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G.R.No.88052

TodayisSaturday,January24,2015

RepublicofthePhilippines
SUPREMECOURT
Manila
THIRDDIVISION
G.R.No.88052December14,1989
JOSEP.MECENAS,ROMEOP.MECENAS,LILIAP.MECENAS,ORLANDOP.MECENAS,VIOLETAM.
ACERVO,LUZVIMINDAP.MECENASandOFELIAM.JAVIER,petitioners,
vs.
HON.COURTOFAPPEALS,CAPT.ROGERSANTISTEBANandNEGROSNAVIGATIONCO.,INC.,
respondents.
BenitoP.FavieandJoseDarioMagnoforpetitioners.
Hernandez,Velicaria,Vibar&Santiagoforprivaterespondents.

FELICIANO,J.:
At 6:20 o'clock in the morning of 22 April 1980, the M/T "Tacloban City," a bargetype oil tanker of Philippine
registry, with a gross tonnage of 1,241,68 tons, owned by the Philippine National Oil Company (PNOC) and
operated by the PNOC Shipping and Transport Corporation (PNOC Shipping), having unloaded its cargo of
petroleum products, left Amlan, Negros Occidental, and headed towards Bataan. At about 1:00 o'clock in the
afternoonofthatsameday,theM/V"DonJuan,"aninterislandvessel,alsoofPhilippineregistry,of2,391.31tons
grossweight,ownedandoperatedbytheNegrosNavigationCo.,Inc.(NegrosNavigation)leftManilaboundfor
Bacolodwithsevenhundredfifty(750)passengerslistedinitsmanifest,andacompletesetofofficersandcrew
members.
Ontheeveningofthatsameday,22April1980,atabout10:30o'clock,the"TaclobanCity"andthe"DonJuan"
collided at the Talbas Strait near Maestra de Ocampo Island in the vicinity of the island of Mindoro. When the
collisionoccurred,theseawascalm,theweatherfairandvisibilitygood.Asaresultofthiscollision,theM/V"Don
Juan" sank and hundreds of its passengers perished. Among the illfated passengers were the parents of
petitioners,thespousesPerfectoMecenasandSofiaMecenas,whosebodieswereneverfounddespiteintensive
searchbypetitioners.
On29December1980,petitionersfiledacomplaintinthethenCourtofFirstInstanceofQuezonCity,docketed
as Civil Case No. Q31525, against private respondents Negros Navigation and Capt. Roger Santisteban, the
captain of the "Don Juan" without, however, impleading either PNOC or PNOC Shipping. In their complaint,
petitioners alleged that they were the seven (7) surviving legitimate children of Perfecto Mecenas and Sofia
MecenasandthatthelatterspousesperishedinthecollisionwhichhadresultedfromthenegligenceofNegros
NavigationandCapt.Santisteban.PetitionersprayedforactualdamagesofnotlessthanP100,000.00aswellas
moralandexemplarydamagesinsuchamountastheCourtmaydeemreasonabletoawardtothem.
Another complaint, docketed as Civil Case No. Q33932, was filed in the same court by Lilia Ciocon claiming
damages against Negros Navigation, PNOC and PNOC Shipping for the death of her husband Manuel Ciocon,
anotherofthelucklesspassengersofthe"DonJuan."ManuelCiocon'sbody,too,wasneverfound.
Thetwo(2)caseswereconsolidatedandheardjointlybytheRegionalTrialCourtofQuezonCity,Branch82.On
17July1986,aftertrial,thetrialcourtrenderedadecision,thedispositiveofwhichreadasfollows:
WHEREFORE,theCourtherebyrendersjudgmentordering:
a) The defendant Negros Navigation Co., Inc. and Capt. Roger Santisteban jointly and severally
liable to pay plaintiffs in Civil Case No Q31525, the sum of P400,000.00 for the death of plaintiffs'
parents,PerfectoA.MecenasandSofiaP.Mecenastopaysaidplaintiff'sthesumofP15.000,00as
andforattorney'sfeespluscostsofthesuit.
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b) Each of the defendants Negros Navigation Co Inc. and Philippine National Oil Company/PNOC
Shipping and Transportation Company, to pay the plaintiff in Civil Case No. Q33932, the sum of
P100,000.00forthedeathofManuelCiocon,topaysaidplaintiffjointlyandseverally,thesumofP1
5,000.00asandforattorney'sfees,pluscostsofthesuit.1
NegrosNavigation,Capt.Santisteban,PNOCandPNOCShippingappealedthetrialcourt'sdecisiontotheCourt
ofAppeals.Later,PNOCandPNOCShippingwithdrewtheirappealcitingacompromiseagreementreachedby
themwithNegrosNavigationtheCourtofAppealsgrantedthemotionbyaresolutiondated5September1988,
subjecttothereservationmadebyLiliaCioconthatshecouldnotbeboundbythecompromiseagreementand
wouldenforcetheawardgrantedherbythetrialcourt.
Intime,theCourtofAppealsrenderedadecisiondated26January1989whichdecreedthefollowing:
WHEREFORE,inviewoftheforegoing,thedecisionofthecourtaquoisherebyaffirmedasmodifiedwithrespect
to Civil Case No. 31525, wherein defendant appellant Negros Navigation Co. Inc. and Capt. Roger Santisteban
areheldjointlyandseverallyliabletopaytheplaintiffstheamountofP100,000.00asactualandcompensatory
damagesandP15,000.00asattorney'sfeesandthecostofthesuit.2
TheissuetoberesolvedinthisPetitionforReviewiswhetherornottheCourtofAppealshaderredinreducing
theamountofthedamagesawardedbythetrialcourttothepetitionersfromP400,000.00toP100,000.00.
WenotethatthetrialcourthadgrantedpetitionersthesumofP400,000,00"forthedeathof[theirparents]"plus
P15,000.00 as attorney's fees, while the Court of Appeals awarded them P100,000.00 "as actual and
compensatory damages" and P15,000.00 as attorney's fees. To determine whether such reduction of the
damagesawardedwasproper,wemustfirstdeterminewhetherpetitionerswereentitledtoanawardofdamages
otherthanactualorcompensatorydamages,thatis,whethertheywereentitledtoawardofmoralandexemplary
damages.
We begin by noting that both the trial court and the Court of Appeals considered the action (Civil Case No. Q
31525) brought by the sons and daughters of the deceased Mecenas spouses against Negros Navigation as
based on quasidelict. We believed that action is more appropriately regarded as grounded on contract, the
contract of carriage between the Mecenas spouses as regular passengers who paid for their boat tickets and
Negros Navigation the surviving children while not themselves passengers are in effect suing the carrier in
representationoftheirdeceasedparents. 3Thus,thesuit(CivilCaseNo.Q33932)filedbythewidowLiliaCioconwas
correctlytreatedbythetrialandappellatecourtsasbasedoncontract(visavisNegrosNavigation)andaswellonquasi
delict(visavisPNOCandPNOCShipping).Inanactionbaseduponabreachofthecontractofcarriage,thecarrierunder
ourcivillawisliableforthedeathofpassengersarisingfromthenegligenceorwillfulactofthecarrier'semployeesalthough
suchemployeesmayhaveactedbeyondthescopeoftheirauthorityoreveninviolationoftheinstructionsofthecarrier, 4
which liability may include liability for moral damages. 5 It follows that petitioners would be entitled to moral damages so
longasthecollisionwiththe"TaclobanCity"andthesinkingofthe"DonJuan"werecausedorattendedbynegligenceon
thepartofprivaterespondents.

Inrespectofthepetitioners'claimforexemplarydamages,itisonlynecessarytorefertoArticle2232oftheCivil
Code:
Article 2332. In contracts and quasicontracts, the court may exemplary damages if the defendant
actedinawanton,fraudulent,reckless,oppressiveormalevolentmanner.6
Thus, whether petitioners are entitled to exemplary damages as claimed must depend upon whether or not
privaterespondentsactedrecklessly,thatis,withgrossnegligence.
We turn, therefore, to a consideration of whether or not Negros Navigation and Capt. Santisteban were grossly
negligent during the events which culminated in the collision with "Tacloban City" and the sinking of the "Don
Juan"andtheresultingheavylossoflives.
The then Commandant of the Philippine Coast Guard, Commodore B.C. Ochoco, in a decision dated 2 March
1981, held that the "Tacloban City" was "primarily and solely [sic] at fault and responsible for the collision." 7
Initially, the Minister of National Defense upheld the decision of Commodore Ochoco. 8 On Motion for Reconsideration,
however,theMinisterofNationalDefensereversedhimselfandheldthatbothvesselshadbeenatfault:

Itisthereforeevidentfromacloseandthoroughreviewoftheevidencethatfaultisimputabletoboth
vessels for the collision. Accordingly, the decision dated March 12, 1982, subject of the Motion for
Reconsideration filed by counsel of M/T Tacloban City, is hereby reversed. However, the
administrative penalties imposed oil both vessels and their respective crew concerned are hereby
affirmed.9
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Thetrialcourt,afterareviewoftheevidencesubmittedduringthetrial,arrivedatthesameconclusionthatthe
MinisterofNationalDefensehadreachedthatboththe"TaclobanCity"andthe"DonJuan"wereatfaultinthe
collision. The trial court summarized the testimony and evidence of PNOC and PNOC Shipping as well as of
NegrosNavigationinthefollowingterms:
DefendantPNOC'sversionoftheincident:
M/VDonJuanwasfirstsightedatabout5or6milesfromTaclobanCity(TSN,January21,1985,p.
13)itwasonthestarboard(right)sideofTaclobanCity.Thiswasavisualcontactnotpickedupby
radar (p. 15, Ibid). Tacloban City was travelling 310 degrees with a speed of 6 knots, estimated
speedofDonJuanof16knots(TSN,May9,pp.56).AsDonJuanapproached,TaclobanCitygave
aleewayof10degreestotheleft.'ThepurposewastoenableTaclobantoseethedirectionofDon
Juan(p.19,Ibid).DonJuanswitchedtogreenlight,signifyingthatitwillpassTaclobanCity'sright
side it will be a starboard to starboard passing (p. 21, Ibid) Tacloban City's purpose in giving a
leewayof10degreesatthispoint,istogiveDonJuanmorespaceforherpassage(p.22,Ibid).This
was increased by Tacloban City to an additional 15 degrees towards the left (p. 22, Ibid). The way
wasclearandDonJuanhasnotchangeditscourse(TSN,May9,1985,p.39).
WhenTaclobanCityaltereditscoursethesecondtime,from300degreesto285degrees,DonJuan
wasabout4.5milesaway(TSN,May9,1985,p.7).
Despite executing a hardport maneuver, the collision nonetheless occurred. Don Juan rammed the
TaclobanCitynearthestarboardbow(p.7,Ibid)."
NENACO's[NegrosNavigation]version.
Don Juan first sighted Tacloban City 4 miles away, as shown by radar (p. 13, May 24, 1983).
TaclobanCityshoweditsredandgreenlightstwiceitproceededto,andwillcross,thepathofDon
Juan.TaclobanwasontheleftsideofDonJuan(TSN,April20,1983,p.4).
UponseeingTacloban'sredandgreenlights,DonJuanexecutedhardstarboard(TSN,p.4,Ibid.)
Thismaneuverisinconformitywiththerulethat'whenbothvesselsareheadonornearlyheadon,
each vessel must turn to the right in order to avoid each other. (p. 5, Ibid). Nonetheless, Tacloban
appearedtobeheadingtowardsDonJuan(p.6,Ibid),
WhenDonJuanexecutedhardstarboard,Taclobanwasabout1,500feetaway(TSN,May24,1983,
p.6).DonJuan,afterexecutionofhardstarboard,willmoveforward200metersbeforethevessel
will respond to such maneuver (p. 7, Ibid). The speed of Don Juan at that time was 17 knits
Tacloban City 6.3 knots. t "Between 9 to 15 seconds from execution of hard starboard, collision
occurred(p.8,Ibid).(pp.34Decision).10
Thetrialcourtconcluded:

M/ V Don Juan and Tacloban City became aware of each other's presence in the area by visual
contact at a distance of something like 6 miles from each other. They were fully aware that if they
continued on their course, they will meet head on. Don Juan steered to the right Tacloban City
continued its course to the left. There can be no excuse for them not to realize that, with such
maneuvers,theywillcollide.Theyexecutedmaneuversinadequate,andtoolate,toavoidcollision.
The Court is of the considered view that the defendants are equally negligent and are liable for
damages.(p.4,decision).11
TheCourtofAppeals,foritspart,reachedthesameconclusion.12

Thereis,therefore,noquestionthatthe"DonJuan"wasatleastasnegligentastheM/T"TaclobanCity"inthe
events leading up to the collision and the sinking of the "Don Juan." The remaining question is whether the
negligence on the part of the "Don Juan" reached that level of recklessness or gross negligence that our Civil
Coderequiresfortheimpositionofexemplarydamages.Ourownreviewoftherecordinthecaseatbarrequires
ustoanswerthisintheaffirmative.
Inthefirstplace,thereportofthePhilippineCoastGuardCommandant(Exhibit"l0"),whileholdingthe"Tacloban
City"as"primarilyandsolely[sic]atfaultandresponsibleforthecollision,"diditselfsetoutthattherehadbeen
faultornegligenceonthepartofCapt.Santistebanandhisofficersandcrewbeforethecollisionandimmediately
aftercontactofthetwo(2)vessels.ThedecisionofCommodoreOchocosaid:
xxxxxxxxx
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M/SDonJuan'sMaster,Capt.RogelioSantisteban,wasplayingmahjongbeforeanduptothetime
of collision. Moreover, after the collision, he failed to institute appropriate measures to delay the
sinking MS Don Juan and to supervise properly the execution of his order of abandonship. As
regardstheofficeronwatch,Senior3rdMateRogelioDevera,headmittedthathefailedordidnot
call or inform Capt. Santisteban of the imminent danger of collision and of the actual collision itself
Also,hefailedtoassisthismastertopreventthefastsinkingoftheship.Therecordalsoindicates
that Auxiliary Chief Mate Antonio Labordo displayed laxity in maintaining order among the
passengersafterthecollision.
xxxxxxxxx.13
Webelievethatthebehaviourofthecaptainofthe"DonJuan"intillsinstanceplayingmahjong"beforeandupto
the time of collision constitutes behaviour that is simply unacceptable on the part of the master of a vessel to
whosehandsthelivesandwelfareofatleastsevenhundredfifty(750)passengershadbeenentrusted.Whether
or not Capt. Santisteban was "offduty" or "onduty" at or around the time of actual collision is quite immaterial
thereis,bothrealisticallyspeakingandincontemplationoflaw,nosuchthingas"offduty"hoursforthemasterof
avesselatseathatisacommoncarrieruponwhomthelawimposesthedutyofextraordinarydiligence
[t]hedutytocarrythepassengerssafelyasfarashumancareandforesightcanprovide,usingthe
utmostdiligenceofverycautiouspersons,withadueregardforallthecircumstances.14
TherecorddoesnotshowthatwasthefirstoronlytimethatCapt.Santistebanhadentertainedhimselfduringa
voyage by playing mahjong with his officers and passengers Negros Navigation in permitting, or in failing to
discoverandcorrectsuchbehaviour,mustbedeemedgrosslynegligent.
Capt.SantistebanwasalsofaultedinthePhilippineCoastGuarddecisionforfailingafterthecollision,"toinstitute
appropriatemeasurestodelaythesinkingofM/VDonJuan."Thisappearstoustobeaeuphemismforfailureto
maintaintheseaworthinessorthewatertightintegrityofthe"DonJuan."Therecordshowsthatthe"DonJuan"
sankwithinten(10)tofifteen(15)minutesafterinitialcontactwiththe"TaclobanCity. 15WhilethefailureofCapt.
Santistebantosupervisehisofficersandcrewintheprocessofabandoningtheshipandhisfailuretoavailofmeasuresto
preventthetoorapidsinkingofhisvesselaftercollision,didnotcausethecollisionbythemselves,suchfailuresdoubtless
contributed materially to the consequent loss of life and, moreover, were indicative of the kind and level of diligence
exercisedbyCapt.Santistebaninrespectofhisvesselandhisofficersandmenpriortoactualcontactbetweenthetwo(2)
vessels. The officeronwatch in the "Don Juan" admitted that he had failed to inform Capt. Santisteban not only of the
"imminentdangerofcollision"butevenof"theactualcollisionitself"

Thereisalsoevidencethatthe"DonJuan"wascarryingmorepassengersthanshehadbeencertifiedasallowed
to carry. The Certificate of Inspection 16 dated 27 August 1979, issued by the Philippine Coast Guard Commander at
IloiloCity,theDonJuan'shomeport,states:

Passengersallowed:810
TotalPersonsAllowed:864
ThereportofthePhilippineCoastGuard(Exhibit"10")statedthatthe"DonJuan"hadbeen"officiallyclearedwith
878 passengers on board when she sailed from the port of Manila on April 22, 1980 at about 1:00 p.m." This
headcountofthepassengers"didnotincludethe126crewmembers,childrenbelowthree(3)yearsoldandtwo
(2)halfpayingpassengers"whichhadbeencountedasoneadultpassenger. 17Thus,thetotalnumberofpersons
onboardthe"DonJuan"onthatillstarrednightof22April1980was1,004,or140personsmorethanthemaximumlumber
that could be safely carried by the "Don Juan," per its own Certificate of Inspection. 18 We note in addition, that only 750
passengers had been listed in its manifest for its final voyage in other words, at least 128 passengers on board had not
even been entered into the "Don Juan's" manifest. The "Don Juan's" Certificate of Inspection showed that she carried life
boat and life raft accommodations for only 864 persons, the maximum number of persons she was permitted to carry in
other words, she did not carry enough boats and life rafts for all the persons actually on board that tragic night of 22 April
1980.

Weholdthatunderthesecircumstances,apresumptionofgrossnegligenceonthepartofthevessel(herofficers
andcrew)andofitsshipownerarisesthispresumptionwasneverrebuttedbyNegrosNavigation.
The grossness of the negligence of the "Don Juan" is underscored when one considers the foregoing
circumstances in the context of the following facts: Firstly, the "Don Juan" was more than twice as fast as the
"Tacloban City." The "Don Juan's" top speed was 17 knots while that of the "Tacloban City" was 6.3. knots. 19
Secondly,the"DonJuan"carriedthefullcomplementofofficersandcrewmembersspecifiedforapassengervesselofher
class.Thirdly,the"DonJuan"wasequippedwithradarwhichwasfunctioningthatnight.Fourthly,the"DonJuan's"officer
onwatch had sighted the "Tacloban City" on his radar screen while the latter was still four (4) nautical miles away. Visual
confirmation of radar contact was established by the "Don Juan" while the "Tacloban City" was still 2.7 miles away. 20 In
the total set of circumstances which existed in the instant case, the "Don Juan," had it taken seriously its duty of
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extraordinarydiligence,couldhaveeasilyavoidedthecollisionwiththe"TaclobanCity,"Indeed,the"DonJuan"mightwell
haveavoidedthecollisionevenifithadexercisedordinarydiligencemerely.

Itistruethatthe"TaclobanCity"failedtofollowRule18oftheInternationalRulesoftheRoadwhichrequirestwo
(2)powerdrivenvesselsmeetingendonornearlyendoneachtoalterhercoursetostarboard(right)sothat
eachvesselmaypassontheportside(left)oftheother.21The"TaclobanCity,"whenthetwo(2)vesselswereonly
threetenths (0.3) of a mile apart, turned (for the second time) 150 to port side while the "Don Juan" veered hard to
starboard. This circumstance, while it may have made the collision immediately inevitable, cannot, however, be viewed in
isolation from the rest of the factual circumstances obtaining before and up to the collision. In any case, Rule 18 like all
other International Rules of the Road, are not to be obeyed and construed without regard to all the circumstances
surroundingaparticularencounterbetweentwo(2)vessels. 22Inordinarycircumstances,avesseldischargesherdutyto
anotherbyafaithfulandliteralobservanceoftheRulesofNavigation, 23andshecannotbeheldatfaultforsodoingeven
thoughadifferentcoursewouldhavepreventedthecollision.Thisrule,however,isnottobeappliedwhereitisapparent,as
intheinstantcase,thathercaptainwasguiltyofnegligenceorofawantofseamanshipinnotperceivingthenecessityfor,
orinsoactingastocreatesuchnecessityfor,adeparturefromtheruleandactingaccordingly. 24 In other words, "route
observance" of the International Rules of the Road will not relieve a vessel from responsibility if the collision could have
beenavoidedbypropercareandskillonherpartorevenbyadeparturefromtherules.25

In the petition at bar, the "Don Juan" having sighted the "Tacloban City" when it was still a long way off was
negligent in failing to take early preventive action and in allowing the two (2) vessels to come to such close
quartersastorenderthecollisioninevitablewhentherewasnonecessityforpassingsoneartothe"Tacloban
City"astocreatethathazardorinevitability,forthe"DonJuan"couldchooseitsowndistance. 26,Itisnoteworthy
thatthe"TaclobanCity,"uponturninghardtoportshortlybeforethemomentofcollision,signalleditsintentiontodosoby
giving two (2) short blasts with horn. 26A The "Don Juan " gave no answering horn blast to signal its own intention and
proceededtoturnhatdtostarboard.26B

We conclude that Capt. Santisteban and Negros Navigation are properly held liable for gross negligence in
connectionwiththecollisionofthe"DonJuan"and"TaclobanCity"andthesinkingofthe"DonJuan"leadingto
the death of hundreds of passengers. We find no necessity for passing upon the degree of negligence or
culpability properly attributable to PNOC and PNOC Shipping or the master of the "Tacloban City," since they
wereneverimpleadedhere.
ItwillberecalledthatthetrialcourthadrenderedalumpsumofP400,000.00topetitionersforthedeathoftheir
parents in the "Don Juan" tragedy. Clearly, the trial court should have included a breakdown of the lump sum
award into its component parts: compensatory damages, moral damages and exemplary damages. On appeal,
theCourtofAppealscouldhaveandshouldhaveitselfbrokendownthelumpsumawardofthetrialcourtintoits
constituent parts perhaps, it did, in its own mind. In any case, the Court of Appeals apparently relying upon
Manchester Development Corporation V. Court of Appeals 27 reduced the P400,000.00 lump sum award into a
P100,000.00foractualandcompensatorydamagesonly.

We believe that the Court of Appeals erred in doing so, It is true that the petitioners' complaint before the trial
courthadinthebodyindicatedthatthepetitionerplaintiffsbelievedthatmoraldamagesintheamountofatleast
P1,400,000.00 were properly due to them (not P12,000,000.00 as the Court of Appeals erroneously stated) as
well as exemplary damages in the sum of P100,000.00 and that in the prayer of their complaint, they did not
specifytheamountofmoralandexemplarydamagessoughtfromthetrialcourt.Wedonotbelieve,however,that
the Manchester doctrine, which has been modified and clarified in subsequent decision by the Court in Sun
InsuranceOffice,Ltd.(SIOL),etal.v.Asuncion,etal.28canbeappliedintheinstantcasesoastoworkastrikingout
of that portion of the trial court's award which could be deemed nationally to constitute an award of moral and exemplary
damages. Manchester was promulgated by the Court on 7 May 1987. Circular No. 7 of this Court, which embodied the
doctrine in Manchester, is dated 24 March 1988. Upon the other hand, the complaint in the case at bar was filed on 29
December1980,thatis,longbeforeeitherManchesterorCircularNo.7of24March1988emerged.Thedecisionofthetrial
court was itself promulgated on 17 July 1986, again, before Manchester and Circular No. 7 were promulgated. We do not
believe that Manchester should have been applied retroactively to this case where a decision on the merits had already
beenrenderedbythetrialcourt,eventhoughsuchdecisionwasthenunderappealandhadnotyetreachedfinality.Thereis
noindicationatallthatpetitionersheresoughtsimplytoevadepaymentofthecourt'sfilingfeesortomisleadthecourtin
theassessmentofthefilingfees.Inanyevent,weapplyManchesterasclarifiedandamplifiedbySunInsuranceOfficeLtd.
(SIOL), by holding that the petitioners shall pay the additional filing fee that is properly payable given the award specified
below,andthatsuchadditionalfilingfeeshallconstitutealienuponthejudgment.

We consider, finally, the amount of damagescompensatory, moral and exemplaryproperly imposable upon
private respondents in this case. The original award of the trial court of P400,000.00 could well have been
disaggregatedbythetrialcourtandtheCourtofAppealsinthefollowingmanner:
1. actualorcompensatorydamagesprovedinthecourseoftrialconsistingofactualexpenses
incurredbypetitioners
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intheirsearchfortheir
parents'bodiesP126,000.00
2. actualorcompensatory
damagesincaseof
wrongfuldeath
(P30,000.00x2)P60,000.0029
(3)moraldamagesP107,000.00

(4)exemplarydamagesP107,000.00
TotalP400,000.00
Consideringthatpetitioners,legitimatechildrenofthedeceasedspousesMecenas,areseven(7)innumberand
thattheylostbothfatherandmotheinonefellblowoffate,andconsideringthepainandanxietytheydoubtless
experienced while searching for their parents among the survivors and the corpses recovered from the sea or
washed ashore, we believe that an additional amount of P200,000.00 for moral damages, making a total of
P307,000.00formoraldamages,makingatotalofP307,000.00asmoraldamages,wouldbequitereasonable.
Exemplary damages are designed by our civil law to permit the courts to reshape behaviour that is socially
deleteriousinitsconsequencebycreatingnegativeincentivesordeterrentsagainstsuchbehaviour.Inrequiring
compliance with the standard which is in fact that of the highest possible degree of diligence, from common
carriersandincreatingapresumptionofnegligenceagainstthem,thelawseelstocompelthemtocontroltheir
employees,totametheirrecklessinstinctsandtoforcethemtotakeadequatecareofhumanbeingsandtheir
property.TheCourtwilltakejudicialnotiveofthedreadfulregularitywithwhichgrievousmaritimedisastersoccur
inourwaterswithmassivelossoflife.Thebulkofourpopulationistoopoortoafforddomesticairtransportation.
Soitisthatnotwithstandingthefrequentsinkingofpassengervesselsinourwaters,crowdsofpeoplecontinueto
travelbysea.ThisCourtispreparedtousetheinstrumentsgiventoitbythelawforsecuringtheendsoflawand
public policy. One of those instruments is the institution of exemplary damages one of those ends, of special
importanceinanarchipelagicstatelikethePhilippines,isthesafeandreliablecarriageofpeopleandgoodsby
sea. Considering the foregoing, we believe that an additional award in the amount of P200,000.00 as exmplary
damages,isquitemodest.
TheCourtisawarethatpetitionersheremerelyaskedfortherestorationoftheP400.000.00awardofthetrial
court.Weunderscoreoncemore,however,thefirmlysettleddoctrinethatthisCourtmayconsiderandresolved
allissueswhichmustbedecidedinordertorendersubstantialjusticetotheparties,includingissuesnotexplicity
raisedbythepartyaffected.Inthecaseatbar,asinKapalaranBusLinev.Coronado,etal.,30boththedemands
ofsustantialjusticeandtheimperiousrequirementsofpublicpolicycompelustotheconclusionthatthetrialcourt'simplicit
awardofmoralandexemplarydamageswaserronoeuslydeledtedandmustberestoredandaugmentedandbroughtmore
nearelytothelevelrequiredbypublicpolicyandsubstantialjustice.

WHEREFORE,thePetitionforReviewoncertiorariisherebyGRANTEDandtheDecisionoftheCourtofAppeals
insofar as it redurce the amount of damages awarded to petitioners to P100,000.00 is hereby REVERSED and
SETASIDE.TheawardgrantedbythetrialcourtisherebyRESTOREDandAUGMENTEDasfollows:
(a)P126,000.00foractualdamages
(b)P60,000.00ascompensatorydamagesforwrongfuldeath
(c)P307,000.00asmoraldamages
(d)P307,000.00asexemplarydamagesmakingatotalofP800,000.00and
(e)P15,000.00asattorney'sfees.
Petitioners shall pay the additional filing fees properly due and payable in view of the award here made, which
feesshallbecomputedbytheClerksofCourtofthetrialcourt,andshallconstitutealienuponthejudgmenthere
awarded.Costagainstprivaterespondents.
SOORDERED.
Fernan,C.J.,Gutierrez,Jr.,BibinandCortes,JJ.,concur.
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Footnotes
1Rollo,p.60.
2Rollo,p.40.
3Seee.g.Necesitov.Paras,104Phil.84(1985)BatangasTransportationCo.v.Caguimbal,etal.,
22SCRA171(1968)andDavilav.PhilippineAirlines,49SCRA497(1973).
4Article1759,CivilCode.
5Article1764,CivilCode.
6See,e.g.,Marchanv.Mendoza,26SCRA731(1961)italicssupplied.
7BMICaseNo.41580Exhibit"l0FolderofExhibits.
8SeeDecision,dated12March1982,oftheMinisterofNationalDefenseExhibit"ll,"Folderof
Exhibitsitalicssupplied.
9Exhibit"13,"FolderofExhibitsitalicssupplied.
10CourtofAppeals'DecisionRollo,pp.3334.
11RegionalTrialCourt'sDecisionRollop.59italicssupplied.
12Decision,C.A.G.R.CVNo.13802,p.8Rollop.38.
13Exhibit"E"FolderofExhibitsitalicssupplied.
14Article1755,CivilCodeitalicssupplied.
15Decision,dated24July1984,MinisterofNationalDefenseExhibit"13."There,theM/TTacloban
Cityurged,thattheDonJuanwasinfactunseaworthy,thatshesankinten(10)minutes"afteronly
oneofherholdswaspuncturedwhenshewassupposedtoremainafloatevenwithtwo(2)adjacent
compartmentscompletelyflooded,suggestingthatherwatertightintegrityhadbeentamperedwith
...
16Exhibit"lA"(NegrosNavigation),FolderofExhibits.
17Exhibit10p.5.
18Seealsothe"CertificateofStability,"dated16December1976,oftheDonJuan("Exhibit"6A,"
FolderofExhibits)statingthatthenumberofpersonsonboardshallnotexceedtheauthorized
numberstipulatedintheCertificateofInspection.
19Decision,dated24July1984oftheMinisterofNationalDefense,Exhibit"13,"FolderofExhibits.
20BMICaseNo.41580Exhibit"l0",FolderofExhibits.Itshouldnotescapenoticethatthe
"TaclobanCity"hadvisuallysightedthe"DonJuan"whenthelatterwasstill5or6milesaway,much
soonerthanthe"DonJuan"haddone.
21Rule18.(a)Whentwopowerdrivenvesselsaremeetingendon,ornearlyendon,soasto
involveriskofcollision,eachshallalterhercoursetostarboard,sothateachmaypassontheport
sideoftheother.ThisRuleonlyappliestocaseswherevesselsaremeetingendonornearlyend
on,insuchamannerastoinvolveriskofcollision,anddoesnotapplytotwovesselswhichmust,if
bothkeepontheirrespectivecourse,passclearofeachother.Theonlycasestowhichitdoesapply
arewheneachoftwovesselsisendon,ornearlyendon,totheotherinotherwords,tocasesin
which,byday,eachvesselseesthemastsoftheotherinalineornearlyinalinewithherownand
bynighttocasesinwhicheachvesselisinsuchapositionastoseeboththesidelightsoftheother.
Itdoesnotapply,byday,tocasesinwhichavesselseesanotheraheadcrossingherowncourseor
byright,tocaseswheretheredlightofonevesselisopposedtotheredlightoftheotherorwhere
thegreenlightofonevesselisopposedtothegreenlightoftheotherorwherearedlightwithouta
greenlightoragreenlightwithoutaredlightisseenahead,orwherebothgreenandredlightsare
seenanywherebutahead.
(b)ForthepurposesofthisRuleandRules19to29inclusive,exceptRule20(c)andRule28,a
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seaplaneonthewatershallbedeemedtobeavessel,andtheexpression'powerdrivenvessel'
shallbeconstruedaccordingly."(AnnexA,PhilippineMerchantMarineRulesandRegulations,540
541[publishedbythePhilippineCoastGuard19771).
22Thus,e.g.
Rule19.Whentwopowerdrivenvesselsarecrossing,soastoinvolveriskofcollision,thevessel
whichhastheotheronherownstarboardsideshallkeepoutofthewayoftheirhand.
Rule22.EveryvesselwhichisdirectedbytheseRulestokeepoutofthewayofanothervesselshall,
sofaraspossible,takepositiveearlyactiontocomplywiththisobligation,andshall,ifthe
circumstancesofthecaseadmit,avoidcrossingaheadoftheother.
23TheOregon,158U.S.186,49Led.943(1985).
24TheSteamshipNacoocheev.Mosley,etal.,137U.S.330,34Led.687(1890).SeealsoHealy
andSharpeCasesandMaterialsonAdmiralty,2nded.(1986)p.585.
25TheNewYork175U.S187,44Led.126(1899)TheAmerica,92U.S432,23Led.724(1876).
SeealsoSchoenbaumAdmiraltyandMaritimeLaw(1987),p.449.16Urrutia&Co.v.BacoRiver
PlantationCo.,
26Phil.632(1913)quotingwithapproval'TheGeneseeChief"12How.443.
26ATSN,January21,1985,p.23seeRule28,InternationalRulesoftheRoad.
26BIbid,p.30.
27149SCRA562(1987).
Rule27.InobeyingandconstruingtheseRules,dueregardshallbehadtoalldangersofnavigation
andcollision,andtoanyspecialcircumstances,includingthelimitationsofthecraftinvolved,which
mayrenderadeparturefromtheaboveRulesnecessaryinordertoavoidimmediatedanger."
Rule29.NothingintheseRulesshallexonerateanyvessel,ortheowner,masterorcrewthereof,
fromtheconsequencesofanyneglecttocarryrightsorsignals,orofanyneglecttokeepaproper
lookout,oroftheneglectofanyprecautionwhichmayberequiredbytheordinarypracticeof
seamen,orbythespecialcircumstancesofthecase."(Italicssupplied)shortlybeforethemomentof
collision,signalleditsintentiontodosobygivingtwo(2)shortblastswithitshorn.26AThe"Don
Juan"gavenoansweringhornblasttosignalitsownintentionandproceededtoturnhardto
starboard.26B
28G.R.Nos.7993738,promulgated13February1988.
29See,e.g.,SpousesFedericoandFeliscisimaR.Francov.Inter
30G.RNo.85531,prolmulgated25August1989.mediateAppellateCourt,etal.,G.R.No.71137,
promulgated5October1989.
TheLawphilProjectArellanoLawFoundation

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