Short answer. Yes. Philippine law expressly says that indemnification for damages covers not only the value of what you actually lost but also the profits you failed to obtain. Income you would have earned from your business during the period of your injury is recoverable as lost profits, provided you can prove the amount with reasonable certainty.
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 components of a full damages claim
Article 2200 of the Civil Code splits your compensation into two parts. The first is the damnum emergens — the value of what you actually lost, such as medical expenses or destroyed property. The second is the lucrum cessans — the profits you failed to obtain because of the injury. Both components form one integrated claim. A person who injures you through negligence is not allowed to limit his liability to your out-of-pocket costs while leaving your lost income uncompensated.
Proving your lost business income
You will need to show, with reasonable certainty, what your business would have earned during the months you were unable to operate. Courts do not require mathematical precision, but speculation is not enough. Useful evidence includes income tax returns, audited financial statements, official receipts, bank records showing regular deposits, and testimony from your accountant or regular customers. The longer and more consistent your earnings history, the stronger your case. If your business was new and had no track record, recovery may be harder to establish and may require expert projections.
What the law does not guarantee
Article 2200 sets the legal basis for the claim; it does not fix the amount. The court will assess what you actually would have earned, not what you hoped to earn. If your business income was irregular or difficult to document, the award may reflect that uncertainty. The rule also requires that the lost profits be a consequence of the wrongful act — if your business was already declining for unrelated reasons before the accident, that prior trend may reduce the recoverable amount. Be prepared to separate pre-existing losses from those caused by the injury.
Lost profits in context with other claims
Lost business income is just one item in a broader damages claim after an accident. Medical expenses, cost of rehabilitation, moral damages for pain and suffering, and — if the negligence was egregious — exemplary damages may all be available under different Civil Code provisions. Each must be pleaded and proved separately. When you consult a lawyer, bring your business records for at least the two or three years before the accident: they form the baseline against which the court will measure what you lost.
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 →