered. Conformably with our ruling in Lim
vs. Ponce de Leon, op. cit., moral damages can be awarded in the
case at bench. There can be no doubt that petitioners must have
suffered sleepless nights, serious anxiety, and wounded feelings due
to the tortious raid caused by petitioners. Private respondents’
avowals of embarrassment and humiliation during the seizure of
their merchandise were supported by their testimonies. Respondent
Cruz declared:

“I felt very nervous. I was crying to loss (sic) my goods and capital because
I am doing business with borrowed money only, there was commotion
created by the raiding team and they even stepped on some of the pants and
dresses on display for sale. All passersby stopped to

_______________

14 Court of Appeals Decision, pp. 5-6; Rollo, pp. 18-19.

15 See, Aberca vs. Ver, op. cit.
16 Section 12, Rule 6, Rules of Court.
17 Simex International (Manila), Inc. vs. Court of Appeals, G.R. No. 88013, March 19,
1990, 183 SCRA 360.

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watch and stared at me with accusing expressions. I was trembling and

18
terribly ashamed, sir.”

Respondent Lugatiman testified:

“I felt very nervous. I was crying and I was very much ashamed because
many people have been watching the PC soldiers hauling my items, and
many/I (sic) heard say ‘nakaw pala ang mga iyan’ for which I am claiming
19
P25,000.00 for damages.”

While respondent Gonzalez stated thus:

“I do not like the way the raid was conducted by the team sir because it
looked like that what I have been selling were stolen items that they should
be confiscated by uniformed soldiers. Many people were around and the
more the confiscation was made in a scandalous manner; every clothes, T-
shirts, pants and dresses even those not wrapped dropped to the ground. I
20
was terribly shamed in the presence of market goers that morning.”

Needless to state, the wantonness of the wrongful seizure justifies

21
the award of exemplary damages. It will also serve as a stern
reminder to all and sundry that the constitutional protection against
unreasonable search and seizure is a virile reality and not a mere
burst of rhetoric. The all encompassing protection extends against
intrusions directly done both by government and indirectly by
private entities.
IN VIEW WHEREOF, the appealed decision is AFFIRMED
WITH MODIFICATION. We impose a SIX PERCENT (6%)
interest from January 9, 1987 on the TWO THOUSAND PESOS
(P2,000.00) for the unreturned twenty-six (26) pieces of girl scouts
items and a TWELVE PERCENT (12%) interest, in lieu of SIX
PERCENT (6%), on the said amount upon finality of this Decision
22
until the payment thereof. Costs against petitioners.

________________

18 Rollo, p. 17.
19 Id., pp. 17-18.
20 Id., p. 18.
21 Article 2229, Civil Code.
22 Eastern Shipping Lines, Inc., vs. Hon. Court of Appeals and Mercantile
Insurance Company, Inc., G.R. No. 97412, July 12, 1994.

239

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VOL. 236, SEPTEMBER 2, 1994 239

People vs. Bayotas

SO ORDERED.

     Narvasa (C.J., Chairman), Padilla, Regalado and Mendoza,

JJ., concur.

Judgment affirmed with modification.

Note.—It is obvious that the purpose of Article 32 of the Civil

Code is to provide a sanction to the deeply cherished rights and
freedoms enshrined in the Constitution. Its message is clear: no man
may seek to violate those sacred rights with impunity. (Aberca vs.
Ver, 160 SCRA 590 [1988])

——o0o——

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