G.R. No.

107518 October 8, 1998

PNOC SHIPPING AND TRANSPORT CORPORATION, petitioner,

vs.
HONORABLE COURT OF APPEALS and MARIA EFIGENIA FISHING
CORPORATION, respondents.

ROMERO, J.:

A party is entitled to adequate compensation only for such pecuniary loss actually suffered
and duly proved.  Indeed, basic is the rule that to recover actual damages, the amount
1

of loss must not only be capable of proof but must actually be proven with a
reasonable degree of certainty, premised upon competent proof or best evidence
obtainable of the actual amount thereof.  The claimant is duty-bound to point out
2

specific facts that afford a basis for measuring whatever compensatory damages are
borne.  A court cannot merely rely on speculations, conjectures, or guesswork as to
3

the fact and amount of damages  as well as hearsay  or uncorroborated testimony
4 5

whose truth is suspect.  Such are the jurisprudential precepts that the Court now
6

applies in resolving the instant petition.

The records disclose that in the early morning of September 21, 1977, the M/V Maria
Efigenia XV, owned by private respondent Maria Efigenia Fishing Corporation, was
navigating the waters near Fortune Island in Nasugbu, Batangas on its way to
Navotas, Metro Manila when it collided with the vessel Petroparcel which at the time
was owned by the Luzon Stevedoring Corporation (LSC).

After investigation was conducted by the Board of Marine Inquiry, Philippine Coast
Guard Commandant Simeon N. Alejandro rendered a decision finding
the Petroparcel at fault. Based on this finding by the Board and after unsuccessful
demands on petitioner,   private respondent sued the LSC and
7

the Petroparcel captain, Edgardo Doruelo, before the then Court of First Instance of

Caloocan City, paying thereto the docket fee of one thousand two hundred fifty-two
pesos (P1,252.00) and the legal research fee of two pesos (P2.00).   In particular,
8

private respondent prayed for an award of P692,680.00, allegedly representing the

value of the fishing nets, boat equipment and cargoes of M/V Maria Efigenia XV, with
interest at the legal rate plus 25% thereof as attorney's fees. Meanwhile, during the
pendency of the case, petitioner PNOC Shipping and Transport Corporation sought
to be substituted in place of LSC as it had already acquired ownership of
the Petroparcel.  9

For its part, private respondent later sought the amendment of its complaint on the
ground that the original complaint failed to plead for the recovery of the lost value of
the hull of M/V Maria Efigenia XV.   Accordingly, in the amended complaint, private
10

respondent averred that M/V Maria Efigenia XV had an actual value of P800,000.00

and that, after deducting the insurance payment of P200,000.00, the amount of
P600,000.00 should likewise be claimed. The amended complaint also alleged that
inflation resulting from the devaluation of the Philippine peso had affected the
replacement value of the hull of the vessel, its equipment and its lost cargoes, such
that there should be a reasonable determination thereof. Furthermore, on account of
the sinking of the vessel, private respondent supposedly incurred unrealized profits
and lost business opportunities that would thereafter be proven.  11

Subsequently, the complaint was further amended to include petitioner as a

defendant   which the lower court granted in its order of September 16,
12

1985.   After petitioner had filed its answer to the second amended complaint, on
13

February 5, 1987, the lower court issued a pre-trial order   containing, among other
14

things, a stipulations of facts, to wit:

1. On 21 September 1977, while the fishing boat "M/V MARIA EFIGENIA"

owned by plaintiff was navigating in the vicinity of Fortune Island in
Nasugbu, Batangas, on its way to Navotas, Metro Manila, said fishing
boat was hit by the LSCO tanker "Petroparcel" causing the former to
sink.

2. The Board of Marine Inquiry conducted an investigation of this

marine accident and on 21 November 1978, the Commandant of the
Philippine Coast Guard, the Honorable Simeon N. Alejandro, rendered a
decision finding the cause of the accident to be the reckless and
imprudent manner in which Edgardo Doruelo navigated the LSCO
"Petroparcel" and declared the latter vessel at fault.

3. On 2 April 1978, defendant Luzon Stevedoring Corporation

(LUSTEVECO), executed in favor of PNOC Shipping and Transport
Corporation a Deed of Transfer involving several tankers, tugboats,
barges and pumping stations, among which was the LSCO Petroparcel.

4. On the same date on 2 April 1979 (sic), defendant PNOC STC again
entered into an Agreement of Transfer with co-defendant Lusteveco
whereby all the business properties and other assets appertaining to
the tanker and bulk oil departments including the motor tanker LSCO
Petroparcel of defendant Lusteveco were sold to PNOC STC.

5. The aforesaid agreement stipulates, among others, that PNOC-STC

assumes, without qualifications, all obligations arising from and by
virtue of all rights it obtained over the LSCO "Petroparcel".

6. On 6 July 1979, another agreement between defendant LUSTEVECO

and PNOC-STC was executed wherein Board of Marine Inquiry Case No.
332 (involving the sea accident of 21 September 1977) was specifically
identified and assumed by the latter.

7. On 23 June 1979, the decision of Board of Marine Inquiry was

affirmed by the Ministry of National Defense, in its decision dismissing
 the appeal of Capt. Edgardo Doruelo and Chief mate Anthony Estenzo
of LSCO "Petroparcel".

8. LSCO "Petroparcel" is presently owned and operated by PNOC-STC

and likewise Capt. Edgardo Doruelo is still in their employ.

9. As a result of the sinking of M/V Maria Efigenia caused by the

reckless and imprudent manner in which LSCO Petroparcel was
navigated by defendant Doruelo, plaintiff suffered actual damages by
the loss of its fishing nets, boat equipments (sic) and cargoes, which
went down with the ship when it sank the replacement value of which
should be left to the sound discretion of this Honorable Court.

After trial, the lower court   rendered on November 18, 1989 its decision disposing of
15

Civil Case No. C-9457 as follows:

WHEREFORE, and in view of the foregoing, judgment is hereby

rendered in favor of the plaintiff and against the defendant PNOC
Shipping & Transport Corporation, to pay the plaintiff:

a. The sum of P6,438,048.00 representing the value of the

fishing boat with interest from the date of the filing of the
complaint at the rate of 6% per annum;

b. The sum of P50,000.00 as and for attorney's fees; and

c. The costs of suit.

The counterclaim is hereby DISMISSED for lack of merit. Likewise, the

case against defendant Edgardo Doruelo is hereby DISMISSED, for lack
of jurisdiction.

SO ORDERED.

In arriving at the above disposition, the lower court cited the evidence presented by
private respondent consisting of the testimony of its general manager and sole
witness, Edilberto del Rosario. Private respondent's witness testified that M/V Maria
Efigenia XV was owned by private respondent per Exhibit A, a certificate of
ownership issued by the Philippine Coast Guard showing that M/V Maria Efigenia
XV was a wooden motor boat constructed in 1965 with 128.23 gross tonnage.
According to him, at the time the vessel sank, it was then carrying 1,060 tubs
(bañeras) of assorted fish the value of which was never recovered. Also lost with the
vessel were two cummins engines (250 horsepower), radar, pathometer and
compass. He further added that with the loss of his flagship vessel in his fishing fleet
of fourteen (14) vessels, he was constrained to hire the services of counsel whom he
paid P10,000 to handle the case at the Board of Marine Inquiry and P50,000.00 for
commencing suit for damages in the lower court.
As to the award of P6,438,048.00 in actual damages, the lower court took into
account the following pieces of documentary evidence that private respondent
proffered during trial:

(a) Exhibit A — certified xerox copy of the certificate of

ownership of M/V Maria Efigenia XV;

(b) Exhibit B — a document titled "Marine Protest"

executed by Delfin Villarosa, Jr. on September 22, 1977
stating that as a result of the collision, the M/V Maria
Efigenia XV sustained a hole at its left side that caused it
to sink with its cargo of 1,050 bañeras valued at
P170,000.00;

(c) Exhibit C — a quotation for the construction of a 95-

footer trawler issued by Isidoro A. Magalong of I. A.
Magalong Engineering and Construction on January 26,
1987 to Del Rosario showing that construction of such
trawler would cost P2,250,000.00;

(d) Exhibit D — pro forma invoice No. PSPI-05/87-NAV

issued by E.D. Daclan of Power Systems, Incorporated on
January 20, 1987 to Del Rosario showing that two (2) units
of CUMMINS Marine Engine model N855-M, 195 bhp. at
1800 rpm. would cost P1,160,000.00;

(e) Exhibit E — quotation of prices issued by Scan Marine

Inc. on January 20, 1987 to Del Rosario showing that a unit
of Furuno Compact Daylight Radar, Model FR-604D, would
cost P100,000.00 while a unit of Furuno Color Video
Sounder, Model FCV-501 would cost P45,000.00 so that the
two units would cost P145,000.00;

(f) Exhibit F — quotation of prices issued by Seafgear

Sales, Inc. on January 21, 1987 to Del Rosario showing that
two (2) rolls of nylon rope (5" cir. X 300fl.) would cost
P140,000.00; two (2) rolls of nylon rope (3" cir. X 240fl.),
P42,750.00; one (1) binocular (7 x 50), P1,400.00, one (1)
compass (6"), P4,000.00 and 50 pcs. of floats, P9,000.00 or
a total of P197,150.00;

(g) Exhibit G — retainer agreement between Del Rosario

and F. Sumulong Associates Law Offices stipulating an
acceptance fee of P5,000.00, per appearance fee of
P400.00, monthly retainer of P500.00, contingent fee of
20% of the total amount recovered and that attorney's fee
to be awarded by the court should be given to Del Rosario;
and
 (h) Exhibit H — price quotation issued by Seafgear Sales,
Inc. dated April 10, 1987 to Del Rosario showing the cost of
poly nettings as: 50 rolls of 400/18 3kts. 100md x 100mtrs.,
P70,000.00; 50 rolls of 400/18 5kts. 100md x 100mtrs.,
P81,500.00; 50 rolls of 400/18 8kts. 100md x 100mtrs.,
P116,000.00, and 50 rolls of 400/18 10kts. 100md x
100mtrs., P146,500 and bañera (tub) at P65.00 per piece or
a total of P414,065.00.

The lower court held that the prevailing replacement value of P6,438,048.00 of the
fishing boat and all its equipment would regularly increase at 30% every year from
the date the quotations were given.

On the other hand, the lower court noted that petitioner only presented Lorenzo
Lazaro, senior estimator at PNOC Dockyard & Engineering Corporation, as sole
witness and it did not bother at all to offer any documentary evidence to support its
position. Lazaro testified that the price quotations submitted by private respondent
were "excessive" and that as an expert witness, he used the quotations of his
suppliers in making his estimates. However, he failed to present such quotations of
prices from his suppliers, saying that he could not produce a breakdown of the costs
of his estimates as it was "a sort of secret scheme." For this reason, the lower court
concluded:

Evidently, the quotation of prices submitted by the plaintiff relative to

the replacement value of the fishing boat and its equipments in the tune
of P6,438,048.00 which were lost due to the recklessness and
imprudence of the herein defendants were not rebutted by the latter
with sufficient evidence. The defendants through their sole witness
Lorenzo Lazaro relied heavily on said witness' bare claim that the
amount afore-said is excessive or bloated, but they did not bother at all
to present any documentary evidence to substantiate such claim.
Evidence to be believed must not only proceed from the mouth of the
credible witness, but it must be credible in itself. (Vda. de Bonifacio vs.
B. L. T. Bus Co., Inc. L-26810, August 31, 1970).

Aggrieved, petitioner filed a motion for the reconsideration of the lower court's
decision contending that: (1) the lower court erred in holding it liable for damages;
that the lower court did not acquire jurisdiction over the case by paying only
P1,252.00 as docket fee; (2) assuming that plaintiff was entitled to damages, the
lower court erred in awarding an amount greater than that prayed for in the second
amended complaint; and (3) the lower court erred when it failed to resolve the issues
it had raised in its memorandum.   Petitioner likewise filed a supplemental motion for
16

reconsideration expounding on whether the lower court acquired jurisdiction over

the subject matter of the case despite therein plaintiff's failure to pay the prescribed
docket fee. 
17

On January 25, 1990, the lower court declined reconsideration for lack of
merit.   Apparently not having received the order denying its motion for
18
reconsideration, petitioner still filed a motion for leave to file a reply to private
respondent's opposition to said motion.   Hence, on February 12, 1990, the lower
19

court denied said motion for leave to file a reply on the ground that by the issuance
of the order of January 25, 1990, said motion had become moot and academic.  20

Unsatisfied with the lower court's decision, petitioner elevated the matter to the Court
of Appeals which, however, affirmed the same in toto on October 14, 1992.   On21

petitioner's assertion that the award of P6,438,048.00 was not convincingly proved by
competent and admissible evidence, the Court of Appeals ruled that it was not
necessary to qualify Del Rosario as an expert witness because as the owner of the
lost vessel, "it was well within his knowledge and competency to identify and
determine the equipment installed and the cargoes loaded" on the vessel.
Considering the documentary evidence presented as in the nature of market reports
or quotations, trade journals, trade circulars and price lists, the Court of Appeals
held, thus:

Consequently, until such time as the Supreme Court categorically rules

on the admissibility or inadmissibility of this class of evidence, the
reception of these documentary exhibits (price quotations) as evidence
rests on the sound discretion of the trial court. In fact, where the lower
court is confronted with evidence which appears to be of doubtful
admissibility, the judge should declare in favor of admissibility rather
than of non-admissibility (The Collector of Palakadhari, 124 [1899], p.
13, cited in Francisco, Revised Rules of Court, Evidence, Volume VII,
Part I, 1990 Edition, p. 18). Trial courts are enjoined to observe the strict
enforcement of the rules of evidence which crystallized through
constant use and practice and are very useful and effective aids in the
search for truth and for the effective administration of justice. But in
connection with evidence which may appear to be of doubtful relevancy
or incompetency or admissibility, it is the safest policy to be liberal, not
rejecting them on doubtful or technical grounds, but admitting them
unless plainly irrelevant, immaterial or incompetent, for the reason that
their rejection places them beyond the consideration of the court. If they
are thereafter found relevant or competent, can easily be remedied by
completely discarding or ignoring them. (Banaria vs. Banaria, et al., C.A.
No. 4142, May 31, 1950; cited in Francisco, Supra). [Emphasis supplied].

Stressing that the alleged inadmissible documentary exhibits were never

satisfactorily rebutted by appellant's own sole witness in the person of Lorenzo
Lazaro, the appellate court found that petitioner ironically situated itself in an
"inconsistent posture by the fact that its own witness, admittedly an expert one,
heavily relies on the very same pieces of evidence (price quotations) appellant has
so vigorously objected to as inadmissible evidence." Hence, it concluded:

. . . The amount of P6,438,048.00 was duly established at the trial on the

basis of appellee's documentary exhibits (price quotations) which stood
uncontroverted, and which already included the amount by way of
adjustment as prayed for in the amended complaint. There was
 therefore no need for appellee to amend the second amended complaint
in so far as to the claim for damages is concerned to conform with the
evidence presented at the trial. The amount of P6,438,048.00 awarded is
clearly within the relief prayed for in appellee's second amended
complaint.

On the issue of lack of jurisdiction, the respondent court held that following the
ruling in Sun Insurance Ltd. v. Asuncion,   the additional docket fee that may later on
22

be declared as still owing the court may be enforced as a lien on the judgment.

Hence, the instant recourse.

In assailing the Court of Appeals' decision, petitioner posits the view that the award
of P6,438,048 as actual damages should have been in light of these considerations,
namely: (1) the trial court did not base such award on the actual value of the vessel
and its equipment at the time of loss in 1977; (2) there was no evidence on
extraordinary inflation that would warrant an adjustment of the replacement cost of
the lost vessel, equipment and cargo; (3) the value of the lost cargo and the prices
quoted in respondent's documentary evidence only amount to P4,336,215.00; (4)
private respondent's failure to adduce evidence to support its claim for unrealized
profit and business opportunities; and (5) private respondent's failure to prove the
extent and actual value of damages sustained as a result of the 1977 collision of the
vessels. 23

Under Article 2199 of the Civil Code, actual or compensatory damages are those
awarded in satisfaction of, or in recompense for, loss or injury sustained. They
proceed from a sense of natural justice and are designed to repair the wrong that has
been done, to compensate for the injury inflicted and not to impose a penalty.   In 24

actions based on torts or quasi-delicts, actual damages include all the natural and
probable consequences of the act or omission complained of.   There are two kinds
25

of actual or compensatory damages: one is the loss of what a person already

possesses (daño emergente), and the other is the failure to receive as a benefit that
which would have pertained to him (lucro cesante).   Thus:
26

Where goods are destroyed by the wrongful act of the defendant the
plaintiff is entitled to their value at the time of destruction, that is,
normally, the sum of money which he would have to pay in the market
for identical or essentially similar goods, plus in a proper case damages
for the loss of use during the period before replacement. In other words,
in the case of profit-earning chattels, what has to be assessed is the
value of the chattel to its owner as a going concern at the time and
place of the loss, and this means, at least in the case of ships, that
regard must be had to existing and pending engagements, . . .

. . . . If the market value of the ship reflects the fact that it is in any case
virtually certain of profitable employment, then nothing can be added to
that value in respect of charters actually lost, for to do so would be pro
tanto to compensate the plaintiff twice over. On the other hand, if the
 ship is valued without reference to its actual future engagements and
only in the light of its profit-earning potentiality, then it may be
necessary to add to the value thus assessed the anticipated profit on a
charter or other engagement which it was unable to fulfill. What the
court has to ascertain in each case is the "capitalised value of the
vessel as a profit-earning machine not in the abstract but in view of the
actual circumstances," without, of course, taking into account
considerations which were too remote at the time of the
loss.   [Emphasis supplied].
27

As stated at the outset, to enable an injured party to recover actual or compensatory

damages, he is required to prove the actual amount of loss with reasonable degree of
certainty premised upon competent proof and on the best evidence available.   The
28

burden of proof is on the party who would be defeated if no evidence would be

presented on either side. He must establish his case by a preponderance of evidence
which means that the evidence, as a whole, adduced by one side is superior to that
of the other.   In other words, damages cannot be presumed and courts, in making an
29

award must point out specific facts that could afford a basis for measuring whatever
compensatory or actual damages are borne.  30

In this case, actual damages were proven through the sole testimony of private
respondent's general manager and certain pieces of documentary evidence. Except
for Exhibit B where the value of the 1,050 bañeras of fish were pegged at their
September 1977 value when the collision happened, the pieces of documentary
evidence proffered by private respondent with respect to items and equipment lost
show similar items and equipment with corresponding prices in early 1987 or
approximately ten (10) years after the collision. Noticeably, petitioner did not object
to the exhibits in terms of the time index for valuation of the lost goods and
equipment. In objecting to the same pieces of evidence, petitioner commented that
these were not duly authenticated and that the witness (Del Rosario) did not have
personal knowledge on the contents of the writings and neither was he an expert on
the subjects thereof.   Clearly ignoring petitioner's objections to the exhibits, the
31

lower court admitted these pieces of evidence and gave them due weight to arrive at
the award of P6,438,048.00 as actual damages.

The exhibits were presented ostensibly in the course of Del Rosario's testimony.
Private respondent did not present any other witnesses especially those whose
signatures appear in the price quotations that became the bases of the award. We
hold, however, that the price quotations are ordinary private writings which under the
Revised Rules of Court should have been proffered along with the testimony of the
authors thereof. Del Rosario could not have testified on the veracity of the contents
of the writings even though he was the seasoned owner of a fishing fleet because he
was not the one who issued the price quotations. Section 36, Rule 130 of the Revised
Rules of Court provides that a witness can testify only to those facts that he knows
of his personal knowledge.

For this reason, Del Rosario's claim that private respondent incurred losses in the
total amount of P6,438,048.00 should be admitted with extreme caution considering
that, because it was a bare assertion, it should be supported by independent
evidence. Moreover, because he was the owner of private respondent
corporation   whatever testimony he would give with regard to the value of the lost
32

vessel, its equipment and cargoes should be viewed in the light of his self-interest
therein. We agree with the Court of Appeals that his testimony as to the equipment
installed and the cargoes loaded on the vessel should be given
credence   considering his familiarity thereto. However, we do not subscribe to the
33

conclusion that his valuation of such equipment, cargo and the vessel itself should
be accepted as gospel truth.   We must, therefore, examine the documentary
34

evidence presented to support Del Rosario's claim as regards the amount of losses.

The price quotations presented as exhibits partake of the nature of hearsay evidence
considering that the persons who issued them were not presented as
witnesses.   Any evidence, whether oral or documentary, is hearsay if its probative
35

value is not based on the personal knowledge of the witness but on the knowledge of
another person who is not on the witness stand. Hearsay evidence, whether objected
to or not, has no probative value unless the proponent can show that the evidence
falls within the exceptions to the hearsay evidence rule.   On this point, we believe
36

that the exhibits do not fall under any of the exceptions provided under Sections 37
to 47 of Rule 130.  37

It is true that one of the exceptions to the hearsay rule pertains to "commercial lists
and the like" under Section 45, Rule 130 of the Revised Rules on Evidence. In this
respect, the Court of Appeals considered private respondent's exhibits as
"commercial lists." It added, however, that these exhibits should be admitted in
evidence "until such time as the Supreme Court categorically rules on the
admissibility or inadmissibility of this class of evidence" because "the reception of
these documentary exhibits (price quotations) as evidence rests on the sound
discretion of the trial court."   Reference to Section 45, Rule 130, however, would
38

show that the conclusion of the Court of Appeals on the matter was arbitrarily arrived
at. This rule states:

Commercial lists and the like. — Evidence of statements of matters of

interest to persons engaged in an occupation contained in a list,
register, periodical, or other published compilation is admissible as
tending to prove the truth of any relevant matter so stated if that
compilation is published for use by persons engaged in that occupation
and is generally used and relied upon by them there.

Under Section 45 of the aforesaid Rule, a document is a commercial list if: (1) it is a
statement of matters of interest to persons engaged in an occupation; (2) such
statement is contained in a list, register, periodical or other published compilation;
(3) said compilation is published for the use of persons engaged in that occupation,
and (4) it is generally used and relied upon by persons in the same occupation.

Based on the above requisites, it is our considered view that Exhibits B, C, D, E, F

and H   are not "commercial lists" for these do not belong to the category of "other
39

published compilations" under Section 45 aforequoted. Under the principle

of ejusdem generis, "(w)here general words follow an enumeration of persons or
things, by words of a particular and specific meaning, such general words are not to
be construed in their widest extent, but are to be held as applying only to persons or
things of the same kind or class as those specifically mentioned."   The exhibits
40

mentioned are mere price quotations issued personally to Del Rosario who requested
for them from dealers of equipment similar to the ones lost at the collision of the two
vessels. These are not published in any list, register, periodical or other compilation
on the relevant subject matter. Neither are these "market reports or quotations"
within the purview of "commercial lists" as these are not "standard handbooks or
periodicals, containing data of everyday professional need and relied upon in the
work of the occupation."   These are simply letters responding to the queries of Del
41

Rosario. Thus, take for example Exhibit D which reads:

January 20, 1987

PROFORMA INVOICE NO. PSPI-05/87-NAV

MARIA EFIGINIA FISHING CORPORATION

Navotas, Metro Manila

Attention: MR. EDDIE DEL ROSARIO

Gentlemen:

In accordance to your request, we are pleated to quote our Cummins

Marine Engine, to wit.

Two (2) units CUMMINS Marine Engine model

N855-M, 195 bhp. at 1800 rpm., 6-cylinder in-
line, 4-stroke cycle, natural aspirated, 5 1/2 in.
x 6 in. bore and stroke, 855 cu. In.
displacement, keel-cooled, electric starting
coupled with Twin-Disc Marine gearbox
model MG-509, 4.5:1 reduction ratio, includes
oil cooler, companion flange, manual and
standard accessories as per attached sheet.

Price FOB Manila P580,000.00/unit

Total FOB Manila P1,160,000.00

TERMS : CASH

DELIVERY : 60-90 days from date of order.

VALIDITY : Subject to our final confirmation.

WARRANTY : One (1) full year against factory defect.

V
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To be sure, letters and telegrams are admissible in evidence but these are, however,
subject to the general principles of evidence and to various rules relating to
documentary evidence.   Hence, in one case, it was held that a letter from an
42

automobile dealer offering an allowance for an automobile upon purchase of a new

automobile after repairs had been completed, was not a "price current" or
"commercial list" within the statute which made such items presumptive evidence of
the value of the article specified therein. The letter was not admissible in evidence as
a "commercial list" even though the clerk of the dealer testified that he had written
the letter in due course of business upon instructions of the dealer.  43

But even on the theory that the Court of Appeals correctly ruled on the admissibility
of those letters or communications when it held that unless "plainly irrelevant,
immaterial or incompetent," evidence should better be admitted rather than rejected
on "doubtful or technical grounds,"   the same pieces of evidence, however, should
44

not have been given probative weight. This is a distinction we wish to point out.
Admissibility of evidence refers to the question of whether or not the circumstance
(or evidence) is to considered at all.   On the other hand, the probative value of
45

evidence refers to the question of whether or not it proves an issue.   Thus, a letter
46

may be offered in evidence and admitted as such but its evidentiary weight depends
upon the observance of the rules on evidence. Accordingly, the author of the letter
should be presented as witness to provide the other party to the litigation the
opportunity to question him on the contents of the letter. Being mere hearsay
evidence, failure to present the author of the letter renders its contents suspect. As
earlier stated, hearsay evidence, whether objected to or not, has no probative value.
Thus:

The courts differ as to the weight to be given to hearsay evidence

admitted without objection. Some hold that when hearsay has been
admitted without objection, the same may be considered as any other
properly admitted testimony. Others maintain that it is entitled to no
more consideration than if it had been excluded.

The rule prevailing in this jurisdiction is the latter one. Our Supreme
Court held that although the question of admissibility of evidence can
not be raised for the first time on appeal, yet if the evidence is hearsay it
 has no probative value and should be disregarded whether objected to
or not. "If no objection is made" — quoting Jones on Evidence — "it
(hearsay) becomes evidence by reason of the want of such objection
even though its admission does not confer upon it any new attribute in
point of weight. Its nature and quality remain the same, so far as its
intrinsic weakness and incompetency to satisfy the mind are
concerned, and as opposed to direct primary evidence, the latter always
prevails.

The failure of the defense counsel to object to the presentation of

incompetent evidence, like hearsay evidence or evidence that violates
the rules of res inter alios acta, or his failure to ask for the striking out
of the same does not give such evidence any probative value. But
admissibility of evidence should not be equated with weight of
evidence. Hearsay evidence whether objected to or not has no probative
value.  47

Accordingly, as stated at the outset, damages may not be awarded on the basis of
hearsay evidence.  48

Nonetheless, the non-admissibility of said exhibits does not mean that it totally
deprives private respondent of any redress for the loss of its vessel. This is because
in Lufthansa German Airlines v. Court of Appeals, 49 the Court said:

In the absence of competent proof on the actual damage suffered,

private respondent is "entitled to nominal damages which, as the law
says, is adjudicated in order that a right of the plaintiff, which has been
violated or invaded by defendant, may be vindicated and recognized,
and not for the purpose of indemnifying the plaintiff for any loss
suffered." [Emphasis supplied].

Nominal damages are awarded in every obligation arising from law, contracts, quasi-
contracts, acts or omissions punished by law, and quasi-delicts, or in every case
where property right has been invaded.   Under Article 2223 of the Civil Code, "(t)he
50

adjudication of nominal damages shall preclude further contest upon the right
involved and all accessory questions, as between the parties to the suit, or their
respective heirs and assigns."

Actually, nominal damages are damages in name only and not in fact. Where these
are allowed, they are not treated as an equivalent of a wrong inflicted but simply in
recognition of the existence of a technical injury.   However, the amount to be
51

awarded as nominal damages shall be equal or at least commensurate to the injury

sustained by private respondent considering the concept and purpose of such
damages.   The amount of nominal damages to be awarded may also depend on
52

certain special reasons extant in the case.  53

Applying now such principles to the instant case, we have on record the fact that
petitioner's vessel Petroparcel was at fault as well as private respondent's complaint
claiming the amount of P692,680.00 representing the fishing nets, boat equipment
and cargoes that sunk with the M/V Maria Efigenia XV. In its amended complaint,
private respondent alleged that the vessel had an actual value of P800,000.00 but it
had been paid insurance in the amount of P200,000.00 and, therefore, it claimed only
the amount of P600,000.00. Ordinarily, the receipt of insurance payments should
diminish the total value of the vessel quoted by private respondent in his complaint
considering that such payment is causally related to the loss for which it claimed
compensation. This Court believes that such allegations in the original and amended
complaints can be the basis for determination of a fair amount of nominal damages
inasmuch as a complaint alleges the ultimate facts constituting the plaintiffs cause of
action.   Private respondent should be bound by its allegations on the amount of its
54

claims.

With respect to petitioner's contention that the lower court did not acquire
jurisdiction over the amended complaint increasing the amount of damages claimed
to P600,000.00, we agree with the Court of Appeals that the lower court acquired
jurisdiction over the case when private respondent paid the docket fee
corresponding to its claim in its original complaint. Its failure to pay the docket fee
corresponding to its increased claim for damages under the amended complaint
should not be considered as having curtailed the lower court's jurisdiction. Pursuant
to the ruling in Sun Insurance Office, Ltd. (SIOL) v. Asuncion,   the unpaid docket fee
55

should be considered as a lien on the judgment even though private respondent

specified the amount of P600,000.00 as its claim for damages in its amended
complaint.

Moreover, we note that petitioner did not question at all the jurisdiction of the lower
court on the ground of insufficient docket fees in its answers to both the amended
complaint and the second amended complaint. It did so only in its motion for
reconsideration of the decision of the lower court after it had received an adverse
decision. As this Court held in Pantranco North Express, Inc. v. Court of
Appeals,   participation in all stages of the case before the trial court, that included
56

invoking its authority in asking for affirmative relief, effectively barred petitioner by
estoppel from challenging the court's jurisdiction. Notably, from the time it filed its
answer to the second amended complaint on April 16, 1985,   petitioner did not
57

question the lower court's jurisdiction. It was only on December 29, 1989   when it
58

filed its motion for reconsideration of the lower court's decision that petitioner raised
the question of the lower court's lack of jurisdiction. Petitioner thus foreclosed its
right to raise the issue of jurisdiction by its own inaction.

WHEREFORE, the challenged decision of the Court of Appeals dated October 14,
1992 in CA-G.R. CV No. 26680 affirming that of the Regional Trial Court of Caloocan
City, Branch 121, is hereby MODIFIED insofar as it awarded actual damages to
private respondent Maria Efigenia Fishing Corporation in the amount of
P6,438,048.00 for lack of evidentiary bases therefor. Considering the fact, however,
that: (1) technically petitioner sustained injury but which, unfortunately, was not
adequately and properly proved, and (2) this case has dragged on for almost two
decades, we believe that an award of Two Million (P2,000,000.00)   in favor of private
59

respondent as and for nominal damages is in order.

No pronouncement as to costs.

SO ORDERED.