Vda. de Gabriel vs. Court of Appeals

Vda. de Gabriel vs.
Court of Appeals
(Insurance Law)
264 SCRA 137 (G.R. No. 103883)
November 11, 1996
Petitioners: Jacqueline Jimenez Vda. de Gabriel

Respondents Court of Appeals and Fortune Insurance and
: Surety Company, Inc.
J. Vitug:
FACTS:
The petitioner for review on certiorari seeks the reversal of the

decision of the Court of Appeals setting aside the judgment of the
Regional Trial Court which ordered private respondent Fortune
Insurance and Surety Company, Inc., to pay petitioner Jacqueline
Jimenez Vda. de Gabriel, the surviving spouse and beneficiary in
an accident (group) insurance of her dead husband, the amount
of ₱100,000.00, plus legal interest.
Marcelino Gabriel, the insured, was employed by Emerald

Construction & Development Corporation (“ECDC”) at its
construction project in Iraq. He was covered by a personal
accident insurance in the amount of ₱100,000.00 under a group
policy procured from private respondent by ECDC for its overseas
workers.
On May 22, 1982, within the life of the policy, Gabriel died in Iraq.
A year later, or on July 12, 1983, ECDC reported Gabriel’s death to
private respondent by telephone. Ultimately private respondent
denied the claim of ECDC on the ground of prescription. Petitioner
went to court alleging that her husband died of electrocution
while working.
ISSUE:
Whether or not the cause of action had prescribed.
HELD:
Yes. On the issue of “prescription”, private respondent correctly

invoked Section 384 of the Insurance Code; viz: “Sec. 384. Any
person having any claim upon the policy issued pursuant to this
chapter shall without any unnecessary delay, present to the
insurance company concerned a written notice of claim setting
forth the nature, extent and duration of the injuries sustained as
certified by a duly licensed physician. Notice of claim must be
filed within six months from date of the accident, otherwise, the
claim shall be deemed waived. Action or suit for recovery of
damage due to loss or injury must be brought, in proper cases,
with the Commissioner on the Courts within one year from the
denial of the claim, otherwise, the claimant’s right of action shall
prescribe.” The notice of death was given to private respondent,
concededly, more than a year after the death of petitioner’s
husband. Private respondent in invoking prescription, was not
referring to the one-year period from the denial of the claim
within which to file an action against an insurer but obviously to
the written notice of claim that had to be submitted within six
months from the time of the accident.
Yes. The petitioner’s claim that the insurance covered only the
building and not the elevator is absured, to say the least. This
Court has little patience with puerile arguments that affront
common sense, let alone basic legal principles with which even
law students are familiar. The circumstance that the building
insured is seven stories high and so had to be provided with
elevators a legal requirement known to the petitioner as an
insurance company makes its contention all the more ridiculous.
No less preposterous is the petitioner’s claim that the elevators

were insured after the occurrence of the fire, a case of shutting
the barn door after the horse had escaped, so to speak. This
pretense merits scant attention. Equally underserving of serious is
its submission that the elevators were not damaged by the fire,
against the report of arson investigators of the INP and indeed, its
own expressed admission in its answer where it affirmed that the
fire “damaged or destroyed a portion of the 7 th floor of the insured
building and more particularly a Hitachi elevator control panel.”
The petitioner argues that since at the time of the fire the building
insured was worth ₱5,800,000.00, the private respondent should
be considered its own insurer for the difference between that
amount and the face value of the policy and should share pro rata
in the loss sustained. Accordingly, the private respondent is
entitled to an indemnity of only ₱67,629.31, the rest of the loss to
be shouldered by it alone. In support of this contention, the
petitioner cites Condition 17 of the policy, which provides: xxx.
However, there is no evidence on record that the building was
worth ₱5,800,000.00 at the time of the loss; only the petitioner
says so and it does not back up its self-serving estimate with any
independent corroboration. On the contrary, the building was
insured at ₱2,500,000.00, and this must be considered, by
agreement of the insurer and the insured, the actual value of the
property insured on the day the fire occurred. This valuation
becomes even more believable if it is remembered that at the
time the building was burned it was still under construction and
not yet completed.
As defined in the aforestated provision, which is not Section 60 of

the Insurance Code,” and open policy is one which the value of
the thing insured is not agreed upon but is left to be ascertained
in case of loss.” This means that the actual loss, as determined
will represent the total indemnity due the insured from the insurer
except only that the total indemnity shall not be exceed the face
value of the policy.
The actual loss has been ascertained in this case and, to repeat,
this Court will respect such factual determination in the absence
of proof that it was arrived at arbitrarily. There is no such
showing. Hence, applying the open policy clause as expressly
agreed upon by the parties in their contract we hold that the
private respondent is entitled to the payment of indemnity under
the said contract in the total amount of ₱508,867.00.

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Vda. de Gabriel vs.

Petitioners: Jacqueline Jimenez Vda. de Gabriel

The petitioner for review on certiorari seeks the reversal of the

Marcelino Gabriel, the insured, was employed by Emerald

Whether or not the cause of action had prescribed.

Yes. On the issue of “prescription”, private respondent correctly

No less preposterous is the petitioner’s claim that the elevators

As defined in the aforestated provision, which is not Section 60 of

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