GILBERTO M. DUAVIT, PETITIONER, VS. THE HON. COURT OF APPEALS, ACTING THROUGH THE THIRD DIVISION, AS PUBLIC RESPONDENT, AND ANTONIO SARMIENTO, SR. & VIRGILIO CATUAR, RESPONDENTS.

This petition raises the sole issue of whether or not the owner
of a private vehicle which figured in an
accident can be held liable under Article 2180 of the Civil Code when the said
vehicle was neither driven by an employee of the owner nor taken with the
consent of the latter.

The facts are summarized in the contested decision, as follows:

“From the evidence adduced by the plaintiffs, consisting of
the testimonies of witnesses Virgilio Catuar, Antonio Sarmiento, Jr., Ruperto Catuar, Jr. and Norberto Bernarte it appears that on July 28, 1971 plaintiffs
Antonio Sarmiento, Sr. and Virgilio
Catuar were aboard a jeep with plate number
77-99-F-1-Manila, 1971, owned by plaintiff, Ruperto Catuar was driving the said jeep on Ortigas
Avenue, San Juan, Rizal; that plaintiff’s jeep, at
the time, was running moderately at 20 to 35 kilometers per hour – and while
approaching Roosevelt Avenue, Virgilio Catuar slowed down; that suddenly, another jeep with plate
number 99-97-F-J, Manila 1971 driven by defendant Oscar Sabiniano
hit and bumped plaintiff’s jeep on the portion near the left rear wheel, and as
a result of the impact plaintiff’s jeep fell on its right and skidded by about
30 yards; that as a result plaintiff’s jeep was damaged, particularly the
windshield, the differential, the part near the left rear wheel and the top
cover of the jeep; that plaintiff Virgilio Catuar was thrown to the middle of the road; his wrist was
broken and he sustained contusions on the head; that likewise plaintiff Antonio
Sarmiento, Sr. was trapped inside the fallen jeep,
and one of his legs was fractured.

“Evidence also shows that the plaintiff Virgilio
Catuar spent a total of P2,464.00
for repairs of the jeep, as shown by the receipts of payment of labor and spare
parts (Exhs. H to H-7).  Plaintiffs likewise tried to prove that
plaintiff Virgilio Catuar,
immediately after the accident was taken to Immaculate Concepcion
Hospital, and then was transferred to the National Orthopedic Hospital; that
while plaintiff Catuar was not confined in the
hospital, his wrist was in a plaster cast for a period of one month, and the
contusions on his head were under treatment for about two (2) weeks; that for
hospitalization, medicine and allied expenses, plaintiff Catuar
spent P5,000.00.

“Evidence also shows that as a result of the incident,
plaintiff Antonio Sarmiento, Sr. sustained injuries
on his leg; that at first, he was taken to the National
Orthopedic Hospital
(Exh. K), but later he was confined at the Makati Medical Center from July 29, to August 29, 1971 and
then from September 15 to 25, 1971; that his leg was in a plaster cast for a
period of eight (8) months; and that for hospitalization and medical attendance, plaintiff Antonio Sarmiento, Sr. spent no less than P13,785.25
as evidenced by receipts in his
possession (Exhs. N to N-1).

“Proofs were adduced also to show that plaintiff Antonio Sarmiento, Sr. is employed as Assistant Accountant of the Canlubang Sugar Estate with a salary of P1,200.00 a month; that as sideline, he also works as accountant
of United Haulers, Inc. with a salary of P500.00 a month; and that as a result
of this incident, plaintiff Sarmiento was unable to
perform his normal work for a period of at least 8 months.  On the other hand, evidence shows that the
other plaintiff Virgilio Catuar is a Chief
Clerk in Canlubang Sugar Estate with a salary of
P500.00 a month, and as a result of
the incident, he was incapacitated to work for a period of one (1) month.

“The plaintiffs have filed this case both against Oscar Sabiniano as driver, and against Gualberto
Duavit as owner of the jeep.

“Defendant Gualberto Duavit, while admitting ownership of the other jeep (Plate
No. 99-07-F-J Manila, 1971), denied that the other defendant (Oscar Sabiniano) was his
employee.  Duavit
claimed that he has not been an
employer of defendant Oscar Sabiniano at anytime up
to the present.

“On the other hand documentary and testimonial evidence show
that defendant Oscar Sabiniano was an employee of the
Board of Liquidators from November
14, 1966 up to January 4,
1973 (Annex A of Answer).

“Defendant Sabiniano, in his
testimony, categorically admitted that he took the jeep from the garage of
defendant Duavit without the consent or authority of
the latter (TSN, September 7, 1978, p. 8). 
He tesfitied further, that Duavit
even filed charges against him for theft of the jeep, but which Duavit did not push through as his (Sabiniano’s) parents
apologized to Duavit on his behalf.

“Defendant Oscar Sabiniano, on the
other hand in an attempt to exculpate himself from liability, makes it appear
that he was taking all necessary precaution while driving and the accident
occurred due to the negligence of Virgilio Catuar.  Sabiniano claims that it was plaintiff’s vehicle which hit
and bumped their jeep.” (Rollo, pp. 21-23)

The trial court found Oscar Sabiniano
negligent in driving the vehicle but found no employer-employee relationship
between him and the petitioner because the latter was then a government
employee and he took the vehicle without the authority and consent of the
owner.  The petitioner was, thus,
absolved from liability under Article 2180 of the Civil Code.

The private respondents
appealed the case.

On January
7, 1988, the Court
of Appeals rendered the questioned decision holding the petitioner jointly and
severally liable with Sabiniano.  The appellate court in part ruled:

“We cannot go along with appellee’s
argument.  It will be seen that in Vargas
v. Langcay, supra, it was held that it is immaterial
whether or not the driver was actually employed by the operator of record or
registered owner, and it is even not necessary to prove who the actual owner of
the vehicle and who the employer of the driver is.  When the Supreme Court ruled, thus:  ‘We must hold and consider such
owner-operator of record (registered owner) as the employer in contemplation of
law, of the driver,’ it cannot be construed other than that the registered
owner is the employer of the driver in contemplation of law.  It is a conclusive presumption of fact and
law, and is not subject to rebuttal of proof to the contrary.  Otherwise, as stated in the decision, we
quote:

“‘The purpose of the principles evolved by the decisions in
these matters will be defeated and thwarted if we entertain the argument of
petitioner that she is not liable because the actual owner and employer was
established by the evidence.  xxx.'”

Along the same vein, the defendant-appellee Gualberto Duavit cannot be allowed to prove that the driver Sabiniano was not his employee at the time of the vehicular
accident.

“The ruling laid down in Amar v. Soberano (1966), 63 O.G. 6850, by this Court to the effect
that the burden of proving the non-existence of an employer-employee
relationship is upon the defendant and this he must do by a satisfactory
preponderance of evidence, has to defer to the doctrines evolved by the Supreme Court in cases of
damages arising from vehicular mishaps involving registered motor vehicle.  (See Tugade
v. Court of Appeals, 85 SCRA 226, 230). 
(Rollo, pp. 26-27)

The appellate court also
denied the petitioner’s motion for reconsideration.  Hence, this petition.

The petitioner contends
that the respondent appellate court committed grave abuse of discretion in
holding him jointly and severally liable with Sabiniano
in spite of the absence of an employer-employee relationship between them and
despite the fact that the petitioner’s jeep was taken out of his garage and was
driven by Sabiniano without his consent.

As early as in 1939, we
have ruled that an owner of a vehicle
cannot be held liable for an
accident involving the said vehicle if the same was driven without his consent
or knowledge and by a person not
employed by him.  Thus, in Duquillo v. Bayot (67 Phil. 131-133-134) [1939]
we said:

“Under the facts established, the defendant cannot be held
liable for anything.  At the time of the
accident, James McGurk was driving the truck, and he
was not an employee of the defendant, nor did he have anything to do with the
latter’s business; neither the defendant
nor Father Ayson, who was in charge of her business, consented to have any of her trucks driven on the day of the accident, as
it was a holy day, and much less by a chauffeur who was not in charge of
driving it; the use of the
defendant’s truck in the circumstances indicated was done without her consent or
knowledge; it may, therefore, be said, that there was not the remotest
contractual relation between the deceased
Pio Duquillo and the
defendant.  It necessarily follows from
all this that articles 1101 and following of the Civil Code, cited by the
appellant, have no application in this case, and, therefore, the errors attributed
to the inferior court are without basis.”

The Court upholds the above ruling as still relevant and better
applicable to present day circumstances.

The respondent court’s
misplaced reliance on the cases of Erezo v.
Jepte (102 Phil. 103 [1957] and Vargas
v. Langcay (6 SCRA 174 [1962]) cannot be
sustained.  In the Erezo
case, Jepte, the registered owner of the truck which collided with a taxicab, and which resulted in the killing of Erezo, claimed that at the time of the accident, the
truck belonged to the Port Brokerage in an arrangement with the corporation but
the same was not known to the Motor Vehicles Office.  This Court sustained the trial court’s ruling
that since Jepte represented himself to be the owner
of the truck and the Motor Vehicles Office, relying on his representation,
registered the vehicle in his name, the Government and all persons affected by
the representation had the right to rely on his declaration of ownership and
registration.  Thus, even if Jepte were not the owner of the truck at the time of the
accident, he was still held liable for the death of Erezo.  Significantly, the driver of the truck was
fully authorized to drive it.

Likewise, in the Vargas
case, just before the accident
occurred, Vargas had sold her jeepney to a third
person, so that at the time of the accident she was no longer the owner of the jeepney. 
This court, nevertheless, affirmed Vargas’ liability since she failed to
surrender to the Motor Vehicles Office the corresponding AC plates in violation
of the Revised Motor Vehicle Law and Commonwealth Act No. 146.  We further ruled that the operator of record
continues to be the operator of the vehicle in contemplation of law, as regards
the public and third persons, and as such is responsible for the
consequences incident to its operator. 
The vehicle involved was a public utility jeepney
for hire.  In such cases, the law does
not only require the surrender of the AC plates but orders the vendor operator
to stop the operation of the jeepney as a form of
public transportation until the matter is reported to the authorities.

As can be seen, the circumstances of the above cases are entirely
different from those in the present case. 
Herein petitioner does not deny ownership of the vehicle involved in the mishap but completely denies
having employed the driver Sabiniano or even having
authorized the latter to drive his jeep. 
The jeep was virtually stolen from the petitioner’s garage.  To hold, therefore, the petitioner liable for
the accident caused by the negligence of Sabiniano
who was neither his driver nor employee would be absurd as it would be like
holding liable the owner of a stolen vehicle for an accident caused by the
person who stole such vehicle.  In this regard, we cannot ignore the many cases of
vehicles forcibly taken from their owners at gunpoint or stolen from garages
and parking areas and the instances of service station attendants or mechanics
of auto repair shops using, without the owner’s consent, vehicles
entrusted to them for servicing or repair.

We cannot blindly
apply absolute rules based on precedents whose facts do not jibe four square with pending cases. 
Every case must be
determined on its own peculiar factual circumstances.  Where, as in this case, the records of the
petition fail to indicate the slightest indicia of an employer-employee
relationship between the owner and the erring driver or any consent given by
the owner for the vehicle’s use, we cannot
hold the owner liable.

We, therefore, find that the respondent appellate court committed
reversible error in holding the petitioner jointly and severally liable with Sabiniano to the private respondent.

WHEREFORE,
the petition is GRANTED and the decision and resolution appealed from are
hereby ANNULLED and SET ASIDE.  The
decision of the then Court of First Instance (now Regional Trial Court) of
Laguna, 8th Judicial District, Branch 6, dated July 30, 1981 is REINSTATED.

SO ORDERED.

Fernan, C.J., (Chairman), Feliciano, Bidin, and Cortes, JJ., concur.