FF Cruz and co vs CA

Facts:

A fire broke up from the furniture shop of the petitioner in Caloocan city early September 6, 1974. Prior to that, neighbor of the said shop requested that the petitioner should build a firewall but failed to do so. The cause of the fire was never discovered. Private respondent got P35k from the insurance on their house and contents thereof.

Issue:

Whether or not the 35k be deducted from the damages thereof

Ruling

Since P35k had already been claimed by the respondents, the court held that such amount should be deducted from the award of damages in accordance with Art 2207 NCC

Art. 2207. If the plaintiff's property has been insured, and he has received indemnity from the insurance company for the injury or loss arising out of the wrong or breach of contract complained of, the insurance company shall be subrogated to the rights of the insured against the wrongdoer or the person who has violated the contract. If the amount paid by the insurance company does not fully cover the injury or loss, the aggrieved party shall be entitled to recover the deficiency from the person causing the loss or injury.

Having been indemnified by their insurer, private respondents are entitled only to recover the deficiency from the petitioner.

Whether or not the insurer should exercise the rights of the insured to which it had been subrogated lies solely within the former's sound discretion. Since the insurer is not a party to the case, its identity is not of record and no claim is made on its behalf, the private respondent's insurer has to claim his right to reimbursement of the P35,000.00 paid to the insured.