Short answer. Yes. Article 2200 provides that indemnification for damages comprehends not only the value of the loss suffered but also that of the profits which the obligee failed to obtain. What you have to supply is proof: lost profit is recoverable, but only in the amount you can actually establish.
What the law says
Indemnification for damages shall comprehend not only the value of the loss suffered, but also that of the profits which the obligee failed to obtain.
Civil Code, Article 2200 — Loss Suffered and Profits Not Realized. Read the full provision →
Two heads of loss in a single sentence
The article names two things and treats them as one entitlement. The first is the value of the loss suffered, the money that actually left your hands or the property that was destroyed. The second is that of the profits which the obligee failed to obtain, the earnings the event prevented. People often assume the second is a bonus a court may or may not entertain. It is not. It is part of what indemnification comprehends, and leaving it out of a claim because it feels speculative is how real losses go unrecovered.
Proof is the whole battle
The catch sits in the neighbouring provision. Article 2199 allows adequate compensation only for the pecuniary loss as he has duly proved, and lost profit is where that requirement bites hardest, because the profit never happened and so left no receipt behind it. What stands in for a receipt is history: filed financial statements, the same period's sales in prior years, the signed order you could not fulfil, the booking that was cancelled. A figure built from what the business actually did before the event will carry. One built from what it hoped to do will not.
Claim profit, not turnover
What you failed to obtain is what would have been left after the costs of earning it, and a computation that ignores the expenses you saved by not operating invites the whole claim to be rejected rather than merely trimmed. Set it out honestly: expected revenue, the costs that would have been incurred to produce it, and the difference. Where the business closed altogether for a period, remember that some costs continued and others stopped, and both belong in the arithmetic if the number is to survive scrutiny.
Two limits sit around it
In contracts and quasi-contracts, Article 2201 confines an obligor in good faith to consequences the parties foresaw or could reasonably have foreseen when the obligation was constituted, so an unusual profit stream is best disclosed at the outset rather than after the breach. And Article 2203 requires the party suffering loss to exercise the diligence of a good father of a family to minimise the damages, which means profits you could have preserved by reopening, hiring elsewhere or replacing equipment promptly may not be recoverable from anyone.
Cases citing this provision
These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.
- Universal International Investment (BVI) Limited vs. Ray Burton Development Corporation/Universal International Investment (BVI) Limited vs. Ray Burton Development Corporation, G.R. No. 182201 / G.R. No. 185815, November 14, 2016 — read the decision on LawPhil →
- National Power Corporation vs. Philipp Brothers Oceanic, Inc, G.R. No. 126204, November 20, 2001 — read the decision on LawPhil →
- Oceanmarine Resources Corporation vs. Jenny Rose G. Nedic, on behalf of her minor son, G.R. No. 236263, July 19, 2022 — read the decision on LawPhil →
- Filipino Society of Composers, Authors and Publishers, Inc. vs. Andrey, Inc, G.R. No. 233918, August 9, 2022 — read the decision on LawPhil →
Related provisions
- Civil Code, Article 2199 — Actual Damages Must Be Proved
- Civil Code, Article 2201 — Damages in Contracts and Quasi-Contracts