THIRD DIVISION Prior to the event, Makati Shangri-La Hotel & Resort, Inc.

(respondent) scheduled an initial food tasting. Petitioners claim that

they requested the hotel to prepare for seven persons the two of
SPOUSES LUIGI M. GUANIO and G.R. No. 190601 them, their respective parents, and the wedding coordinator. At the
ANNA HERNANDEZ-GUANIO,
scheduled food tasting, however, respondent prepared for only six.
Petitioners,
Present:
Petitioners initially chose a set menu which included black cod, king
CARPIO MORALES,
- versus - Chairperson, J., prawns and angel hair pasta with wild mushroom sauce for the main
BRION, course which cost P1,000.00 per person. They were, however, given
BERSAMIN,
VILLARAMA, JR.,an andoption in which salmon, instead of king prawns, would be in the
SERENO, JJ. menu at P950.00 per person. They in fact partook of the salmon.
MAKATI SHANGRI-LA HOTEL
and RESORT, INC., also doing
business under the name of Promulgated: Three days before the event, a final food tasting took place. Petitioners
SHANGRI-LA HOTEL MANILA, aver that the salmon served was half the size of what they were served
Respondent. February 7, 2011
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - during the initial food tasting; and when queried about it, the hotel
----x quoted a much higher price (P1,200.00) for the size that was initially
served to them. The parties eventually agreed on a final price
DECISION P1,150 per person.

CARPIO MORALES, J. A day before the event or on July 27, 2001, the parties finalized and
forged their contract.[1]

For their wedding reception on July 28, 2001, spouses Luigi

Petitioners claim that during the reception, respondents
M. Guanio and Anna Hernandez-Guanio (petitioners) booked at the
representatives, Catering Director Bea Marquez and Sales Manager
Shangri-la Hotel Makati (the hotel).
Tessa Alvarez, did not show up despite their assurance that they
would; their guests complained of the delay in the service of the
dinner; certain items listed in the published menu were unavailable;
the hotels waiters were rude and unapologetic when confronted about
the delay; and despite Alvarezs promise that there would be no charge
for the extension of the reception beyond 12:00 midnight, they were
billed and paid P8,000 per hour for the three-hour extension of the
event up to 4:00 A.M. the next day.
Petitioners further claim that they brought wine and liquor in
accordance with their open bar arrangement, but these were not served
to the guests who were forced to pay for their drinks.
Petitioners thus sent a letter-complaint to the Makati Shangri-la Hotel
and Resort, Inc. (respondent) and received an apologetic reply from
Krister Svensson, the hotels Executive Assistant Manager in charge of
Food and Beverage. They nevertheless filed a complaint for breach of
contract and damages before the Regional Trial Court (RTC)
of Makati City.
In its Answer, respondent claimed that petitioners requested a
combination of king prawns and salmon, hence, the price was
increased to P1,200.00 per person, but discounted at P1,150.00; that
contrary to petitioners claim, Marquez and Alvarez were present
during the event, albeit they were not permanently stationed thereat as
there were three other hotel functions; that while there was a delay in
the service of the meals, the same was occasioned by the sudden
increase of guests to 470 from the guaranteed expected minimum
number of guests of 350 to a maximum of 380, as stated in the Banquet
Event Order (BEO);[2] and that Isaac Albacea, Banquet Service
Director, in fact relayed the delay in the service of the meals to
petitioner Luigis father, Gil Guanio.
Respecting the belated service of meals to some guests, respondent
attributed it to the insistence of petitioners wedding coordinator that
certain guests be served first.
On Svenssons letter, respondent, denying it as an admission of
liability, claimed that it was meant to maintain goodwill to its
customers.
By Decision of August 17, 2006, Branch 148 of the Makati RTC
rendered judgment in favor of petitioners, disposing as follows:
WHEREFORE, premises considered, judgment is
hereby rendered in favor of the plaintiffs and against
the defendant ordering the defendants to pay the
plaintiff the following:
1) The amount of P350,000.00 by way of
actual damages;
2) The amount of P250,000.00 for and as
moral damages;
 3) The amount of P100,000.00 as
exemplary damages;
4) The amount of P100,000.00 for and as
attorneys fees.
With costs against the defendant.
[3]
SO ORDERED.
In finding for petitioners, the trial court relied heavily on the letter
of Svensson which is partly quoted below:
Upon receiving your comments on our service
rendered during your reception here with us, we are
in fact, very distressed. Right from minor issues
pappadums served in the soup instead of the creutons,
lack of valet parkers, hard rolls being too hard till a
major one slow service, rude and arrogant waiters, we
have disappointed you in all means.
Indeed, we feel as strongly as you do that the services
you received were unacceptable and definitely not up
to our standards. We understand that it is our job to
provide excellent service and in this instance, we
have fallen short of your expectations. We ask you
please to accept our profound apologies for causing
such discomfort and annoyance. [4] (underscoring
supplied)
The trial court observed that from the tenor of the letter . . . the
defendant[-herein respondent] admits that the services the plaintiff[-
herein petitioners] received were unacceptable and definitely not up to
their standards.[5]
On appeal, the Court of Appeals, by Decision of July 27,
2009,[6] reversed the trial courts decision, it holding that the proximate
cause of petitioners injury was an unexpected increase in their guests:
x x x Hence, the alleged damage or injury brought
about by the confusion, inconvenience and disarray
during the wedding reception may not be attributed to
defendant-appellant Shangri-la.
We find that the said proximate cause, which is
entirely attributable to plaintiffs-appellants, set the
chain of events which resulted in the alleged
inconveniences, to the plaintiffs-appellants. Given the
circumstances that obtained, only the Sps. Guanio
may bear whatever consequential damages that they
may have allegedly suffered.[7] (underscoring
supplied)
Petitioners motion for reconsideration having been denied by
Resolution of November 18, 2009, the present petition for review was
filed.
The Court finds that since petitioners complaint arose from a contract,
the doctrine of proximate cause finds no application to it:
The doctrine of proximate cause is applicable
only in actions for quasi-delicts, not in actions
 involving breach of contract. x x x The doctrine is a
device for imputing liability to a person where there
is no relation between him and another party. In such
a case, the obligation is created by law itself. But,
where there is a pre-existing contractual relation
between the parties, it is the parties themselves who
create the obligation, and the function of the law is
merely to regulate the relation thus
created.[8] (emphasis and underscoring supplied)
What applies in the present case is Article 1170 of the Civil
Code which reads:
Art. 1170. Those who in the performance of
their obligations are guilty of fraud, negligence or
delay, and those who in any manner contravene the
tenor thereof, are liable for damages.
RCPI v. Verchez, et al. [9] enlightens:
In culpa contractual x x x the mere proof of
the existence of the contract and the failure of its
compliance justify, prima facie, a corresponding right
of relief. The law, recognizing the obligatory force of
contracts, will not permit a party to be set free from
liability for any kind of misperformance of the
contractual undertaking or a contravention of the
tenor thereof. A breach upon the contract confers
upon the injured party a valid cause for recovering
that which may have been lost or suffered. The
remedy serves to preserve the interests of the
promissee that may include his expectation
interest, which is his interest in having the benefit of
his bargain by being put in as good a position as he
would have been in had the contract been
performed, or his reliance interest, which is his
interest in being reimbursed for loss caused by
reliance on the contract by being put in as good a
position as he would have been in had the contract not
been made; or his restitution interest, which is his
interest in having restored to him any benefit that he
has conferred on the other party. Indeed, agreements
can accomplish little, either for their makers or for
society, unless they are made the basis for action. The
effect of every infraction is to create a new duty, that
is, to make RECOMPENSE to the one who has been
injured by the failure of another to observe his
contractual obligation unless he can show
extenuating circumstances, like proof of his exercise
of due diligence x x x or of the attendance of
fortuitous event, to excuse him from his ensuing
liability. (emphasis and underscoring in the original;
capitalization supplied)
The pertinent provisions of the Banquet and Meeting
Services Contract between the parties read:
4.3 The ENGAGER shall be billed in
accordance with the prescribed rate for the minimum
guaranteed number of persons contracted for,
regardless of under attendance or non-appearance of
the expected number of guests, except where the
ENGAGER cancels the Function in accordance with
 its Letter of Confirmation with the HOTEL. Should
the attendance exceed the minimum guaranteed
attendance, the ENGAGER shall also be billed at the
actual rate per cover in excess of the minimum
guaranteed attendance.
xxxx
4.5. The ENGAGER must inform the
HOTEL at least forty eight (48) hours before the
scheduled date and time of the Function of any
change in the minimum guaranteed covers. In the
absence of such notice, paragraph 4.3 shall apply in
the event of under attendance. In case the
actual number of attendees exceed the minimum
guaranteed number
by ten percent (10%), the HOTEL shall not in any
way be held liable for any damage or
inconvenience which may be caused thereby. The
ENGAGER shall also undertake to advise the
guests of the situation and take positive steps to
remedy the same.[10] (emphasis, italics and
underscoring supplied)
Breach of contract is defined as the failure without legal
reason to comply with the terms of a contract. It is also defined as the
[f]ailure, without legal excuse, to perform any promise which forms
the whole or part of the contract.[11]
The appellate court, and even the trial court, observed that
petitioners were remiss in their obligation to inform respondent of the
change in the expected number of guests. The observation is reflected
in the records of the case. Petitioners failure to discharge such
obligation thus excused, as the above-quoted paragraph 4.5 of the
parties contract provide, respondent from liability for any damage or
inconvenience occasioned thereby.
As for petitioners claim that respondent departed from
its verbal agreement with petitioners, the same fails, given that the
written contract which the parties entered into the day before the event,
being the law between them.
Respecting the letter of Svensson on which the trial court
heavily relied as admission of respondents liability but which the
appellate court brushed aside, the Court finds the appellate courts
stance in order. It is not uncommon in the hotel industry to receive
comments, criticisms or feedback on the service it delivers. It is also
customary for hotel management to try to smooth ruffled feathers to
preserve goodwill among its clientele.
Kalalo v. Luz holds:[12]
 Statements which are not estoppels nor judicial
admissions have no quality of conclusiveness, and an
opponent whose admissions have been offered
against him may offer any evidence which serves as
an explanation for his former assertion of what he
now denies as a fact.
Respondents Catering Director, Bea Marquez,
explained the hotels procedure on receiving and processing
complaints, viz:
ATTY. CALMA:
Q You mentioned that the letter indicates an
acknowledgement of the concern and that
there was-the first letter there was an
acknowledgment of the concern and an
apology, not necessarily indicating that such
or admitting fault?
A Yes.
Q Is this the letter that you are referring to?
If I may, Your Honor, that was the letter dated August
4, 2001, previously marked as plaintiffs
exhibits, Your Honor. What is the procedure
of the hotel with respect to customer
concern?
A Upon receipt of the concern from the guest or
client, we acknowledge receipt of such
concern, and as part of procedure in service
industry particularly Makati Shangri-la we
apologize for whatever inconvenience but at
the same time saying, that of course, we
would go through certain investigation and
get back to them for the feedback with
whatever concern they may have.
Q Your Honor, I just like at this point mark the
exhibits, Your Honor, the letter dated August
4, 2001 identified by the witness, Your
Honor, to be marked as Exhibit 14 and the
signature of Mr. Krister Svensson be marked
as Exhibit 14-A.[13]
xxxx
Q In your opinion, you just mentioned that there is a
procedure that the hotel follows with respect
to the complaint, in your opinion was this
procedure followed in this particular
concern?
A Yes, maam.
Q What makes you say that this procedure was
followed?
A As I mentioned earlier, we proved that we did
acknowledge the concern of the client in this
case and we did emphatize from the client
and apologized, and at the same time got back
to them in whatever investigation we have.
Q You said that you apologized, what did you
apologize for?
A Well, first of all it is a standard that we apologize,
right? Being in the service industry, it is a
practice that we apologize if there is any
inconvenience, so the purpose for
apologizing is mainly to show empathy and
to ensure the client that we are hearing them
out and that we will do a better investigation
and it is not in any way that we are admitting
any fault.[14] (underscoring supplied)
 peace of mind.[16] Respondents lack of prudence is an affront to this
right.
To the Court, the foregoing explanation of the hotels Banquet
Director overcomes any presumption of admission of breach which
WHEREFORE, the Court of Appeals Decision dated July
Svenssons letter might have conveyed.
27, 2009 is PARTIALLY REVERSED. Respondent is, in light of the

The exculpatory clause notwithstanding, the Court notes that foregoing discussion, ORDERED to pay the amount of P50,000.00 to

respondent could have managed the situation better, it being held in petitioners by way of nominal damages.

high esteem in the hotel and service industry. Given respondents vast
experience, it is safe to presume that this is not its first encounter with
booked events exceeding the guaranteed cover. It is not audacious to
expect that certain measures have been placed in case this predicament
crops up. That regardless of these measures, respondent still received
Republic of the Philippines
complaints as in the present case, does not amuse. SUPREME COURT
Manila
Respondent admitted that three hotel functions coincided with
petitioners reception. To the Court, the delay in service might have THIRD DIVISION

been avoided or minimized if respondent exercised prescience in G.R. No. 164349 January 31, 2006
scheduling events. No less than quality service should be delivered
RADIO COMMUNICATIONS OF THE PHILIPPINES, INC.
especially in events which possibility of repetition is close to nil.
(RCPI),Petitioner,
Petitioners are not expected to get married twice in their lifetimes. vs.
ALFONSO VERCHEZ, GRACE VERCHEZ-INFANTE,
In the present petition, under considerations of equity, the MARDONIO INFANTE, ZENAIDA VERCHEZ-CATIBOG,
AND FORTUNATO CATIBOG, Respondents.
Court deems it just to award the amount of P50,000.00 by way of
nominal damages to petitioners, for the discomfiture that they were DECISION
subjected to during to the event.[15] The Court recognizes that every
CARPIO MORALES, J.:
person is entitled to respect of his dignity, personality, privacy and
On January 21, 1991, Editha Hebron Verchez (Editha) was confined
at the Sorsogon Provincial Hospital due to an ailment. On even date,
her daughter Grace Verchez-Infante (Grace) immediately hied to the
Sorsogon Branch of the Radio Communications of the Philippines,
Inc. (RCPI) whose services she engaged to send a telegram to her
sister Zenaida Verchez-Catibog (Zenaida) who was residing at 18
Legal St., GSIS Village, Quezon City1 reading: "Send check money
Mommy hospital." For RCPIs services, Grace paid P10.502 for
which she was issued a receipt.3
As three days after RCPI was engaged to send the telegram to
Zenaida no response was received from her, Grace sent a letter to
Zenaida, this time thru JRS Delivery Service, reprimanding her for
not sending any financial aid.
Immediately after she received Graces letter, Zenaida, along with
her husband Fortunato Catibog, left on January 26, 1991 for
Sorsogon. On her arrival at Sorsogon, she disclaimed having
received any telegram.
In the meantime, Zenaida and her husband, together with her mother
Editha left for Quezon City on January 28, 1991 and brought Editha
to the Veterans Memorial Hospital in Quezon City where she was
confined from January 30, 1991 to March 21, 1991.
The telegram was finally delivered to Zenaida 25 days later or on
February 15, 1991.4 On inquiry from RCPI why it took that long to
deliver it, a messenger of RCPI replied that he had nothing to do
with the delivery thereof as it was another messenger who previously
was assigned to deliver the same but the address could not be
located, hence, the telegram was resent on February 2, 1991, and the
second messenger finally found the address on February 15, 1991.
Edithas husband Alfonso Verchez (Verchez), by letter of March 5,
1991,5 demanded an explanation from the manager of the Service
Quality Control Department of the RCPI, Mrs. Lorna D. Fabian, who
replied, by letter of March 13, 1991,6 as follows:
Our investigation on this matter disclosed that subject telegram was
duly processed in accordance with our standard operating procedure.
However, delivery was not immediately effected due to
the occurrence of circumstances which were beyond the control and
foresight of RCPI. Among others, during the transmission process,
the radio link connecting the points of communication involved
encountered radio noise and interferences such that subject telegram
did not initially registered (sic) in the receiving teleprinter machine.
Our internal message monitoring led to the discovery of the
above. Thus, a repeat transmission was made and subsequent
delivery was effected. (Underscoring supplied)
Verchezs lawyer thereupon wrote RCPIs manager Fabian, by letter
of July 23, 1991,7 requesting for a conference on a specified date and
time, but no representative of RCPI showed up at said date and time.
On April 17, 1992, Editha died.
On September 8, 1993, Verchez, along with his daughters Grace and
Zenaida and their respective spouses, filed a complaint against RCPI
before the Regional Trial Court (RTC) of Sorsogon for damages. In
their complaint, the plaintiffs alleged that, inter alia, the delay in
delivering the telegram contributed to the early demise of the late
Editha to their damage and prejudice,8 for which they prayed for the
award of moral and exemplary damages9 and attorneys fees.10
After its motion to dismiss the complaint for improper venue11 was
denied12 by Branch 5 of the RTC of Sorsogon, RCPI filed its answer,
alleging that except with respect to Grace,13 the other plaintiffs had
no privity of contract with it; any delay in the sending of the
telegram was due to force majeure, "specifically, but not limited to,
radio noise and interferences which adversely affected the
transmission and/or reception of the telegraphic message";14 the
clause in the Telegram Transmission Form signed by Grace absolved
it from liability for any damage arising from the transmission other
than the refund of telegram tolls;15 it observed due diligence in the
selection and supervision of its employees; and at all events, any
cause of action had been barred by laches.16
The trial court, observing that "although the delayed delivery of the
questioned telegram was not apparently the proximate cause of the
death of Editha," ruled out the presence of force majeure. Respecting
the clause in the telegram relied upon by RCPI, the trial court held
that it partakes of the nature of a contract of adhesion.
Finding that the nature of RCPIs business obligated it to dispatch
the telegram to the addressee at the earliest possible time but that it
did not in view of the negligence of its employees to repair its radio
transmitter and the concomitant delay in delivering the telegram on
time, the trial court, upon the following provisions of the Civil Code,
to wit:
Article 2176 Whoever by act or omission causes damage to
another, there being at fault or negligence, is obliged to pay for the
damage done. Such fault or negligence if there is no pre-existing
contractual relation between the parties, is called quasi-delict and is
governed by the provisions of this Chapter.
Article 1173 defines the fault of (sic) negligence of the obligor as the
"omission of the diligence which is required by the nature of the
obligation and corresponds with the circumstances of the person, of
the time, or the place."
In the instant case, the obligation of the defendant to deliver the
telegram to the addressee is of an urgent nature. Its essence is the
early delivery of the telegram to the concerned person. Yet, due to
the negligence of its employees, the defendant failed to discharge of
its obligation on time making it liable for damages under Article
2176.
The negligence on the part of the employees gives rise to
the presumption of negligence on the part of the
employer.17 (Underscoring supplied),
rendered judgment against RCPI. Accordingly, it disposed:
WHEREFORE, in the light of the foregoing premises, judgment is
hereby rendered in favor of the plaintiffs and against the defendant,
to wit:
Ordering the defendant to pay the plaintiffs the following amount:
1. The amount of One Hundred Thousand (P100,000.00)
Pesos as moral damages;
2. The amount of Twenty Thousand (P20,000.00) Pesos as
attorneys fees; and
3. To pay the costs.
SO ORDERED.18
On appeal, the Court of Appeals, by Decision of February 27,
2004,19 affirmed the trial courts decision.
Hence, RCPIs present petition for review on certiorari, it raising the
following questions: (1) "Is the award of moral damages proper even
if the trial court found that there was no direct connection between
the injury and the alleged negligent acts?"20 and (2) "Are the
stipulations in the Telegram Transmission Form, in the nature
"contracts of adhesion" (sic)?21
RCPI insists that respondents failed to prove any causal connection
between its delay in transmitting the telegram and Edithas death.22
RCPIs stand fails. It bears noting that its liability is anchored
on culpa contractual or breach of contract with regard to Grace, and
on tort with regard to her co-plaintiffs-herein-co-respondents.
Article 1170 of the Civil Code provides:
Those who in the performance of their obligations are guilty of
fraud, negligence, or delay, and those who in any manner contravene
the tenor thereof, are liable for damages. (Underscoring supplied)
Passing on this codal provision, this Court explained:
In culpa contractual x x x the mere proof of the existence of the
contract and the failure of its compliance justify, prima facie, a
corresponding right of relief. The law, recognizing the obligatory
force of contracts, will not permit a party to be set free from liability
for any kind of misperformance of the contractual undertaking or a
contravention of the tenor thereof. A breach upon the contract
confers upon the injured party a valid cause for recovering that
which may have been lost or suffered. The remedy serves to preserve
the interests of the promissee that may include his "expectation
interest," which is his interest in having the benefit of his bargain by
being put in as good a position as he would have been in had the
contract been performed, or his "reliance interest," which is his
interest in being reimbursed for loss caused by reliance on the
contract by being put in as good a position as he would have been in
had the contract not been made; or his "restitution interest," which
is his interest in having restored to him any benefit that he has
conferred on the other party. Indeed, agreements can accomplish
little, either for their makers or for society, unless they are made the
basis for action. The effect of every infraction is to create a new
duty, that is, to make recompense to the one who has been injured by
the failure of another to observe his contractual obligation unless he
can show extenuating circumstances, like proof of his exercise of
due diligence x x x or of the attendance of fortuitous event, to
excuse him from his ensuing liability.23 (Emphasis and underscoring
supplied)
In the case at bar, RCPI bound itself to deliver the telegram within
the shortest possible time. It took 25 days, however, for RCPI to
deliver it.
RCPI invokes force majeure, specifically, the alleged radio noise and
interferences which adversely affected the transmission and/or
reception of the telegraphic message. Additionally, its messenger
claimed he could not locate the address of Zenaida and it was only
on the third attempt that he was able to deliver the telegram.
For the defense of force majeure to prosper,
x x x it is necessary that one has committed no negligence or
misconduct that may have occasioned the loss. An act of God cannot
be invoked to protect a person who has failed to take steps to
forestall the possible adverse consequences of such a loss. Ones
negligence may have concurred with an act of God in producing
damage and injury to another; nonetheless, showing that the
immediate or proximate cause of the damage or injury was a
fortuitous event would not exempt one from liability. When the
effect is found to be partly the result of a persons participation
whether by active intervention, neglect or failure to act the
whole occurrence is humanized and removed from the rules
applicable to acts of God.
xxxx
Article 1174 of the Civil Code states that no person shall be
responsible for a fortuitous event that could not be foreseen or,
though foreseen, was inevitable. In other words, there must be an
exclusion of human intervention from the cause of injury or
loss.24 (Emphasis and underscoring supplied)
Assuming arguendo that fortuitous circumstances prevented RCPI
from delivering the telegram at the soonest possible time, it should
have at least informed Grace of the non-transmission and the non-
delivery so that she could have taken steps to remedy the situation.
But it did not. There lies the fault or negligence.
In an earlier case also involving RCPI, this Court held:
Considering the public utility of RCPIs business and its contractual
obligation to transmit messages, it should exercise due diligence to
ascertain that messages are delivered to the persons at the given
address and should provide a system whereby in cases of undelivered
messages the sender is given notice of non-delivery. Messages sent
by cable or wireless means are usually more
important and urgent than those which can wait for the mail.25
xxxx
People depend on telecommunications companies in times of
deep emotional stress or pressing financial needs. Knowing that
messages about the illnesses or deaths of loved ones, births or
marriages in a family, important business transactions, and notices of
conferences or meetings as in this case, are coursed through the
petitioner and similar corporations, it is incumbent upon them to
exercise a greater amount of care and concern than that shown in this
case. Every reasonable effort to inform senders of the non-delivery
of messages should be undertaken.26
(Emphasis and underscoring supplied)
RCPI argues, however, against the presence of urgency in the
delivery of the telegram, as well as the basis for the award of moral
damages, thus:27
The request to send check as written in the telegraphic text negates
the existence of urgency that private respondents allegations that
time was of the essence imports. A check drawn against a Manila
Bank and transmitted to Sorsogon, Sorsogon will have to be
deposited in a bank in Sorsogon and pass thru a minimum clearing
period of 5 days before it may be encashed or withdrawn. If the
transmittal of the requested check to Sorsogon took 1 day private
respondents could therefore still wait for 6 days before the same may
be withdrawn. Requesting a check that would take 6 days before it
could be withdrawn therefore contradicts plaintiffs claim of urgency
or need.28
At any rate, any sense of urgency of the situation was met when
Grace Verchez was able to communicate to Manila via a letter that
she sent to the same addressee in Manila thru JRS.29
xxxx
As far as the respondent courts award for moral damages is
concerned, the same has no basis whatsoever since private
respondent Alfonso Verchez did not accompany his late wife when
the latter went to Manila by bus. He stayed behind in Sorsogon for
almost 1 week before he proceeded to Manila. 30
When pressed on cross-examination, private respondent Alfonso
Verchez could not give any plausible reason as to the reason why he
did not accompany his ailing wife to Manila.31
xxxx
It is also important to consider in resolving private respondents
claim for moral damages that private respondent Grace Verchez did
not accompany her ailing mother to Manila.32
xxxx
It is the common reaction of a husband to be at his ailing wifes side
as much as possible. The fact that private respondent Alfonso
Verchez stayed behind in Sorsogon for almost 1 week convincingly
demonstrates that he himself knew that his wife was not in critical
condition.33
(Emphasis and underscoring supplied)
RCPIs arguments fail. For it is its breach of contract upon which its
liability is, it bears repeating, anchored. Since RCPI breached its
contract, the presumption is that it was at fault or negligent. It,
however, failed to rebut this presumption.
For breach of contract then, RCPI is liable to Grace for damages.
And for quasi-delict, RCPI is liable to Graces co-respondents
following Article 2176 of the Civil Code which provides:
Whoever by act or omission causes damage to another, there being
fault or negligence, is obliged to pay for the damage done. Such fault
or negligence, if there is no pre-existing contractual relation between
the parties, is called a quasi-delict and is governed by the provisions
of this Chapter. (Underscoring supplied)
RCPIs liability as an employer could of course be avoided if it could
prove that it observed the diligence of a good father of a family to
prevent damage. Article 2180 of the Civil Code so provides:
The obligation imposed by Article 2176 is demandable not only for
ones own acts or omissions, but also for those of persons for whom
one is responsible.
xxxx
The owners and managers of an establishment or enterprise are
likewise 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.
Employers shall be liable for the damages caused by their employees
and household helpers acting within the scope of their assigned tasks,
even though the former are not engaged in any business or industry.
xxxx
The responsibility treated of in this article shall cease when the
persons herein mentioned prove that they observed all the diligence
of a good father of a family to prevent damage. (Underscoring
supplied)
RCPI failed, however, to prove that it observed all the diligence of a
good father of a family to prevent damage.
Respecting the assailed award of moral damages, a determination of
the presence of the following requisites to justify the award is in
order:
x x x firstly, evidence of besmirched reputation or physical, mental
or psychological suffering sustained by the claimant; secondly, a
culpable act or omission factually established; thirdly, proof that the
wrongful act or omission of the defendant is the proximate cause of
damages sustained by the claimant; and fourthly, that the case is
predicated on any of the instances expressed or envisioned by Article
2219 and Article 2220 of the Civil Code.34
Respecting the first requisite, evidence of suffering by the plaintiffs-
herein respondents was correctly appreciated by the CA in this wise:
The failure of RCPI to deliver the telegram containing the message
of appellees on time, disturbed their filial tranquillity. Family
members blamed each other for failing to respond swiftly to an
emergency that involved the life of the late Mrs. Verchez, who
suffered from diabetes.35
As reflected in the foregoing discussions, the second and third
requisites are present.
On the fourth requisite, Article 2220 of the Civil Code provides:
Willful injury to property may be a legal ground for awarding moral
damages if the court should find that, under the circumstances, such
damages are justly due. The same rule applies to breaches of
contract where the defendant acted fraudulently or in bad
faith. (Emphasis and underscoring supplied)
After RCPIs first attempt to deliver the telegram failed, it did not
inform Grace of the non-delivery thereof and waited for 12 days
before trying to deliver it again, knowing as it should know that
time is of the essence in the delivery of telegrams. When its second
long-delayed attempt to deliver the telegram again failed, it, again,
waited for another 12 days before making a third attempt. Such
nonchalance in performing its urgent obligation indicates gross
negligence amounting to bad faith. The fourth requisite is thus also
present.
In applying the above-quoted Article 2220, this Court has awarded
moral damages in cases of breach of contract where the defendant
was guilty of gross negligence amounting to bad faith, or in wanton
disregard of his contractual obligation.36
As for RCPIs tort-based liability, Article 2219 of the Civil Code
provides:
Moral damages may be recovered in the following and analogous
cases:
xxxx
(10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30,
32, 34, and 35. (Emphasis supplied)
Article 26 of the Civil Code, in turn, provides:
Every person shall respect the dignity, personality, privacy
and peace of mind of his neighbors and other persons. The
following and similar acts, though they may not constitute a criminal
offense, shall produce a cause of action for damages, prevention, and
other relief:
xxxx
(2) Meddling with or disturbing the private life or family
relations of another. (Emphasis supplied)
RCPIs negligence in not promptly performing its obligation
undoubtedly disturbed the peace of mind not only of Grace but also
her co-respondents. As observed by the appellate court, it disrupted
the "filial tranquillity" among them as they blamed each other "for
failing to respond swiftly to an emergency." The tortious acts and/or
omissions complained of in this case are, therefore, analogous to acts
mentioned under Article 26 of the Civil Code, which are among the
instances of quasi-delict when courts may award moral damages
under Article 2219 of the Civil Code.
In fine, the award to the plaintiffs-herein respondents of moral
damages is in order, as is the award of attorneys fees, respondents
having been compelled to litigate to protect their rights.
Clutching at straws, RCPI insists that the limited liability clause in
the "Telegram Transmission Form" is not a contract of adhesion.
Thus it argues:
Neither can the Telegram Transmission Form be considered a
contract of adhesion as held by the respondent court. The said
stipulations were all written in bold letters right in front of the WHEREFORE, the petition is DENIED, and the challenged
Telegram Transmission Form. As a matter of fact they were beside decision of the Court of Appeals is AFFIRMED.
the space where the telegram senders write their telegraphic
messages. It would have been different if the stipulations were Costs against petitioner.
written at the back for surely there is no way the sender will easily
notice them. The fact that the stipulations were located in a particular SO ORDERED.
space where they can easily be seen, is sufficient notice to any sender
(like Grace Verchez-Infante) where she could manifest her
disapproval, leave the RCPI station and avail of the services of the
other telegram operators.37 (Underscoring supplied)

RCPI misunderstands the nature of a contract of adhesion. Neither

the readability of the stipulations nor their physical location in the
contract determines whether it is one of adhesion.

A contract of adhesion is defined as one in which one of the parties

imposes a ready-made form of contract, which the other party may
EN BANC
accept or reject, but which the latter cannot modify. One party
prepares the stipulation in the contract, while the other party merely
[G.R. No. L-27454. April 30, 1970.]
affixes his signature or his "adhesion" thereto, giving no room for
negotiation and depriving the latter of the opportunity to
ROSENDO O. CHAVES, Plaintiff-Appellant, v. FRUCTUOSO
bargain on equal footing.38 (Emphasis and underscoring supplied)
GONZALES, Defendant-Appellee.
While a contract of adhesion is not necessarily void and
Chaves, Elio, Chaves & Associates, for Plaintiff-Appellant.
unenforceable, since it is construed strictly against the party who
drafted it or gave rise to any ambiguity therein, it is stricken down as
Sulpicio E. Platon, for Defendant-Appellee.
void and unenforceable or subversive of public policy when the
weaker party is imposed upon in dealing with the dominant
bargaining party and is reduced to the alternative of taking it or
SYLLABUS
leaving it, completely deprived of the opportunity to bargain on
equal footing.39
1. CIVIL LAW; CONTRACTS; BREACH OF CONTRACT FOR
This Court holds that the Court of Appeals finding that the parties NON-PERFORMANCE; FIXING OF PERIOD BEFORE FILING
contract is one of adhesion which is void is, given the facts and OF COMPLAINT FOR NON-PERFORMANCE, ACADEMIC.
circumstances of the case, thus well-taken. Where the time for compliance had expired and there was breach of
contract by non-performance, it was academic for the plaintiff to
have first petitioned the court to fix a period for the performance of
the contract before filing his complaint.
2. ID.; ID.; ID.; DEFENDANT CANNOT INVOKE ARTICLE 1197
OF THE CIVIL CODE OF THE PHILIPPINES. Where the
defendant virtually admitted non-performance of the contract by
returning the typewriter that he was obliged to repair in a non-
working condition, with essential parts missing, Article 1197 of the
Civil Code of the Philippines cannot be invoked. The fixing of a
period would thus be a mere formality and would serve no purpose
than to delay.
3. ID.; ID.; ID.; DAMAGES RECOVERABLE; CASE AT BAR.
Where the defendant-appellee contravened the tenor of his obligation
because he not only did not repair the typewriter but returned it "in
shambles, he is liable for the cost of the labor or service expended
in the repair of the typewriter, which is in the amount of P58.75,
because the obligation or contract was to repair it. In addition, he is
likewise liable under Art. 1170 of the Code, for the cost of the
missing parts, in the amount of P31.10, for in his obligation to repair
the typewriter he was bound, but failed or neglected, to return it in
the same condition it was when he received it.
4. ID.; ID.; ID.; CLAIMS FOR DAMAGES OR ATTORNEYS
FEES NOT RECOVERABLE; NOT ALLEGED OR PROVED IN
INSTANT CASE. Claims for damages and attorneys fees must be
pleaded, and the existence of the actual basis thereof must be proved.
As no findings of fact were made on the claims for damages and
attorneys fees, there is no factual basis upon which to make an
award therefor.
5. REMEDIAL LAW; APPEALS; APPEAL FROM COURT OF
FIRST INSTANCE TO SUPREME COURT; ONLY QUESTIONS
OF LAW REVIEWABLE. Where the appellant directly appeals
from the decision of the trial court to the Supreme Court on
questions of law, he is bound by the judgment of the court a quo on
its findings of fact.
DECISION
REYES, J.B.L., J.:
This is a direct appeal by the party who prevailed in a suit for breach
of oral contract and recovery of damages but was unsatisfied with the
decision rendered by the Court of First Instance of Manila, in its
Civil Case No. 65138, because it awarded him only P31.10 out of his
total claim of P690 00 for actual, temperate and moral damages and
attorneys fees.
The appealed judgment, which is brief, is hereunder quoted in full:j
"In the early part of July, 1963, the plaintiff delivered to the
defendant, who is a typewriter repairer, a portable typewriter for
routine cleaning and servicing. The defendant was not able to finish
the job after some time despite repeated reminders made by the
plaintiff. The defendant merely gave assurances, but failed to comply
with the same. In October, 1963, the defendant asked from the
plaintiff the sum of P6.00 for the purchase of spare parts, which
amount the plaintiff gave to the defendant. On October 26, 1963,
after getting exasperated with the delay of the repair of the
typewriter, the plaintiff went to the house of the defendant and asked
for the return of the typewriter. The defendant delivered the
typewriter in a wrapped package. On reaching home, the plaintiff
examined the typewriter returned to him by the defendant and found
out that the same was in shambles, with the interior cover and some
parts and screws missing. On October 29, 1963. the plaintiff sent a
letter to the defendant formally demanding the return of the missing
parts, the interior cover and the sum of P6.00 (Exhibit D). The
following day, the defendant returned to the plaintiff some of the
missing parts, the interior cover and the P6.00.
"On August 29, 1964, the plaintiff had his typewriter repaired by
Freixas Business Machines, and the repair job cost him a total of
P89.85, including labor and materials (Exhibit C).
"On August 23, 1965, the plaintiff commenced this action before the
City Court of Manila, demanding from the defendant the payment of
P90.00 as actual and compensatory damages, P100.00 for temperate
damages, P500.00 for moral damages, and P500.00 as attorneys
fees.
"In his answer as well as in his testimony given before this court, the
defendant made no denials of the facts narrated above, except the
claim of the plaintiff that the typewriter was delivered to the
defendant through a certain Julio Bocalin, which the defendant
denied allegedly because the typewriter was delivered to him
personally by the plaintiff.
"The repair done on the typewriter by Freixas Business Machines
with the total cost of P89.85 should not, however, be fully
chargeable against the defendant. The repair invoice, Exhibit C,
shows that the missing parts had a total value of only P31.10.
"WHEREFORE, judgment is hereby rendered ordering the defendant
to pay the plaintiff the sum of P31.10, and the costs of suit.
"SO ORDERED."cralaw virtua1aw library
The error of the court a quo, according to the plaintiff-appellant,
Rosendo O. Chaves, is that it awarded only the value of the missing
parts of the typewriter, instead of the whole cost of labor and
materials that went into the repair of the machine, as provided for in
Article 1167 of the Civil Code, reading as
follows:jgc:chanrobles.com.ph
"ART. 1167. If a person obliged to do something fails to do it, the
same shall be executed at his cost.
This same rule shall be observed if he does it in contravention of the
tenor of the obligation. Furthermore it may be decreed that what has
been poorly done he undone."cralaw virtua1aw library
On the other hand, the position of the defendant-appellee, Fructuoso
Gonzales, is that he is not liable at all, not even for the sum of
P31.10, because his contract with plaintiff-appellant did not contain a
period, so that plaintiff-appellant should have first filed a petition for
the court to fix the period, under Article 1197 of the Civil Code,
within which the defendant appellee was to comply with the contract
before said defendant-appellee could be held liable for breach of
contract.
Because the plaintiff appealed directly to the Supreme Court and the
appellee did not interpose any appeal, the facts, as found by the trial
court, are now conclusive and non-reviewable. 1
The appealed judgment states that the "plaintiff delivered to the
defendant . . . a portable typewriter for routine cleaning and
servicing" ; that the defendant was not able to finish the job after
some time despite repeated reminders made by the plaintiff" ; that
the "defendant merely gave assurances, but failed to comply with the
same" ; and that "after getting exasperated with the delay of the
repair of the typewriter", the plaintiff went to the house of the
defendant and asked for its return, which was done. The inferences
derivable from these findings of fact are that the appellant and the
appellee had a perfected contract for cleaning and servicing a
typewriter; that they intended that the defendant was to finish it at
some future time although such time was not specified; and that such
time had passed without the work having been accomplished, far the
defendant returned the typewriter cannibalized and unrepaired,
which in itself is a breach of his obligation, without demanding that malice charged to the appellee. As no findings of fact were made on
he should be given more time to finish the job, or compensation for the claims for damages and attorneys fees, there is no factual basis
the work he had already done. The time for compliance having upon which to make an award therefor. Appellant is bound by such
evidently expired, and there being a breach of contract by non- judgment of the court, a quo, by reason of his having resorted
performance, it was academic for the plaintiff to have first petitioned directly to the Supreme Court on questions of law.
the court to fix a period for the performance of the contract before
filing his complaint in this case. Defendant cannot invoke Article IN VIEW OF THE FOREGOING REASONS, the appealed
1197 of the Civil Code for he virtually admitted non-performance by judgment is hereby modified, by ordering the defendant-appellee to
returning the typewriter that he was obliged to repair in a non- pay, as he is hereby ordered to pay, the plaintiff-appellant the sum of
working condition, with essential parts missing. The fixing of a P89.85, with interest at the legal rate from the filing of the complaint.
period would thus be a mere formality and would serve no purpose Costs in all instances against appellee Fructuoso Gonzales.
than to delay (cf. Tiglao. Et. Al. V. Manila Railroad Co. 98 Phil.
18l). Concepcion, C.J., Dizon, Makalintal, Zaldivar, Castro, Fernando,
Teehankee and Villamor, JJ., concur.
It is clear that the defendant-appellee contravened the tenor of his
obligation because he not only did not repair the typewriter but Barredo, J., did not take part.
returned it "in shambles", according to the appealed decision. For
such contravention, as appellant contends, he is liable under Article
1167 of the Civil Code. jam quot, for the cost of executing the
obligation in a proper manner. The cost of the execution of the
obligation in this case should be the cost of the labor or service
expended in the repair of the typewriter, which is in the amount of
P58.75. because the obligation or contract was to repair it.

In addition, the defendant-appellee is likewise liable, under Article

1170 of the Code, for the cost of the missing parts, in the amount of
P31.10, for in his obligation to repair the typewriter he was bound,
but failed or neglected, to return it in the same condition it was when
he received it.

Appellants claims for moral and temperate damages and attorneys

fees were, however, correctly rejected by the trial court, for these
were not alleged in his complaint (Record on Appeal, pages 1-5).
Claims for damages and attorneys fees must be pleaded, and the
existence of the actual basis thereof must be proved. 2 The appealed
judgment thus made no findings on these claims, nor on the fraud or