Case Digest (G.R. No. 151038)
Facts:
Petron Corporation v. Spouses Cesar Jovero and Erma F. Cudilla, Spouses Lonito Tan and Luzvilla Samson, and Spouses Rogelio Limpoco and Lucia Josue, G.R. No. 151038, January 18, 2012, Supreme Court Second Division, Sereno, J., writing for the Court.Petitioner Petron Corporation (Petron), a domestic importer and distributor of petroleum products, entered into a Retail Dealer Contract with Rubin Uy on 30 April 1984 to supply and authorize the operation of a gasoline station in Estancia, Iloilo for the period 1 May 1984 to 30 April 1989. Separately, Petron contracted hauling services with Jose Villaruz (doing business as Gale Freight Services) in March 1988, specifying three tank trucks by plate numbers for exclusive use in Petron’s deliveries, and setting safety and indemnity obligations for the hauler.
On 27 October 1988 Rubin Uy gave a Special Power of Attorney to Chiong Uy to manage the station; Chiong and his wife Dortina Uy operated the station as Rubin Uy’s agents. On 3 January 1991, Petron arranged delivery of petroleum ordered by station employee Ronnie Allanaraiz; Villaruz supplied a tank truck different from those enumerated in the hauling contract, driven by Pepito Igdanis. During unloading to the station’s underground tank a fire began in the fill pipe, spread to the hose and—after Igdanis drove the truck while the burning hose remained attached—caused a conflagration destroying nearby properties belonging to respondents (spouses Jovero, Tan, and Limpoco).
Respondents sued Petron, Villaruz, Rubin Uy and Dortina Uy in separate actions consolidated before the Regional Trial Court (RTC) of Iloilo City (Civil Case Nos. 19633, 19684 and 20122), alleging negligence causing the fire. After trial the RTC (Decision dated 27 April 1998) found Petron, Villaruz, Pepito Igdanis, Rubin Uy and Dortina Uy negligent and ordered them solidarily liable for actual damages, litigation expenses, attorney’s fees and costs, dismissing defendants’ counterclaims and cross-claims as in pari delicto.
Petron, Villaruz and Dortina Uy appealed to the Court of Appeals (CA). Rubin Uy’s appeal was dismissed for failure to file an appellants brief. The CA, in a Decision promulgated 12 December 2001, affirmed the RTC: it agreed Petron had been negligent for allowing operation of the station absent a valid dealership contract or for retaining sufficient control and responsibility (including ownership of pumps and underground tank), and that delivery of the product had not been completed at the time of the fire; the CA also found Villaruz and Dortina Uy negligent and solidarily liable.
Petron filed a Petition for Review under Rule 45 challenging the CA Decision. Petron argued (inter alia) that (a) the dealership contract had been implicitly renewed or that expiration did not convert the dealer into Petron’s agent; (b) delivery was completed at the depot upon payment so Petron no longer owned the goods in transit; (c) hauler Vil...(Pro-only)
Issues:
- Whether Petron may be held at fault for continuing to do business with Rubin Uy without renewing or extending their expired dealership agreement.
- Whether a causal connection exists between Petron’s failure to renew or extend the dealership contract and the fire that damaged respondents’ properties.
- Whether Petron is liable for the fire that occurred during the unloading by an independent hauler of fuel sold to an independent dealer at the dealer’s station.
- Whether a supplier of fuel can be held liable for the neglect of others in distributing and storing such fue...(Pro-only)
Ruling:
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Ratio:
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Doctrine:
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