FIRST DIVISION

[G.R. No. 172122. June 22, 2007.]

MERCURY DRUG CORPORATION and ROLANDO J. DEL

ROSARIO, petitioners, vs. SPOUSES RICHARD HUANG and
CARMEN HUANG, and STEPHEN HUANG, respondents.

DECISION

PUNO, C.J : p

On appeal are the Decision 1 and Resolution 2 of the Court of Appeals in

CA-G.R. CV No. 83981, dated February 16, 2006 and March 30, 2006,
respectively which affirmed with modification the Decision 3 of the Regional
Trial Court (RTC) of Makati City, dated September 29, 2004. The trial court
found petitioners jointly and severally liable to pay respondents damages for
the injuries sustained by respondent Stephen Huang, son of respondent
spouses Richard and Carmen Huang.
First, the facts:

Petitioner Mercury Drug Corporation (Mercury Drug) is the registered

owner of a six-wheeler 1990 Mitsubishi Truck with plate number PRE 641
(truck). It has in its employ petitioner Rolando J. del Rosario as driver.
Respondent spouses Richard and Carmen Huang are the parents of respondent
Stephen Huang and own the red 1991 Toyota Corolla GLI Sedan with plate
number PTT 775 (car).
These two vehicles figured in a road accident on December 20, 1996 at
around 10:30 p.m. within the municipality of Taguig, Metro Manila. Respondent
Stephen Huang was driving the car, weighing 1,450 kg., while petitioner Del
Rosario was driving the truck, weighing 14,058 kg. Both were traversing the C-5
Highway, north bound, coming from the general direction of Alabang going to
Pasig City. The car was on the left innermost lane while the truck was on the
next lane to its right, when the truck suddenly swerved to its left and slammed
into the front right side of the car. The collision hurled the car over the island
where it hit a lamppost, spun around and landed on the opposite lane. The
truck also hit a lamppost, ran over the car and zigzagged towards, and finally
stopped in front of Buellah Land Church. TIEHSA

At the time of the accident, petitioner Del Rosario only had a Traffic
Violation Receipt (TVR). His driver's license had been confiscated because he
had been previously apprehended for reckless driving.
The car, valued at P300,000.00, was a total wreck. Respondent Stephen
Huang sustained massive injuries to his spinal cord, head, face, and lung.
Despite a series of operations, respondent Stephen Huang is paralyzed for life
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 from his chest down and requires continuous medical and rehabilitation
treatment.
Respondents fault petitioner Del Rosario for committing gross negligence
and reckless imprudence while driving, and petitioner Mercury Drug for failing
to exercise the diligence of a good father of a family in the selection and
supervision of its driver.
In contrast, petitioners allege that the immediate and proximate cause of
the accident was respondent Stephen Huang's recklessness. According to
petitioner Del Rosario, he was driving on the left innermost lane when the car
bumped the truck's front right tire. The truck then swerved to the left, smashed
into an electric post, crossed the center island, and stopped on the other side of
the highway. The car likewise crossed over the center island and landed on the
same portion of C-5. Further, petitioner Mercury Drug claims that it exercised
due diligence of a good father of a family in the selection and supervision of all
its employees.
The trial court, in its Decision dated September 29, 2004, found
petitioners Mercury Drug and Del Rosario jointly and severally liable to pay
respondents actual, compensatory, moral and exemplary damages, attorney's
fees, and litigation expenses. The dispositive portion reads:
WHEREFORE, judgment is rendered finding defendants Mercury
Drug Corporation, Inc. and Rolando del Rosario, jointly and severally
liable to pay plaintiffs Spouses Richard Y. Huang and Carmen G. Huang,
and Stephen Huang the following amounts:
1. Two Million Nine Hundred Seventy Three Thousand Pesos
(P2,973,000.00) actual damages;

2. As compensatory damages:

a. Twenty Three Million Four Hundred Sixty One Thousand,

and Sixty-Two Pesos (P23,461,062.00) for life care
cost of Stephen;

b. Ten Million Pesos (P10,000,000.00) as and for lost or

impaired earning capacity of Stephen;
3. Four Million Pesos (P4,000,000.00) as moral damages;

4. Two Million Pesos (P2,000,000.00) as exemplary damages; and

5. One Million Pesos (P1,000,000.00) as attorneys fees and

litigation expense. 4

On February 16, 2006, the Court of Appeals affirmed the decision of the
trial court but reduced the award of moral damages to P1,000,000.00. The
appellate court also denied the motion for reconsideration filed by petitioners.

Hence, this appeal.

Petitioners cite the following grounds for their appeal:
1. That the subject Decision which dismissed the appeal of petitioners
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 herein but AFFIRMED WITH MODIFICATION the decision of the Regional
Trial Court, Branch 64, Makati City, in that the award of moral damages
was reduced to P1,000,000.00 and its Resolution dated March 30,
2006, which dismissed outright the Motion for Reconsideration must be
set aside because the Honorable Court of Appeals committed
reversible error:

A. IN DENYING OUTRIGHTLY THE MOTION FOR RECONSIDERATION ON

ALLEGEDLY BEING FILED OUT OF TIME FOR ONE DAY;

B. IN ACCORDING GREATER WEIGHT TO THE EVIDENCE ADDUCED BY

THE RESPONDENTS HEREIN AND COMPLETELY DISREGARDING
THE DEFENSE INTERPOSED BY THE PETITIONERS HEREIN; HcDSaT

C. IN DISREGARDING COMPLETELY ALL EVIDENCES PRESENTED BY THE

PETITIONERS HEREIN AND PROCEEDED TO RENDER ITS DECISION
BASED ON PRESUMPTIONS AND PERSONAL OPINIONS OF PEOPLE
WHO ARE NOT WITNESSES TO THE ACCIDENT;

D. IN AWARDING DAMAGES IN FAVOR OF RESPONDENTS HEREIN;

E. IN FINDING THAT MERCURY DRUG CORPORATION FAILED TO

EXERCISE THE DILIGENCE REQUIRED IN SUPERVISING ITS
EMPLOYEES DESPITE OVERWHELMING EVIDENCE PRESENTED BY
PETITIONER COMPANY;

F. IN FINDING THAT PETITIONER ROLANDO DEL ROSARIO WAS

NEGLIGENT IN DRIVING THE TRUCK AT THE TIME OF ACCIDENT
AND TOTALLY DISREGARDING THE EVIDENCES PRESENTED
DURING THE TRIAL OF THE CASE.

G. IN PRESENTING ONLY IN THE DECISION TESTIMONIES FAVORABLE

TO THE RESPONDENTS HEREIN AND COMPLETELY DISREGARDING
THE EVIDENCES PRESENTED BY THE PETITIONERS HEREIN WHICH
CONTRADICTED SUCH TESTIMONIES NOT ONLY THROUGH ORAL
TESTIMONIES BUT AS WELL AS DOCUMENTARY EVIDENCES. 5

We affirm the findings of the trial court and the appellate court that
petitioner Del Rosario was negligent. The evidence does not support
petitioners' claim that at the time of the accident, the truck was at the left inner
lane and that it was respondent Stephen Huang's car, at its right, which
bumped the right front side of the truck. Firstly, petitioner Del Rosario could not
precisely tell which part of the truck was hit by the car, 6 despite the fact that
the truck was snub-nosed and a lot higher than the car. Petitioner Del Rosario
could not also explain why the car landed on the opposite lane of C-5 which was
on its left side. He said that "the car did not pass in front of him after it hit him
or under him or over him or behind him." 7 If the truck were really at the left
lane and the car were at its right, and the car hit the truck at its front right side,
the car would not have landed on the opposite side, but would have been
thrown to the right side of the C-5 Highway. Noteworthy on this issue is the
testimony of Dr. Marlon Rosendo H. Daza, an expert in the field of physics. He
conducted a study based on the following assumptions provided by
respondents:

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 1. Two vehicles collided;
2. One vehicle is ten times heavier, more massive than the other;

3. Both vehicles were moving in the same direction and at the same
speed of about 85 to 90 kilometers per hour;

4. The heavier vehicle was driving at the innermost left lane, while the
lighter vehicle was at its right. HSAcaE

Dr. Daza testified that given the foregoing assumptions, if the lighter vehicle
hits the right front portion of the heavier vehicle, the general direction of the
light vehicle after the impact would be to the right side of the heavy vehicle,
not the other way around. The truck, he opined, is more difficult to move as
it is heavier. It is the car, the lighter vehicle, which would move to the right
of, and away from the truck. Thus, there is very little chance that the car will
move towards the opposite side, i.e ., to the left of the truck.

Dr. Daza also gave a further study on the basis of the same assumptions
except that the car is on the left side of the truck, in accordance with the
testimony of respondent Stephen Huang. Dr. Daza concluded that the general
direction of the car after impact would be to the left of the truck. In this
situation, the middle island against which the car was pinned would slow down
the car, and enable the truck to catch up and hit the car again, before running
over it. 8

To support their thesis, petitioners tried to show the damages that the
truck sustained at its front right side. The attempt does not impress. The
photographs presented were taken a month after the accident, and Rogelio
Pantua, the automechanic who repaired the truck and authenticated the
photographs, admitted that there were damages also on the left side of the
truck. 9
Worse still, petitioner Del Rosario further admitted that after the impact,
he lost control of the truck and failed to apply his brakes. Considering that the
car was smaller and lighter than the six-wheeler truck, the impact allegedly
caused by the car when it hit the truck could not possibly be so great to cause
petitioner to lose all control that he failed to even step on the brakes. He
testified, as follows:
ATTY. DIAZ:
May I proceed, Your Honor. You were able to apply the brakes,
were you sir?
WITNESS:

No more, sir, because I went over the island.

ATTY. DIAZ:

Because as you said you lost control, correct sir?

WITNESS:

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 Yes, sir.
ATTY. DIAZ:
In other words, sir from the time your truck was hit according to
you up to the time you rested on the shoulder, you traveled fifty
meters?

WITNESS:
Yes, sir, about that distance.

ATTY. DIAZ:
And this was despite the fact that you were only traveling at the
speed of seventy five kilometers per hour, jumped over the
island, hit the lamppost, and traveled the three lanes of the
opposite lane of C-5 highway, is that what you want to impress
upon this court?
WITNESS:

Yes, sir. 10

We therefore find no cogent reason to disturb the findings of the RTC and
the Court of Appeals. The evidence proves petitioner Del Rosario's negligence
as the direct and proximate cause of the injuries suffered by respondent
Stephen Huang. Petitioner Del Rosario failed to do what a reasonable and
prudent man would have done under the circumstances. HICEca

We now come to the liability of petitioner Mercury Drug as employer of

Del Rosario. Articles 2176 and 2180 of the Civil Code provide:
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 pre-existing
contractual relation between the parties, is called a quasi-delict and is
governed by the provisions of this Chapter.
Art. 2180. The obligation imposed by article 2176 is demandable
not only for one's own acts or omissions, but also for those of persons
for whom one is responsible.

xxx xxx xxx

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.

xxx xxx xxx

The liability of the employer under Art. 2180 of the Civil Code is direct or
immediate. It is not conditioned on a prior recourse against the negligent
employee, or a prior showing of insolvency of such employee. It is also joint and
solidary with the employee. 11

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 To be relieved of liability, petitioner Mercury Drug should show that it
exercised the diligence of a good father of a family, both in the selection of the
employee and in the supervision of the performance of his duties. Thus, in the
selection of its prospective employees, the employer is required to examine
them as to their qualifications, experience, and service records. 12 With respect
to the supervision of its employees, the employer should formulate standard
operating procedures, monitor their implementation, and impose disciplinary
measures for their breach. To establish compliance with these requirements,
employers must submit concrete proof, including documentary evidence. 13

In the instant case, petitioner Mercury Drug presented testimonial

evidence on its hiring procedure. According to Mrs. Merlie Caamic, the
Recruitment and Training Manager of petitioner Mercury Drug, applicants are
required to take theoretical and actual driving tests, and psychological
examination. In the case of petitioner Del Rosario, however, Mrs. Caamic
admitted that he took the driving tests and psychological examination when he
applied for the position of Delivery Man, but not when he applied for the
position of Truck Man. Mrs. Caamic also admitted that petitioner Del Rosario
used a Galant which is a light vehicle, instead of a truck during the driving
tests. Further, no tests were conducted on the motor skills development,
perceptual speed, visual attention, depth visualization, eye and hand
coordination and steadiness of petitioner Del Rosario. No NBI and police
clearances were also presented. Lastly, petitioner Del Rosario attended only
three driving seminars — on June 30, 2001, February 5, 2000 and July 7, 1984.
In effect, the only seminar he attended before the accident which occurred in
1996 was held twelve years ago in 1984.

It also appears that petitioner Mercury Drug does not provide for a back-
up driver for long trips. At the time of the accident, petitioner Del Rosario has
been out on the road for more than thirteen hours, without any alternate. Mrs.
Caamic testified that she does not know of any company policy requiring back-
up drivers for long trips. 14
Petitioner Mercury Drug likewise failed to show that it exercised due
diligence on the supervision and discipline over its employees. In fact, on the
day of the accident, petitioner Del Rosario was driving without a license. He
was holding a TVR for reckless driving. He testified that he reported the
incident to his superior, but nothing was done about it. He was not suspended
or reprimanded. 15 No disciplinary action whatsoever was taken against
petitioner Del Rosario. We therefore affirm the finding that petitioner Mercury
Drug has failed to discharge its burden of proving that it exercised due
diligence in the selection and supervision of its employee, petitioner Del
Rosario.
We now consider the damages which respondents should recover from
the petitioners.

The trial court awarded the following amounts:

1. Two Million Nine Hundred Seventy-Three Thousand Pesos
(P2,973,000.00) actual damages;
AHTICD

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 2. As compensatory damages:

a. Twenty-Three Million Four Hundred Sixty One Thousand, and

Sixty-Two Pesos (P23,461,062.00) for life care cost of
Stephen;
b. Ten Million Pesos (P10,000,000.00) as and for lost or impaired
earning capacity of Stephen;
3. Four Million Pesos (P4,000,000.00) as moral damages;
4. Two Million Pesos (P2,000,000.00) as exemplary damages; and

5. One Million Pesos (P1,000,000.00) as attorney's fees and litigation

expense.

The Court of Appeals affirmed the decision of the trial court but reduced
the award of moral damages to P1,000,000.00.

With regard to actual damages, Art. 2199 of the Civil Code provides that "
[E]xcept as provided by law or by stipulation one is entitled to an adequate
compensation only for such pecuniary loss suffered by him as he has duly
proved . . . ." In the instant case, we uphold the finding that the actual
damages claimed by respondents were supported by receipts. The amount of
P2,973,000.00 represented cost of hospital expenses, medicines, medical
services and supplies, and nursing care services provided respondent Stephen
from December 20, 1996, the day of the accident, until December 1998.

Petitioners are also liable for all damages which are the natural and
probable consequences of the act or omission complained of. 16 The doctors
who attended to respondent Stephen are one in their prognosis that his
chances of walking again and performing basic body functions are nil. For the
rest of his life, he will need continuous rehabilitation and therapy to prevent
further complications such as pneumonia, bladder and rectum infection, renal
failure, sepsis and severe bed sores, osteoporosis and fractures, and other
spinal cord injury-related conditions. He will be completely dependent on the
care and support of his family. We thus affirm the award of P23,461,062.00 for
the life care cost of respondent Stephen Huang, based on his average monthly
expense and the actuarial computation of the remaining years that he is
expected to live; and the conservative amount of P10,000,000.00, as reduced
by the trial court, for the loss or impairment of his earning capacity, 17
considering his age, probable life expectancy, the state of his health, and his
mental and physical condition before the accident. He was only seventeen
years old, nearly six feet tall and weighed 175 pounds. He was in fourth year
high school, and a member of the school varsity basketball team. He was also
class president and editor-in-chief of the school annual. He had shown very
good leadership qualities. He was looking forward to his college life, having just
passed the entrance examinations of the University of the Philippines, De La
Salle University, and the University of Asia and the Pacific. The University of
Sto. Tomas even offered him a chance to obtain an athletic scholarship, but the
accident prevented him from attending the basketball try-outs. Without doubt,
he was an exceptional student. He excelled both in his academics and
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 extracurricular undertakings. He is intelligent and motivated, a go-getter, as
testified by Francisco Lopez, respondent Stephen Huang's godfather and a bank
executive. 18 Had the accident not happened, he had a rosy future ahead of
him. He wanted to embark on a banking career, get married and raise children.
Taking into account his outstanding abilities, he would have enjoyed a
successful professional career in banking. But, as Mr. Lopez stated, it is highly
unlikely for someone like respondent to ever secure a job in a bank. To his
knowledge, no bank has ever hired a person suffering with the kind of disability
as Stephen Huang's. 19
We likewise uphold the award of moral and exemplary damages and
attorney's fees. DHITcS

"The award of moral damages is aimed at a restoration, within the limits

of the possible, of the spiritual status quo ante." 20 Moral damages are designed
to compensate and alleviate in some way the physical suffering, mental
anguish, fright, serious anxiety, besmirched reputation, wounded feelings,
moral shock, social humiliation, and similar injury unjustly caused a person.
Although incapable of pecuniary computation, they must be proportionate to
the suffering inflicted. 21 The amount of the award bears no relation
whatsoever with the wealth or means of the offender.
In the instant case, respondent Stephen Huang and respondent spouses
Richard and Carmen Huang testified to the intense suffering they continue to
experience as a result of the accident. Stephen recounted the nightmares and
traumas he suffers almost every night when he relives the accident. He also
gets depression when he thinks of his bleak future. He feels frustration and
embarrassment in needing to be helped with almost everything and in his
inability to do simple things he used to do. Similarly, respondent spouses and
the rest of the family undergo their own private suffering. They live with the
day-to-day uncertainty of respondent Stephen Huang's condition. They know
that the chance of full recovery is nil. Moreover, respondent Stephen Huang's
paralysis has made him prone to many other illnesses. His family, especially
respondent spouses, have to make themselves available for Stephen twenty-
four hours a day. They have patterned their daily life around taking care of him,
ministering to his daily needs, altering the lifestyle to which they had been
accustomed.
Respondent Carmen Huang's brother testified on the insensitivity of
petitioner Mercury Drug towards the plight of respondent. Stephen, viz.:
Maybe words cannot describe the anger that we feel towards the
defendants. All the time that we were going through the crisis, there
was none ( sic ) a single sign of nor offer of help, any consolation or
anything whatsoever. It is funny because, you know, I have many
colleagues, business associates, people even as far as United States,
Japan, that I probably met only once, when they found out, they make
a call, they sent card, they write small notes, but from the defendant,
absolute silence. They didn't care, and worst, you know, this is a
company that have (sic ) all the resources to help us. They were (sic ) on
our part, it was doubly painful because we have no choice but to go
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 back to them and buy the medicines that we need for Stephen. So, I
don't know how someone will really have no sense of decency at all to
at least find out what happened to my son, what is his condition, or if
there is anything that they can do to help us. 22

On the matter of exemplary damages, Art. 2231 of the Civil Code provides
that in cases of quasi-delicts, exemplary damages may be granted if the
defendant acted with gross negligence. The records show that at the time of
the accident, petitioner Del Rosario was driving without a license because he
was previously ticketed for reckless driving. The evidence also shows that he
failed to step on his brakes immediately after the impact. Had petitioner Del
Rosario done so, the injuries which respondent Stephen sustained could have
been greatly reduced. Wanton acts such as that committed by petitioner Del
Rosario need be suppressed; and employers like petitioner Mercury Drug
should be more circumspect in the observance of due diligence in the selection
and supervision of their employees. The award of exemplary damages in favor
of the respondents is therefore justified.
With the award of exemplary damages, we also affirm the grant of
attorney's fees to respondents. 23 In addition, attorney's fees may be granted
when a party is compelled to litigate or incur expenses to protect his interest
by reason of an unjustified act of the other party. 24
Cost against petitioners.
IN VIEW THEREOF, the petition is DENIED. The Decision and Resolution of
the Court of Appeals dated February 16, 2006 and March 30, 2006,
respectively, in CA-G.R. CV No. 83981, are AFFIRMED.
SO ORDERED. DaTICE

Sandoval-Gutierrez, Corona, Azcuna and Garcia, JJ., concur.

Footnotes
1. Rollo , pp. 9-72.
2. Id. at 74-75.

3. Id. at 523-564.
4. Id. at 563-564.
5. Id. at 90-92.
6. TSN, March 27, 2000, p. 16.
7. TSN, April 12, 2000, pp. 53-58.

8. TSN, March 23, 2003, pp. 5-29.

9. TSN, June 14, 2000, pp. 10-11.
10. TSN, April 12, 2000, pp. 27-29.

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 11. Art. 2194, Civil Code. The responsibility of two or more persons who are liable
for a quasi-delict is solidary.

12. Estacion v. Bernardo , G.R. No. 144723, February 27, 2006, 483 SCRA 222;
Campo v. Camarote, 100 Phil. 459, 463 (1956).
13. Victory Liner, Inc. v. Heirs of Andres Malecdan, G.R. No. 154278, December 27,
2002, 394 SCRA 520.

14. TSN, January 2002, pp. 39-42.

15. TSN, April 2000, pp. 11-16; TSN, November 28, 2001, pp. 35-37.
16. Art. 2202, Civil Code. In crimes and quasi-delicts, the defendant shall be liable
for all damages which are the natural and probable consequences of the act
or omission complained of. It is not necessary that such damages have been
foreseen or could have reasonably been foreseen by the defendant.
17. Art. 2205, Civil Code. Damages may be recovered:

(1) For loss or impairment of earning capacity in cases of temporary or

permanent personal injury;

xxx xxx xxx

18. TSN, September 24, 1999, pp. 28-29.
19. TSN, September 24, 1999, pp. 30-31.
20. Cesar Sangco, Torts and Damages 986 (Rev. ed., 1994), cited in Roque v.
Torres, G.R. 157632, December 6, 2006.
21. Philippine National Railways v. Brunty , G.R. No. 169891, November 2, 2006.
22. TSN, January 11, 1999, pp. 23-24.

23. Art. 2208 (1), Civil Code.

24. Art. 2208 (2), Civil Code.

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