PICART vs.

SMITH
Where both parties are negligent, how do we determine who is at fault? What is the
Doctrine of the Last Clear Chance?
In this case, Picart, riding on his pony, met a collision with an automobile. He then asks
for damages for the injuries he suffered. As the Court explains both parties are negligent. It is
therefore incumbent upon the Court to determine whether Picart, being negligent, would still be
adjudged with damages. To resolve the case, the Court applied the Doctrine of the Last Clear
Chance:
xxx The doctrine applies only in a situation where the plaintiff was guilty of prior or
antecedent negligence but the defendant, who had the last fair chance to avoid the
impending harm and failed to do so, is made liable for all the consequences of the
accident notwithstanding the prior negligence of the plaintiff
But as we have already stated, the defendant was also negligent; and in such case the
problem always is to discover which agent is immediately and directly responsible. It will
be noted that the negligent acts of the two parties were not contemporaneous, since
the negligence of the defendant succeeded the negligence of the plaintiff by an
appreciable interval. Under these circumstances the law is that the person who has the
last fair chance to avoid the impending harm and fails to do so is chargeable with the
consequences, without reference to the prior negligence of the other party xxx
It must be emphasized that in applying this doctrine, the petitioner is not freed from
liability. Since both parties are at fault, the damages awarded shall be mitigated to compensate
for the other party’s contributory negligence. As explained in the cited case, Rkes vs. Atlantic:
xxx It was held that while the defendant was liable to the plaintiff by reason of its
negligence in having failed to keep the track in proper repair nevertheless the amount of
the damages should be reduced on account of the contributory negligence in the
plaintiff xxx
The Court also introduced the criteria in determining negligence, to wit:
xxx Conduct is said to be negligent when a prudent man in the position of the tortfeasor
would have foreseen that an effect harmful to another was sufficiently probable to
warrant his foregoing conduct or guarding against its consequences.
By applying the doctrine it can be said that the act of the defendant is the proximate cause
of the injury while that of the plaintiff is the remote cause.
xxx It is enough to say that the negligence of the defendant was in this case the
immediate and determining cause of the accident and that the antecedent negligence of the
plaintiff was a more remote factor in the case xxx
 Bustamante vs. CA
GR No. 89880
February 6, 1991

What are the exceptions in applying the Doctrine of the Last Clear Chance?

The petitioners are parents of deceased passengers asking for damages resulting to the
death of their sons and daughters. This was caused by the collision of the bus passenger with the
truck. The petitioners therefore prays a collection for damages against the driver and owner of
the truck.
The CA using the doctrine of last clear chance absolved the truck driver imputing that the
negligence of the bus driver is the proximate cause of the injury. Furthermore, the latter has the
last clear chance to minimize the peril but it failed to do so.

xxx the bus driver had the last clear chance to avoid the collision and his reckless
negligence in proceeding to overtake the hand tractor was the proximate cause of the
collision." (Rollo, p. 95). Said court also noted that "the record also discloses that the bus
driver was not a competent and responsible driver. His driver's license was confiscated
for a traffic violation on April 17, 1983 and he was using a ticket for said traffic violation
on the day of the accident in question (pp. 16-18, TSN, July 23, 1984). He also admitted
that he was not a regular driver of the bus that figured in the mishap and was not given
any practical examination xxx

The Court judged differently assailing that the last clear chance does not apply in the case
at hand. The exceptions of application of the doctrine was promulgated by the Court in this case:

xxx the principle of "last clear chance" applies "in a suit between the owners and drivers
of colliding vehicles. It 1) does not arise where a passenger demands responsibility from
the carrier to enforce its contractual obligations. For it would be inequitable to exempt
the negligent driver of the jeepney and its owners on the ground that the other driver
was likewise guilty of negligence."

Furthermore, "as between defendants: The doctrine cannot be extended into the field of
2) joint tortfeasors as a test of whether only one of them should be held liable to the
injured person by reason of his discovery of the latter's peril, and it cannot be invoked
as between 3) defendants concurrently negligent. As against third persons, a negligent
actor cannot defend by pleading that another had negligently failed to take action which
could have avoided the injury." Xxx
 Since the case at bar is not a suit between the owners and drivers of the colliding vehicles
but a suit brought by the heirs of the deceased passengers against both owners and drivers of
the colliding vehicles. Therefore, the respondent court erred in absolving the owner and driver
of the cargo truck from liability.

Phoenix vs. IAC

GR No. L-65295
March 10, 1987

A dump truck, owned by Phoenix, was parked askew (not parallel to the street curb) in
such a manner as to stick out onto the street, partly blocking the way of oncoming traffic. There
were no lights nor any so-called "early warning" reflector devices set anywhere near the dump
truck, front or rear. Dionisio, private respondent, claimed that he tried to avoid a collision by
swerving his car to the left but it was too late and his car smashed into the dump truck. As a result
of the collision, Dionisio suffered some physical injuries including some permanent facial scars, a
"nervous breakdown" and loss of two gold bridge dentures. He now asks for damages alleging
that the proximate cause of suffering the same is the negligent act of the driver.

Petitioner assails that Dionisio’s act is a sufficient intervening cause, and that their driver’s
negligent act is only a passive and static condition.

Sufficient intervening cause vis-à-vis passive static condition vis-à-vis forseeable

intervening cause:

It has been agreed upon that indeed Dionisio was also negligent. He was hurrying home
that night and driving faster than he should have been. Worse, he extinguished his headlights at
or near the intersection of General Lacuna and General Santos Streets and thus did not see the
dump truck that was parked askew and sticking out onto the road lane. But nonetheless, the
proximate cause of his injury is the negligent act of the driver parking his truck in a skew.

The truck driver whether or not created a passive and static condition is immaterial. As
explained in this case:

xxx Cause and condition. Many courts have sought to distinguish between the active
"cause" of the harm and the existing "conditions" upon which that cause operated. If the
defendant has created only a passive static condition which made the damage possible,
the defendant is said not to be liable. But so far as the fact of causation is concerned, in
the sense of necessary antecedents which have played an important part in producing
the result it is quite impossible to distinguish between active forces and passive situations,
particularly since, as is invariably the case, the latter are the result of other active forces
which have gone before. The defendant who spills gasoline about the premises creates a
"condition," but the act may be culpable because of the danger of fire. When a spark
ignites the gasoline, the condition has done quite as much to bring about the fire as the
spark; and since that is the very risk which the defendant has created, the defendant will
 not escape responsibility. Even the lapse of a considerable time during which the
"condition" remains static will not necessarily affect liability; one who digs a trench in
the highway may still be liable to another who fans into it a month afterward. "Cause"
and "condition" still find occasional mention in the decisions; but the distinction is now
almost entirely discredited. So far as it has any validity at all, it must refer to the type of
case where the forces set in operation by the defendant have come to rest in a position
of apparent safety, and some new force intervenes. But even in such cases, it is not the
distinction between "cause" and "condition" which is important but the nature of the
risk and the character of the intervening cause xxx

As the Court ruled, there is no distinction whether a person provided a static

condition only or an active force as long it has created a risk in which an injury later
resulted. The improper parking of the dump truck created an unreasonable risk of injury
for anyone driving down General Lacuna Street and for having so created this risk, the
truck driver must be held responsible.

Moreover, the negligent act of Dionisio is not just an ordinary intervening cause
but a forseeable intervening cause:

xxx Foreseeable Intervening Causes. If the intervening cause is one which in

ordinary human experience is reasonably to be anticipated or one which the
defendant has reason to anticipate under the particular circumstances, the
defendant may be negligence among other reasons, because of failure to guard
against it; or the defendant may be negligent only for that reason. Thus one who
sets a fire may be required to foresee that an ordinary, usual and customary wind
arising later wig spread it beyond the defendant's own property, and therefore to
take precautions to prevent that event. The person who leaves the combustible
or explosive material exposed in a public place may foresee the risk of fire from
some independent source. ... In all of these cases there is an intervening cause
combining with the defendant's conduct to produce the result and in each case
the defendant's negligence consists in failure to protect the plaintiff against that
very risk.

Obviously the defendant cannot be relieved from liability by the fact that the risk
or a substantial and important part of the risk, to which the defendant has
subjected the plaintiff has indeed come to pass. Foreseeable intervening forces
are within the scope original risk, and hence of the defendant's negligence. The
courts are quite generally agreed that intervening causes which fall fairly in this
category will not supersede the defendant's responsibility xxx

Dionisio's negligence was "only contributory," that the "immediate and proximate
cause" of the injury remained the truck driver's "lack of due care" and that consequently
respondent Dionisio may recover damages though such damages are subject to mitigation by the
courts.

Doctrine of last clear chance vis-à-vis comparative negligence

Lastly, the truck driver assails the doctrine of the last clear chance that private
respondent Dionisio had the "last clear chance" of avoiding the accident and hence his injuries,
and that Dionisio having failed to take that "last clear chance" must bear his own injuries alone.
xxx The common law notion of last clear chance permitted courts to grant recovery
to a plaintiff who had also been negligent provided that the defendant had the last
clear chance to avoid the casualty and failed to do so. Accordingly, it is difficult to
see what role, if any, the common law last clear chance doctrine has to play in a
jurisdiction where the common law concept of contributory negligence as an
absolute bar to recovery by the plaintiff, has itself been rejected, as it has been in
Article 2179 of the Civil Code of the Philippines xxx
This means that even if the doctrine of last clear chance indeed exists, it does not
rule in the favor of the defendant alone. The petitioner being equally negligent must
bear a part of his suffering.
ART. 2179 of the Civil Code provides:
When the plaintiff’s own negligence was the immediate cause of his injury, he
cannot recover damages. But if his negligence was only contributory, the
immediate and proximate cause of the injury being the defendant’s lack of due
care, the plaintiff may recover damages, but the courts shall mitigate the damages
to be awarded.
xxx The petitioners urge that the truck driver (and therefore his employer) should
be absolved from responsibility for his own prior negligence because the
unfortunate plaintiff failed to act with that increased diligence which had become
necessary to avoid the peril precisely created by the truck driver's own wrongful act
or omission. To accept this proposition is to come too close to wiping out the
fundamental principle of law that a man must respond for the forseeable
consequences of his own negligent act or omission. Our law on quasi-delicts seeks
to reduce the risks and burdens of living in society and to allocate them among the
members of society. To accept the petitioners' pro-position must tend to weaken
the very bonds of society xxx
The comparative negligence of Dionisio led the court to mitigate the award of
damages, 20-80 ratio to the favor of Dionisio.
 Glan vs. IAC
GR No. 70493
May 18, 1989

The case involves a collision between a jeepney and a truck carrying various hard
ware materials owned by the petitioner. It resulted to the death of some passengers, hence, the
family of the deceased herein private respondents ask for damages. From the investigations of
policemen and testimony of witnesses, the jeepney was found beyond the demarcation line in
the middle of the road, this means he is outside his lane. Furthermore, the jeepney was in zig
zagged manner before the collision.
The Court applying the doctrine of the last clear chance absolved the petitioner. This
case clearly manifest an exemption of the comparative negligence applicable to two negligent
parties. Allegedly, the truck driver was not negligent because he has prevented the impending
peril against the jeepney driver.
xxx From these facts the logical conclusion emerges that the driver of the jeep had
what judicial doctrine has appropriately called the last clear chance to avoid the
accident, while still at that distance of thirty meters from the truck, by stopping in
his turn or swerving his jeep away from the truck, either of which he had sufficient
time to do while running at a speed of only thirty kilometers per hour. In those
circumstances, his duty was to seize that opportunity of avoidance, not merely rely
on a supposed right to expect, as the Appellate Court would have it, the truck to
swerve and leave him a clear path xxx
The Court similarly applied the explanation enshrined in the doctrinal case of Picart vs. Smith:
xxx It goes without saying that the plaintiff himself was not free from fault, for he was
guilty of antecedent negligence in planting himself on the wrong side of the road. But as
we have already stated, the defendant was also negligent; and in such case the problem
always is to discover which agent is immediately and directly responsible. It will be noted
that the negligent acts of the two parties were not contemporaneous, since the
negligence of the defendant succeeded the negligence of the plaintiff by an appreciable
interval. Under these circumstances the law is that the person who has the last fair
chance to avoid the impending harm and fails to do so is chargeable with the
consequences, without reference to the prior negligence of the other party xxx
 According to the Court, the death of the jeepney driver was caused by his negligent
act of not impeding the peril which is within his control to desist. This case strictly applied the
doctrine clearly deviating from latter jurisprudence applying a comparative negligence between
the parties. As the Court has proven, the truck was already in the full stop. There is indeed an
intervening time between the acts of the parties, hence, clearly exonerating the truck driver
from liability. The intervening time should have been used by the jeepney driver to save
himself.
xxx Compassion for the plight of those whom an accident has robbed of the love and
support of a husband and father is an entirely natural and understandable sentiment. It
should not, however, be allowed to stand in the way of, much less to influence, a just
verdict in a suit at law xxx
 Pantranco vs. Baesa
GR No. 79050-51
November 14, 1989

The Doctrine of Last Clear Chance is not applied in blanket. The collision of a bus and
jeepney in this case has led the Court to re-emphasized two basic exemptions in the application
of the doctrine.
xxx 1) it is necessary to show that the person who allegedly had the last opportunity to
avert the accident was aware of the existence of the peril or should, with exercise of
due care, have been aware of it. One cannot be expected to avoid an accident or injury
if he does not know or could not have known the existence of the peril. In this case, there
is nothing to show that the jeepney driver David Ico knew of the impending danger. When
he saw at a distance that the approaching bus was encroaching on his lane, he did not
immediately swerve the jeepney to the dirt shoulder on his right since he must have
assumed that the bus driver will return the bus to its own lane upon seeing the jeepney
approaching from the opposite direction xxx
xxx a motorist who is properly proceeding on his own side of the highway is generally
entitled to assume that an approaching vehicle coming towards him on the wrong side,
will return to his proper lane of traffic. There was nothing to indicate to David Ico that the
bus could not return to its own lane or was prevented from returning to the proper lane
by anything beyond the control of its driver xxx
Moreover, even if the jeepney had known the peril, the Court reiterated that it would be
impossible for anyone to prevent the same.
xxx By the time David Ico must have realized that the bus was not returning to its own
lane, it was already too late to swerve the jeepney to his right to prevent an accident.
The speed at which the approaching bus was running prevented David Ico from
swerving the jeepney to the right shoulder of the road in time to avoid the collision.
Thus, even assuming that the jeepney driver perceived the danger a few seconds before
the actual collision, he had no opportunity to avoid it. This Court has held that the last
clear chance doctrine 2) "can never apply where the party charged is required to act
instantaneously, and if the injury cannot be avoided by the application of all means at
hand after the peril is or should have been discovered" xxx
Hence, it is the bus company who should bear the loss. It is his failure in going back to his
own lane upon seeing the jeepney which caused the injury, thereby making his negligent
act as the proximate cause.
Since the case at hand asked for damages arising from quasi delict, the company
alleviated itself from liability assailing the diligence of a good father in supervision and
election of its employees.
The Court ruled in the negative:
xxx When an injury is caused by the negligence of an employee, there instantly
arises a presumption that the employer has been negligent either in the selection
of his employees or in the supervision over their acts. Although this presumption
is only a disputable presumption which could be overcome by proof of diligence
of a good father of a family, this Court believes that the evidence submitted by
the defendant to show that it exercised the diligence of a good father of a family
in the case of Ramirez, as a company driver is far from sufficient. No support
evidence has been adduced. The professional driver’s license of Ramirez has not
been produced. There is no proof that he is between 25 to 38 years old. There is
also no proof as to his educational attainment, his age, his weight and the fact that
he is married or not. Neither are the result of the written test, psychological and
physical test, among other tests, have been submitted in evidence [sic]. His NBI or
police clearances and clearances from previous employment were not marked in
evidence. No evidence was presented that Ramirez actually and really attended
the seminars xxx
 Philippine Bank of Commerce vs. CA
GR No. 97626
March 14, 1997

Private respondent, RMC Company, assails damages against the Bank for allegedly
allowing its deposit to be accounted in the account another. Allegedly, their company
secretary, Yabut, deposited instead in the account of his husband the earnings of the
company. Private respondent asks for reimbursement of the amount P304,979.74. by
virtue of quasi delict:
There are three elements of a quasi-delict: (a) damages suffered by the plaintiff;
(b) fault or negligence of the defendant, or some other person for whose acts he must
respond; and (c) the connection of cause and effect between the fault or negligence of
the defendant and the damages incurred by the plaintiff.
The test by which to determine the existence of negligence in a particular case
which may be stated as follows: Did the defendant in doing the alleged negligent act use
that reasonable care and caution which an ordinarily prudent person would have used in
the same situation? If not, then he is guilty of negligence. (Picart vs. Smith)
Applying the same, the proximate cause of the injury suffered by the Bank is:
xxx the bank's teller, Ms. Azucena Mabayad, was negligent in validating,
officially stamping and signing all the deposit slips prepared and presented by
Ms. Yabut, despite the glaring fact that the duplicate copy was not completely
accomplished contrary to the self-imposed procedure of the bank with respect to
the proper validation of deposit slips, original or duplicate xxx
xxx proximate cause [is defined] as "that cause, which, in natural and continuous
sequence, unbroken by any efficient intervening cause, produces the injury, and
without which the result would not have occurred. . . ."
PROXIMATE CAUSE: In this case, absent the act of Ms. Mabayad in negligently validating
the incomplete duplicate copy of the deposit slip, Ms. Irene Yabut would not have the facility
with which to perpetrate her fraudulent scheme with impunity.
Even applying the Doctrine of the Last Clear Chance would still hold the fact the bank has
the last fair chance to avoid the peril:
xxx Here, assuming that private respondent RMC was negligent in entrusting cash to a
dishonest employee, thus providing the latter with the opportunity to defraud the
company, as advanced by the petitioner, yet it cannot be denied that the petitioner bank,
thru its teller, had the last clear opportunity to avert the injury incurred by its client,
simply by faithfully observing their self-imposed validation procedure xxx
 However, it cannot be denied that the company is equally negligent. It was
negligent in not checking its monthly statements of account. Had it done so, the company
would have been alerted to the series of frauds being committed against RMC by its
secretary. This calls for the application of comparative negligence:
Article 2179 of the New Civil Code, to wit:
xxx When the plaintiff's own negligence was the immediate and proximate
cause of his injury, he cannot recover damages. But if his negligence was only
contributory, the immediate and proximate cause of the injury being the defendant's
lack of due care, the plaintiff may recover damages, but the courts shall mitigate the
damages to be awarded xxx
This prompted the Court to divide the damages with the ratio 60-40, in favor of private
respondent.
 Ong vs. Metropolitan Water District
GR No. L-7664
August 29, 1958

A young boy 14 years of age was found dead in one of the pools of the respondent.
Allegeing negligence in the respondent to assure the safety of its customer, the parents of the
deceased come before the Court praying for damages arising from quasi delict.
The lower courts however found that the respondent is not remised in its duty since every
precaution or warning is available in the premises. Life guards and other life saving materials can
also be easily availed by customer. Moreover, the life guard on duty upon knowing the situation
immediately went to the relied of the boy. The respondents’ relief operations team earnestly did
their best thereafter to save the life of the boy. However, the boy has been lifeless already prior
to the same.
Petitioner now rests to the Doctrine of Last Clear Chance, explaining that even if Ong was
indeed at fault, the respondent has the last fair chance or opportunity to save the boy’s life.
The Court ruled in the negative assailing that the doctrine does not apply in this case.
xxx Since it is not known how minor Ong came into the big swimming pool and it being
apparent that he went there without any companion in violation of one of the regulations
of appellee as regards the use of the pools, and it appearing that lifeguard responded to
the call for help as soon as his attention was called to it and immediately after retrieving
the body all efforts at the disposal of appellee had been put into play in order to bring
him back to life, it is clear that there is no room for the application of the doctrine now
invoked by appellants to impute liability to appellee..
The last clear chance doctrine can never apply where the party charged is required to
act instantaneously, and if the injury cannot be avoided by the application of all means
at hand after the peril is or should have been discovered; at least in cases in which any
previous negligence of the party charged cannot be said to have contributed to the
injury xxx
 Anuran vs. Buno
GR No. L-21353
May 20, 1996

A passenger jeepney was parked on the road to Taal, Batangas. A motor truck speeding
along, negligently bumped it from behind, with such violence that three of its passengers died,
even as two others suffered injuries that required their confinement. Hence, So, these suits were
instituted by the representatives of the dead and of the injured, to recover consequently
damages against the driver and the owners of the truck and also against the driver and the
owners of the jeepney.
The CA exonerated the owners and drivers of the jeepney using the Doctrine of the Last
Clear Chance:
xxx It explained that although "the driver of the ill-starred vehicle was not free from fault,
for he was guilty of an antecedent negligence in parking his vehicle with a portion thereof
occupying the asphalted road", it considered the truck driver guilty of greater negligence
which was the efficient cause of the collision; and applying the doctrine of the "last clear
chance" said Court ordered the owners of the truck to pay, solidarily with its driver xxx
The Court finds the reasoning of the CA erroneous. This case warrants the exemption of
the application of the doctrine.
xxx The principle about the "last clear chance" would call for application in a suit between
the owners and drivers of the two colliding vehicles. It does not arise where a passenger
demands responsibility from the carrier to enforce its contractual obligations. For it
would be inequitable to exempt the negligent driver of the jeepney and its owners on the
ground that the other driver was likewise guilty of negligence xxx
As the Court further explained, the common carries, by operation of law, is obliged to
observe utmost diligence towards their passengers.
xxx It must be remembered that the obligation of the carrier to transport its passengers
safely is such that the New Civil Code requires "utmost diligence" from the carriers (Art.
1755) who are "presumed to have been at fault or to have acted negligently, unless they
prove that they have observed extraordinary diligence" (Art. 1756). In this instance, this
legal presumption of negligence is confirmed by the Court of Appeals' finding that the
driver of the jeepney in question was at fault in parking the vehicle improperly. It must
follow that the driver — and the owners — of the jeepney must answer for injuries to its
passengers xxx
 Raynera vs. Hiceta
GR No. 120027
April 21, 1999

Reynaldo Raynera, the deceased, crashed his motorcycle into the left rear portion of the
truck trailer, which was without tail lights. Due to the collision, Reynaldo sustained head injuries
and truck helper Geraldino D. Lucelo rushed him to the Paraaque Medical Center. Upon arrival
at the hospital, the attending physician pronounced Reynaldo Raynera dead on arrival. The family
of the deceased now asks for damages.
Imputing the Doctrine of Last Clear Chance, the Court ruled in favor of the truck driver.
xxx We find that the direct cause of the accident was the negligence of the victim.
Traveling behind the truck, he had the responsibility of avoiding bumping the vehicle in
front of him. He was in control of the situation. His motorcycle was equipped with
headlights to enable him to see what was in front of him. He was traversing the service
road where the prescribed speed limit was less than that in the highway xxx
NEGLIGENCE: The omission to do something which a reasonable man, guided by those
considerations which ordinarily regulate the conduct of human affairs, would do, or the
doing of something, which a prudent and reasonable man would not do.
PROXIMATE CAUSE: cause, which, in natural and continuous sequence, unbroken by any
efficient intervening cause, produces the injury, and without which the result would not
have occurred.
The doctrine imposts that between two negligent parties, the person who has the last fair
chance or opportunity to prevent the peril but fails to do so shall suffer the consequences.
xxx It has been said that drivers of vehicles who bump the rear of another vehicle are
presumed to be the cause of the accident, unless contradicted by other evidence. The
rationale behind the presumption is that the driver of the rear vehicle has full control
of the situation as he is in a position to observe the vehicle in front of him.
Consequently, no other person was to blame but the victim himself since he was the one
who bumped his motorcycle into the rear of the Isuzu truck. He had the last clear chance
of avoiding the accident xxx
 Canlas vs. CA
GR No. 112160
February 28, 2000

Canlas and Private respondent Manosca decided to undertake a business venture. To

pursue the same, Canlas decided to undertake a Special Power of Attorney in favor of Manosca
so that he could mortgage the lands for a loan. Manosca was able to mortgage the land to Asian
Savings Bank through the use of an impostor who acted as Spouses Canlas. Petitioner asked for
annulment of the deed of real esate mortgage with the prayer of damages against the negligent
act of the respondent Bank.
The Court ruled that respondent Bank should reimburse the petitioner for being remised
in observance of its diligence, particularly in approving a loan with impostors in the absence of
any proof of their identities.
Applying the Doctrine of the Last Clear Chance, the Bank has within its capacity the last
fair chance to prevent the fraudulent act.
xxx In essence, the doctrine of last clear chance is to the effect that where both parties
are negligent but the negligent act of one is appreciably later in point of time than that
of the other, or where it is impossible to determine whose fault or negligence brought
about the occurrence of the incident, the one who had the last clear opportunity to
avoid the impending harm but failed to do so, is chargeable with the consequences
arising therefrom xxx
xxx Assuming that Osmundo Canlas was negligent in giving Vicente Mañosca the
opportunity to perpetrate the fraud, by entrusting to latter the owner's copy of the
transfer certificates of title of subject parcels of land, it cannot be denied that the bank
had the last clear chance to prevent the fraud, by the simple expedient of faithfully
complying with the requirements for banks to ascertain the identity of the persons
transacting with them xxx
For not observing the degree of diligence required of banking institutions, whose
business is impressed with public interest, respondent Asian Savings Bank has to bear the loss
sued upon.
Moreover, the Court held the REM as void.
xxx Settled is the rule that a contract of mortgage must be constituted only by the
absolute owner on the property mortgaged; a mortgage, constituted by an impostor is
void. Considering that it was established indubitably that the contract of mortgage sued
upon was entered into and signed by impostors who misrepresented themselves as the
spouses Osmundo Canlas and Angelina Canlas, the Court is of the ineluctible conclusion
and finding that subject contract of mortgage is a complete nullity xxx
 Consolidated Bank vs. CA
GR No. 138569
September 11, 2003

LC Diaz, a client of petitioner bank, made a deposit through his employee. During the
transaction, the employee left the passbook in the possession of the teller while he when to
another bank. When employee returned, the passbook was nowhere to be found. Allegedly, the
teller cannot remember to whom she gave the same. Consequently, Diaz found out that the
passbook was used by another thereby withdrawing an amount of P300,000. Private respondent
now prays for damages for the alleged negligence of the Bank.
To exonerate itself, Solidbank assails the application of the doctrine of the last clear
chance to which the Court ruled in the negative.
xxx We do not apply the doctrine of last clear chance to the present case. Solidbank is
liable for breach of contract due to negligence in the performance of its contractual
obligation to L.C. Diaz. This is a case of culpa contractual, where neither the contributory
negligence of the plaintiff nor his last clear chance to avoid the loss, would exonerate
the defendant from liability. Such contributory negligence or last clear chance by the
plaintiff merely serves to reduce the recovery of damages by the plaintiff but does not
exculpate the defendant from his breach of contract xxx
Solidbanks rules on savings account require that the deposit book should be carefully
guarded by the depositor and kept under lock and key, if possible. When the passbook is in the
possession of Solidbanks tellers during withdrawals, the law imposes on Solidbank and its tellers
an even higher degree of diligence in safeguarding the passbook.
Likewise, Solidbanks tellers must exercise a high degree of diligence in insuring that they
return the passbook only to the depositor or his authorized representative. The tellers know, or
should know, that the rules on savings account provide that any person in possession of the
passbook is presumptively its owner. If the tellers give the passbook to the wrong person, they
would be clothing that person presumptive ownership of the passbook, facilitating
unauthorized withdrawals by that person. For failing to return the passbook to Calapre, the
authorized representative of L.C. Diaz, Solidbank and Teller No. 6 presumptively failed to
observe such high degree of diligence in safeguarding the passbook, and in insuring its return
to the party authorized to receive the same.
xxx In culpa contractual, once the plaintiff proves a breach of contract, there is a
presumption that the defendant was at fault or negligent. The burden is on the
defendant to prove that he was not at fault or negligent. In contrast, in culpa aquiliana
the plaintiff has the burden of proving that the defendant was negligent. In the present
case, L.C. Diaz has established that Solidbank breached its contractual obligation to return
the passbook only to the authorized representative of L.C. Diaz. There is thus a
 presumption that Solidbank was at fault and its teller was negligent in not returning the
passbook to Calapre. The burden was on Solidbank to prove that there was no negligence
on its part or its employees xxx
The Court accepts that Diaz is also negligent. In this case, L.C. Diaz was guilty of
contributory negligence in allowing a withdrawal slip signed by its authorized signatories to fall
into the hands of an impostor. Thus, the liability of Solidbank should be reduced.
In Philippine Bank of Commerce v. Court of Appeals, where the Court held the depositor
guilty of contributory negligence, it allocated the damages between the depositor and the bank
on a 40-60 ratio. The Court applies this ratio in this case.
 Engada vs. CA
GR No. 140698
June 20, 2003

The petitioner, driver of a pick up made a head on collision with Iran, the driver of a
Tamarraw FX. Allegedly, the pick ups right signal light flashed, at the same time, it swerved to its
left, encroaching upon the lane of the Tamaraw and headed towards a head-on collision course
with it. Iran swerved to his left but the pick-up also swerved to its right. Thus, the pick-up collided
with the Tamaraw, hitting the latter at its right front passenger side. The impact caused the head
and chassis of the Tamaraw to separate from its body. The passenger therein also suffered
injuries.

In his defense, petitioner avers that although his act of occupying the Tamaraw’s lane was
the initial act in the chain of events, Iran’s swerving to the left after petitioner flashed his right
turn signal, constituted a sufficient intervening event, which proximately caused the eventual
injuries and damages to private complainant.

The Court introduced the emergency rule in defending the act of Iran.

xxx The rationale of this rule is that a person who is confronted with a sudden emergency
might have no time for thought, and he must make a prompt decision based largely
upon impulse or instinct. Thus, he cannot be held to the same standard of conduct as
one who had an opportunity to reflect, even though it later appears that he made the
wrong decision xxx

xxx An individual who suddenly finds himself in a situation of danger and is required to
act without much time to consider the best means that may be adopted to avoid the
impending danger, is not guilty of negligence if he fails to undertake what subsequently
and upon reflection may appear to be a better solution, unless the emergency was
brought by his own negligence xxx

Hence, the existence of this emergency rule barred the application of the doctrine of the
last clear chance.

xxx Instead, what has been shown is the presence of an emergency and the proper
application of the emergency rule. Petitioners act of swerving to the Tamaraws lane at
a distance of 30 meters from it and driving the Isuzu pick-up at a fast speed as it
approached the Tamaraw, denied Iran time and opportunity to ponder the situation at
all. There was no clear chance to speak of xxxx

Moreover, the law requires diligence to be observed by vehicles who overtakes or drives
outside their lane.
 It is a settled rule that a driver abandoning his proper lane for the purpose of overtaking
another vehicle in an ordinary situation has the duty to see to it that the road is clear and he
should not proceed if he cannot do so in safety (The Land Transportation and Traffic Code).