Employer Liability for Driver Negligence: R Transport v. Yu on Registered and Actual Owners

A fatal road accident on EDSA in 1993 produced a 2015 Supreme Court ruling that answers a question many accident victims and business owners still ask: when a company driver causes death or injury, who answers for the damage — the employer, the registered owner of the vehicle, or both? In R Transport Corporation v. Luisito G. Yu (G.R. No. 174161, February 18, 2015), the Court held that the employer of a negligent driver is directly and solidarily liable, and that an operator cannot escape by pointing to a registered owner who was not actually running the bus.

What happened in the case

At around 8:45 in the morning of December 12, 1993, Loreta J. Yu alighted from a passenger bus in front of Robinson's Galleria along the north-bound lane of Epifanio de los Santos Avenue. She was struck and run over by a bus driven by Antonio P. Gimena, an employee of R Transport Corporation. She was rushed to Medical City Hospital but was pronounced dead on arrival.

Luisito G. Yu, her husband, sued R Transport, Gimena, and Metro Manila Transport Corporation (MMTC) for damages. MMTC denied liability, explaining that it was merely the registered owner of the bus, which it had acquired under a government bus installment purchase program for resale to R Transport, the actual owner and operator.

The trial court ruled for the husband. It found R Transport liable for failing to prove diligence in selecting and supervising its driver, and held MMTC solidarily liable because a victim of a tort should not have to look beyond the certificate of registration to enforce a claim. The Court of Appeals affirmed, modifying the decision to make Gimena solidarily liable as well.

The issue before the Supreme Court

R Transport asked the Court to reverse the rulings. It argued that the evidence did not prove its driver was negligent, that the bus from which the victim had alighted was the proximate cause of the death, and that since it was not the registered owner of the offending bus, it could not be held liable.