SUMMIT GUARANTY & INSURANCE COMPANY, INC., PETITIONER, VS. THE HONORABLE COURT OF APPEALS (TENTH DIVISION), HONORABLE GREGORIA CRUZ ARNALDO, IN HER CAPACITY AS INSURANCE COMMIS­…

Petition for certiorari, prohibition and mandamus,
with a prayer for a restraining order, to annul and set aside the orders of the
respondent Court of Appeals issued in Case CA-G.R. No. SP-09113, entitled: “Summit
Guaranty & Insurance Co.,
Inc., petitioner,
versus Hon. Insurance Commissioner and Leonardo Certeza, respondents”, as well as the
decision of the Insurance Commissioner in I.C. Case No. 631, entitled: “Leonardo
Certeza, complainant, versus Summit Guaranty Insurance Co., Inc., respondent”, to restrain the Insurance Com­missioner
from further proceeding with I.C. Case No. 631, and to direct the said
Insurance Commissioner to dismiss the complaint against the petitioner.

The undisputed facts show that the Certeza
& Sons, Inc. acquired from Felipe Uy a Toyota
jeep with Motor No. 12 RC36-9122, insured with the herein petitioner, Summit
Guaranty & Insurance Co., Inc., under a private car comprehensive Policy
No. 181764 for third-party liability in
the amount of P20,000.00 for the period from October 19, 1976 to October
19, 1977.  The said policy was endorsed
by the insurance company to Certeza & Sons, Inc.
per Indorsement No. PC-0043/77, effective January 13,
1977.

On August 20, 1977, the insured vehicle, while travelling along E. Lopez St., Jaro,
Iloilo, driven by Rico Certeza, side­swiped a
pedestrian and collided with a jeepney owned by a
certain Daniel Dorillo.  The accident caused the death of George Certeza, a passenger in the insured vehicle, injuries to
the pedestrian Tony Posa, and injuries to passengers in the jeepney.

The injured were taken to the Iloilo Mission Hospital and Gov.
Benito Lopez Memorial Hospital Medical and hospitalization expenses incurred
therein amounted to P15,000.00, more or less, which Leonardo Certeza settled by executing two (2) promissory notes in
the amount of P8,344.80 for the injured pedestrian Tony Posa
and P6,344.80 for the passengers of the other vehicle, in favor of the Iloilo
Mission Hospital and Gov. Benito Lopez Memorial Hospital, respectively.  Subsequently, demand for payment of the hospitalization
and medical expenses of the injured and in­demnity for the death of George Certeza in the amount of P20,000.00 was made upon the
insurance company.  When the insurance
company failed to pay, a complaint against the insurance company was filed with
the Insurance Commission on January 31, 1978, docketed therein as I.C. Case No.
631.^[1]

After appropriate proceedings, judgment was rendered against the
insurance company on February 9, 1979, as follows:

“In view of the foregoing, judgment is hereby rendered
ordering respondent company to indemnify complainant the sum of P20,000 with
interest provided for in Section 244 of the Insurance Code (P.D. 612) from the
date the complaint was filed until
fully satisfied, plus the sum of P1,000 as attorney’s fees, with costs.”^[2]

From the above judgment, the petitioner appealed to the Court of
Appeals, docketed therein as CA-G.R. No. SP-09113^[3]
and on May 10, 1979, the respondent appellate court dismissed the petition for
review.^[4]
The petitioner moved for the reconsideration of the resolution,^[5]
but its motion was denied on May 31, 1979.^[6]
Where upon, the petitioner filed the present recourse.

The petitioner claims that the resolutions issued by the re­spondent
Court of Appeals on May 10 and 31, 1979 in CA-G.R. No. SP-09113 are null and void for
having been issued without jurisdic­tion; and that the Insurance Commission
erred in ordering petitioner to pay the private respondent Leonardo Certeza the value of the policy.

The petitioner argues that the Court of Appeals has no appellate
jurisdiction over decisions, rulings and orders of the In­surance Commissioner.

The contention is meritorious. 
Section 416 of the Insurance Code, as amended by Presidential Decree No.
1455 which took effect on June 11, 1978, provides that appeals from decisions,
orders, and rulings of the Insurance Commissioner should be addressed to the
Supreme Court.  The pertinent portion of
said Section reads, as follows:

“Any decision, order or ruling rendered by the Commissioner
after a hearing shall have the force and effect of a judgment.  Any party may appeal from a final order, ruling or decision of the Commissioner by filing with the Commissioner within thirty days
from receipt of copy of such order, ruling or deci­sion a notice of appeal and
with the Supreme Court twelve printed or mimeographed copies of
a petition for certiorari or review of such
order, ruling or decision, as the case may be. 
A copy of the peti­tion shall be served upon the Commissioner and upon
the adverse party, and proof of service thereof attached, to the original of
the petition.” (Under­lining for emphasis)

Petitioner, however, is estopped, on
ground of public policy, from invoking the plea of lack of jurisdiction after submitting
itself to the jurisdiction of the Court of Appeals and assailing its
jurisdiction only after an adverse judgment was rendered against the
petitioner.  It appears that Presidential
Decree No. 1455, transferring jurisdiction over appeals from decisions, orders
and rulings of the Insurance Commissioner to the Supreme Court, was enacted on
June 11, 1978, long before the Insurance Commissioner rendered a decision
against the petitioner on Feb­ruary 2, 1979. 
This decree notwithstanding, petitioner filed a notice of appeal,
serving notice that it is appealing the judgment of the Insurance Commissioner
to the Court of Appeals,^[7]
and filed with the Court of Appeals, an urgent motion for extension of time within which to submit a petition for review.^[8] The motion was granted,^[9] and the petitioner submitted its petition
for review with the Court of Appeals on April 25, 1979.^[10] No­where in its petition for review did the
petitioner raise the question of lack of jurisdiction.  Petitioner merely claimed therein that the
Insurance Commissioner erred in finding
private respondent entitled to the payment of indemnity.  Then, after the Court of Appeals had
dismissed the petition on May 10, 1979, the petitioner filed a motion for the
reconsideration of the resolution.^[11] Again, the petitioner did not question the
jurisdiction of the Court of Appeals.  On
the contrary, the petitioner main­tained “that this Honorable Tribunal
(Court of Appeals) acquired jurisdiction over the case from the time the notice of appeal from the decision was filed
seasonably by herein petitioner with the Office of the Insurance
Commissioner.” It is only in the petition under consideration that the
petitioner has raised for the first time the issue of lack of jurisdiction.  The petitioner can not be permitted to
belatedly raise the issue of lack of juris­diction.  In the case of Tijam vs. Sibonghanoy,^[12] this Court said:

“A party may be estopped or barred
from raising a question in different ways and for different rea­sons.  Thus we speak of estoppel
in pais, or estoppel
by deed or by record, and of estoppel by laches.

“Laches, in a general sense, is
failure or neg­lect, for an unreasonable and unexplained length of time, to do
that which, by exercising due diligence or omission to assert a right within a
reasonable time, warranting a presumption that the party entitled to assert it
either has abandoned it or declined to assert it.

“The doctrine of laches or of ‘stale
demands’ is based upon grounds of public policy which requires, for the peace
of society, the discouragement of stale claims and, unlike the statute of
limitations, is not a mere question of time but is principally a question of
the inequity or unfairness of permitting a right or claim to be enforced or
asserted.

“It has been held that a party cannot invoke the jurisdiction
of a court to secure affirmative relief against his opponent and, after
obtaining or failing to obtain such relief, repudiate or question that same
jurisdiction (Dean vs. Dean, 136 Or. 694, 86
A.L.R. 79).  In the case just cited,
by way of explaining the rule, it was further said that the question whether
the court had jurisdiction either
of the subject-matter of the action or of the parties was not important in such
cases because the party is barred from such conduct not because the judgement or order of the court is valid and conclusive as an adjudication, but
for the reason that such a practice can not be tolerated -obviously for
reasons of public policy.

“Furthermore, it has also been held that after voluntarily
submitting a cause and encountering an adverse decision on the merits, it is
too late for the loser to question the jurisdiction or power of the court (Pease vs. Rathbun-Jones,
etc.; 243 U.S. 273, 61 L.Ed. 715, 37 S.Ct. 283; St. Louis etc. vs. McBride, 141 U.S. 127, 35 L.Ed. 659).  And
in Littleton vs. Burges,
16 Wyo. 58, the Court said that it is
not right for a party who has affirmed and invoked the jurisdic­tion of
a court in a particular matter to secure an affirmative relief, to afterwards
deny that same juris­diction to escape a penalty.

“Upon this same principle is what We said in the three cases
mentioned in the resolution of the Court of Appeals of May 20, 1963 (supra) – to the
effect that we frown upon the ‘undesirable practice’ of a party submitting his case
for decision and then accept­ing the judgment, only if favorable, and attacking
it for lack of jurisdiction, when adverse – as well as in Pindangan
etc. vs. Dans, et al., G.R. L-14591, Septem­ber
26, 1962; Montelibano, et
al. vs. Bacolod-Murcia Milling Co., Inc., G.R.
L-15092; Young Men Labor Union etc. vs. The Court of Industrial Relations, et al.,
G.R.
No. L-20307, Feb. 26, 1965, and Mejia vs. Lucas, 100 Phil. p.
277.”

At any rate, the defense of the petitioner that it is exempt from
liability under the insurance contract is without merit. The excepted risk
provision in the insurance policy reads, as follows:

“(1) death of or bodily injury to
any person in the employment of the insured arising out of and in the course of
such employment or death or bodily injury to any person being a member of the
Insured’s household who is a passenger in the Motor Vehicle.”

Under the aforequoted provision, the
insurer is exempt from liability in cases of: (1) death or injury to any person
in the
employment of the insured arising out of and in the course of such employment; and
(2) death or injury to a member of the Insured’s household who is a passenger
in the motor vehicle.

In the instant case, there is no evidence that the deceased
George Certeza was an employee of the insured Certeza & Sons, Inc. and that his death arose out of
and in the course of employment, as to exempt the petitioner from
liability.  The claim of the peti­tioner
that “It is the burden of private respondent to prove that GEORGE CERTEZA
who is his son is not an employee of this family corporation,”^[13]
is untenable.  Section 1, Rule 131 of the
Revised Rules of Court provides that “each party must prove his own affir­mative
allegation.” The rule imposes upon the defendant who alleges an
affirmative matter in avoidance of plaintiff’s claim or cause of action, upon
which the issue is taken by the plaintiff, the burden of establishing the facts
which are thus alleged by presenting proof in support thereof.^[14]
Thus, in the case of Paris-Manila Perfume Co. vs. Phoenix
Assurance Company,^[15] where a fire insurance company issued
a policy insuring certain property against loss by fire, but did not cover any
loss or damage oc­casioned by an explosion, and the insured property was
destroyed by fire during the life of the policy, and the insurance company
contended that the fire was the result of an explosion which was the primary
cause of the fire, the Court held that the burden of proof of that fact is on
the insurance company, and for want of proof, the insurance company is liable.

There is, likewise, no evidence that the deceased George Cer­teza was a member of the household of the insured.  While Leonardo Certeza,
the father of the deceased is an
officer in the Certeza & Sons, Inc., it cannot be
implied that the deceased is a member of the household of the insured since the
insured is a corpora­tion that has a personality separate and distinct from its
offi­cers and stockholders.

WHEREFORE, the petition should be, as it is hereby, DENIED.  The judgment of the Insurance Commission in
I.C. Case No. 631, entitled: “Leonardo Certeza,
com­plainant, versus Summit Guaranty & Insurance Company, Inc.,
respondent,” is AFFIRMED.  The
temporary restraining order heretofore issued is hereby lifted and set aside.  With costs against the petitioner Summit
Guaranty & In­surance Co., Inc.

SO ORDERED.

Barredo, (Chairman), Abad Santos, De Castro, and
Ericta, JJ., concur.

Aquino, J., see concurring opinion.

Escolin, J.,
no part.

^[1] Rollo, pp. 7, 12-13.

^[2] Id.,
p. 12.

^[3] Id.,
pp. 16, 22.

^[4] Id.,
p. 33.

^[5] Id.,
p. 38.

^[6] Id.,
p. 50.

^[7] Id., p. 16.

^[8] Id., p. 17.

^[9] Id., p. 31.

^[10] Id., pp. 19-29.

^[11] Id., p. 38.

^[12] L-21450, April 15, 1968, 23 SCRA 29, 35,
reiterated in Rodriguez vs. Court of Appeals, L-29264, August 29, 1969, 29 SCRA 419, 429.

^[13] Rollo, p. 3.

^[14]
20 Am Jur 142.

^[15]
49 Phil. 753.

Clean
Clean

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