Pacific Banking Corp vs. CA
Pacific Banking Corp vs. CA
DECISION
PARAS, J :p
It will be noted that the fact of fraud was tried by express or at least
implied consent of the parties. Petitioner did not only object to the
introduction of evidence but on the contrary, presented the very evidence
that proved its existence.
Be that as it may, it is established that the Supreme Court has ample
authority to go beyond the pleadings where in the interest of justice and
the promotion of public policy, there is a need to make its own finding to
support its conclusion. Otherwise stated, the Court can consider a fact
which surfaced only after trial proper (Maharlika Publishing Corp. v. Tagle,
142 SCRA 561 [1986]).
Generally, the cause of action on the policy accrues when the loss occurs.
But when the policy provides that no action shall be brought unless the
claim is first presented extrajudicially in the manner provided in the policy,
the cause of action will accrue from the time the insurer finally rejects the
claim for payment (Eagle Star Insurance v. Chia Yu, 55 Phil 701 [1955]).
In the case at bar, policy condition No. 11 specifically provides that the
insured shall on the happening of any loss or damage give notice to the
company and shall within fifteen (15) days after such loss or damage
deliver to the private respondent (a) a claim in writing giving particular
account as to the articles or goods destroyed and the amount of the loss
or damage and (b) particulars of all other insurances, if any. Likewise,
insured was required "at his own expense to produce, procure and give to
the company all such further particulars, plans, specifications, books,
vouchers, invoices, duplicates or copies thereof, documents, proofs and
information with respect to the claim". (Record on Appeal, pp. 18-20).
The evidence adduced shows that twenty-four (24) days after the fire,
petitioner merely wrote letters to private respondent to serve as a
noticeof loss, thereafter, the former did not furnish the latter whatever
pertinent documents were necessary to prove and estimate its loss.
Instead, petitioner shifted upon private respondent the burden of fishing
out the necessary information to ascertain the particular account of the
articles destroyed by fire as well as the amount of loss. It is noteworthy
that private respondent and its adjuster notified petitioner that insured had
not yet filed a written claim nor submitted the supporting documents in
compliance with the requirements set forth in the policy. Despite the
notice, the latter remained unheedful. Since the required claim by insured,
together with the preliminary submittal of relevant documents had not
been complied with, it follows that private respondent could not be
deemed to have finally rejected petitioner's claim and therefore the latter's
causeof action had not yet arisen. Compliance with condition No. 11 is a
requirement sine qua non to the right to maintain an action as prior thereto
no violation of petitioner's right can be attributable to private respondent.
This is so, as before such final rejection, there was no real necessity for
bringing suit. Petitioner should have endeavored to file the formal claim
and procure all the documents, papers, inventory needed by private
respondent or its adjuster to ascertain the amount of loss and after
compliance await the final rejection of its claim. Indeed, the law does not
encourage unnecessary litigation (Eagle Star Insurance Co., Ltd., et al. v.
Chia Yu, p. 701, supra).
Verily, petitioner prematurely filed Civil Case No. 56889 and dismissal
thereof was warranted under the circumstances.
While it is a cardinal principle of insurance law that a policy or
contract of insurance is to be construed liberally in favor of the insured
and strictly as against the insurer company (Eagle Star Insurance Co.,
Ltd., et al. v. Chia Yu, p. 702, supra; Taurus Taxi Co., Inc. v. The Capital
Ins. & Surety Co., Inc., 24 SCRA 458 [1968]; National Power Corp. v. CA,
145 SCRA 533 [1986]), yet, contracts of insurance, like other contracts, are
to be construed according to the sense and meaning of the terms which
the parties themselves have used. If such terms are clear and
unambiguous, they must be taken and understood in their plain, ordinary
and popular sense (Young v. Midland Textile Ins. Co., 30 Phil. 617
[1919]; Union Manufacturing Co., Inc. v. Phil. Guaranty Co., Inc., p.
277 supra; Pichel v. Alonzo, 111 SCRA 341 [1982]; Gonzales v. CA, 124
SCRA 630 [1983]; GSIS v. CA, 145 SCRA 311 [1986]; Herrera v. Petrophil
Corp., 146 SCRA 385 [1986]).
Contracts of insurance are contracts of indemnity upon the terms and
conditions specified in the policy. The parties have a right to impose such
reasonable conditions at the time of the making of the contract as they
may deem wise and necessary. The agreement has the force of law
between the parties. The terms of the policy constitute the measure of the
insurer's liability, and in order to recover, the insured must show himself
within those terms. The compliance of the insured with the terms of the
policy is a condition precedent to the right of recovery (Stokes v. Malayan
Insurance Co., Inc., 127 SCRA 766 [1984]). LLjur