Loss of earning capacity
By Jose C. Sison, Philstar, Dec. 21, 2016
The heirs of a victim who died due to the recklessness and negligence of other people are entitled not only to indemnity for his death, moral and exemplary damages and attorneys’ fees but also for compensation due to loss of capacity to earn. This is explained in this case of Mandy.
Mandy was the 26-year-old son of the couple Linda and Mario who just finished schooling and started to work in a newspaper as photo journalist where he was earning P200 a day. His parents were staying in their province while his office was in the city. So he usually goes home to the province every weekend.
One evening on the way home, he took a bus to visit his parents. But while the bus was traversing a diversion road, it collided with another bus running on the opposite road. As a result of the impact, several passengers died including Mandy.
Two months later after Mandy’s wake and burial, his parents Linda and Mario filed a complaint before the Regional Trial Court (RTC) for damages against both bus companies involved in the collision, and their drivers. The also claimed for loss of earning capacity, because their son’s bright future has suddenly been shattered.
After trial the RTC rendered a decision finding both bus companies solidarily liable for Mandy’s death and ordering them to pay: (1) P50,000 as civil indemnity for his death; (2) P1,296,000 for unrealized income; (3) P100,000.00 moral damages; (4) P25,000 exemplary damages; and (5) P25,000 attorney’s fees. The total amount adjudged shall earn 6 percent interest per annum from date of judgment until finality; thereafter 12 percent per annum until judgment is satisfied.
This decision was affirmed by the Court of Appeals (CA) except for the award for the unrealized income of P1,296,000 which was deleted. The bus companies were likewise ordered to pay P25,000 as temperate damages. Was the CA correct in deleting the award for unrealized income?
The Supreme Court said no. Under Article 2206 of the Civil Code, the heirs of the victim are entitled to indemnity for loss of earning capacity. Compensation of this nature is awarded not for loss of earnings, but for loss of capacity to earn. It partakes of the nature of actual damages which is duly proven usually by documentary evidence except when the deceased is self-employed and earning less than the minimum wage under current labor laws, or when he was employed as a daily wage earner earning less than the minimum wage.
In this case, the parents of Mandy presented a certification from Mandy’s employer regarding his salary to substantiate the claim for loss of earning capacity. While the signatory to such certification did not testify attesting to its genuineness and authenticity, the bus companies did not object to it during the trial. So it was deemed admitted and could be validly utilized by the trial court.
The award of loss of earning capacity based on the life expectancy of 80 years less age at the time of death multiplied by gross annual income less living expenses must be awarded to Mandy’s. In this case, such award totaled P1,296,000.This ruling is similar to the case of Spouses Enriquez vs. Isarog Line Transport et.al. G.R. 212008, November 16, 2016.