Kinds of Damages in Philippine Law: Actual, Moral, Exemplary, Nominal, Temperate, and Liquidated
Introduction
In Philippine jurisprudence, the concept of damages is rooted in the Civil Code of the Philippines (Republic Act No. 386), particularly under Title XVIII on Damages. Damages refer to the sum of money awarded to a person who has suffered loss or injury due to the wrongful act or omission of another. The primary purpose of damages is to indemnify the injured party, deter wrongful conduct, or vindicate rights, depending on the type. Philippine law recognizes six main kinds of damages: actual, moral, exemplary, nominal, temperate, and liquidated. These are classified based on the nature of the injury, the intent behind the act, and the circumstances surrounding the case.
The Civil Code provides the foundational framework, supplemented by judicial interpretations from the Supreme Court. Actual damages compensate for proven pecuniary losses, while moral damages address non-pecuniary harm like emotional distress. Exemplary damages serve a punitive function, nominal damages affirm violated rights without substantial loss, temperate damages apply when exact amounts are hard to prove, and liquidated damages are pre-agreed upon in contracts. Understanding these distinctions is crucial for litigants, as courts award damages based on evidence, equity, and public policy. Multiple types can be awarded in a single case if justified.
This article explores each kind in detail, including their legal bases, requisites for award, computation methods, limitations, and illustrative applications in Philippine contexts such as torts, contracts, and crimes.
Actual Damages
Actual damages, also known as compensatory damages, are the most straightforward type, aimed at reimbursing the injured party for the exact value of the loss suffered. Under Article 2199 of the Civil Code, a person is entitled to adequate compensation for pecuniary loss directly resulting from the wrongful act, provided such loss is proven with reasonable certainty.
Requisites and Proof
To recover actual damages, the claimant must establish: (1) the existence of a wrongful act or omission; (2) a causal connection between the act and the damage; and (3) the amount of loss with competent evidence. Mere allegations are insufficient; receipts, invoices, appraisals, or expert testimony are typically required. For instance, in cases of property damage from negligence, the cost of repairs or replacement value must be substantiated.
Actual damages cover two subcategories: dano emergente (loss of what one already has, like medical expenses) and lucro cesante (loss of expected profits, such as lost income from business interruption). In breach of contract cases (Article 2201), the obligor is liable for foreseeable damages, while in quasi-delicts (Article 2202), liability extends to all natural and probable consequences.
Limitations and Exceptions
Interest may be added from the date of judicial demand (Article 2209-2213), typically at 6% per annum for obligations not involving loans. In criminal cases with civil liability (Article 100 of the Revised Penal Code), actual damages can be claimed alongside moral or exemplary ones. However, if the loss is not proven, actual damages cannot be awarded; courts may instead grant temperate damages.
Applications in Philippine Context
In labor disputes, actual damages include backwages for illegal dismissal. In medical malpractice suits, they cover hospital bills and lost earnings. Supreme Court rulings, such as in People v. Jugueta (2016), emphasize that actual damages must be itemized and supported by evidence to avoid speculation.
Moral Damages
Moral damages compensate for non-physical injuries, including mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation, and similar harms. Governed by Articles 2217-2220 of the Civil Code, they are awarded when the act causes emotional or psychological suffering, regardless of pecuniary loss.
Requisites and Proof
The key elements are: (1) a factual basis for the suffering; (2) proximate cause linking the defendant's act to the injury; and (3) the suffering must be a direct result of a crime, quasi-delict, or breach of contract involving bad faith or gross negligence. Unlike actual damages, quantification is discretionary and based on the court's assessment of circumstances, not strict proof of amount. Testimony from the victim or witnesses suffices to establish the existence of suffering.
Moral damages are not punitive but restorative, aiming to alleviate intangible harm. They are recoverable in cases like defamation (Article 2219(7)), malicious prosecution, or wrongful death.
Limitations and Exceptions
They cannot be awarded to juridical persons (e.g., corporations) as they lack feelings, though natural persons representing them might claim personally. In contracts, moral damages require bad faith (Article 2220). Courts temper awards to prevent unjust enrichment, often ranging from PHP 10,000 to PHP 500,000 depending on severity.
Applications in Philippine Context
In family law, moral damages are common in annulment cases involving psychological incapacity or adultery. In human rights violations, such as during martial law claims under the Human Rights Victims Reparation Act, they address trauma. The Supreme Court in Expertravel & Tours, Inc. v. Court of Appeals (2005) clarified that moral damages require evidence of bad faith in breach of contract scenarios.
Exemplary Damages
Exemplary damages, also called punitive or corrective damages, are imposed to deter the wrongdoer and others from similar acts, serving a public policy function. Under Articles 2229-2235 of the Civil Code, they are awarded in addition to moral, temperate, or compensatory damages when the defendant acted with gross negligence, recklessness, or in a wanton, fraudulent, or malevolent manner.
Requisites and Proof
Prerequisites include: (1) entitlement to moral, temperate, or compensatory damages; (2) the act must warrant correction or example; and (3) evidence of aggravating circumstances. They are not standalone; actual or moral damages must first be proven. The amount is discretionary, considering the defendant's financial capacity and the gravity of the offense.
In criminal cases (Article 2230), exemplary damages require proof of aggravating circumstances under the Revised Penal Code. In contracts or quasi-contracts (Article 2232), they apply if the defendant acted fraudulently or in bad faith.
Limitations and Exceptions
They are not recoverable against the government or in cases of simple negligence. Awards are moderated to align with deterrence without being excessive, often 10-50% of actual damages.
Applications in Philippine Context
In product liability cases, exemplary damages punish manufacturers for defective goods causing harm. In environmental torts, like oil spills, they deter corporate negligence. The Supreme Court in Mendoza v. Court of Appeals (1994) upheld exemplary damages in a quasi-delict involving reckless driving, emphasizing their role in public safety.
Nominal Damages
Nominal damages are awarded to vindicate or recognize a legal right that has been violated, without need for proof of actual loss. Per Articles 2221-2223 of the Civil Code, they apply when a right is infringed but no substantial injury or damage results, or when damages are unquantifiable.
Requisites and Proof
Elements: (1) violation of a right; (2) no pecuniary loss suffered; and (3) the award serves to affirm the right. They are symbolic, typically small amounts like PHP 1,000 to PHP 10,000, and do not require evidence of harm beyond the violation itself.
Nominal damages differ from moral ones by not addressing suffering; they merely acknowledge the breach.
Limitations and Exceptions
They cannot coexist with actual damages for the same act, as actual losses would warrant compensatory relief. In trespass cases without damage, they are appropriate.
Applications in Philippine Context
In property disputes, nominal damages are awarded for technical trespass. In election protests where a candidate's right is violated but no win is proven, they vindicate the process. The Supreme Court in Roble v. Arbasa (2001) awarded nominal damages for breach of contract without proven loss.
Temperate Damages
Temperate or moderate damages are granted when pecuniary loss is established but its exact amount cannot be proven with certainty. Under Articles 2224-2225 of the Civil Code, courts may award a reasonable amount based on equity and the facts of the case.
Requisites and Proof
Requirements: (1) some pecuniary loss occurred; (2) the precise amount is unprovable; and (3) the award is fair under the circumstances. They bridge the gap between actual and nominal damages, often used in death or injury cases where future losses are speculative.
The court exercises discretion, considering averages or estimates.
Limitations and Exceptions
They cannot be awarded if actual damages are fully proven or if no loss exists. They are subordinate to actual damages.
Applications in Philippine Context
In wrongful death suits, temperate damages cover funeral expenses when receipts are lost. In business interruption from force majeure, they approximate lost profits. The Supreme Court in People v. Lagman (2010) applied temperate damages for unproven medical costs in a homicide case.
Liquidated Damages
Liquidated damages are pre-determined amounts stipulated in a contract to be paid in case of breach, as per Articles 2226-2228 of the Civil Code. They simplify compensation by avoiding proof of actual loss.
Requisites and Proof
They must be: (1) agreed upon in the contract; (2) reasonable and not unconscionable; and (3) triggered by breach. No further proof of damage is needed unless the stipulation is challenged as a penalty.
Courts may reduce excessive amounts if partial performance occurred or if they are iniquitous.
Limitations and Exceptions
They are void if intended as a penalty without relation to potential loss. In obligations with penal clauses, they can include interest.
Applications in Philippine Context
In construction contracts, liquidated damages penalize delays per day. In lease agreements, they cover unpaid rent. The Supreme Court in SS Ventures International, Inc. v. SS Ventures Labor Union (2008) enforced liquidated damages but reduced them for equity.
Interplay and Multiple Awards
Philippine courts often award combinations, such as actual and moral in torts, or exemplary with moral in gross negligence cases. Under Article 2234, exemplary damages require separate pleading. The totality principle ensures awards are just, not excessive.
In criminal proceedings, civil damages are integrated (Rule 111, Rules of Court), allowing simultaneous recovery. Interest and attorney's fees (Article 2208) may augment damages.
Conclusion
The kinds of damages in Philippine law embody principles of justice, equity, and deterrence, ensuring victims are made whole while holding wrongdoers accountable. Litigants must align claims with evidence and Civil Code provisions, as judicial discretion plays a key role. These mechanisms foster a balanced legal system, adapting to diverse contexts from personal injuries to contractual disputes.