Case Summary (G.R. No. 136914)
Background of the Case
The case revolves around a petition for review on certiorari of a decision by the Court of Appeals, which affirmed a Regional Trial Court ruling ordering the petitioner, Country Bankers Insurance Corporation, to pay a claim under a fire insurance policy. The respondent, a cooperative declared insolvent, suffered a total loss of its property due to a fire incident that occurred on July 1, 1989, during the policy's effective period.
Contractual Relationship and Fire Incident
The petitioner, a corporation engaged in the insurance business, and the respondent entered into Fire Insurance Policy No. F-1397, covering the respondent's stocks-in-trade from June 20, 1989, to June 20, 1990. When a fire destroyed the respondent's building, the cooperative filed a claim supported by several documents, including a police spot report indicating that the fire was allegedly caused by NPA rebels. The petitioner denied coverage, asserting the fire was caused by an excepted risk under the policy's terms.
Trial Court's Findings
The trial court, after weighing the evidence, ruled in favor of the respondent. It evaluated the credibility and reliability of the petitioner's defenses, finding them unconvincing. The court ordered the insurer to pay the insurance claim, including interest, actual damages, exemplary damages, attorney's fees, and litigation expenses.
Appeals and Legal Arguments
The petitioner appealed the trial court's decision, raising three key errors. These included the claim that the Court of Appeals failed to recognize evidence indicating that the fire resulted from an excepted risk, the imposition of interest at 12% per annum from the filing of the complaint, and the awards for actual and exemplary damages, attorney’s fees, and litigation expenses.
Burden of Proof and Hearsay Evidence
Regarding the defense of an excepted risk, it is established that the burden of proof lies with the insurer to show that the claim falls under an exclusion in the insurance policy. The petitioner presented evidence through sworn statements and a spot report, but the Court determined these were inadmissible hearsay as the witnesses did not testify in court and were not subject to cross-examination. This lack of credible evidence weakened the petitioner's position.
Interest Rate and Damage Awards
The court held that while the insurer was liable to pay the respondent, the interest imposed by the trial court at 12% per annum was erroneous. Instead, it should b
...continue readingCase Syllabus (G.R. No. 136914)
Case Background
- The case involves a petition for review on certiorari filed by Country Bankers Insurance Corporation against Lianga Bay and Community Multi-Purpose Cooperative, Inc.
- The decision under review was rendered by the Court of Appeals on December 29, 1998, which affirmed the Regional Trial Court's (RTC) decision from December 26, 1991.
- The RTC had ordered the petitioner to pay the respondent a total of P200,000.00 under Fire Insurance Policy No. F-1397, plus interest, actual damages, exemplary damages, litigation expenses, attorney’s fees, and costs of suit.
Facts of the Case
- The petitioner, Country Bankers Insurance Corporation, is an insurance provider, while the respondent is a duly registered cooperative that was declared insolvent and represented by Cornelio Jamero.
- A contract of fire insurance was entered into between the parties on June 20, 1989, covering stocks-in-trade against fire for a period ending June 20, 1990.
- On July 1, 1989, a fire occurred at the respondent’s building, leading to a total loss of its stocks-in-trade, furniture, fixtures, equipment, and records.
- The respondent filed an insurance claim supported by various documents, including a spot report and sworn statements.
- The petitioner denied the claim, alleging that the fire was set by NPA rebels, thus constituting an exc