G.R. No. 181398 – FEB LEASING AND FINANCE CORPORATION (now BPI LEASING CORPORATION), petitioners, vs. SPOUSES SERGIO P. BAYLON and MARITESS VILLENA-BAYLON, BG HAULER, INC., and MANUEL Y. ESTILLOSO, respondents.
CARPIO, J.
Rule Synopsis
Insofar as third persons are concerned, the registered owner of a vehicle must answer for the loss, damage or liability arising from its use, even if he was not the actual owner or possessor thereof. Transfers, leases, among others, of the vehicle not registered with the LTO does not bind third persons.
Facts
FEB Leasing and Finance Corp. was the registered owner of an Isuzu oil tanker. The same was leased to BG Hauler, Inc. and was driven by the latter’s driver, Manuel Y. Estilloso. The tanker was insured by FGU Insurance Corp. The tanker fatally hit Loretta Baylon, daughter of Sps Baylon.
The Sps Baylon filed a complaint for damages against FEB, BG Hauler, the driver and FGU Insurance. BG Hauler filed a cross-claim against FGU.
FEB alleged that it was not liable to Sps Baylon on ground that under its finance lease contract with BG Hauler, it was not liable for any loss, damage, or injury that the leased oil tanker might cause. It also alleged that the driver was not its employee.
BG Hauler also disclaimed liability on ground that FEB was the registered owner of the tanker. It also alleged contributory negligence on the part of the deceased.
FGU Insurance also claimed contributory negligence. It also said that it had deposited with the court P450k jointly in the names of Sps Baylon, FEB and BG Hauler.
The RTC ruled in favor of Sps Baylon holding the driver, BG Hauler (as employer), and FEB solidarily liable. The CA affirmed. The SC affirmed.
Issue
May the registered owner of a financially leased vehicle be held liable for loss, damage, or injury caused by the vehicle notwithstanding an exemption provision in the financial lease contract?
Ruling and Discussion
Yes. The registered owner of a financially leased vehicle may be held liable for loss, damage, or injury caused by the vehicle notwithstanding an exemption provision in the financial lease contract.
Insofar as third parties are concerned, the registered owner of the vehicle may be held liable for loss, damage, or injury caused to the former. This notwithstanding any provision exempting said registered owner from liability arising from the same with lessees or other parties in actual use of the vehicle.
The registered owner is not without remedy, since is may still file a cross-claim against the erring party, BG Hauler in this case. In the absence of such, the Court cannot require BG Hauler to reimburse FEB for the latter’s liability to the spouses Baylon. However, as the registered owner of the oil tanker, petitioner may not escape its liability to third persons.
With respect to the public and third persons, the registered owner of a motor vehicle is directly and primarily responsible for the consequences of its operation regardless of who the actual vehicle owner might be. The registered owner of the vehicle is liable for quasi-delicts resulting from its use. The sale, transfer or lease of the vehicle, which is not registered with the Land Transportation Office, will not bind third persons aggrieved in an accident involving the vehicle. The policy behind the rule is to enable the victim to find redress by the expedient recourse of identifying the registered vehicle owner in the records of the Land Transportation Office.
Dispositive
Petition denied, judgment and resolution affirmed.