FACTS: Complainant (petitioner) was the owner of a Colt Lancer, Model 1976, insured with respondent company under Private Car Policy No. MBI/PC-0704 for P35,000.00 — Own Damage; P30,000.00 — Theft; and P30,000.00 — Third Party Liability, effective May 16, 1977 to May 16, 1978. On May 9, 1978, the vehicle was brought to the Sunday Machine Works, Inc., for general check-up and repairs. On May 11, 1978, while it was in the custody of the Sunday Machine Works, the car was allegedly taken by six (6) persons and driven out to Montalban, Rizal. While travelling along Mabini St., Sitio Palyasan, Barrio Burgos, going North at Montalban, Rizal, the car figured in an accident, hitting and bumping a gravel and sand truck parked at the right side of the road going south. As a consequence, the gravel and sand truck veered to the right side of the pavement going south and the car veered to the right side of the pavement going north. The driver, Benito Mabasa, and one of the passengers died and the other four sustained physical injuries. The car, as well, suffered extensive damage. Complainant, thereafter, filed a claim for total loss with the respondent company but claim was denied. Hence, complainant was compelled to institute the present action.”||| (Villacorta v. Insurance Commission, G.R. No. L-54171, [October 28, 1980], 188 PHIL 497-504)

ISSUE: won there was no violation of authorize driver clause, won theft clause applies.

HELD: YES for both. A car owner who entrusts his car to an established car service and repair shop necessarily entrusts his car key to the shop owner and employees who are presumed to have the insured’s permission to drive the car for legitimate purposes of checking or road-testing the car. The mere happenstance that the employee(s) of the shop owner diverts the use of the car to his own illicit or unauthorized purpose in violation of the trust reposed in the shop by the insured car owner does not mean that the “authorized driver” clause has been violated such as to bar recovery, provided that such employee is duly qualified to drive under a valid driver’s license.

The situation is no different from the regular or family driver, who instead of carrying out the owner’s order to fetch the children from school takes out his girl friend instead for a joy ride and instead wrecks the car. There is no question of his being an “authorized driver” which allows recovery of the loss although his trip was for a personal or illicit purpose without the owner’s authorization. cdll

Secondly, and independently of the foregoing (since when a car is unlawfully taken, it is the theft clause, not the “authorized driver” clause, that applies), where a car is admittedly as in this case unlawfully and wrongfully taken by some people, be they employees of the car shop or not to whom it had been entrusted, and taken on a long trip to Montalban without the owner’s consent or knowledge, such taking constitutes or partakes of the nature of theft as defined in Article 308 of the Revised Penal Code, viz. “(W)ho are liable for theft. — Theft is committed by any person who, with intent to gain but without violence against or intimidation of persons nor force upon things, shall take personal property of another without the latter’s consent,” for purposes of recovering the loss under the policy in question.

The evidence does not warrant respondent commission’s findings that it was a mere “joy ride”. From the very investigator’s report cited in its comment, 3 the police found from the waist of the car driver Benito Mabasa y Bartolome who smashed the car and was found dead right after the incident “one Cal. 45 Colt. and one apple type grenade,” hardly the materials one would bring along on a “joy ride”. Then, again, it is equally evident that the taking proved to be quite permanent rather than temporary, for the car was totally smashed in the fatal accident and was never returned in serviceable and useful condition to petitioner-owner.

Assuming, despite the totally inadequate evidence, that the taking was “temporary” and for a “joy ride”, the Court sustains as the better view that which holds that when a person, either with the object of going to a certain place, or learning how to drive, or enjoying a free ride, takes possession of a vehicle belonging to another, without the consent of its owner, he is guilty of theft because by taking possession of the personal property belonging to another and using it, his intent to gain is evident since he derives therefrom utility, satisfaction, enjoyment and pleasure. Justice Ramon C. Aquino cites in his work Groizard who holds that the use of a thing constitutes gain and Cuello Calon who calls it “hurt de uso”.

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