A.C. No. 12375 - Ick vs. Amazona

On July 17, 1994, a Fuso Road Tractor driven by Raul Tutor rammed into the house-cum-store of respondent Myrna Tamayo in Pier 18, Vitas, Tondo, Manila.
The accident resulted in severe damage: part of the house was destroyed; two persons – Reniel Tamayo (son of Myrna Tamayo) and Felmarie Oledan (daughter of Felix Oledan) – were killed, and several others, including Marissa Enano, Felix Oledan, and two sons of Lucita Suyom, sustained injuries.

The tractor was originally under a finance-lease agreement with Equitable Leasing Corporation, the registered owner as shown by the Official Receipt No. 62204139 and Certificate of Registration No. 08262797 furnished through the Land Transportation Office (LTO).
After payments by Edwin Lim (representing or associated with Ecatine), a Deed of Sale was executed on December 9, 1992, transferring the tractor to Ecatine.
The Deed of Sale, although valid and binding between the parties, was not registered with the LTO, leaving Equitable as the de jure registered owner for all third-party purposes.

Respondents initially filed a damages complaint (Civil Case No. 95-73522) in the Regional Trial Court (RTC) of Manila, Branch 14, against Raul Tutor, Ecatine Corporation, and Equitable Leasing.
The RTC dropped certain parties who could not be served, and subsequently rendered a decision awarding actual damages, moral damages, and attorney’s fees against Equitable Leasing Corporation.
On appeal, the Court of Appeals (CA) affirmed the RTC’s ruling with the modification of deleting the award for attorney’s fees.
Equitable Leasing Corporation (petitioner) filed a Petition for Review under Rule 45, arguing that it was not liable since the vehicle had been sold and that the driver was an employee of Ecatine.

Petitioner argued that since the tractor had been sold to Ecatine and was no longer under its possession or control at the time of the accident, it should not be held liable for the acts of the driver, Raul Tutor.
Petitioner further contended that it could not be held liable for moral damages as respondents failed to establish the necessary causal link between any wrongful act or omission by petitioner and the injuries suffered by the respondents.

The LTO Certificate of Registration dated May 31, 1991, identified the tractor as registered under Equitable Leasing Corporation (“Leased to Edwin Lim”).
Despite the unregistered Deed of Sale, Equitable remained the registered owner at the time of the accident, thereby attracting legal responsibility for the negligent acts of the driver.
Legal submissions also emphasized that under prevailing laws the registered owner is deemed the employer of the driver for purposes of quasi delict liability.

Whether the courts erred in holding that Equitable Leasing Corporation, as the registered owner of the motor vehicle, is liable for damages caused by the negligence of the tractor’s driver, despite the execution of an unregistered Deed of Sale transferring ownership to Ecatine.
Whether the driver, although allegedly employed by Ecatine, should be considered the agent of the registered owner for purposes of establishing direct and solidary liability under quasi delict.

Whether the trial court and Court of Appeals erred in awarding moral damages to the respondents, especially given petitioner's claim that there was no sufficient causal connection between its actions and the injuries sustained by the parties.