Facts:
On June 28, 2021, the Supreme Court resolved a Petition for Review on Certiorari filed by
Malayan Insurance Company, Inc. (
Malayan) assailing the March 21, 2012 Decision and August 13, 2012 Resolution of the Court of Appeals (CA) in CA-G.R. SP No. 114414, which reversed and set aside several issuances of the
Insurance Commission (IC). The dispute originated from a letter dated October 3, 2008 sent by
Rico J. Pablo (
Pablo) to the IC, requesting assistance in determining the amounts
Malayan and
Stronghold Insurance Company, Inc. (
Stronghold) must reimburse him. Pablo obtained
Compulsory Third Party Liability (CTPL) insurance for his newly acquired motor vehicle, a 2007 Mitsubishi Adventure GLX Diesel Wagon, from Stronghold under Certificate of Cover No. 380623, effective from January 16, 2007 to January 16, 2010, with a coverage limit of
P100,000.00, and the policy contained a
Schedule of Indemnities. For the same vehicle, Pablo also obtained an
Excess Cover for Third Party Bodily and Death Liability from Malayan under Private Vehicle Policy No. PV-0159-200880003 with an excess coverage amount of
P200,000.00. During the effectivity of both policies, Pablo, while driving the insured vehicle, sideswiped a six-year-old pedestrian in 2008, resulting in bodily injuries that required hospital treatment. Pablo claimed
P100,318.08 in hospital and medical expenses and filed third party liability claims for reimbursement with both Stronghold and Malayan. Stronghold computed its liability using the Schedule of Indemnities and arrived at
P29,000.00, reasoning that only
P29,000.00 was recoverable under the scheduled items, leaving an excess of
P71,318.08 allegedly for the account of the excess coverage provider. Malayan refused to pay the alleged excess, prompting Pablo to seek the IC’s intervention, where the insurance companies submitted their position papers. In its May 21, 2009 Resolution, the IC ruled for Malayan, ordering Stronghold to pay
P100,000.00 and Malayan to pay only
P318.08, applying
Western Guaranty Corporation v. Court of Appeals (
Western Guaranty) and holding that the Schedule of Indemnities did not limit the amounts recoverable for hospitalization and medication as long as the claim did not exceed the policy’s insurance coverage; the IC further treated the Schedule of Indemnities as contrary to Western Guaranty. After Stronghold moved for reconsideration, the IC in its November 17, 2009 Order modified its earlier ruling by directing the amendment of the Schedule of Indemnities in Stronghold’s policy to conform with Western Guaranty, and it adjusted the dispositive language to specify that the amended liability should be within the
excess bodily injury coverage. Stronghold’s clarificatory motion and second motion for reconsideration were later denied by the IC in its May 25, 2010 Ruling. Stronghold then filed a Petition for Review before the CA. In its March 21, 2012 Decision, the CA reversed the IC issuances and ordered Stronghold and Malayan to reimburse Pablo
P42,714.83 and
P57,603.25, respectively. The CA held that Western Guaranty was applicable and interpreted it as supporting observance of the Schedule of Indemnities limits for items listed therein, with any excess for non-covered or otherwise disallowed items attributable to the excess coverage provider. It rejected Stronghold’s invocation of
Government Service Insurance System v. Court of Appeals (
GSIS) on the ground that there was no conflict because the policy in GSIS did not involve the same all-encompassing clause addressed in Western Guaranty. The CA denied both motions for reconsideration in its August 13, 2012 Resolution, and Malayan thereafter filed the present Petition, contending, among others, that the CA’s ruling misread Western Guaranty, disregarded the IC’s interpretation of CTPL limits and excess coverage mechanics, and that Stronghold’s CA petition was belated.
Issues:
What is the extent of
Stronghold’s liability under its CTPL policy, and correspondingly, the amount that
Malayan must reimburse under the excess coverage, in light of
Western Guaranty and the
Schedule of Indemnities?
Ruling:
Ratio:
Doctrine: