When to award moral damages?

As to moral damages, Article 20 of the Civil Code provides that every person who, contrary to law, willfully or negligently causes damage to another, shall indemnify the latter for the same. In addition, Article 2219 (10) of the Civil Code provides that moral damages may be recovered in acts or actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34 and 35 of the same Code. More particularly, Article 21 of the said Code provides that any person who willfully causes loss or injury to another in a manner that is contrary to morals, good customs, or public policy shall compensate the latter for the damage.In the present case, the act of Alice and Rosita in fraudulently encashing [presenting for payment] the subject check to the prejudice of respondents is certainly a violation of law as well as of the public policy that no one should put the law into his own hands. As to SBTC and its officers, their negligence is so gross as to amount to a willful injury to respondents. The banking system has become an indispensable institution in the modern world and plays a vital role in the economic life of every civilized society. Whether as mere passive entities for the safe-keeping and saving of money or as active instruments of business and commerce, banks have attained a ubiquitous presence among the people, who have come to regard them with respect and even gratitude and most of all, confidence. For this reason, banks should guard against injury attributable to negligence or bad faith on its part.

There is no hard-and-fast rule in the determination of what would be a fair amount of moral damages since each case must be governed by its own peculiar facts. The yardstick should be that it is not palpably and scandalously excessive. Moreover, the social standing of the aggrieved party is essential to the determination of the proper amount of the award. Otherwise, the goal of enabling him to obtain means, diversions, or amusements to restore him to the status quo ante would not be achieved. In the present case, the Court finds no cogent reason to modify the amount of moral damages granted by the CA. (G.R. No. 155033; December 19, 2007)