G.R. No. 147791 - Construction Development Corp. of the Philippines vs. Estrella

On December 29, 1978, respondents Rebecca G. Estrella and her granddaughter Rachel E. Fletcher boarded a Batangas Laguna Tayabas Bus Co. (BLTB) bus in San Pablo City, bound for Pasay City.
Their journey was cut short when a tractor-truck owned by Construction Development Corporation of the Philippines (CDCP) rammed the BLTB bus from behind on the South Expressway.
The collision caused severe injuries to Estrella and Fletcher, who were pinned under the seats and regained consciousness only after rescuers freed them.
Both were hospitalized at Makati Medical Center, with diagnoses including fractures and lacerations:

Estrella: fracture of left tibia mid-third, lacerated wound on chin, contusions, rib fractures.
Fletcher: extensive lacerations, partial amputation of left leg, open comminuted fractures of both tibiae.

Respondents filed a complaint for damages against CDCP, BLTB, their drivers Espiridion Payunan, Jr. (CDCP) and Wilfredo Datinguinoo (BLTB), and Philippine Phoenix Surety & Insurance Inc. (Phoenix).
Allegations included negligence of the drivers, failure of BLTB and CDCP to exercise due diligence in employee selection and supervision, BLTB’s negligent operation of an unsafe bus, and claims for actual damages, moral and exemplary damages, attorney’s fees, and litigation costs.
CDCP amended its answer to file a third-party complaint against Phoenix.

The Regional Trial Court (RTC) of Manila, Branch 13, found BLTB and CDCP liable for actual, moral, and exemplary damages, as well as attorney’s fees, ordering them to pay respondents jointly and severally.
The RTC held BLTB as a common carrier liable for breach of contract of carriage due to negligence presumed from failure to carry passengers safely.
CDCP was found negligent due to reckless driving of its employee, which also established a presumption of negligence in employee supervision and selection.
The court dismissed all counterclaims and the third-party complaint against Phoenix for being prescribed.

Respondents’ motion for reconsideration was denied by the RTC.
The case was elevated to the Court of Appeals (CA), which affirmed the RTC's decision with modifications:

Legal interest of 6% per annum to run from the filing of the complaint (February 4, 1980) on actual damages.
Awarded attorney’s fees equivalent to 30% of the total amount recovered, based on retainer agreement.
Increased exemplary damages awarded to respondents.
Affirmed dismissal of CDCP’s claim against Phoenix due to prescription.

CDCP filed a petition, raising issues regarding the sole liability of BLTB and its driver, the alleged excessiveness of damages, attorney’s fees, and legal interest, and the denial of insurance recovery from Phoenix due to prescription.

Whether BLTB and/or its driver Wilfredo Datinguinoo should be held solely liable for the damages sustained by respondents.
Whether the damages, attorney's fees, and legal interest awarded by the Court of Appeals are excessive or unfounded.
Whether respondent Philippine Phoenix Surety & Insurance Inc. (Phoenix) is liable under its insurance policy, considering the claim was dismissed on the ground of prescription.