1977 Bar Exam Question and Answer
By: Bautista, Cecille Loie G.
Topic: No Fault Indemnity Clause
Question:
Jose, driving his own car with his wife Maria, were on their way home from their respective offices when a
car driven by Pedro hit them from behind which was in turn hit by a gasoline tanker driven by Mario, causing
the car of Jose to turn turtle, thus, resulting to the death of Maria. All motor vehicles being insured, Jose
filed his claim for the death of Maria against the “NO FAULT” Insurance, Section 378 of the Insurance Code.
1. Will Jose’s claim for the death of Maria against all the insurers of the said three motor vehicles
prosper and up to what amount?
2. If Jose includes in the claim damage for his car, will the claim prosper? Why?
Answer:
1. Jose’s claim for the death of Maria will not prosper.
Under Section 378 of the Insurance Code, “Any claim for the death or injury to any third passenger or
third party pursuant to the provisions of this Chapter shall be paid without the necessity of proving fault or
negligence of any kind; Provided, that for purposes of this section, (iii) Claim may be made against one
motor vehicle only. In the case of an occupant of a vehicle, claim shall lie against the insurer of the vehicle
in which the occupant is riding.
In this case, the “NO FAULT” claim against the vehicle in which the deceased was riding is the one
authorized, but the claim against the other vehicle will not prosper.
Hence, Jose’s claim will not prosper.
2. Jose’s claim for damages for his car will not prosper.
Section 378 of the Insurance Code on “No Fault” applies only to “any claim for death or injury to any
passenger or third party”.
Here, the claim is not for any death or injury.
Hence, Jose’s claim for damages for his car will not prosper.
1977 Bar Exam Question and Answer
By: Bautista, Cecille Loie G.
Topic: Insurable Interest; Property Insurance
Question:
A owns a house worth P500, 000.00. He insured it against fire for P250, 000.00 for the period of January
1, 1977 to January 1, 1978. At the instance of B, who is a judgment creditor of A, the said house was levied
upon by the Sheriff and sold at the public auction on March 15, 1977. It was adjudicated to B for
P150,000.00 at the auction sale. B insured the house against fire for P150, 000.00 for the period from
March 16, 1977 to March 16, 1978. The house was accidentally burned on April 1, 1977.
1. May A recover under his policy?
2. May B recover under his policy?
Answers:
1. Yes, A can recover under his policy.
Under the Law on Insurance, a judgment debtor whose property has been seized on execution has an
insurable interest therein until the right to redeem or have the same set aside has been lost.
In this case, the right of A to redeem the property has not yet expired, the 12 months’ time after the
sale having not elapsed before the loss occurred. A having insurable interest at the time of the lost, he can
recover under his policy.
Hence, A can recover under policy.
2. Yes, B can recover under his policy.
Under the Law on Insurance, a purchaser at a judicial sale has an insurable interest in the property to
the extent of the amount of which he insured it, not exceeding his interest in the property.
In this case, B has still insurable interest at the time the loss occurred.
Hence, B can recover under his policy.
2004 Bar Examination Question and Answer
By: Bautista, Cecille Loie G.
Topic: Insured; Accident Policy
Question:
CNI insured SAM under a homeowner’s policy against claim for accidental injuries by neighbors. SAM’s
minor son, BOY, injured 3 children of POS, a neighbor, who sued SAM for damages. SAM’s lawyer was
ATT, who paid for his services by the insurer for reporting periodically on the case for CNI. In one report,
ATT disclosed to CNI that after his investigations, he found the injuries to the 3 children not accidental but
intentional.
SAM lost the case in court, and POS was awarded P1M for damages which he sought to collect from the
insurer. But CNI used ATT’s report to deny the claim on the ground that the injuries to POS’ 3 children were
intentional, hence excluded from the policy’s coverage. POS countered that CNI was estopped from using
ATT’s report because it was unethical for ATT to provide prejudicial information against his client to the
insurer, CNI. Who should prevail: the claimant, POS, or the insurer, CNI?
Answer:
POS should prevail.
In Finman General Assurance Corp. vs. Court of Appeals, 213 SCRA 413 (1992), the Supreme
Court held that there is no “accident” in the context of insurance policy, if it is the natural result of the
insured’s voluntary act, unaccompanied by anything unforeseen except the injury. There is no accident
when a deliberate act is performed, unless some additional and unforeseen happening occurs that brings
about the injury.
In this case, this element of deliberateness is not clearly shown from the facts of the case, especially
considering that BOY is a minor, and the injured parties are children.
Hence, POS should prevail.
