G.R. No. L-12986 March 31, 1966 1.

Police Department report: —

THE SPOUSES BERNABE AFRICA and SOLEDAD C. AFRICA, Investigation disclosed that at about 4:00 P.M.
and the HEIRS OF DOMINGA ONG, petitioners-appellants, March 18, 1948, while Leandro Flores was
vs. transferring gasoline from a tank truck, plate No. T-
CALTEX (PHIL.), INC., MATEO BOQUIREN and THE COURT OF 5292 into the underground tank of the Caltex
APPEALS, respondents-appellees. Gasoline Station located at the corner of Rizal
Avenue and Antipolo Street, this City, an unknown
Ross, Selph, Carrascoso and Janda for the respondents. Filipino lighted a cigarette and threw the burning
Bernabe Africa, etc. for the petitioners. match stick near the main valve of the said
underground tank. Due to the gasoline fumes, fire
MAKALINTAL., J.: suddenly blazed. Quick action of Leandro Flores in
pulling off the gasoline hose connecting the truck
with the underground tank prevented a terrific
This case is before us on a petition for review of the decision of the explosion. However, the flames scattered due to the
Court of Appeals, which affirmed that of the Court of First Instance of hose from which the gasoline was spouting. It
Manila dismissing petitioners' second amended complaint against burned the truck and the following accessorias and
respondents. residences.

The action is for damages under Articles 1902 and 1903 of the old 2. The Fire Department report: —
Civil Code. It appears that in the afternoon of March 18, 1948 a fire
broke out at the Caltex service station at the corner of Antipolo street
In connection with their allegation that the premises was (sic)
and Rizal Avenue, Manila. It started while gasoline was being hosed
from a tank truck into the underground storage, right at the opening subleased for the installation of a coca-cola and cigarette
of the receiving tank where the nozzle of the hose was inserted. The stand, the complainants furnished this Office a copy of a
photograph taken during the fire and which is submitted
fire spread to and burned several neighboring houses, including the
herewith. it appears in this picture that there are in the
personal properties and effects inside them. Their owners, among
premises a coca-cola cooler and a rack which according to
them petitioners here, sued respondents Caltex (Phil.), Inc. and
Mateo Boquiren, the first as alleged owner of the station and the information gathered in the neighborhood contained
second as its agent in charge of operation. Negligence on the part of cigarettes and matches, installed between the gasoline
pumps and the underground tanks.
both of them was attributed as the cause of the fire.

The report of Captain Tinio reproduced information given by a certain

The trial court and the Court of Appeals found that petitioners failed
to prove negligence and that respondents had exercised due care in Benito Morales regarding the history of the gasoline station and what
the premises and with respect to the supervision of their employees. the chief of the fire department had told him on the same subject.

The foregoing reports were ruled out as "double hearsay" by the

The first question before Us refers to the admissibility of certain
Court of Appeals and hence inadmissible. This ruling is now
reports on the fire prepared by the Manila Police and Fire
Departments and by a certain Captain Tinio of the Armed Forces of assigned as error. It is contended: first, that said reports were
the Philippines. Portions of the first two reports are as follows: admitted by the trial court without objection on the part of
respondents; secondly, that with respect to the police report (Exhibit made by the public officer in the performance of his duties, or by
V-Africa) which appears signed by a Detective Zapanta allegedly "for such other person in the performance of a duty specially enjoined by
Salvador Capacillo," the latter was presented as witness but law; and (c) that the public officer or other person had sufficient
respondents waived their right to cross-examine him although they knowledge of the facts by him stated, which must have been
had the opportunity to do so; and thirdly, that in any event the said acquired by him personally or through official information (Moran,
reports are admissible as an exception to the hearsay rule under Comments on the Rules of Court, Vol. 3 [1957] p. 398).
section 35 of Rule 123, now Rule 130.
Of the three requisites just stated, only the last need be considered
The first contention is not borne out by the record. The transcript of here. Obviously the material facts recited in the reports as to the
the hearing of September 17, 1953 (pp. 167-170) shows that the cause and circumstances of the fire were not within the personal
reports in question, when offered as evidence, were objected to by knowledge of the officers who conducted the investigation. Was
counsel for each of respondents on the ground that they were knowledge of such facts, however, acquired by them through official
hearsay and that they were "irrelevant, immaterial and impertinent." information? As to some facts the sources thereof are not even
Indeed, in the court's resolution only Exhibits J, K, K-5 and X-6 were identified. Others are attributed to Leopoldo Medina, referred to as
admitted without objection; the admission of the others, including the an employee at the gas station were the fire occurred; to Leandro
disputed ones, carried no such explanation. Flores, driver of the tank truck from which gasoline was being
transferred at the time to the underground tank of the station; and to
On the second point, although Detective Capacillo did take the respondent Mateo Boquiren, who could not, according to Exhibit V-
witness stand, he was not examined and he did not testify as to the Africa, give any reason as to the origin of the fire. To qualify their
facts mentioned in his alleged report (signed by Detective Zapanta). statements as "official information" acquired by the officers who
All he said was that he was one of those who investigated "the prepared the reports, the persons who made the statements not only
location of the fire and, if possible, gather witnesses as to the must have personal knowledge of the facts stated but must have the
occurrence, and that he brought the report with him. There was duty to give such statements for record.1
nothing, therefore, on which he need be cross-examined; and the
contents of the report, as to which he did not testify, did not thereby The reports in question do not constitute an exception to the hearsay
become competent evidence. And even if he had testified, his rule; the facts stated therein were not acquired by the reporting
testimony would still have been objectionable as far as information officers through official information, not having been given by the
gathered by him from third persons was concerned. informants pursuant to any duty to do so.

Petitioners maintain, however, that the reports in themselves, that is, The next question is whether or not, without proof as to the cause
without further testimonial evidence on their contents, fall within the and origin of the fire, the doctrine of res ipsa loquitur should apply so
scope of section 35, Rule 123, which provides that "entries in official as to presume negligence on the part of appellees. Both the trial
records made in the performance of his duty by a public officer of the court and the appellate court refused to apply the doctrine in the
Philippines, or by a person in the performance of a duty specially instant case on the grounds that "as to (its) applicability ... in the
enjoined by law, are prima facie evidence of the facts therein stated." Philippines, there seems to he nothing definite," and that while the
rules do not prohibit its adoption in appropriate cases, "in the case at
There are three requisites for admissibility under the rule just bar, however, we find no practical use for such doctrine." The
mentioned: (a) that the entry was made by a public officer, or by question deserves more than such summary dismissal. The doctrine
another person specially enjoined by law to do so; (b) that it was has actually been applied in this jurisdiction, in the case of Espiritu
vs. Philippine Power and Development Co. (CA-G.R. No. 3240-R,
September 20, 1949), wherein the decision of the Court of Appeals in the absence of the explanation, that the injury arose from
was penned by Mr. Justice J.B.L. Reyes now a member of the defendant's want of care."
Supreme Court.
And the burden of evidence is shifted to him to establish that
The facts of that case are stated in the decision as follows: he has observed due care and diligence. (San Juan Light &
Transit Co. v. Requena, 244, U.S. 89, 56 L. ed. 680.) This
In the afternoon of May 5, 1946, while the plaintiff-appellee rule is known by the name of res ipsa loquitur (the
and other companions were loading grass between the transaction speaks for itself), and is peculiarly applicable to
municipalities of Bay and Calauan, in the province of the case at bar, where it is unquestioned that the plaintiff had
Laguna, with clear weather and without any wind blowing, an every right to be on the highway, and the electric wire was
electric transmission wire, installed and maintained by the under the sole control of defendant company. In the ordinary
defendant Philippine Power and Development Co., Inc. course of events, electric wires do not part suddenly in fair
alongside the road, suddenly parted, and one of the broken weather and injure people, unless they are subjected to
ends hit the head of the plaintiff as he was about to board unusual strain and stress or there are defects in their
the truck. As a result, plaintiff received the full shock of 4,400 installation, maintenance and supervision; just as barrels do
volts carried by the wire and was knocked unconscious to not ordinarily roll out of the warehouse windows to injure
the ground. The electric charge coursed through his body passersby, unless some one was negligent. (Byrne v.
and caused extensive and serious multiple burns from skull Boadle, 2 H & Co. 722; 159 Eng. Reprint 299, the leading
to legs, leaving the bone exposed in some parts and causing case that established that rule). Consequently, in the
intense pain and wounds that were not completely healed absence of contributory negligence (which is admittedly not
when the case was tried on June 18, 1947, over one year present), the fact that the wire snapped suffices to raise a
after the mishap. reasonable presumption of negligence in its installation, care
and maintenance. Thereafter, as observed by Chief Baron
Pollock, "if there are any facts inconsistent with negligence, it
The defendant therein disclaimed liability on the ground that the
plaintiff had failed to show any specific act of negligence, but the is for the defendant to prove."
appellate court overruled the defense under the doctrine of res ipsa
loquitur. The court said: It is true of course that decisions of the Court of Appeals do not lay
down doctrines binding on the Supreme Court, but we do not
consider this a reason for not applying the particular doctrine of res
The first point is directed against the sufficiency of plaintiff's
ipsa loquitur in the case at bar. Gasoline is a highly combustible
evidence to place appellant on its defense. While it is the
material, in the storage and sale of which extreme care must be
rule, as contended by the appellant, that in case of
noncontractual negligence, or culpa aquiliana, the burden of taken. On the other hand, fire is not considered a fortuitous event, as
it arises almost invariably from some act of man. A case strikingly
proof is on the plaintiff to establish that the proximate cause
similar to the one before Us is Jones vs. Shell Petroleum
of his injury was the negligence of the defendant, it is also a
recognized principal that "where the thing which caused Corporation, et al., 171 So. 447:
injury, without fault of the injured person, is under the
exclusive control of the defendant and the injury is such as in Arthur O. Jones is the owner of a building in the city of
the ordinary course of things does not occur if he having Hammon which in the year 1934 was leased to the Shell
such control use proper care, it affords reasonable evidence, Petroleum Corporation for a gasoline filling station. On
October 8, 1934, during the term of the lease, while gasoline
 was being transferred from the tank wagon, also operated by Predicated on these circumstances and the further
the Shell Petroleum Corporation, to the underground tank of circumstance of defendant's failure to explain the cause of
the station, a fire started with resulting damages to the the fire or to show its lack of knowledge of the cause, plaintiff
building owned by Jones. Alleging that the damages to his has evoked the doctrine of res ipsa loquitur. There are many
building amounted to $516.95, Jones sued the Shell cases in which the doctrine may be successfully invoked and
Petroleum Corporation for the recovery of that amount. The this, we think, is one of them.
judge of the district court, after hearing the testimony,
concluded that plaintiff was entitled to a recovery and Where the thing which caused the injury complained of is
rendered judgment in his favor for $427.82. The Court of shown to be under the management of defendant or his
Appeals for the First Circuit reversed this judgment, on the servants and the accident is such as in the ordinary course
ground the testimony failed to show with reasonable of things does not happen if those who have its management
certainty any negligence on the part of the Shell Petroleum or control use proper care, it affords reasonable evidence, in
Corporation or any of its agents or employees. Plaintiff absence of explanation by defendant, that the accident
applied to this Court for a Writ of Review which was granted, arose from want of care. (45 C.J. #768, p. 1193).
and the case is now before us for decision.1äwphï1.ñët
This statement of the rule of res ipsa loquitur has been
In resolving the issue of negligence, the Supreme Court of Louisiana widely approved and adopted by the courts of last resort.
held: Some of the cases in this jurisdiction in which the doctrine
has been applied are the following, viz.: Maus v. Broderick,
Plaintiff's petition contains two distinct charges of negligence 51 La. Ann. 1153, 25 So. 977; Hebert v. Lake Charles Ice,
— one relating to the cause of the fire and the other relating etc., Co., 111 La. 522, 35 So. 731, 64 L.R.A. 101, 100 Am.
to the spreading of the gasoline about the filling station. St. Rep. 505; Willis v. Vicksburg, etc., R. Co., 115 La. 63, 38
So. 892; Bents v. Page, 115 La. 560, 39 So. 599.
Other than an expert to assess the damages caused
plaintiff's building by the fire, no witnesses were placed on The principle enunciated in the aforequoted case applies with equal
the stand by the defendant. force here. The gasoline station, with all its appliances, equipment
and employees, was under the control of appellees. A fire occurred
Taking up plaintiff's charge of negligence relating to the therein and spread to and burned the neighboring houses. The
cause of the fire, we find it established by the record that the persons who knew or could have known how the fire started were
filling station and the tank truck were under the control of the appellees and their employees, but they gave no explanation thereof
defendant and operated by its agents or employees. We whatsoever. It is a fair and reasonable inference that the incident
further find from the uncontradicted testimony of plaintiff's happened because of want of care.
witnesses that fire started in the underground tank attached
to the filling station while it was being filled from the tank In the report submitted by Captain Leoncio Mariano of the Manila
truck and while both the tank and the truck were in charge of Police Department (Exh. X-1 Africa) the following appears:
and being operated by the agents or employees of the
defendant, extended to the hose and tank truck, and was Investigation of the basic complaint disclosed that the Caltex
communicated from the burning hose, tank truck, and Gasoline Station complained of occupies a lot approximately
escaping gasoline to the building owned by the plaintiff. 10 m x 10 m at the southwest corner of Rizal Avenue and
 Antipolo. The location is within a very busy business district the statement of Leandro Flores before the police investigator. Flores
near the Obrero Market, a railroad crossing and very thickly was the driver of the gasoline tank wagon who, alone and without
populated neighborhood where a great number of people assistance, was transferring the contents thereof into the
mill around t underground storage when the fire broke out. He said: "Before
loading the underground tank there were no people, but while the
until loading was going on, there were people who went to drink coca-cola
(at the coca-cola stand) which is about a meter from the hole leading
gasoline to the underground tank." He added that when the tank was almost
filled he went to the tank truck to close the valve, and while he had
his back turned to the "manhole" he, heard someone shout "fire."
tever be theWactjvities of these peopleor lighting a cigarette
cannot be excluded and this constitute a secondary hazard
Even then the fire possibly would not have spread to the neighboring
to its operation which in turn endangers the entire
neighborhood to conflagration. houses were it not for another negligent omission on the part of
defendants, namely, their failure to provide a concrete wall high
enough to prevent the flames from leaping over it. As it was the
Furthermore, aside from precautions already taken by its concrete wall was only 2-1/2 meters high, and beyond that height it
operator the concrete walls south and west adjoining the consisted merely of galvanized iron sheets, which would predictably
neighborhood are only 2-1/2 meters high at most and cannot crumple and melt when subjected to intense heat. Defendants'
avoid the flames from leaping over it in case of fire. negligence, therefore, was not only with respect to the cause of the
fire but also with respect to the spread thereof to the neighboring
Records show that there have been two cases of fire which houses.
caused not only material damages but desperation and also
panic in the neighborhood. There is an admission on the part of Boquiren in his amended
answer to the second amended complaint that "the fire was caused
Although the soft drinks stand had been eliminated, this through the acts of a stranger who, without authority, or permission
gasoline service station is also used by its operator as a of answering defendant, passed through the gasoline station and
garage and repair shop for his fleet of taxicabs numbering negligently threw a lighted match in the premises." No evidence on
ten or more, adding another risk to the possible outbreak of this point was adduced, but assuming the allegation to be true —
fire at this already small but crowded gasoline station. certainly any unfavorable inference from the admission may be taken
against Boquiren — it does not extenuate his negligence. A decision
The foregoing report, having been submitted by a police officer in the of the Supreme Court of Texas, upon facts analogous to those of the
performance of his duties on the basis of his own personal present case, states the rule which we find acceptable here. "It is the
observation of the facts reported, may properly be considered as an rule that those who distribute a dangerous article or agent, owe a
exception to the hearsay rule. These facts, descriptive of the location degree of protection to the public proportionate to and
and objective circumstances surrounding the operation of the commensurate with a danger involved ... we think it is the generally
gasoline station in question, strengthen the presumption of accepted rule as applied to torts that 'if the effects of the actor's
negligence under the doctrine of res ipsa loquitur, since on their face negligent conduct actively and continuously operate to bring about
they called for more stringent measures of caution than those which harm to another, the fact that the active and substantially
would satisfy the standard of due diligence under ordinary simultaneous operation of the effects of a third person's innocent,
circumstances. There is no more eloquent demonstration of this than tortious or criminal act is also a substantial factor in bringing about
the harm, does not protect the actor from liability.' (Restatement of But Caltex did not present any contract with Boquiren that would
the Law of Torts, vol. 2, p. 1184, #439). Stated in another way, "The reveal the nature of their relationship at the time of the fire. There
intention of an unforeseen and unexpected cause, is not sufficient to must have been one in existence at that time. Instead, what was
relieve a wrongdoer from consequences of negligence, if such presented was a license agreement manifestly tailored for purposes
negligence directly and proximately cooperates with the independent of this case, since it was entered into shortly before the expiration of
cause in the resulting injury." (MacAfee, et al. vs. Traver's Gas the one-year period it was intended to operate. This so-called license
Corporation, 153 S.W. 2nd 442.) agreement (Exhibit 5-Caltex) was executed on November 29, 1948,
but made effective as of January 1, 1948 so as to cover the date of
The next issue is whether Caltex should be held liable for the the fire, namely, March 18, 1948. This retroactivity provision is quite
damages caused to appellants. This issue depends on whether significant, and gives rise to the conclusion that it was designed
Boquiren was an independent contractor, as held by the Court of precisely to free Caltex from any responsibility with respect to the
Appeals, or an agent of Caltex. This question, in the light of the facts fire, as shown by the clause that Caltex "shall not be liable for any
not controverted, is one of law and hence may be passed upon by injury to person or property while in the property herein licensed, it
this Court. These facts are: (1) Boquiren made an admission that he being understood and agreed that LICENSEE (Boquiren) is not an
was an agent of Caltex; (2) at the time of the fire Caltex owned the employee, representative or agent of LICENSOR (Caltex)."
gasoline station and all the equipment therein; (3) Caltex exercised
control over Boquiren in the management of the state; (4) the But even if the license agreement were to govern, Boquiren can
delivery truck used in delivering gasoline to the station had the name hardly be considered an independent contractor. Under that
of CALTEX painted on it; and (5) the license to store gasoline at the agreement Boquiren would pay Caltex the purely nominal sum of
station was in the name of Caltex, which paid the license fees. P1.00 for the use of the premises and all the equipment therein. He
(Exhibit T-Africa; Exhibit U-Africa; Exhibit X-5 Africa; Exhibit X-6 could sell only Caltex Products. Maintenance of the station and its
Africa; Exhibit Y-Africa). equipment was subject to the approval, in other words control, of
Caltex. Boquiren could not assign or transfer his rights as licensee
In Boquiren's amended answer to the second amended complaint, without the consent of Caltex. The license agreement was supposed
he denied that he directed one of his drivers to remove gasoline from to be from January 1, 1948 to December 31, 1948, and thereafter
the truck into the tank and alleged that the "alleged driver, if one until terminated by Caltex upon two days prior written notice. Caltex
there was, was not in his employ, the driver being an employee of could at any time cancel and terminate the agreement in case
the Caltex (Phil.) Inc. and/or the owners of the gasoline station." It is Boquiren ceased to sell Caltex products, or did not conduct the
true that Boquiren later on amended his answer, and that among the business with due diligence, in the judgment of Caltex. Termination
changes was one to the effect that he was not acting as agent of of the contract was therefore a right granted only to Caltex but not to
Caltex. But then again, in his motion to dismiss appellants' second Boquiren. These provisions of the contract show the extent of the
amended complaint the ground alleged was that it stated no cause of control of Caltex over Boquiren. The control was such that the latter
action since under the allegations thereof he was merely acting as was virtually an employee of the former.
agent of Caltex, such that he could not have incurred personal
liability. A motion to dismiss on this ground is deemed to be an Taking into consideration the fact that the operator owed his
admission of the facts alleged in the complaint. position to the company and the latter could remove him or
terminate his services at will; that the service station
Caltex admits that it owned the gasoline station as well as the belonged to the company and bore its tradename and the
equipment therein, but claims that the business conducted at the operator sold only the products of the company; that the
service station in question was owned and operated by Boquiren. equipment used by the operator belonged to the company
and were just loaned to the operator and the company took Caltex further argues that the gasoline stored in the station belonged
charge of their repair and maintenance; that an employee of to Boquiren. But no cash invoices were presented to show that
the company supervised the operator and conducted Boquiren had bought said gasoline from Caltex. Neither was there a
periodic inspection of the company's gasoline and service sales contract to prove the same.
station; that the price of the products sold by the operator
was fixed by the company and not by the operator; and that As found by the trial court the Africas sustained a loss of P9,005.80,
the receipts signed by the operator indicated that he was a after deducting the amount of P2,000.00 collected by them on the
mere agent, the finding of the Court of Appeals that the insurance of the house. The deduction is now challenged as
operator was an agent of the company and not an erroneous on the ground that Article 2207 of the New Civil Code,
independent contractor should not be disturbed. which provides for the subrogation of the insurer to the rights of the
insured, was not yet in effect when the loss took place. However,
To determine the nature of a contract courts do not have or regardless of the silence of the law on this point at that time, the
are not bound to rely upon the name or title given it by the amount that should be recovered be measured by the damages
contracting parties, should thereby a controversy as to what actually suffered, otherwise the principle prohibiting unjust
they really had intended to enter into, but the way the enrichment would be violated. With respect to the claim of the heirs
contracting parties do or perform their respective obligations of Ong P7,500.00 was adjudged by the lower court on the basis of
stipulated or agreed upon may be shown and inquired into, the assessed value of the property destroyed, namely, P1,500.00,
and should such performance conflict with the name or title disregarding the testimony of one of the Ong children that said
given the contract by the parties, the former must prevail property was worth P4,000.00. We agree that the court erred, since it
over the latter. (Shell Company of the Philippines, Ltd. vs. is of common knowledge that the assessment for taxation purposes
Firemens' Insurance Company of Newark, New Jersey, 100 is not an accurate gauge of fair market value, and in this case should
Phil. 757). not prevail over positive evidence of such value. The heirs of Ong
are therefore entitled to P10,000.00.
The written contract was apparently drawn for the purpose of
creating the apparent relationship of employer and Wherefore, the decision appealed from is reversed and respondents-
independent contractor, and of avoiding liability for the appellees are held liable solidarily to appellants, and ordered to pay
negligence of the employees about the station; but the them the aforesaid sum of P9,005.80 and P10,000.00, respectively,
company was not satisfied to allow such relationship to exist. with interest from the filing of the complaint, and costs.
The evidence shows that it immediately assumed control,
and proceeded to direct the method by which the work Bengzon, C.J., Bautista Angelo, Concepcion, Reyes, J.B.L., Barrera,
contracted for should be performed. By reserving the right to Regala, Bengzon, J.P., Zaldivar and Sanchez, JJ., concur.
terminate the contract at will, it retained the means of Dizon, J., took no part.
compelling submission to its orders. Having elected to
assume control and to direct the means and methods by
which the work has to be performed, it must be held liable for
the negligence of those performing service under its
direction. We think the evidence was sufficient to sustain the
verdict of the jury. (Gulf Refining Company v. Rogers, 57
S.W. 2d, 183).