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YHT Realty V CA

The case involves multiple thefts from McLoughlin's safety deposit box at the Tropicana Hotel in Manila over several stays. McLoughlin discovered money missing from envelopes in the box on two occasions. The hotel admitted an employee named Tan had stolen McLoughlin's key to open the box. The trial court found the hotel responsible and awarded damages. The Court of Appeals affirmed. The Supreme Court also found the hotel responsible, as both keys were required to open the box and the thefts could not have occurred without hotel involvement. The Court also found an agreement limiting the hotel's responsibility to be void under the Civil Code.

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47 views

YHT Realty V CA

The case involves multiple thefts from McLoughlin's safety deposit box at the Tropicana Hotel in Manila over several stays. McLoughlin discovered money missing from envelopes in the box on two occasions. The hotel admitted an employee named Tan had stolen McLoughlin's key to open the box. The trial court found the hotel responsible and awarded damages. The Court of Appeals affirmed. The Supreme Court also found the hotel responsible, as both keys were required to open the box and the thefts could not have occurred without hotel involvement. The Court also found an agreement limiting the hotel's responsibility to be void under the Civil Code.

Uploaded by

Camtugan & Partners Law Offices
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Punay, Hahn Purnell P.

| JD-2SP | Credit Transactions

YHT Realty v. The Court of Appeals GR No. 126780 February 17, 2005

Facts: McLoughlin, an Australian businessman, usually booked the Tropicana hotel


during his trips to the Philippines. On 1987, McLoughlin registered with Tropicana and as
practice, rented a safety deposit box. The safety deposit box could only be opened through the
use of two keys, one of which is given to McLoughlin, and the other remaining in the possession
of the management. McLoughlin placed envelopes containing money, letters, credit cards,
bankbooks, and a checkbook.
McLoughlin left for a brief trip to Hongkong without checking out at the Tropicana,
taking from his safety deposit box an envelope containing US$5,000 and another with
AUS$10,000. When he arrived in Hongkong, he discovered upon counting that US$3,000,
instead of US$5,000, was in the envelope. He thought that it was just a result of bad accounting
since he did not spend anything from that envelope.
After returning to Manila, he checked out of Tropicana and left for Australia. When he
arrived in Australia, he discovered that the envelope with US$10,000 was short of US$5,000. He
also noticed that the jewelry which he bought in Hongkong and stored in the safety deposit box
upon his return to Tropicana was likewise missing. He asked the management if anything he
lost was returned to them, but to no avail.
He again registered at Tropicana and rented a safety deposit box and placed therein an
envelope containing US$15,000, another envelope containing AUS$10,000. After 12 days,
McLoughlin requested to open his safety deposit box. He noticed that in the envelope
containing US$15,000, US$2,000 were missing and in the envelope previously containing
AUS$10,000, AUS$4,500 were missing.
The management admitted that a certain Tan would steal McLoughlin’s key and open
his safety deposit box. With this, McLoughlin insisted that the hotel must assume responsibility
for the loss.
Defense of YHT Realty: "Undertaking for the Use of Safety Deposit Box, paragraphs 2 and 4":
2. To release and hold free and blameless TROPICANA APARTMENT HOTEL from any liability
arising from any loss in the contents and/or use of the said deposit box for any cause
whatsoever, including but not limited to the presentation or use thereof by any other person
should the key be lost;
4. To return the key and execute the RELEASE in favor of TROPICANA APARTMENT HOTEL upon
giving up the use of the box.
Punay, Hahn Purnell P. | JD-2SP | Credit Transactions

RTC of Manila: YHT Realty management is ordered to pay McLoughlin ₱441,000, ₱3,674,238 as
actual and consequential damages arising from the loss of his Australian and American dollars
and jewelries, ₱500,000 as moral damages, ₱350,000 as exemplary damages, litigation
expenses in the sum of ₱200,000, attorney’s fees and costs of suit.
The trial court ruled that paragraphs (2) and (4) of the "Undertaking for The Use of
Safety Deposit Box" are not valid for being contrary to the express mandate of Article 2003 of
the New Civil Code and against public policy.

Court of Appeals: Affirmed the decision of the RTC, with modifications as to costs.

Held: (1) One key is assigned to the guest while the other remains in the possession of the
management. If the guest desires to open his safety deposit box, he must request the
management for the other key to open the same. In other words, the guest alone cannot open
the safety deposit box without the assistance of the management or its employees. With more
reason that access to the safety deposit box should be denied if the one requesting for the
opening of the safety deposit box is a stranger. Thus, in case of loss of any item deposited in the
safety deposit box, it is inevitable to conclude that the management had at least a hand in the
consummation of the taking, unless the reason for the loss is force majeure.
(2) Mere close companionship and intimacy are not enough to warrant the conclusion
that Tan is the wife of McLoughlin, considering that what is involved in the instant case is the
very safety of McLoughlin's deposit. If only petitioners exercised due diligence in taking care of
McLoughlin's safety deposit box, they should have confronted him as to his relationship with
Tan considering that the latter had been observed opening McLoughlin's safety deposit box a
number of times at the early hours of the morning.
(3) The issue of whether the "Undertaking for The Use of Safety Deposit Box" executed
by McLoughlin is tainted with nullity, both the trial court and the appellate court found the
same to be null and void. We find no reason to reverse their common conclusion. Article 2003
is controlling.
Art. 2003. The hotel-keeper cannot free himself from responsibility by posting notices to the
effect that he is not liable for the articles brought by the guest. Any stipulation between the
hotel-keeper and the guest whereby the responsibility of the former as set forth in Articles
1998 to 2001 is suppressed or diminished shall be void.

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