G.R. No. 131723, 13 December 2007

FACTS:

T.E.A.M. Electronics Corporation (TEC) is wholly owned by respondent Technology Electronics Assembly and Management Pacific Corporation (TPC). Manila Electric Company (Meralco) is a utility company supplying electricity in the Metro Manila area.

MERALCO alleges that TEC tampered the electric meters in its buildings and should thus be liable for differential billings. For failure of TEC to pay such differential billing, petitioner disconnected the electricity supply to said buildings.

TEC and TPC filed a complaint for damages against MERALCO before the RTC Pasig. The RTC ruled in favor of TEC-TPC and ordered MERALCO to pay the former actual damages, moral damages, exemplary damages and attorney’s fees. The court found the evidence of petitioner insufficient to prove that TEC was guilty of tampering the meter installations. The CA affirmed the RTC decision with modifications, hence this petition for review on certiorari under Rule 45.

ISSUE:

Whether the Court of Appeals committed grievous errors in declaring TEC and TPC entitled to the damages which it awarded.

RULING:

The Court deems it proper to delete the award of moral damages. TEC’s claim was premised allegedly on the damage to its goodwill and reputation. As a rule, a corporation is not entitled to moral damages because, not being a natural person, it cannot experience physical suffering or sentiments like wounded feelings, serious anxiety, mental anguish and moral shock. The only exception to this rule is when the corporation has a reputation that is debased, resulting in its humiliation in the business realm. But in such a case, it is imperative for the claimant to present proof to justify the award. It is essential to prove the existence of the factual basis of the damage and its causal relation to petitioner’s acts. In the present case, the records are bereft of any evidence that the name or reputation of TEC/TPC has been debased as a result of petitioner’s acts. Besides, the trial court simply awarded moral damages in the dispositive portion of its decision without stating the basis thereof.

*Case digest by Teonilo M. Bagalanon Jr., JD – 4, Andres Bonifacio College, SY 2019 – 2020