Mercury Drug v. Huang

On December 20, 1996, a six-wheeler truck collided with a Toyota Corolla on the C-5 Highway in Taguig. Mercury Drug owned the truck, and its employee Rolando del Rosario was driving. The car belonged to the spouses Richard and Carmen Huang and was driven by their son Stephen. According to the Huangs, the truck swerved left and slammed into the car. The car was hurled over the island, and the truck then ran over it. Del Rosario had no driver's license at the time, only a Traffic Violation Receipt: his license had been confiscated for an earlier reckless driving violation. Stephen, then 17, was left paralyzed from the chest down. The Huangs sued for damages. Petitioners claimed that the car had bumped the truck and that Mercury Drug had exercised due diligence in selecting and supervising its employees. The RTC of Makati held Mercury Drug and Del Rosario jointly and severally liable for actual damages, life care costs, loss of earning capacity, moral and exemplary damages, and attorney's fees. The CA affirmed but reduced the moral damages from P4,000,000 to P1,000,000. Petitioners appealed to the Supreme Court.

1. 1Whether Del Rosario's negligence was the proximate cause of Stephen's injuries.
2. 2Whether Mercury Drug proved that it exercised the diligence of a good father of a family in the selection and supervision of Del Rosario.
3. 3Whether the damages awarded were proper.

The Court affirmed the finding that Del Rosario was negligent. His version could not explain why the car landed on the opposite side of C-5, and a physics expert supported the Huangs' account. He admitted losing control and never braking. His negligence was the direct and proximate cause of Stephen's injuries. Under Arts. 2176 and 2180 of the Civil Code, the employer's liability "is direct or immediate." It is not conditioned on prior recourse against the employee or on proof of the employee's insolvency, and it is joint and solidary with the employee's (Art. 2194). To escape liability, the employer must prove diligence both in selection, by examining qualifications, experience and service records, and in supervision, by formulating and monitoring standard operating procedures and imposing discipline, shown by concrete proof, including documentary evidence. Mercury Drug failed on both counts: - Del Rosario took the driving tests and psychological examination when he applied as Delivery Man, not as Truck Man. - He was tested on a light vehicle. - No NBI or police clearances were presented. - His only seminar before the accident was in 1984. - There was no back-up driver, although he had been on the road for more than 13 hours. - He was not disciplined even after his license was confiscated. The damages were upheld: actual damages were supported by receipts (Art. 2199), life care costs and lost earning capacity are natural and probable consequences (Arts. 2202, 2205), moral damages (P1,000,000, as reduced by the CA) were justified, exemplary damages were proper for gross negligence (Art. 2231), and attorney's fees followed (Art. 2208). The petition was denied and the CA rulings were affirmed.