G.R. No. 75112 - Filamer Christian Institute vs. Court of Appeals

On October 20, 1977 at 6:30 p.m., an accident occurred in Roxas City involving a Pinoy jeep owned by petitioner Filamer Christian Institute.
The victim, private respondent Potenciano Kapunan, Sr., an 82-year-old retired schoolteacher, sustained multiple injuries when he was struck by the jeep as he was walking along Roxas Avenue.
The jeep was driven by Daniel Funtecha, who was alleged to be an employee and also a working scholar of the petitioner.
Notably, evidence showed that at the time of the accident only one headlight of the jeep was functioning.

Funtecha, who only possessed a student driver’s permit, assumed control of the vehicle after persuading Allan Masa, the authorized driver, to relinquish the steering wheel.
Both Funtecha and Masa fled the scene after the accident, with a tricycle driver later transporting the unconscious Kapunan, Sr. to the hospital.
Although Funtecha faced a criminal case for serious physical injuries through reckless imprudence in the City Court, a separate civil action for damages was properly initiated by Kapunan, Sr.

The Regional Trial Court (RTC) of Roxas City, Branch 14, in Civil Case No. V-4222, found petitioner Filamer Christian Institute, Funtecha, and additionally non-impleaded Allan Masa negligent.
The RTC rendered a detailed judgment awarding monetary relief for medical expenses, doctor’s fees, additional expenses during hospitalization, court litigation expenses, loss of earnings, moral damages, and attorney’s fees.
The decision also involved joint and several liabilities, particularly noting that Filamer Christian Institute’s liability was primary and direct.
The judgment further absolved Agustin Masa from personal liability due to his absence from the vehicle during the incident, despite his managerial oversight.

Both petitioner Filamer Christian Institute and third-party defendant Zenith Insurance Corporation appealed the RTC’s decision; however, the appeal by the insurance firm was dismissed due to failure to pay docket fees.
On December 17, 1985, the Court of Appeals rendered a decision in full affirmance of the RTC’s judgment as it related to Funtecha and other parties.
Filamer Christian Institute, as petitioner, raised its primary contention on appeal that it could not be held responsible for Funtecha’s tortious act due to the absence of an employer-employee relationship.

Filamer Christian Institute invoked Section 14, Rule X of Book III of the Labor Code, arguing that Funtecha, being a working scholar, did not enjoy an employer-employee relationship with the petitioner.
It was emphasized that Funtecha rendered services in exchange for free tuition, working only two hours daily before his classes, and was not included in the company payroll.
Additionally, the accident occurred when Funtecha was acting outside the scope of his assigned janitorial duties (cleaning school passageways early in the morning) by assuming control of the jeep in the early evening.

The case extensively referenced Article 2176 and Article 2180 of the Civil Code regarding tort liability and vicarious liability for the acts of persons for whom one is responsible.
The RTC and the Court of Appeals deliberated on whether these provisions could be applied to working scholars and whether the actions of Funtecha fell within his employment scope.
Evidence included the malfunctioning headlight of the jeep, testimony regarding the time and nature of Funtecha’s employment, and admissions regarding the transfer of vehicle control from the duly authorized driver.

Whether petitioner Filamer Christian Institute can be held liable for the tortious act of Funtecha based on an employer-employee relationship.

The applicability of Article 2180 of the Civil Code in imposing vicarious liability for the negligence of Funtecha.
Whether the employment relationship exists when Funtecha is classified under the category of working scholars.

Whether Funtecha, at the time of the accident, was acting within the scope of his assigned duties.

Examination of the discrepancy between his regular janitorial service and his decision to drive the jeep in the evening.
Consideration of his status as a student working in exchange for free education under Section 14, Rule X of the Labor Code.

The involvement of third parties like Allan Masa, who was not impleaded in the civil case, despite having a role in the chain of events.
The interpretation of the statutory language regarding vicarious liability in quasi-delicts.