Philippine School of Business Administration et al vs.

Court of Appeals et al
Date (4 February 1992) | Ponente: Padilla

Overview: PSBA is being made to account by the parents of its student, Carlitos Bautista, who was stabbed to
death by assailants from outside the school inside the school premises. The Court of Appeals ruled that the
RTC decision to deny the school’s motion to dismiss was correct, affirming the order, following the rule on
quasi-delicts (NCC Arts. 2180 and 2176). The Supreme Court, however, ruled that the law on quasi-delicts does
not apply, as there exists a contract between school and student including an obligation to safety; it rules that
torts may be the acts that break a contract and thus liability may still be incurred by the school following NCC
Art. 21.

Topic: Obligations; quasi-delicts; torts

Statement of the Case

- The death of one Carlitos Bautista on the premises of the Philippine School of Business Administration
(PSBA) prompted his parents to file a suit for damages resulting from negligence, recklessness, and
insufficiency of safety precautions against said school, specifically its officials, at the RTC of Manila,
which was presided over by Judge Regina Ordonez-Benitez. As defendants, PSBA et al sought the
dismissal of the case on the ground that PSBA, as an academic institution, is beyond the ambit of Article
2180 of the NCC, under which they are being sued. The RTC denied their motion to dismiss, then the
subsequent motion for reconsideration.
- Defendants-turned-petitioners assailed the RTC’s dispositions before the CA, but the appellate court
upheld the ruling given by the RTC, and denied the subsequent motion for reconsideration, bringing the
appellants to the Supreme Court.

Statement of Facts
- 30 August 1985: Carlitos Bautista was stabbed to death on the second floor balcony of PSBA. Bautista
was a student in said school, a junior commerce major. It was established that the assailants were
outsiders, not enrolled nor affiliated with the school.
o His parents (the private respondents Segunda [?] and Arsenia), filed suit for damages against
the school and the following school officials: Juan D. Lim (President), Benjamin P. Paulino
(Vice-President), Antonio M. Magtalas (Treasurer/Cashier), Col. Pedro Sacro (Chief of Security)
and Lt. M. Soriano (Assistant Chief of Security). The last, during the proceedings, resigned from
his position.
- 8 December 1987: The respondent Manila RTC, having overruled instant petitioners’ contentions,
denies their motion to dismiss the case.
- 25 January 1988: The RTC dismisses the motion for reconsideration as well.
- 10 June 1988: The CA affirms the trial court’s orders; petitioners file a motion for reconsideration.
- 22 August 1988: The CA denies the motion for reconsideration.

Applicable Laws:
- ART. 1157(5), NCC: OBLIGATIONS ARISE FROM:
(5) QUASI-DELICTS
- ART. 1162, NCC: OBLIGATIONS DERIVED FROM QUASI-DELICTS SHALL BE GOVERNED BY THE PROVISIONS OF CHAPTER 2, TITLE XVII OF
THIS BOOK, AND BY SPECIAL LAWS.
- ART. 2176, NCC: 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, PARS. 1, 7, NCC: 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
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.
- ART. 21, NCC: ANY PERSON WHO WILFULLY CAUSES LOSS OR INJURY TO ANOTHER IN A MANNER THAT IS CONTRARY TO MORALS, GOOD
CUSTOMS OR PUBLIC POLICY SHALL COMPENSATE THE LATTER FOR THE DAMAGE.

Issues:
1. Was the Court of Appeals correct in affirming the decision of the RTC not to dismiss the case against
PSBA?
 Held Rationale:
HOWEVER, the Supreme Court disagrees with the CA’s basis for the decision being anchored on
Arts. 2176 and 2180 of the NCC. The SC agrees with the CA that the case must be remanded to
the RTC for trial on its merits. But the reason provided by the CA, which is that in light of previous
jurisprudence and the fact that Article 2180 is a holdover from the Spanish era, the school
administrators should be made liable for damages until they prove themselves absolved of liability
in trial by merits, is erroneous. The SC points out that Arts 2180 and 2176 establish the rule of in
loco parentis (“in place of the parents” – Mikey) and that in the discussions provided in the cases
cited by the CA, it was clear that the liability of the school exists only for the acts performed by
students while in school custody, something which was established to have not been the case
here. Thus the rule on quasi-delicts does not apply.
1. Yes.
The SC rules that despite the inapplicability of the rule on quasi-delicts, the school is still liable
because all academic institutions enter into a contract with all its enrollees. Part of the obligations
of this contract is the providence of an adequate atmosphere of safety for its students (“x x x no
student can absorb the intricacies of physics or higher mathematics or explore the realm of the arts
and other sciences when bullets are flying or grenades exploding in the air or where there looms
around the school premises a constant threat to life and limb.”). Obligations from quasi-delict or
tort* do not govern, since these are extra-contractual and a contract has been made here.
However, in Air France vs. Carroscoso, it was established that liability from tort may still exist even
if there is a contract, because the act that breaks the contract may also be a tort. This rule obeys
Art. 21. The SC here dictates that a trial is necessary in order to determine whether such willful
negligence really lies, in order that liability should be properly determined.

Judgment: Case remanded to Manila RTC, the court of origin.

Notes:
* tort. 1. A civil wrong for which a remedy may be obtained, usu. in the form of damages; a breach of duty that
the law imposes on everyone in the same relation to one another as those involved in a given transaction. 2.
(pl.) The branch of law dealing with such wrongs. (Black’s Law Dictionary, 7th ed.)