G.R. No. 64693 - Lita Enterprises, Inc. vs. Intermediate Appellate Court

Petitioner: Victory Liner, Inc., a common carrier, and its driver, Ricardo Joson, Jr.
Respondents: The heirs of Andres Malecdan – widow Elena Malecdan and their children Veronica, Virginia, Mary Pauline, Arthur, Viola, Manuel, and Valentin Malecdan.

Andres Malecdan, a 75-year-old farmer from Barangay Nungnungan 2, Cauayan, Isabela, was crossing the National Highway on July 15, 1994, around 7:00 p.m.
While crossing, a Dalin Liner bus, which had stopped to allow passage for him and his carabao, was followed and overtaken by a Victory Liner bus driven by Ricardo Joson, Jr.
In overtaking, the Victory Liner bus struck both the old man and his carabao.
As a result of the collision, Andres was thrown off his carabao; both he and the carabao sustained fatal injuries.
Witness Virgilio Lorena, who was nearby in a waiting shed, observed the incident and later executed a sworn statement corroborating the facts.

Private respondents filed a suit for damages on October 5, 1994, in the Regional Trial Court (RTC) of Baguio City, Civil Case No. 3082-R.
The RTC found evidence of gross negligence on the part of both the bus driver and Victory Liner, Inc.

The RTC held that the driver’s reckless behavior and lack of appropriate conduct after the incident were culpable.
Victory Liner, Inc. was also found negligent in supervising and selecting its employee.

Death indemnity of P50,000.00
Actual damages of P88,339.00
Moral damages of P200,000.00
Exemplary damages of P50,000.00
Attorney’s fees computed at 30% of the recoverable amount (later modified to P50,000.00)
Payment of court costs.

The counterclaim by Victory Liner, Inc. and its third-party complaint were dismissed.

The decision of the RTC was affirmed by the Court of Appeals, with the sole modification fixing the attorney’s fees at P50,000.00.
Victory Liner, Inc. petitioned for review before the Supreme Court raising multiple issues regarding:

The award of moral damages being double the amount prayed for by respondents and the award of actual damages supported by expenses claimed beyond the burial of the deceased.
The finding of gross negligence and the supervisory lapses despite the alleged diligence measures taken by Victory Liner, Inc.
Whether the factual findings and evidentiary record sufficiently supported the imposition of both moral and exemplary damages along with the conclusion of negligent supervision.

Whether the Court of Appeals erred in affirming the RTC’s award of moral damages (P200,000.00), which was double the amount prayed for by the private respondents, and in allowing actual damages not fully substantiated by official receipts or related to expenses incurred beyond the victim’s burial.
Whether the appreciation of the trial court regarding the negligence of Victory Liner, Inc. in supervising its employee was proper, given that the petitioner presented measures (such as the assignment of inspectors, installation of tachometers, periodic training, and other documentary evidence) that purportedly show diligence in the selection and supervision of its drivers.
Whether the consolidation of testimonial and documentary evidence provided by petitioner regarding its diligence in employee selection and supervision was properly disregarded, and if such disregard constituted a grave abuse or excess of jurisdiction.