Philippine Supreme Court Jurisprudence > Year 2012 > February 2012 Decisions > [G.R. No. 165413 : February 22, 2012] PHILAM INSURANCE COMPANY, INC. AND AMERICAN HOME INSURANCE CO., PETITIONERS, VS. COURT OF APPEALS, AND D.M. CONSUNJI INC., RESPONDENTS.:

In this Petition for Review on Certiorari under Rule 45, petitioners Philam Insurance Company, Incorporated (Philam) and American Home Insurance Company (AHIC) seek the reversal of the Decision of the Court of Appeals (CA) in CA-G.R. CV No. 60098 dated 28 June 2004 and its Resolution dated 24 September 2004. The CA Decision reversed and set aside that of the Regional Trial Court (RTC) of Makati City in Civil Case No. 95-540 dated 28 April 1998.cralaw

The CA ruled against petitioners� demand for the recovery of the value of the insured�s generator set (genset) against private respondent D.M. Consunji Incorporated (DMCI), whose alleged negligence damaged the said equipment.

The antecedent facts are as follows:

Four gensets from the United States of America were ordered by Citibank, N.A. (Citibank). Petitioner AHIC insured these gensets under Certificate No. 60221 for USD 851,500 covering various risks.^[1] The insurance policy provided that the claim may be paid in the Philippines by Philam Insurance Co., Inc, AHIC�s local settling agent.^[2]

Citibank�s broker-forwarder, Melicia International Services (MIS),^[3] transported the gensets in separate container vans. It was instructed by Citibank to deliver and haul one genset to Makati City,^[4] where the latter�s office was being constructed by the building contractor, DMCI.

MIS was further instructed to place the 13-ton genset^[5] at the top of Citibank�s building. The broker-forwarder declined, since it had no power cranes.^[6] Thus, Citibank assigned the job to private respondent DMCI, which accepted the task.^[7]

On 16 October 1993, DMCI lifted the genset with a crane (Unic-K-2000) that had a hydraulic telescopic boom and a loading capacity of 20 tons.^[8] During the lifting process, both the crane�s boom and the genset fell and got damaged.^[9]

The events leading to the fall, based mainly on the signed statement^[10] of DMCI�s crane operator, Mr. Ariel Del Pilar, transpired as follows:

The genset was lifted clear out of the open top container by the crane. After clearing the container van, the crane operator, Mr. Ariel del Pilar, had to position the genset over the vicinity of the storage area. To do this, the boom of the crane carrying the generator set had to be turned (swing) to face right and stopped when it loomed over the storage area. The genset was swinging as it came to a stop following the right turn. The crane operator waited for the genset to stop swinging for him to perform the next maneuver. The boom had to be raised three (3) degrees more from its position at 75 degrees, up to 78 degrees. At 78 degrees the genset could be lowered straight down to the delivery storage area.

The genset stopped swinging. The crane operator proceeded to raise the boom to 78 degrees. While so doing, the crane operator felt a sudden upward movement of the boom. The genset began to swing in and out, towards the crane operator, then outward and away. The body of the crane lifted off the ground, the boom fell from an approximate height of 9 feet, first hitting a Meralco line, then falling to the ground.^[11]

After two days, DMCI�s surveyor, Manila Adjusters & Surveyors Co. (MASC) assessed the condition of the crane and the genset.^[12] According to its Survey Certificate, the genset was already deformed.^[13]

Citibank demanded from DMCI the full value of the damaged genset, including the cost, insurance and freight amounting to USD 212,850.^[14] Private respondent refused to pay, asserting that the damage was caused by an accident.^[15]

Thereafter, Citibank filed an insurance claim with Philam, AHIC�s local settling agent, for the value of the genset.  Philam paid the claim for PhP 5,866,146.^[16]

Claiming the right of subrogation, Philam demanded the reimbursement of the genset�s value from DMCI, which denied liability.^[17] Thus, on 19 April 1994, Philam filed a Complaint with the RTC to recover the value of the insured genset.^[18]

At the trial court, petitioner Philam did not invoke res ipsa loquitur. Rather, during the pre-trial conference, the parties agreed on this sole issue: �Whether or not the damage was the fault of the defendant or within their area of supervision at the time the cause of damage occurred.�^[19]

The RTC ruled in favor of Philam and ordered as follows:

WHEREFORE PREMISES CONSIDERED, judgment is hereby rendered in favor of plaintiff as against defendant ordering the latter to pay plaintiff as follows:

1. the amount of PhP 5,866,146.00 as actual damages with interest at 6% per annum from the date of filing of this Complaint until the sum is fully paid.
   
   
2. the amount equivalent to 25% of the sum recoverable as attorney�s fees;
   
   
3. cost of suit.
   

SO ORDERED. ^[20]

The trial court ruled that the loss or damage to the genset was due to the negligent operation of the crane:

This Court finds that the loss or damage brought about by the falling of the genset was caused by negligence in the operation of the crane in lifting the genset to as high as 9 feet causing the boom to fall [sic], hitting the Meralco line to ground, sustaining heavy damage, which negligence was attributable to the crane operator.^[21]

DMCI appealed to the CA, which reversed and set aside the RTC�s Decision. The appellate court ruled that the falling of the genset was a clear case of accident and, hence, DMCI could not be held responsible.

In this case, plaintiffs-appellees failed to discharge the burden of proving negligence on the part of the defendant-appellant�s crane operator and other employees assisting in unloading the genset.

xxx                xxx                 xxx

The falling of the genset to the ground was a clear case of accident xxx. xxx [D]efendant-appellant cannot be held responsible for the event which could not be foreseen, or which though foreseen, was inevitable.^[22]

Accordingly, the dispositive portion reads:

WHEREFORE, there being merit in the appeal, the assailed Decision dated April 28, 1998 of the Regional Trial Court, Branch 61 of Makati City in Civil Case no. 95-1450, is REVERSED and SET ASIDE, and the complaint dismissed.

SO ORDERED.^[23]

Hence, the pertinent issue in this Petition is whether petitioners have sufficiently established the negligence of DMCI for the former to recover the value of the damaged genset. While this Court is not a trier of facts, and hesitates to review the factual findings of the lower courts, in this occasion, it would do so considering the conflicting legal conclusions of the RTC and the CA.

For DMCI to be liable for damages, negligence on its part must be established.^[24] Additionally, that finding must be the proximate cause of the damage to the genset.^[25] We agree with the CA that Philam failed to establish DMCI�s negligence.

Negligence is the want of care required by the circumstances.^[26] It is a conduct that involves an unreasonably great risk of causing damage; or, more fully, a conduct that falls below the standard established by law for the protection of others against unreasonably great risk of harm.^[27]

Philam blames the conduct of DMCI�s crane operator for the genset�s fall. Essentially, it points out the following errors in operating the crane:

First, Del Pilar did not give any reason for his act of raising the boom from 75 to 78 degrees at the stage when the genset was already set for lowering to the ground.^[28]

Second, Del Pilar�s revving of the motor of the boom �triggered the chain of events � starting with the jerk, then followed by the swinging of the genset which was obviously violent as it caused the body of the crane to tilt upward, and ultimately, caused the boom with the genset to fall.�^[29]

It would be a long stretch to construe these as acts of negligence. Not all omissions can be considered as negligent. The test of negligence is as follows:

Could a prudent man, in the case under consideration, foresee harm as a result of the course actually pursued? If so, it was the duty of the actor to take precautions to guard against that harm. Reasonable foresight of harm, followed by ignoring of the suggestion born of this prevision, is always necessary before negligence can be held to exist.^[30]

Applying the test, the circumstances would show that the acts of the crane operator were rational and justified.

Addressing Philam�s first submission, this Court finds that the records are replete with explanations for why the boom of the crane had to be raised from 75 to 78 degrees. Although the boom is already in the general area of the genset�s storage place, still, it had to be raised three (3) degrees in order to put it exactly in the proper designation. At 78 degrees, the genset could be lowered straight down to the delivery/storage area.^[31] DMCI�s crane operation team determined accordingly that there was a need to raise the boom in order to put the genset in the exact location. Indeed, the heavy equipment must be secured in its proper place.

Proceeding to the more contentious claim, Philam emphasized the apparent inconsistencies in Del Pilar�s narration. In his signed statement, executed 15 days after the incident, Del Pilar stated that when he raised the boom from 75 to 78 degrees, he revved the motor, upon which he felt the sudden upward movement (jerk) of the boom followed by the swinging of the genset.^[32]

But in his affidavit, executed already during the trial, Del Pilar mentioned that he moved the boom slowly when he raised it to 78 degrees.^[33] Philam deems this narration questionable since the �slow movement� was never mentioned in Del Pilar�s earlier signed statement.^[34]

Examining the signed statement and the affidavit of Del Pilar, petitioner Philam inaccurately portrayed his narration.

In his signed statement, Del Pilar already mentioned that he slowly moved the genset, and when it swayed, he waited for the swinging to stop before he lifted the equipment:

Itinuloy ko na ang pag-angat ng genset at pagkatapos ng malagpas na sa open top van container, dahan-dahan na ako nagpihit o swing papunta sa kanan at pagkatapos ng nasa direksyon na ako ng paglalagyan, itinigil ko ang pagpihit o pag swing pagkatapos hinintay ko ang genset sa paggalaw at ng huminto na ang genset sa paggalaw, nagboom up ako mula 75� hanggang 78�, sa tantya ko at noong mag boom up, nag-rebolution (sic) ako at naramdaman ko na biglang gumalaw paangat (paboom-up) ang boom ng Crane No. CR-81 at nag-swing na naman patungo sa akin ang genset. At nang ito ay umindayog papalayo sa crane ay doon ko naramdaman na iyong body ng Crane No. CR-81 ay umangat at nakita kong tumumba ang boom ng Crane CR-81 at bumagsak ang genset sa loob ng Citibank (sic) Parking Area. Noon ika-16 ng Octubre 1993 ng oras na alas 4:55 ng umaga.� (Emphasis supplied.)

In his affidavit, Del Pilar�s statements concentrated on the manner of lifting of the genset. At this point, he recalled that the boom was raised slowly^[35]:

T:	Papaano mo naitaas ang �boom� ng �crane� mula 75 digri hanggang 78 digri?
S:	Dahan-dahan lang po.
T:	Pagkatapos mong maitaas ang boom ng crane sa 78 digri, iyong inumpisahan ibinaba ang �generator set� sa lupa subalit ito ay nagumpisang umugoy-ugoy o dumuyan-duyan palabas at papasok ang karga na �generator set� patungo sa akin. Ito ba ay tutuo?
S:	Opo. [36](Emphasis supplied.)

The affidavit, which the CA used as the main basis for its Decision, pertained exactly to how the crane�s boom had been raised. It is only when a witness makes two sworn statements, and these two statements incur the gravest contradictions, that the court cannot accept both statements as proof.^[37]

Logically, in order to raise the crane�s boom, the operator must step on the pedal; else, the 13-ton genset would not be brought down. Philam did not even present expert evidence to challenge the need of increasing the power supply to move the boom.

Donato F. Solis, DMCI�s electrical engineer assigned to supervise and coordinate the crane�s operations, corroborated Del Pilar�s description.  He gave an eyewitness account of the incident, and his statements thereon were taken by the surveyor, MASC. Solis said:

Q:	What happened when the genset was already lifted out and at the above proposed storage area?
A:	After it was already at above the designated area, the genset was still swinging during the time (at about 4:50 a.m., October 16, 1993) and when the genset stopped swinging I noticed that it was being lowered slowly to the ground and until approx. 6 feet above the ground. I noticed that it was not being lowered because it was moving diagonally toward us. When it was moving toward us we ran to avoid being hit by the genset.[38]

Even if Del Pilar failed to mention the slow manner of raising the boom in his earlier signed statement, the reverse is not necessarily established. Persons are easily liable to commit errors in the recollection of minute details of an important occurrence.^[39]

Alternatively, Philam asserts that if care was exercised in operating the crane, and yet the genset was damaged, then it must have been the very crane itself that was defective.^[40]

We cannot give credence to mere conjectures and assumptions on the condition of the crane to prove negligence. In Picart v. Smith, the Court stressed that abstract speculations cannot be of much value:

The question as to what would constitute the conduct of a prudent man in a given situation must of course be always determined in the light of human experience and in view of the facts involved in the particular case. Abstract speculations cannot here be of much value but this much can be profitably said: Reasonable men govern their conduct by the circumstances which are before them or known to them. They are not, and are not supposed to be, omniscient of the future. Hence they can be expected to take care only when there is something before them to suggest or warn of danger.^[41]

The speculative assertion of Philam should be supported by specific evidence of the crane�s defects. Instead, Philam utterly failed to contradict the findings of MASC which made an actual site inspection to observe the crane used in lifting the genset. In its Survey Certificate, it stated that: �[U]pon close examination, the crane was observed in actual operation and found to be in satisfactory working condition.�^[42] (Emphasis supplied.)

Since Philam failed to convince us of actions that would lay the blame on DMCI, this Court agrees with the CA that DMCI exercised the necessary care and precaution in lifting the genset.

Firstly, a whole team was involved in transferring the genset. Petitioners did not even the question the acts of the other team members involved in the crane operations. Del Pilar stated thus:

T:	Ikaw lang ba mag-isa ang magbababa ng nasabing �generator set�?
S:	Hindi po, ako po ay tinulungan ng isang katrabahong �rigger� na ang pangalan ay si G. MARCELINO ROMERO, ng aming Foreman na si G. FERNANDO DELA ROSA ng Motor Pool, isang mekaniko, at ni DONATO SOLIS, isang ehenyero.
T:	Anu-ano tulong o ayuda ang naibigay sa iyo ng bawat isa sa mga taong iyong nabanggit?
S:	Si G. MARCELINO ROMERO na isang �rigger� ay tumulong sa akin upang maitali ang �generator set� sa kable ng �crane� at sa pagbibigay ng senyas sa akin kung kailan itataas ang pagbuhat ng �generator set�, kung kailan magaalalay sa pagtaas at mga iba pang bagay-bagay na may kinalaman sa pagpapatakbo ng �crane�. Ang motor pool foreman ay nandoon naman upang tingnan at subaybayan na lahat ng bagay pangkaligtasan sa pagbubuhat ng crane sa �generator set� upang ito�y maibaba ng maayos. Si Ehenyero DONATO SOLIS ay ang pangkalahatang nangangasiwa sa pagbubuhat o paglalapag ng nasabing �generator set�. Ang mekaniko naman na hindi ko na matandaan ang kanyang pangalan ay nandoon upang tumulong kung sakaling magkakaroon ng suliranin pang-mekanikal ang �crane�.[43]

Secondly, as found by the CA,^[44] Del Pilar exercised reasonable care and caution when he tested the crane four times right before actual operations to make sure that it could lift the genset. He stated further:

T:	Maari (sic) mo bang isalaysay ang buong pangyayari tungkol sa pagbuhat at pagdiskarga ng genset mula sa open top van container na nasa trailer ng ibabaw ng Marzan Trucking?
S:	Nang matalian po namin (ako at ang nasabing rigger man) ang genset, pumunta na po ako sa operating cab ng Crane No. CR-81 pagkatapos pinaandar ko ang Crane CR-81 para umpisahan iangat ang genset mula sa open top container pagkatapos sinubukan ko ng buhatin ang genset at nang mabuhat ng isa o dalawang dangkal, ibinaba ko ito muli sa dating pwesto ng maka-apat na beses.
T:	Bakit mo ibinaba ng apat na beses ang genset mula ng ito ay iangat mo?
S:	Sinisigurado ko ho na kaya ng Crane No. 81 ang bigat ng genset[.][45]

The testing of the crane during actual operations was corroborated by Solis when he stated as follows:

Q:	What did you observe during the lifting operation?
A:	During the lifting operation, I noticed that it took awhile (approx. 30 minutes) in lifting the genset, because the Crane Operator, Mr. Ariel del Pilar was testing the lifting capability of Crane No. CR-81. I saw the genset, which was several times lifted about 1 foot high from the flooring of the open top van container.[46]

Thirdly, as can be gleaned from the statements above, Del Pilar stopped turning the controls, and it was only when the swinging stopped that he performed the next maneuver. All of these acts, as proven by the evidence, showed due diligence in operating the crane.

In their final effort to reverse the appellate court, petitioners invoked res ipsa loquitur, even if they never had raised this doctrine before the trial court.

According to petitioners, the requisites of res ipsa loquitur are present in this case.^[47] Had the principle been applied, the burden of proof in establishing due diligence in operating the crane would have shifted to DMCI.^[48]

In this case, res ipsa loquitur is not applicable, since there is direct evidence^[49] on the issue of diligence or lack thereof pertaining to the lifting of the genset. The doctrine is not a rule of substantive law, but merely a mode of proof or a mere procedural convenience.^[50]

In any event, res ipsa loquitur merely provides a rebuttable presumption of negligence. On this, we have already pointed out that the evidence does not prove negligence on the part of DMCI, and that due diligence on its part has been established.

Hence, it has generally been held that the presumption arising from the doctrine cannot be availed of, or is overcome when the plaintiff has knowledge and testifies or presents evidence as to the specific act of negligence that caused the injury complained of; or when there is direct evidence as to the precise cause of the accident, and with all the attendant facts clearly present.^[51] Finally, neither the presumption nor the doctrine would apply when the circumstances have been so completely elucidated that no inference of the defendant's liability can reasonably be made, whatever the source of the evidence.^[52]

Absent any finding of negligence, we sustain the CA�s findings that DMCI exercised due diligence; that the event is an accident; and that consequently Philam cannot claim damages for the damaged genset.^[53]cralaw

IN VIEW THEREOF, the assailed 28 June 2004 Decision of the Court of Appeals and its 24 September 2004 Resolution are AFFIRMED. The 11 October 2004 Petition for Review filed by Philam Insurance Company, Inc. and American Home Insurance Corporation is hereby denied for lack of merit.

SO ORDERED.

Carpio, (Chairperson), Villarama, Jr.,^* Perez, and Reyes, JJ., concur.

Endnotes:

---

^* Designated as Acting member in lieu of Associate Justice Arturo D. Brion per Special Order No. 1195 dated 15 February 2012.

^[1] CA Decision penned by Associate Justice Hakim S. Abdulwahid, with Associate Justices Elvi John S. Asuncion and Mariano C. del Castillo concurring, p. 1; rollo, p. 17.

^[2] Citibank�s Letter dated 27 October 1993, Exhibit A; RTC records, p. 252.

^[3] Survey Certificate of Manila Adjusters & Surveyors Co., Exhibit O-2; RTC records, p. 276.

^[4] Citibank�s Letter dated 14 October 1993, Exhibit 1; RTC records, p. 347.

^[5] Survey Certificate of Manila Adjusters & Surveyors Co., supra note 3.

^[6] Affidavit of Edilberto C. Palisoc, DMCI�s Area Manager, dated 7 October 1997, Annex Det-1; RTC records, p. 342.

^[7] Id.

^[8] Survey Certificate of Manila Adjusters & Surveyors Co., Exhibit 4-b; RTC records, p. 278.

^[9] Statement of Ariel del Pilar, DMCI�s crane operator, dated 21 October 1993; RTC records, p. 285.

^[10] Id.

^[11] Petitioners� Petition for Review, pp. 3-4; rollo, pp. 5-6.

^[12] Survey Certificate of Manila Adjusters & Surveyors Co., Exhibit 4-c; RTC records, p. 278.

^[13] Citibank�s Letter dated 21 October 1993, Exhibit 2; RTC records, p. 348.

^[14] DMCI�s Letter dated 22 October 1993, Exhibit 3; RTC records, p. 350.

^[15] Citibank�s Letter, supra note 2; RTC records, p. 252.

^[16] Subrogation Receipt dated 6 April 1994, Exhibit T; RTC records, p. 305.

^[17] CA Decision, supra note 1, p. 2; rollo, p. 18.

^[18] Philam�s Complaint dated 18 April, 1994; RTC records, p. 1.

^[19] RTC Order dated 10 October 1995; RTC records, p. 184.

^[20] RTC Decision penned by Judge Fernando V. Gorospe Jr., p. 2; CA rollo, p. 37.

^[21] Id.

^[22] CA Decision, supra note 1, p. 8; rollo, p. 24.

^[23] Id. at 25.

^[24] Brown v. Manila Electric Road and Light Co., 20 Phil. 406 (1911).

^[25] American Express International v. Cordero, 509 Phil 619 (2005).

^[26] Picart v. Smith, 37 Phil. 809 (1918).

^[27] Id.

^[28] Petitioners� Petition for Review, supra note 11, supra no p. 6; rollo, p. 8.

^[29] Petitioners� Memorandum, p. 11; rollo, p. 68.

^[30] Picart v. Smith, supra note 26.

^[31] Affidavit of Ariel del Pilar, DMCI�s crane operator, dated 29 April 1997; RTC records, p. 371.

^[32] Statement of Ariel del Pilar dated 21 October 1993, supra note 9.

^[33] Affidavit of Ariel del Pilar dated 29 April 1997, supra note 31.

^[34] Petitioners� Petition for Review, supra note 11, p. 7; rollo, p. 9.

^[35] Affidavit of Ariel del Pilar, dated 29 April 1997, supra note 31.

^[36] Id.

^[37] Mondragon v. CA, 158 Phil. 1135 (1974).

^[38] Statement of Donato F. Solis, DMCI�s Electrical Engineer, dated 21 October 1993; RTC records, p. 288.

^[39] People v. Resayaga, G.R. No. L-23234, 26 December 1973, 159 SCRA 426.

^[40] Petitioners� Petition for Review, supra note 34.

^[41] Picart v. Smith, supra note 26, at 813.

^[42] Survey Certificate of Manila Adjusters & Surveyors Co. supra note 3; RTC records, p. 279.

^[43] Affidavit of Ariel del Pilar dated 29 April 1997, supra note 31.

^[44] CA Decision, supra note 1, p. 7; rollo, p. 23.

^[45] Statement of Ariel del Pilar dated 21 October 1993, supra note 9; RTC records, p. 283.

^[46] Statement of Donato F. Solis, supra note 38; RTC records, p. 287.

^[47] Petitioners� Petition for Review, supra note 11, p. 9; rollo, p. 11.

^[48] Id.

^[49] Ludo and Luym Development Corporation v. Barreto, 508 Phil. 285 (2005).

^[50] Layugan v. IAC, 249 Phil. 369 (1988), citing Corpus Juris Secundum, Vol. 65A, 529.

^[51] Id. at 544.

^[52] Id. at 545-548.

^[53] Brown v. Manila Electric Road and Light Company, supra note 24.