Republic of the Philippines Not satisfied with the police report, petitioners hired a private investigator, retired Col.

private investigator, retired Col. Jose

SUPREME COURT G. Fernandez, who on December 10, 1972, submitted a report (Exh. "2") finding Tobias
Manila guilty. This report however expressly stated that further investigation was still to be
conducted.
THIRD DIVISION
Nevertheless, on December 12, 1972, petitioner Hendry issued a memorandum
G.R. No. 81262 August 25, 1989 suspending Tobias from work preparatory to the filing of criminal charges against him.

GLOBE MACKAY CABLE AND RADIO CORP., and HERBERT C. HENDRY, petitioners, On December 19,1972, Lt. Dioscoro V. Tagle, Metro Manila Police Chief Document
vs. Examiner, after investigating other documents pertaining to the alleged anomalous
THE HONORABLE COURT OF APPEALS and RESTITUTO M. TOBIAS, respondents. transactions, submitted a second laboratory crime report (Exh. "B") reiterating his previous
finding that the handwritings, signatures, and initials appearing in the checks and other
Atencia & Arias Law Offices for petitioners. documents involved in the fraudulent transactions were not those of Tobias. The lie
detector tests conducted on Tobias also yielded negative results.
Romulo C. Felizmena for private respondent.
Notwithstanding the two police reports exculpating Tobias from the anomalies and the fact
that the report of the private investigator, was, by its own terms, not yet complete,
CORTES, J.
petitioners filed with the City Fiscal of Manila a complaint for estafa through falsification of
commercial documents, later amended to just estafa. Subsequently five other criminal
Private respondent Restituto M. Tobias was employed by petitioner Globe Mackay Cable complaints were filed against Tobias, four of which were for estafa through Falsification of
and Radio Corporation (GLOBE MACKAY) in a dual capacity as a purchasing agent and commercial document while the fifth was for of Article 290 of' the Revised Penal Code
administrative assistant to the engineering operations manager. In 1972, GLOBE MACKAY (Discovering Secrets Through Seizure of Correspondence). Two of these complaints were
lâwphî1.ñèt

discovered fictitious purchases and other fraudulent transactions for which it lost several refiled with the Judge Advocate General's Office, which however, remanded them to the
thousands of pesos. fiscal's office. All of the six criminal complaints were dismissed by the fiscal. Petitioners
appealed four of the fiscal's resolutions dismissing the criminal complaints with the
According to private respondent it was he who actually discovered the anomalies and Secretary of Justice, who, however, affirmed their dismissal.
reported them on November 10, 1972 to his immediate superior Eduardo T. Ferraren and
to petitioner Herbert C. Hendry who was then the Executive Vice-President and General In the meantime, on January 17, 1973, Tobias received a notice (Exh. "F") from petitioners
Manager of GLOBE MACKAY. that his employment has been terminated effective December 13, 1972. Whereupon,
Tobias filed a complaint for illegal dismissal. The labor arbiter dismissed the complaint. On
On November 11, 1972, one day after private respondent Tobias made the report, appeal, the National Labor Relations Commission (NLRC) reversed the labor arbiter's
petitioner Hendry confronted him by stating that he was the number one suspect, and decision. However, the Secretary of Labor, acting on petitioners' appeal from the NLRC
ordered him to take a one week forced leave, not to communicate with the office, to leave ruling, reinstated the labor arbiter's decision. Tobias appealed the Secretary of Labor's
his table drawers open, and to leave the office keys. order with the Office of the President. During the pendency of the appeal with said office,
petitioners and private respondent Tobias entered into a compromise agreement regarding
On November 20, 1972, when private respondent Tobias returned to work after the forced the latter's complaint for illegal dismissal.
leave, petitioner Hendry went up to him and called him a "crook" and a "swindler." Tobias
was then ordered to take a lie detector test. He was also instructed to submit specimen of Unemployed, Tobias sought employment with the Republic Telephone Company
his handwriting, signature, and initials for examination by the police investigators to (RETELCO). However, petitioner Hendry, without being asked by RETELCO, wrote a letter
determine his complicity in the anomalies. to the latter stating that Tobias was dismissed by GLOBE MACKAY due to dishonesty.

On December 6,1972, the Manila police investigators submitted a laboratory crime report Private respondent Tobias filed a civil case for damages anchored on alleged unlawful,
(Exh. "A") clearing private respondent of participation in the anomalies. malicious, oppressive, and abusive acts of petitioners. Petitioner Hendry, claiming illness,
did not testify during the hearings. The Regional Trial Court (RTC) of Manila, Branch IX, because recognized or granted by law as such, may nevertheless become the source of
through Judge Manuel T. Reyes rendered judgment in favor of private respondent by some illegality. When a right is exercised in a manner which does not conform with the
ordering petitioners to pay him eighty thousand pesos (P80,000.00) as actual damages, norms enshrined in Article 19 and results in damage to another, a legal wrong is thereby
two hundred thousand pesos (P200,000.00) as moral damages, twenty thousand pesos committed for which the wrongdoer must be held responsible. But while Article 19 lays
(P20,000.00) as exemplary damages, thirty thousand pesos (P30,000.00) as attorney's down a rule of conduct for the government of human relations and for the maintenance of
fees, and costs. Petitioners appealed the RTC decision to the Court of Appeals. On the social order, it does not provide a remedy for its violation. Generally, an action for
other hand, Tobias appealed as to the amount of damages. However, the Court of damages under either Article 20 or Article 21 would be proper.
Appeals, an a decision dated August 31, 1987 affirmed the RTC decision in toto.
Petitioners' motion for reconsideration having been denied, the instant petition for review Article 20, which pertains to damage arising from a violation of law, provides that:
on certiorari was filed.
Art. 20. Every person who contrary to law, wilfully or negligently causes
The main issue in this case is whether or not petitioners are liable for damages to private damage to another, shall indemnify the latter for the same.
respondent.
However, in the case at bar, petitioners claim that they did not violate any provision of law
Petitioners contend that they could not be made liable for damages in the lawful exercise since they were merely exercising their legal right to dismiss private respondent. This does
of their right to dismiss private respondent. not, however, leave private respondent with no relief because Article 21 of the Civil Code
provides that:
On the other hand, private respondent contends that because of petitioners' abusive
manner in dismissing him as well as for the inhuman treatment he got from them, the Art. 21. Any person who wilfully causes loss or injury to another in a
Petitioners must indemnify him for the damage that he had suffered. manner that is contrary to morals, good customs or public policy shall
compensate the latter for the damage.
One of the more notable innovations of the New Civil Code is the codification of "some
basic principles that are to be observed for the rightful relationship between human beings This article, adopted to remedy the "countless gaps in the statutes, which leave so many
and for the stability of the social order." [REPORT ON THE CODE COMMISSION ON THE victims of moral wrongs helpless, even though they have actually suffered material and
PROPOSED CIVIL CODE OF THE PHILIPPINES, p. 39]. The framers of the Code, moral injury" [Id.] should "vouchsafe adequate legal remedy for that untold number of
seeking to remedy the defect of the old Code which merely stated the effects of the law, moral wrongs which it is impossible for human foresight to provide for specifically in the
but failed to draw out its spirit, incorporated certain fundamental precepts which were statutes" [Id. it p. 40; See also PNB v. CA, G.R. No. L-27155, May 18,1978, 83 SCRA 237,
"designed to indicate certain norms that spring from the fountain of good conscience" and 247].
which were also meant to serve as "guides for human conduct [that] should run as golden
threads through society, to the end that law may approach its supreme ideal, which is the In determining whether or not the principle of abuse of rights may be invoked, there is no
sway and dominance of justice" (Id.) Foremost among these principles is that pronounced rigid test which can be applied. While the Court has not hesitated to apply Article 19
in Article 19 which provides: whether the legal and factual circumstances called for its application [See for e.g., Velayo
v. Shell Co. of the Phil., Ltd., 100 Phil. 186 (1956); PNB v. CA, supra; Grand Union
Art. 19. Every person must, in the exercise of his rights and in the Supermarket, Inc. v. Espino, Jr., G.R. No. L-48250, December 28, 1979, 94 SCRA 953;
performance of his duties, act with justice, give everyone his due, and PAL v. CA, G.R. No. L-46558, July 31,1981,106 SCRA 391; United General Industries, Inc,
observe honesty and good faith. v. Paler G.R. No. L-30205, March 15,1982,112 SCRA 404; Rubio v. CA, G.R. No. 50911,
August 21, 1987, 153 SCRA 183] the question of whether or not the principle of abuse of
This article, known to contain what is commonly referred to as the principle of abuse of rights has been violated resulting in damages under Article 20 or Article 21 or other
rights, sets certain standards which must be observed not only in the exercise of one's applicable provision of law, depends on the circumstances of each case. And in the instant
rights but also in the performance of one's duties. These standards are the following: to act case, the Court, after examining the record and considering certain significant
with justice; to give everyone his due; and to observe honesty and good faith. The law, circumstances, finds that all petitioners have indeed abused the right that they invoke,
therefore, recognizes a primordial limitation on all rights; that in their exercise, the norms of causing damage to private respondent and for which the latter must now be indemnified.
human conduct set forth in Article 19 must be observed. A right, though by itself legal
The trial court made a finding that notwithstanding the fact that it was private respondent and as a result of which, Tobias remained unemployed for a longer period of time. For this
Tobias who reported the possible existence of anomalous transactions, petitioner Hendry further damage suffered by Tobias, petitioners must likewise be held liable for damages
"showed belligerence and told plaintiff (private respondent herein) that he was the number consistent with Article 2176 of the Civil Code. Petitioners, however, contend that they have
one suspect and to take a one week vacation leave, not to communicate with the office, to a "moral, if not legal, duty to forewarn other employers of the kind of employee the plaintiff
leave his table drawers open, and to leave his keys to said defendant (petitioner Hendry)" (private respondent herein) was." [Petition, p. 14; Rollo, p. 15]. Petitioners further claim that
[RTC Decision, p. 2; Rollo, p. 232]. This, petitioners do not dispute. But regardless of "it is the accepted moral and societal obligation of every man to advise or warn his
whether or not it was private respondent Tobias who reported the anomalies to petitioners, fellowmen of any threat or danger to the latter's life, honor or property. And this includes
the latter's reaction towards the former upon uncovering the anomalies was less than civil. warning one's brethren of the possible dangers involved in dealing with, or accepting into
An employer who harbors suspicions that an employee has committed dishonesty might be confidence, a man whose honesty and integrity is suspect" [Id.]. These arguments, rather
justified in taking the appropriate action such as ordering an investigation and directing the than justify petitioners' act, reveal a seeming obsession to prevent Tobias from getting a
employee to go on a leave. Firmness and the resolve to uncover the truth would also be job, even after almost two years from the time Tobias was dismissed.
expected from such employer. But the high-handed treatment accorded Tobias by
petitioners was certainly uncalled for. And this reprehensible attitude of petitioners was to Finally, there is the matter of the filing by petitioners of six criminal complaints against
continue when private respondent returned to work on November 20, 1972 after his one Tobias. Petitioners contend that there is no case against them for malicious prosecution
week forced leave. Upon reporting for work, Tobias was confronted by Hendry who said. and that they cannot be "penalized for exercising their right and prerogative of seeking
"Tobby, you are the crook and swindler in this company." Considering that the first report justice by filing criminal complaints against an employee who was their principal suspect in
made by the police investigators was submitted only on December 10, 1972 [See Exh. A] the commission of forgeries and in the perpetration of anomalous transactions which
the statement made by petitioner Hendry was baseless. The imputation of guilt without defrauded them of substantial sums of money" [Petition, p. 10, Rollo, p. 11].
basis and the pattern of harassment during the investigations of Tobias transgress the
standards of human conduct set forth in Article 19 of the Civil Code. The Court has already While sound principles of justice and public policy dictate that persons shall have free
ruled that the right of the employer to dismiss an employee should not be confused with resort to the courts for redress of wrongs and vindication of their rights [Buenaventura v.
the manner in which the right is exercised and the effects flowing therefrom. If the Sto. Domingo, 103 Phil. 239 (1958)], the right to institute criminal prosecutions can not be
dismissal is done abusively, then the employer is liable for damages to the employee exercised maliciously and in bad faith [Ventura v. Bernabe, G.R. No. L-26760, April 30,
[Quisaba v. Sta. Ines-Melale Veneer and Plywood Inc., G.R. No. L-38088, August 30, 1971, 38 SCRA 5871.] Hence, in Yutuk V. Manila Electric Co., G.R. No. L-13016, May 31,
1974, 58 SCRA 771; See also Philippine Refining Co., Inc. v. Garcia, G.R. No. L-21871, 1961, 2 SCRA 337, the Court held that the right to file criminal complaints should not be
September 27,1966, 18 SCRA 107] Under the circumstances of the instant case, the used as a weapon to force an alleged debtor to pay an indebtedness. To do so would be a
petitioners clearly failed to exercise in a legitimate manner their right to dismiss Tobias, clear perversion of the function of the criminal processes and of the courts of justice. And
giving the latter the right to recover damages under Article 19 in relation to Article 21 of the in Hawpia CA, G.R. No. L-20047, June 30, 1967. 20 SCRA 536 the Court upheld the
Civil Code. judgment against the petitioner for actual and moral damages and attorney's fees after
making a finding that petitioner, with persistence, filed at least six criminal complaints
But petitioners were not content with just dismissing Tobias. Several other tortious acts against respondent, all of which were dismissed.
were committed by petitioners against Tobias after the latter's termination from work.
Towards the latter part of January, 1973, after the filing of the first of six criminal To constitute malicious prosecution, there must be proof that the prosecution was
complaints against Tobias, the latter talked to Hendry to protest the actions taken against prompted by a design to vex and humiliate a person and that it was initiated deliberately by
him. In response, Hendry cut short Tobias' protestations by telling him to just confess or the defendant knowing that the charges were false and groundless [Manila Gas
else the company would file a hundred more cases against him until he landed in jail. Corporation v. CA, G.R. No. L-44190, October 30,1980, 100 SCRA 602]. Concededly, the
Hendry added that, "You Filipinos cannot be trusted." The threat unmasked petitioner's bad filing of a suit by itself, does not render a person liable for malicious prosecution [Inhelder
faith in the various actions taken against Tobias. On the other hand, the scornful remark Corporation v. CA, G.R. No. 52358, May 301983122 SCRA 576]. The mere dismissal by
about Filipinos as well as Hendry's earlier statements about Tobias being a "crook" and the fiscal of the criminal complaint is not a ground for an award of damages for malicious
"swindler" are clear violations of 'Tobias' personal dignity [See Article 26, Civil Code]. prosecution if there is no competent evidence to show that the complainant had acted in
bad faith [Sison v. David, G.R. No. L-11268, January 28,1961, 1 SCRA 60].
The next tortious act committed by petitioners was the writing of a letter to RETELCO
sometime in October 1974, stating that Tobias had been dismissed by GLOBE MACKAY In the instant case, however, the trial court made a finding that petitioners acted in bad
due to dishonesty. Because of the letter, Tobias failed to gain employment with RETELCO faith in filing the criminal complaints against Tobias, observing that:
xxx hundred cases, considering the number of anomalous transactions committed against
GLOBE MACKAY. However, petitioners' good faith is belied by the threat made by Hendry
Defendants (petitioners herein) filed with the Fiscal's Office of Manila a total after the filing of the first complaint that one hundred more cases would be filed against
of six (6) criminal cases, five (5) of which were for estafa thru falsification of Tobias. In effect, the possible filing of one hundred more cases was made to hang like the
commercial document and one for violation of Art. 290 of the Revised sword of Damocles over the head of Tobias. In fine, considering the haste in which the
Penal Code "discovering secrets thru seizure of correspondence," and all criminal complaints were filed, the fact that they were filed during the pendency of the
were dismissed for insufficiency or lack of evidence." The dismissal of four illegal dismissal case against petitioners, the threat made by Hendry, the fact that the
(4) of the cases was appealed to the Ministry of Justice, but said Ministry cases were filed notwithstanding the two police reports exculpating Tobias from
invariably sustained the dismissal of the cases. As above adverted to, two involvement in the anomalies committed against GLOBE MACKAY, coupled by the
of these cases were refiled with the Judge Advocate General's Office of the eventual dismissal of all the cases, the Court is led into no other conclusion than that
Armed Forces of the Philippines to railroad plaintiffs arrest and detention in petitioners were motivated by malicious intent in filing the six criminal complaints against
the military stockade, but this was frustrated by a presidential decree Tobias.
transferring criminal cases involving civilians to the civil courts.
Petitioners next contend that the award of damages was excessive. In the complaint filed
xxx against petitioners, Tobias prayed for the following: one hundred thousand pesos
(P100,000.00) as actual damages; fifty thousand pesos (P50,000.00) as exemplary
To be sure, when despite the two (2) police reports embodying the findings damages; eight hundred thousand pesos (P800,000.00) as moral damages; fifty thousand
of Lt. Dioscoro Tagle, Chief Document Examiner of the Manila Police pesos (P50,000.00) as attorney's fees; and costs. The trial court, after making a
Department, clearing plaintiff of participation or involvement in the computation of the damages incurred by Tobias [See RTC Decision, pp. 7-8; Rollo, pp.
fraudulent transactions complained of, despite the negative results of the lie 154-1551, awarded him the following: eighty thousand pesos (P80,000.00) as actual
detector tests which defendants compelled plaintiff to undergo, and damages; two hundred thousand pesos (P200,000.00) as moral damages; twenty
although the police investigation was "still under follow-up and a thousand pesos (P20,000.00) as exemplary damages; thirty thousand pesos (P30,000.00)
supplementary report will be submitted after all the evidence has been as attorney's fees; and, costs. It must be underscored that petitioners have been guilty of
gathered," defendants hastily filed six (6) criminal cases with the city committing several actionable tortious acts, i.e., the abusive manner in which they
Fiscal's Office of Manila, five (5) for estafa thru falsification of commercial dismissed Tobias from work including the baseless imputation of guilt and the harassment
document and one (1) for violation of Art. 290 of the Revised Penal Code, during the investigations; the defamatory language heaped on Tobias as well as the
so much so that as was to be expected, all six (6) cases were dismissed, scornful remark on Filipinos; the poison letter sent to RETELCO which resulted in Tobias'
with one of the investigating fiscals, Asst. Fiscal de Guia, commenting in loss of possible employment; and, the malicious filing of the criminal complaints.
one case that, "Indeed, the haphazard way this case was investigated is Considering the extent of the damage wrought on Tobias, the Court finds that, contrary to
evident. Evident likewise is the flurry and haste in the filing of this case petitioners' contention, the amount of damages awarded to Tobias was reasonable under
against respondent Tobias," there can be no mistaking that defendants the circumstances.
would not but be motivated by malicious and unlawful intent to harass,
oppress, and cause damage to plaintiff. Yet, petitioners still insist that the award of damages was improper, invoking the principle
of damnum absque injuria. It is argued that "[t]he only probable actual damage that plaintiff
xxx (private respondent herein) could have suffered was a direct result of his having been
dismissed from his employment, which was a valid and legal act of the defendants-
appellants (petitioners herein). " [Petition, p. 17; Rollo, p. 18].
[RTC Decision, pp. 5-6; Rollo, pp. 235-236].
lâwphî1.ñèt

According to the principle of damnum absque injuria, damage or loss which does not
In addition to the observations made by the trial court, the Court finds it significant that the
constitute a violation of a legal right or amount to a legal wrong is not actionable [Escano v.
criminal complaints were filed during the pendency of the illegal dismissal case filed by
CA, G.R. No. L-47207, September 25, 1980, 100 SCRA 197; See also Gilchrist v. Cuddy
Tobias against petitioners. This explains the haste in which the complaints were filed,
29 Phil, 542 (1915); The Board of Liquidators v. Kalaw, G.R. No. L-18805, August 14,
which the trial court earlier noted. But petitioners, to prove their good faith, point to the fact
1967, 20 SCRA 987]. This principle finds no application in this case. It bears repeating that
that only six complaints were filed against Tobias when they could have allegedly filed one
even granting that petitioners might have had the right to dismiss Tobias from work, the
abusive manner in which that right was exercised amounted to a legal wrong for which
petitioners must now be held liable. Moreover, the damage incurred by Tobias was not
only in connection with the abusive manner in which he was dismissed but was also the
result of several other quasi-delictual acts committed by petitioners.

Petitioners next question the award of moral damages. However, the Court has already
ruled in Wassmer v. Velez, G.R. No. L-20089, December 26, 1964, 12 SCRA 648, 653,
that [p]er express provision of Article 2219 (10) of the New Civil Code, moral damages are
recoverable in the cases mentioned in Article 21 of said Code." Hence, the Court of
Appeals committed no error in awarding moral damages to Tobias.

Lastly, the award of exemplary damages is impugned by petitioners. Although Article 2231
of the Civil Code provides that "[i]n quasi-delicts, exemplary damages may be granted if
the defendant acted with gross negligence," the Court, in Zulueta v. Pan American World
Airways, Inc., G.R. No. L- 28589, January 8, 1973, 49 SCRA 1, ruled that if gross
negligence warrants the award of exemplary damages, with more reason is its imposition
justified when the act performed is deliberate, malicious and tainted with bad faith. As in
the Zulueta case, the nature of the wrongful acts shown to have been committed by
petitioners against Tobias is sufficient basis for the award of exemplary damages to the
latter.

WHEREFORE, the petition is hereby DENIED and the decision of the Court of Appeals in
CA-G.R. CV No. 09055 is AFFIRMED.

SO ORDERED.

Fernan, C.J., Gutierrez, Jr. and Bidin, JJ., concur.

Feliciano, J., took no part.

Footnotes

** Penned by Justice Jorge R. Coquia and concurred in be Justice Josue

N. Bellosillo and Justice Venancio D. Aldecoa Jr.