Case Digest on Andres Lao vs.

CA, Associated Anglo-American Tabacco

Corp. and Esteban Co.
July 27, 2010
Andres Lao vs. CA, the Associated Anglo-Amedican Tabacco Corp. and Esteban Co.
February 17, 2000
Corporate Officers not personally liable for Authorized Corporate Acts
Facts: In 1965 a Contract of Sales Agent was entered by the Association of AngloAmerican Tobacco Corporation with Andres Lao. Lao was to sell cigarettes
manufactured and shipped by the Corporation to his address in Tacloban, and he
would remit the sales proceeds. Lao would receive commission for those sold, with
a monthly salary and operational allowance. In 1968 Laos attention was called to
his enormous accounts and the difficulty in obtaining a tally despite his avowal of
regular remittance of collections. In 1969 it was established that his liability
amounted to P525,053. Also, the Corp. discovered that Lao was engaged in a
construction business and suspecting that he diverted the sale proceeds to such
business, it gave a demand letter for payment of his obligations. It also found that
contrary to his allegations, he did not have a huge collectible from customers and
nothing was due to the Corporation. From then on, the Corp. no longer sent him
shipments. In 1970, Andres, Jose and Tomas Lao brought a complaint for accounting
and damages against the Corp.. The court ordered both to undergo a court
supervised accounting but also ordered the Corporation to pay the Laos actual loss
of earnings, moral damages, exemplary damages, atty. fees and cost of suit. Later
the court gave a supplemental decision dismissing Laos claim of overpayment. The
Corp. and the Laos appealed. The CA found the Corp. liable for actual damages of
loss of earnings, moral damages and exemplary damages. It also ordered the Corp.
to pay the claim of overpayment by Lao. The Corp. file a motion for reconsideration
and during its pendency, Esteban Co, the new VP of the Corp. filed a complaint with
the fiscal alleging Lao failed to remit an amount which he allegedly misappropriated
and converted to his own personal use. Pending the criminal case, Lao filed against
the Corp. and Esteban Co a complaint for malicious prosecution. The fiscal found
that Lao did not commit estafa and that his liability was civil. The trial court found
the Corp and Esteban Co guilty of malicious prosecution. They appealed. Co asserts
that he cannot be held jointly and severally liable with the Corp. as he was acting as
executive vice president and his action was within the scope of his authority as such
corporate officer.
Issue: Whether or not Co should be held solidarily liable with the Corp.
Held: A perusal of his affidavit reveals that at the time he filed the complaint on
June 1974, Co was vice president of the Corp. As a corporate officer, his power to
bind the Corp as its agent must be sought from statute, charter, by-laws, a
delegation of authority to a corporate officer, or from the acts of the board of
directions, expressed or implied from custom of doing business. In this case, no
such sources of Cos authority from which to deduce whether or not he was acting
beyond the scope of his responsibilities are mentioned, or proven. It is logical to
conclude that the board or by-laws of the Corp. vested Co with certain executive
duties, one of which is the case for the Corp. That Co was authorized to institute
the estafa case is buttressed by the fact the Corp failed to make an issue out of his
authority to file the case. The defense should have been specially pleaded by the
Corp. Its failure to interpose such defense could only mean that the filing of Co was
with consent and authority of the Corp. Thus, Co may not be held personally liable
for acts performed by him in pursuance of an authority.
CASE DIGEST ON GELUZ V. CA [2 S 801 (1961)] - F: Nita Villanueva came to know
the defendant (Antonio Geluz) for the first time in 1948-- thru her aunt. In 1950, she
became preganant by her present husband before they were legally married. During
to conceal her pregnancy from her parent, she had herself aborted by def. After the
marriage w/ the pltff., she again became pregnant. As she was employed in the

COMELEC and her pregnancy proved to be inconvenient, she had herself aborted
again by def. in Oct 1953. Less than 2 years later, she again became pregnant. On
2/21/55, she again repaired to the def's clinic. Nita was again aborted of a 2-month
old foetus, in consideration of the sum of P50.
It is the third and last abortion that constitutes pltff's basis in filing this action and
award of damages The CA and the trial court predicated the award of damages
upon the provisions of the initial par. of Art. 2206 of the NCC.
RULING: This award, we believe, to be error for the said art., in fixing an award for
the death of a person, does not cover the case of an unborn foetus that is not
endowed w/ personality.
RATIO: Parents of unborn foetus cannot sue for damages on its behalf. A husband of
a woman who voluntarily procured her abortion could not recover damages from the
physician who caused the same. (1) Since an action for pecuniary damages on
account of personal injury or death pertains primarily to the injured, no such right
of action could derivatively accrue to the parents or heirs of an unborn child. In
fact, even if a cause of action did accrue on behalf of the unborn child, the same
was extinguished by its pre-natal death, since no transmission to anyone can take
place from one that lacked juridical personality (or juridical capacity, as
distinguished from capacity to act). It is no answer to invoke the provisional
personality of a conceived child (conceptus pro nato habetur) under Article 40 of the
Civil Cod, because that same article expressly limits such provisional personality by
imposing the condition that the child should be subsequently born alive: "provided it
be born later with the condition specified in the following article." In the present
case, there is no dispute that the child was dead when separated from its mother's
womb.
(2) This is not to say that the parents are not entitled to collect any damages at all.
But such damages must be those inflicted directly upon them, as distinguished from
the injury or violation of the rights of the deceased, his right to life and physical
integrity. Because the parents cannot expect either help, support or services from
an unborn child, they would normally be limited to moral damages for the illegal
arrest of the normal development of the spes hominis that was the foetus, i.e., on
account of distress and anguish attendant to its loss, and the disappointment of
their parental expectations (Art. 2217, CC), as well as to exemplary damages, if the
circumstances should warrant them (Art. 2230, CC). But in this case, there is no
basis for an award of moral damages, evidently because the husband's indifference
to the previous abortions clearly indicates that he was unconcerned with the
frustration of his parental hopes and affection.

Art. 41. For civil purposes, the foetus is considered born if it is alive at the time it is
completely delivered from the mother's womb. However, if the foetus had an
intrauterine life of less than seven months, it is not deemed born if it dies within
twenty-four hours after its complete delivery from the maternal womb.
Tolentino: Separation from Mother.-- This is produced by the cutting of the umbilical
cord, whether the removal takes place naturally or by surgical operation.
Alive at Birth.-- The duration of extra-uterine life is immaterial; for acquisition of
juridical personality, it is enough that the child lives even for an instant.
Test of Life.-- The general opinion is that independent life required for juridical
personality can be shown only by complete respiration. The cry of the child,
although it is not a necessary sign of life, is evidence that it has acquired complete
respiration. Another indication of complete respiration is the floating of the lungs
when placed in water; this means that air has penetrated into the lungs by
breathing.
Viability Not Required.-- Viability means that the child is capable of living, and this is
determined by the extent of the development of its organs.

Premature Birth.-- In this case, if the child does not live 24 hours completely
separated from the mother's womb, it does not acquire juridical personality. This is
an absolute requirement for feotuses w/c have an intrauterine life of less than 7
mos. (Balane quoting Manresa and JBL.)
"The aborted creature does not reach the category of a natural person and
consequently is not born in the contemplation of law." (Geluz v. CA, supra.)
This is so, even if the child is killed before the period lapses and it can be proved
that it could have survived that period if it had not been prevented by the wilful act
of another. On the other hand, juridical personality is acquired even if the survival
for 24 hours is caused only by medical or scientific means w/o w/c the child would
have died before the lapse of that period.

ROMAGO ELECTRIC CO., INC. vs. HONORABLE COURT OF APPEALS, SOLEDAD C. CAC,
JOEPHIL BIEN, RENATO CUNANAN and DELFIN INCIONG
G.R. No. 130721. May 26, 2005
Facts: The National Power Corporation entered into an agreement with ROMAGO
ELECTRIC CO., INC. for the erection and installation of NPCs 69 KV 3-Phase
Transmission Lines for P2,657,856.40. Subsequently, ROMAGO subcontracted the
project to BICC Construction, an unregistered loose partnership composed of
Soledad Cac, Delfin Inciong, Joephil Bien and Renato Cunanan, for P1,614,387.99.
When the project was completed, there was an outstanding balance due to BICC
Construction from ROMAGO, part of which was the formers share in the CPA
amounting to 70% of the NPC-ROMAGO contract or P175,545.05. Mrs. Soledad Cac,
wrote NPC to hold its payment to ROMAGO of the aforementioned CPA amounting to
P250,778.65. Payment was nonetheless released to ROMAGO by virtue of a sworn
affidavit executed that there does not exist any lien or encumbrances against the
said NPC-ROMAGO contract. It appears that Mariano Cac, authorized representative
and husband of Soledad Cac, was paid the amount of P38,712.70 in full payment of
accounts including retention of various works at NPC-Isabela under defendants
Cash Disbursement Voucher No. 23162 dated 03 October 1983.When BICCs
demands for payment were ignored by ROMAGO, the partners, thru Mrs. Soledad
Cac as lone plaintiff, filed a complaint for collection of sum of money with damages.
Issues: 1) Whether or not the private respondents are entitled to the CPA accorded
to the petitioner by NPC.
2) Whether or not the particulars of petitioners cash disbursement voucher no.
23162 signed by private respondents authorized representative / agent
acknowledging receipt of said amount did not extinguish, relieve, release any and
all claims including contract price adjustment which private respondents may have
against petitioner on the subcontract.
Held: 1. Contrary to the petitioners asseverations that the CPA was not intended to
be made applicable to the Romago-BICC subcontract, it must be remembered that
the petitioner and the private respondents expressly agreed what documents were
going to be incorporated in the principal subcontract. We agree with the appellate
court that the qualifying phrase obligations and responsibilities contained in the
Romago-BICC subcontract was applicable only to the NPC-Romago contract. What is
more, the CPA is not found in the NPC-Romago contract, but in the NPC's Plans and
Specifications which was expressly included as part of the Contract Documents.
2. Said pleading expressly states that the CPA is not included in the
computation. This is precisely because the petitioner believes that the private
respondents are not entitled to the CPA, hence, there is no basis for including it.
Said CPA not being part of the subcontract price of P1,614,387.99, the release

mentioned in the cash voucher cannot, therefore, be construed as a release of the

CPA.

Faculty of Civil Law Digest Pool 2010

VICENTE S. ALMARIO
PHILIPPINE AIRLINES, INC.532 SCRA 614 (2007), SECOND DIVISION (Carpio Morales,
Courts will not allow one party to enrich himself at the expense of another.
On April 28, 1995, Almario, then about 39 years of age and a Boeing 737 (B-737)
First Officer atPAL, successfully bid for the higher position of Airbus 300 (A-300) First
Officer. Since said higher
position required additional training, he underwent, at PALs expense, more than
five months of training
consisting of ground schooling in Manila and flight simulation in Melbourne,
Australia. After completing the training course, Almario served as A-300 First Officer
of PAL, but after eight months of service as
such, he tendered his resignation, for personal reasons. Despite a l
etter coming from PAL toreconsider his resignation otherwise he will bear the cost of
training, Mr. Almario still proceeded with hisresignation.Later on, PAL filed a
Complaint against Almario before the Regional Trial Court (RTC), forreimbursement
of
P851,107 worth of training costs, attorneys fees equivalent to 20% of the said
amount, and costs of litigation. PAL invoked the existence of an innominate contract
of
do ut facias (Igive that you may do) with Almario in that by spending for his training,
he would render service to ituntil the costs of training were recovered in at least
three (3) years. Almario having resigned before the 3-year period, PAL prayed that
he should be ordered to reimburse the costs for his training. In his Answer, Almario
denied the existence of any agreement with PAL that he would have to render
service to it forthree years after his training failing which he would reimburse the
training costs. He pointed out that theCollective Bargaining Agreement (CBA)
between PAL and the Airline PilotsAssociation of thePhilippines (ALPAP), of which he
was a member, carried no such agreement.
Mr. Almarios contention was confirmed by the RTC but was reversed by the Court of
Appeals
(CA). The CA found Almario liable under the CBA between PAL and ALPAP and, in
any event, under Article 22 of the Civil Code. Thus, this action for review
onCertiorari by Mr. Almario.
ISSUE:
Whether or not the act of Mr. Almario is in violation of the CBA
HELD:
Article XXIII, Section 1 of the CBA provides that pilots fifty-seven (57) years of age
shall be

frozen in their position and shall not be permitted to occupy any position in the
companys turbo
-jetfleet. The reason why pilots who are 57 years of age are no longer qualified to
bid for a higher position isbecause they have only three (3) years left before the
mandatory retirement age of 60 and to send themto training at that age, PAL would
no longer be able to recover whatever training expenses it will have toincur