G.R. No. L-22533 - Ramos vs. Pepsi-Cola Bottling Co. of the Philippines

Case Summary (G.R. No. L-22533)

Trial Court Disposition and Initial Liability Findings

After trial, the Court of First Instance rendered judgment on April 15, 1961. It found Bonifacio negligent. As to PEPSI-COLA, the trial court declared that PEPSI-COLA had not sufficiently proved that it exercised the diligence of a good father of a family to prevent the damage. The trial court ordered PEPSI-COLA and Bonifacio to pay petitioners solidarily the amounts of P2,638.50 as actual damages, P2,000.00 as moral damages, P2,000.00 as exemplary damages, and P1,000.00 as attorney’s fees, with costs.

Court of Appeals Review and Modification of PEPSI-COLA’s Liability

PEPSI-COLA and Bonifacio appealed to the Court of Appeals. On January 15, 1964, the Court of Appeals affirmed the trial court’s finding that Bonifacio was negligent. However, it modified the judgment by absolving PEPSI-COLA from liability. The Court of Appeals held that, contrary to petitioners’ position, PEPSI-COLA had sufficiently proved due diligence in the selection of its driver Bonifacio. The Court of Appeals anchored this conclusion on the “uncontradicted testimony” of Juan T. Anasco, PEPSI-COLA’s personnel manager, regarding the hiring process and screening measures imposed on the driver applicant.

The Court of Appeals’ Due Diligence Finding as to Driver Selection

The Court of Appeals treated the hiring and examination steps as evidence of due diligence. It described that Bonifacio had been first hired as a member of the bottle crop in the production department, and that when he was hired as a driver, PEPSI-COLA examined his background, required clearances, considered his previous experience, and subjected him to a physical examination. He was then sent to the pool house to take the usual driver’s examination comprising a theoretical examination and a practical driving examination. The Court of Appeals also noted that PEPSI-COLA was a member of a Safety Council. It relied on Campo vs. Camarote for the rule that an employer should not rely merely on a professional driver’s license, but must carefully examine an applicant as to qualifications, experience, and record of service. On this basis, the Court of Appeals concluded that PEPSI-COLA exercised the diligence of a good father of a family in selecting its driver.

Issues on Petition for Review and the Standard of Review for Factual Credibility

Petitioners then appealed to the Supreme Court, contending that PEPSI-COLA’s evidence failed to show that it exercised due diligence in the selection of its driver in question. The Supreme Court characterized petitioners’ attack as directed against the testimony of Anasco, asserting that as a PEPSI-COLA employee he was biased and his testimony was not believable. The Court treated these arguments as an attempt to raise issues of fact and credibility. It held that, as a general rule, it would respect the Court of Appeals’ findings of fact, with limited exceptions not shown to obtain in the case.

Deference to Credibility Determinations and Acceptance of Established Facts

The Supreme Court ruled that Anasco’s credibility was not reviewable in the proceedings. Since the Court of Appeals had found the witness credible, the testimony as accepted by that court could not be assailed at that stage. The Court also invoked its distinction between questions of law and questions of fact: it considered the matter to involve credibility and probative assessment, thus falling within factual controversy. Accordingly, for purposes of the appeal, the Supreme Court treated as established that, as testified by Anasco, PEPSI-COLA had carefully examined Bonifacio regarding qualifications, experience, and record of service, and had taken all steps referred to by the Court of Appeals.

Legal Framework: Employer Liability and the Rebuttal of Presumed Negligence

The Supreme Court sustained PEPSI-COLA’s due diligence on the governing standard articulated in Campo v. Camarote, which requires careful examination of the applicant for employment beyond mere possession of a professional driver’s license. It further explained that no question was raised as to PEPSI-COLA’s due diligence in supervision. It then stated the statutory rule: under Article 2180 of the Civil Code, owners and managers of an establishment or enterprise are responsible for damages caused by their employees in the service of the branches in which the latter are employed, or on the occasion of their functions, but the responsibility ceases when they prove that they observed all the diligence of a good father of a family to prevent damage.

In construing the old civil code provision analogous to Article 2180, the Supreme Court cited Bahia v. Litonjua, stressing two points: first, that once injury is caused by a servant or employee through negligence, a presumption of law arises that the employer was negligent in selection, supervision, or both; second, that the presumption is juris tantum and may be rebutted. Thus, if the employer proves due care in selection and supervision, the presumption is overcome and liability does not attach.

Application to the Present Arguments: Limited Challenge to Selection

The Supreme Court observed that petitioners’ contention focused only on due diligence in the selection of the driver. It also noted that the record, including what petitioners themselves quoted from PEPSI-COLA’s wit

Case Syllabus (G.R. No. L-22533)

Parties and Procedural Posture

Placido C. Ramos and Augusto L. Ramos sued Pepsi-Cola Bottling Co. of the P.I. (PEPSI-COLA) and Andres Bonifacio in the Court of First Instance of Manila for damages arising from a collision.
The collision involved the car of Placido Ramos, which was driven by Augusto Ramos, the son and co-plaintiff of Placido.
The trial court rendered judgment on April 15, 1961, holding Bonifacio negligent and holding PEPSI-COLA liable for failing to prove due diligence in preventing the damage.
The defendants appealed to the Court of Appeals, which on January 15, 1964 affirmed Bonifacio’s negligence but absolved PEPSI-COLA on the ground that it proved due diligence in the selection of its driver.
The plaintiffs then appealed to the Supreme Court through a petition for review, challenging the portion of the Court of Appeals’ decision absolving PEPSI-COLA.

Key Factual Allegations

The case arose from a vehicular collision on May 10, 1958, involving Placido Ramos’ car and PEPSI-COLA’s tractor-truck and trailer.
Augusto Ramos drove Placido Ramos’ car during the collision.
PEPSI-COLA’s tractor-truck and trailer were driven by Andres Bonifacio, who served as PEPSI-COLA’s driver.
The trial court found Bonifacio negligent, and this finding was affirmed by the Court of Appeals.
The appellate controversy centered on whether PEPSI-COLA proved it exercised the diligence of a good father of a family to prevent the damage.

Trial Court Findings

The trial court declared that Bonifacio was negligent.
The trial court held that PEPSI-COLA had not sufficiently proved that it exercised the diligence of a good father of a family to prevent the damage.
The trial court ordered PEPSI-COLA and Bonifacio to pay P2,638.50 as actual damages, P2,000.00 as moral damages, P2,000.00 as exemplary damages, and P1,000.00 as attorney’s fees, with costs.
The trial court treated PEPSI-COLA as solidarily liable with Bonifacio under the applicable civil law principles on employer responsibility.

Court of Appeals Modification

The Court of Appeals affirmed the trial court’s ruling insofar as it found Bonifacio negligent.
The Court of Appeals modified the judgment by absolving PEPSI-COLA, holding that it sufficiently proved due diligence in the selection of its driver, Bonifacio.
The Court of Appeals relied on the testimony of Juan T. Anasco, PEPSI-COLA’s personnel manager.
The Court of Appeals found it uncontradicted that Bonifacio had undergone a recruitment and examination process that included background inquiry, submission of clearances, assessment of previous experience, physical examination, and driver examinations consisting of theoretical and practical tests.
The Court of Appeals also considered that PEPSI-COLA was a member of a Safety Council.
The Court of Appeals invoked Campo vs. Camarote to support the rule that possession of a professional driver’s license alone is insufficient.

Issues on Review

The principal issue before the Supreme Court was whether PEPSI-COLA failed to prove that it exercised the diligence of a good father of a family in the selection of its driver, Bonifacio.
The plaintiffs also challenged the probative value and credibility of Anasco’s testimony, alleging bias and lack of believability because he was PEPSI-COLA’s employee.
The plaintiffs raised, as additional assignments of error, matters concerning alleged violations of the Revised Motor Vehicle Law and related rules and regulations.
The plaintiffs also attempted to challenge whether PEPSI-COLA had acted to ratify the negligent act of its driver.

Appellants’ Contentions

The appellants argued that the Court of Appeals erred in finding due diligence in the selection of Bonifacio because, according to them, PEPSI-COLA’s evidence was insufficient.
They contended that Anasco, being PEPSI-COLA’s employee, was an interested and biased witness.
They asserted that the Court of Appeals’