Insurance; illegitimate children as beneficiaries

 "In this case, it is clear from the petition filed before the trial court that, although petitioners are the legitimate heirs of Loreto, they were not named as beneficiaries in the insurance policies issued by Insular and Grepalife. The basis of petitioners’ claim is that Eva, being a concubine of Loreto and a suspect in his murder, is disqualified from being designated as beneficiary of the insurance policies, and that Eva’s children with Loreto, being illegitimate children, are entitled to a lesser share of the proceeds of the policies. They also argued that pursuant to Section 12 of the Insurance Code,19 Eva’s share in the proceeds should be forfeited in their favor, the former having brought about the death of Loreto. Thus, they prayed that the share of Eva and portions of the shares of Loreto’s illegitimate children should be awarded to them, being the legitimate heirs of Loreto entitled to their respective legitimes.

It is evident from the face of the complaint that petitioners are not entitled to a favorable judgment in light of Article 2011 of the Civil Code which expressly provides that insurance contracts shall be governed by special laws, i.e., the Insurance Code. Section 53 of the Insurance Code states—

SECTION 53. The insurance proceeds shall be applied exclusively to the proper interest of the person in whose name or for whose benefit it is made unless otherwise specified in the policy.

Pursuant thereto, it is obvious that the only persons entitled to claim the insurance proceeds are either the insured, if still alive; or the beneficiary, if the insured is already deceased, upon the maturation of the policy.20 The exception to this rule is a situation where the insurance contract was intended to benefit third persons who are not parties to the same in the form of favorable stipulations or indemnity. In such a case, third parties may directly sue and claim from the insurer.21

Petitioners are third parties to the insurance contracts with Insular and Grepalife and, thus, are not entitled to the proceeds thereof. Accordingly, respondents Insular and Grepalife have no legal obligation to turn over the insurance proceeds to petitioners. The revocation of Eva as a beneficiary in one policy and her disqualification as such in another are of no moment considering that the designation of the illegitimate children as beneficiaries in Loreto’s insurance policies remains valid. Because no legal proscription exists in naming as beneficiaries the children of illicit relationships by the insured,22 the shares of Eva in the insurance proceeds, whether forfeited by the court in view of the prohibition on donations under Article 739 of the Civil Code or by the insurers themselves for reasons based on the insurance contracts, must be awarded to the said illegitimate children, the designated beneficiaries, to the exclusion of petitioners. It is only in cases where the insured has not designated any beneficiary,23 or when the designated beneficiary is disqualified by law to receive the proceeds,24 that the insurance policy proceeds shall redound to the benefit of the estate of the insured.

In this regard, the assailed June 16, 2005 Resolution of the trial court should be upheld. In the same light, the Decision of the CA dated January 8, 2008 should be sustained. Indeed, the appellate court had no jurisdiction to take cognizance of the appeal; the issue of failure to state a cause of action is a question of law and not of fact, there being no findings of fact in the first place.25

WHEREFORE, the petition is DENIED for lack of merit. Costs against petitioners.

SO ORDERED."

HEIRS OF LORETO C. MARAMAG, represented by surviving spouse VICENTA PANGILINAN MARAMAG, Petitioners, vs. EVA VERNA DE GUZMAN MARAMAG, ODESSA DE GUZMAN MARAMAG, KARL BRIAN DE GUZMAN MARAMAG, TRISHA ANGELIE MARAMAG, THE INSULAR LIFE ASSURANCE COMPANY, LTD., and GREAT PACIFIC LIFE ASSURANCE CORPORATION, Respondents. G.R. No. 181132, June 5, 2009. 

https://lawphil.net/judjuris/juri2009/jun2009/gr_181132_2009.html

Grave oral defamation or slander

"The lone assignment of error (Brief for the Petitioners, p. 91), is as follows:

THAT THE HONORABLE COURT OF APPEALS ERRED IN FINDING THAT THE WORDS UTTERED BY THE PETITIONERS IN CONVERSATION WITH EACH OTHER AND WHILE IN THE HEAT OF ANGER CONSTITUTE GRAVE ORAL DEFAMATION INSTEAD OF MERELY LIGHT ORAL DEFAMATION.

In effect, counsel for petitioners abandoned all the assignments of error in the Court of Appeals, confined himself to only one, and practically admitted that the accused committed the crime charged although of a lesser degree that of slight oral defamation only, instead of grave oral defamation.

There is no dispute regarding the main facts that had given rise to the present case. Appellant-petitioner in this instant appeal, does not deny that the accused, on the occasion in question, uttered the defamatory words alleged in the information. Thus, the sole issue that the Court has to resolve is whether or not the defamatory words constitute serious oral defamation or simply slight oral defamation.

The term oral defamation or slander as now understood, has been defined as the speaking of base and defamatory words which tend to prejudice another in his reputation, office, trade, business or means of livelihood (33 Am. Jur. 39). Article 358, Revised Penal Code, spells out the demarcation line, between serious and slight oral defamations, as follows: "Oral defamation shall be punished by arresto mayor in its maximum period to prision correccional in its minimum period, if it is of a serious and insulting nature, otherwise, the penalty shall be arresto menor or a fine not exceeding 200 pesos." (Balite v. People, 18 SCRA 280 [1966]).

To determine whether the offense committed is serious or slight oral defamation, the Court adopted the following guidelines:

. . . We are to be guided by a doctrine of ancient respectability that defamatory words will fall under one or the other, depending upon, as Viada puts it, '...upon their sense and grammatical meaning judging them separately, but also upon the special circumstances of the case, antecedents or relationship between the offended party and the offender, which might tend to prove the intention of the offender at the time: ... Balite v. People, Ibid., quoting Viada, Codigo Penal, Quinta edicion, page 494).

Thus, in the same case cited where scurrilous words imputed to the offended party the crime of estafa, the Court ruled:

The scurrilous words imputed to the offended party the crime estafa. The language of the indictment strikes deep into the character of the victim; He 'has sold the union; he 'has swindled the money of the vendees; he 'received bribe money in the amount of P10,000.00 ... and another P6,000.00'; He 'is engaged in racketeering and enriching himself with the capitalists'; He 'has spent the funds of the union for his personal use.'

No amount of sophistry will take these statements out of the compass of grave oral defamation. They are serious and insulting. No circumstances need to be shown to upgrade the slander. . . .

In another case where a woman of violent temper hurled offensive and scurrilous epithets including words imputing unchastity against a respectable married lady and tending to injure the character of her young daughters, the Court ruled that the crime committed was grave slander:

The language used by the defendant was deliberately applied by her to the complainant. The words were uttered with evident intent to injure complainant, to ruin her reputation, and to hold her in public contempt, for the sake of revenge. One who will thus seek to impute vice or immorality to another, the consequences of which might gravely prejudice the reputation of the person insulted, in this instance apparently an honorable and respectable lady and her young daughters, all prominent in social circles, deserves little judicial sympathy. Certainly, it is time for the courts to put the stamp of their disapproval on this practice of vile and loud slander. (U.S. v. Tolosa, 37 Phil. 166 [1917]).

In a case where the accused, a priest, called the offended party a gangster, in the middle of a sermon, the court affirmed the conviction of the accused for slight slander (People v. Arcand 68 Phil. 601 [1939]). There was no imputation of a crime nor a vice or immorality in said case.

In the instant case, appellant-petitioner admitted having uttered the defamatory words against Atty. Vivencio Ruiz. Among others he called Atty. Ruiz, "estapador", which attributes to the latter the crime of estafa, a serious and insulting imputation. As stated by the Court in Balite v. People, supra, "no amount of sophistry will take these statements out of the compass of grave oral defamation . . . No circumstances need to be shown to upgrade the slander."

Defamatory words uttered specifically against a lawyer when touching on his profession are libelous per se. Thus, in Kleeberg v. Sipser (191 NY 845 [1934]), it was held that "where statements concerning plaintiff in his professional capacity as attorney are susceptible, in their ordinary meaning, of such construction as would tend to injure him in that capacity, they are libelous per se and (the) complaint, even in the absence of allegation of special damage, states cause of action." Oral statements that a certain lawyer is 'unethical,' or a false charge, dealing with office, trade, occupation, business or profession of a person charged, are slanderous per se (Kraushaar v. LaVin, 42 N.Y.S. 2d 857 [1943]; Mains v. Whiting 49 NW 559 [1891]; Greenburg v. De Salvo, 216 So. 2d 638 [1968]).

In Pollard v. Lyon (91 US 225 [1876]), the court there had occasion to divide oral slander, as a cause of action, into several classes, as follows:

(1) Words falsely spoken of a person which impute to the party the commission of some criminal offense involving moral turpitude for which the party, if the charge is true, may be indicted and punished;

(2) Words falsely spoken of a person which impute that the party is infected with some contagious disease, where, if the charge is true, it would exclude the party from society;

(3) Defamatory words falsely spoken of a person which impute to the party unfitness to perform the duties of an office or employment, or the want of integrity in the discharge of the duties of such office or employment;

(4) Defamatory words falsely spoken of a party which prejudice such party in his or her profession or trade; and

(5) Defamatory words falsely spoken of a person, which, though not in themselves actionable, occasion the party special damage."

In the instant case, appellant-petitioner imputed the crime of estafa against a prominent lawyer one-time Justice of the Peace and member of the Provincial Board of Nueva Ecija, a professor of law and for sometime a president of the Nueva Ecija Bar Association. As the scurrilous imputation strikes deep into the character of the victim, no special circumstance need be shown for the defamatory words uttered to be considered grave oral defamation Balite v. People, supra. In addition, the fact that the offended party is a lawyer, the totality of such words as "kayabang", "tunaw ang utak", "swapang at estapador", imputed against him has the import of charging him with dishonesty or improper practice in the performance of his duties, hence, actionable per se.

Petitioner argues that this Court in People v. Doronila (40 O.G. No. 15, Supp. 11, p. 231 [1941]) and People v. Modesto (40 O.G. No. 15, Supp. 11, p. 128 [1941]) ruled that defamatory words uttered in the heat of anger could only give rise to slight oral defamation (Rono, p. 13).

We disagree.

An examination of the rulings relied upon by petitioner showed that said cases were decided not by this Court but by the respondent court. Suffice it to say that said decisions do not bind this Court.

Nevertheless, the cases adverted to by petitioner would not in any manner help his cause. As pointed out by the Solicitor General, there was no reason for the petitioner to be angry at the offended party who was merely performing his duties as a lawyer in defense of his client. Petitioner's anger was not lawfully caused. (Brief for the Appellee, p. 7). The fact that the defamatory words were uttered by the petitioner without provocation by private respondent and taken seriously by the latter, renders inapplicable the cases relied upon by petitioner.

As a matter of fact, the scurrilous remarks were found by the respondent court to have been uttered in a loud voice, in the presence of at least ten (10) persons, taken seriously by the offended party and without provocation on his part.

WHEREFORE, the petition is Denied for lack of merit and the appealed decision Affirmed in toto.

SO ORDERED."

DANIEL VICTORIO and EXEQUIEL VICTORIO, petitioners, vs. THE HON. COURT OF APPEALS and THE PEOPLE OF THE PHILIPPINES, respondents. G.R. Nos. L-32836-37, May 3, 1989. 

https://lawphil.net/judjuris/juri1989/may1989/gr_l32836_37_1989.html

Damages against a party in default

"To adjudge damages, paragraph (d) of Section 3 of Rule 9 of the Rules of Court provides that a judgment against a party in default "shall not exceed the amount or be different in kind from that prayed for nor award unliquidated damages." The proscription against the award of unliquidated damages is significant, because it means that the damages to be awarded must be proved convincingly, in accordance with the quantum of evidence required in civil cases.

Unfortunately for petitioners, the grant of damages was not sufficiently supported by the evidence for the following reasons.

First, petitioners were not deprived of their property without cause. As correctly pointed out by the CA, Act No. 3135, as amended, does not require personal notice to the mortgagor.53 In the present case, there has been no allegation -- much less, proof -- of noncompliance with the requirement of publication and public posting of the notice of sale, as required by Áct No. 3135. Neither has there been competent evidence to show that the price paid at the foreclosure sale was inadequate.54 To be sure, there was no ground to invalidate the sale.

Second, as previously stated, petitioners have not convincingly established their right to damages on the basis of the purported agreement to repurchase. Without reiterating our prior discussion on this point, we stress that entitlement to actual and compensatory damages must be proved even under Section 3 of Rule 9 of the Rules of Court. The same is true with regard to awards for moral damages and attorney’s fees, which were also granted by the trial court.

In sum, petitioners have failed to convince this Court of the cogency of their position, notwithstanding the advantage they enjoyed in presenting their evidence ex parte. Not in every case of default by the defendant is the complainant entitled to win automatically.

WHEREFORE, this Petition is hereby DENIED and the assailed Decision and Resolution AFFIRMED. Costs against petitioners.

SO ORDERED."

ERLINDA GAJUDO, FERNANDO GAJUDO, JR., ESTELITA GAJUDO, BALTAZAR GAJUDO and DANILO ARAHAN CHUA, Petitioners, vs. TRADERS ROYAL BANK,1Respondent. G.R. No. 151098, March 21, 2006.

https://lawphil.net/judjuris/juri2006/mar2006/gr_151098_2006.html

Quantum of proof

 "First Issue: Quantum of Proof

Petitioners challenge the CA Decision for applying Section 3 of Rule 9 of the Rules of Court, rather than Section 1 of Rule 133 of the same Rules. In essence, petitioners argue that the quantum of evidence for judgments flowing from a default order under Section 3 of Rule 9 is not the same as that provided for in Section 1 of Rule 133.

For ease of discussion, these two rules will be reproduced below, starting with Section 3 of Rule 9 of the Rules of Court:

"Sec. 3. Default; declaration of. – If the defending party fails to answer within the time allowed therefor, the court shall, upon motion of the claiming party with notice to the defending party, and proof of such failure, declare the defending party in default. Thereupon, the court shall proceed to render judgment granting the claimant such relief as his pleading may warrant, unless the court in its discretion requires the claimant to submit evidence. Such reception of evidence may be delegated to the clerk of court.

"(a) Effect of order of default. – A party in default shall be entitled to notice of subsequent proceedings but not to take part in the trial.

"(b) Relief from order of default. – A party declared in default may at any time after notice thereof and before judgment file a motion under oath to set aside the order of default upon proper showing that his failure to answer was due to fraud, accident, mistake or excusable negligence and that he has a meritorious defense. In such case, the order of default may be set aside on such terms and conditions as the judge may impose in the interest of justice.

"(c) Effect of partial default. – When a pleading asserting a claim states a common cause of action against several defending parties, some of whom answer and the others fail to do so, the court shall try the case against all upon the answers thus filed and render judgment upon the evidence presented.

"(d) Extent of relief to be awarded. – A judgment rendered against a party in default shall not exceed the amount or be different in kind from that prayed for nor award unliquidated damages.

"(e) Where no defaults allowed. – If the defending party in an action for annulment or declaration of nullity of marriage or for legal separation fails to answer, the court shall order the prosecuting attorney to investigate whether or nor a collusion between the parties exists, and if there is no collusion, to intervene for the State in order to see to it that the evidence submitted is not fabricated."

We now quote Section 1 of Rule 133:

"SECTION 1. Preponderance of evidence, how determined. – In civil cases, the party having the burden of proof must establish his case by a preponderance of evidence. In determining where the preponderance or superior weight of evidence on the issues involved lies, the court may consider all the facts and circumstances of the case, the witnesses’ manner of testifying, their intelligence, their means and opportunity of knowing the facts to which they are testifying, the nature of the facts to which they testify, the probability or improbability of their testimony, their interest or want of interest, and also their personal credibility so far as the same may legitimately appear upon the trial. The court may also consider the number of witnesses, though the preponderance is not necessarily with the greater number."

Between the two rules, there is no incompatibility that would preclude the application of either one of them. To begin with, Section 3 of Rule 9 governs the procedure which the trial court is directed to take when a defendant fails to file an answer. According to this provision, the court "shall proceed to render judgment granting the claimant such relief as his pleading may warrant," subject to the court’s discretion on whether to require the presentation of evidence ex parte. The same provision also sets down guidelines on the nature and extent of the relief that may be granted. In particular, the court’s judgment "shall not exceed the amount or be different in kind from that prayed for nor award unliquidated damages."

As in other civil cases, basic is the rule that the party making allegations has the burden of proving them by a preponderance of evidence.19 Moreover, parties must rely on the strength of their own evidence, not upon the weakness of the defense offered by their opponent.20 This principle holds true, especially when the latter has had no opportunity to present evidence because of a default order. Needless to say, the extent of the relief that may be granted can only be as much as has been alleged and proved21 with preponderant evidence required under Section 1 of Rule 133.

Regarding judgments by default, it was explained in Pascua v. Florendo22 that complainants are not automatically entitled to the relief prayed for, once the defendants are declared in default. Favorable relief can be granted only after the court has ascertained that the relief is warranted by the evidence offered and the facts proven by the presenting party. In Pascua, this Court ruled that "x x x it would be meaningless to require presentation of evidence if every time the other party is declared in default, a decision would automatically be rendered in favor of the non-defaulting party and exactly according to the tenor of his prayer. This is not contemplated by the Rules nor is it sanctioned by the due process clause."23

The import of a judgment by default was further clarified in Lim Tanhu v. Ramolete.24 The following disquisition is most instructive:

"Unequivocal, in the literal sense, as these provisions [referring to the subject of default then under Rule 18 of the old Rules of Civil Procedure] are, they do not readily convey the full import of what they contemplate. To begin with, contrary to the immediate notion that can be drawn from their language, these provisions are not to be understood as meaning that default or the failure of the defendant to answer should ‘be interpreted as an admission by the said defendant that the plaintiff’s cause of action find support in the law or that plaintiff is entitled to the relief prayed for.’ x x x.

x x x x x x x x x

"Being declared in default does not constitute a waiver of rights except that of being heard and of presenting evidence in the trial court. x x x.

"In other words, a defaulted defendant is not actually thrown out of court. While in a sense it may be said that by defaulting he leaves himself at the mercy of the court, the rules see to it that any judgment against him must be in accordance with law. The evidence to support the plaintiff’s cause is, of course, presented in his absence, but the court is not supposed to admit that which is basically incompetent. Although the defendant would not be in a position to object, elementary justice requires that only legal evidence should be considered against him. If the evidence presented should not be sufficient to justify a judgment for the plaintiff, the complaint must be dismissed. And if an unfavorable judgment should be justifiable, it cannot exceed in amount or be different in kind from what is prayed for in the complaint."25

In sum, while petitioners were allowed to present evidence ex parte under Section 3 of Rule 9, they were not excused from establishing their claims for damages by the required quantum of proof under Section 1 of Rule 133. Stated differently, any advantage they may have gained from the ex parte presentation of evidence does not lower the degree of proof required. Clearly then, there is no incompatibility between the two rules."

ERLINDA GAJUDO, FERNANDO GAJUDO, JR., ESTELITA GAJUDO, BALTAZAR GAJUDO and DANILO ARAHAN CHUA, Petitioners, vs. TRADERS ROYAL BANK,1Respondent. G.R. No. 151098, March 21, 2006.

https://lawphil.net/judjuris/juri2006/mar2006/gr_151098_2006.html