Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09

Transportation Law Review

Based on the lectures of: Atty. Melissa Romana Suarez A L!"ABL# LA$
'tarrin*: 'hyler, the cab beetle!

Art. 1766. In all matters not regulated by this Code, the rights and obligations of common carriers shall be governed by the Code of Commerce and by special laws. The primary law in transportation law is the civil code, partic larly the provisions on common carriers! The s ppletory laws are the "ode o# "ommerce, and special laws li$e the "%&'( )"arria*e o# &oods by 'ea (ct+, 'alva*e ,aw, -arsaw "onvention, Tari## and " stoms "ode! $hat is transportation% .t is a movement o# thin*s or persons #rom one place to another/ a carryin* across! $hat does transportation include% 0! -aitin* time - 1 st beca se a person is in the airport waitin* #or the #li*ht to board, does not mean that transportation has not started! 2! ,oadin* and *oods nloadin* with respect to transportation o#

A t e n e o d e & a v a o " ol le 3 e o f L a w

?@: ?acts: 7rnesto "endaAa, a 1 n$ dealer, was en*a*ed in b yin* p sed bottles and scrap metal in Pan*asinan! Bpon *atherin* s ##icient 4 antities o# s ch scrap material, "endaAa wo ld brin* s ch material to Manila #or resale! 5e tili>ed 2 si@-wheeler tr c$s which he owned #or ha lin* the material to Manila! %n the ret rn trip to Pan*asinan, "endaAa wo ld load his vehicles with car*o which vario s merchants wanted delivered to di##erin* establishments in Pan*asinan! ?or that service, "endaAa char*ed #rei*ht rates which were commonly lower than re* lar commercial rates! 'ometime in Covember 09D0, Pedro de & >man, a merchant and a thori>ed dealer o# &eneral Mil$ "ompany )Philippines+, .nc! in Brdaneta, Pan*asinan, contracted with "endaAa #or the ha lin* o# D80 cartons o# ,iberty #illed mil$ #rom a wareho se o# &eneral Mil$ in Ma$ati, Ei>al, to de & >mans establishment in Brdaneta on or be#ore 4 =ecember 09D0! (ccordin*ly, on 0 =ecember 09D0, "endaAa loaded in Ma$ati the merchandise on to his tr c$s: 080 cartons were loaded on a tr c$ driven by "endaAa himsel#/ while F00 cartons were placed on board the other tr c$ which was driven by Man el 7strada, "endaAa s driver and employee! %nly 080 bo@es o# ,iberty #illed mil$ were delivered to de & >man! The other F00 bo@es never reached de & >man, since the tr c$ which carried these bo@es was hi1ac$ed somewhere alon* the Mac(rth r 5i*hway in Pani4 i, Tarlac, by armed men who too$ with them the tr c$, its driver, his helper and the car*o! 5eld: (rticle 0D32 o# the "ivil "ode ma$es no distinction between one whose principal b siness activity is the carryin* o# persons or *oods or both, and one who does s ch carryin* only as an ancillary activity )in local idiom, as Ga sidelineH+! (rticle 0D32 also care# lly avoids ma$in* any distinction between a person or enterprise o##erin* transportation service on a re* lar or sched led basis and one o##erin* s ch service on an occasional, episodic or nsched led basis! Ceither does (rticle 0D32 distin* ish between a carrier o##erin* its services to the G*eneral p blic,H i!e!, the *eneral comm nity or pop lation, and one who o##ers services or solicits b siness only #rom a narrow se*ment o# the *eneral pop lation! (rticle 0D33 deliberately re#rained #rom ma$in* s ch distinctions! "endaAa is properly characteri>ed as a common carrier even tho *h he merely Gbac$-ha ledH *oods #or other merchants #rom Manila to Pan*asinan, altho *h s ch bac$ha lin* was done on a periodic or occasional rather than re* lar or sched led manner, and even tho *h "endaAas principal occ pation was not the carria*e o# *oods #or others! There is no disp te that "endaAa char*ed his c stomers a #ee #or ha lin* their *oods/ that #ee #re4 ently #ell below commercial #rei*ht rates is not relevant! ( certi#icate o# p blic convenience is not a re4 isite #or the inc rrin* o# liability nder the "ivil "ode provisions *overnin* common carriers! That liability arises the moment a person or #irm acts as a common carrier, witho t re*ard to whether or not s ch carrier has also complied with the re4 irements o# the applicable re* latory stat te and implementin* re* lations and has been *ranted a certi#icate o# p blic convenience or other #ranchise!

3! 'toppin* in transit - when one ta$es a lon* #li*ht, transit stops are also incl ded even i# passen*er is re4 ired to disembar$ and ta$e all his belon*in*s with him! 4! (ll other accessorial services in connection with loaded movement -- so it co ld be anythin*, li$e when are in 56, yo are allowed to chec$-in the "ity, movement o# yo r l **a*e #rom the city chec$ in to airport is already incl ded in the term transportation! &#'!(!T!)( )' ")MM)( "ARR!#R *""+ the yo the the

Art. 1732. Common carriers are persons, corporations, firms or associations engaged in the business of carrying or transporting passengers or goods or both, by land, water, or air, for compensation, offering their services to the public. #lements: 0! m st be a person, association, corporation, or #irms 2! 7n*a*ed in a b siness 3! Transports persons or *oods or both by land, water or air 4! %##ers service to the p blic 8! (ccepts compensation #or services .# one element is missin*, then it is not a common carrier! (ational Steel vs. "A ,-. S"RA /0 )Tr e test o# "ommon carrier+ The carria*e o# *oods and passen*ers provided it has space #or all who opt to avail themselves o# its transportation #or a #ee! This means that i# yo are a carrier, yo cannot discriminate! 9o have to provide space #or everyone who wants to avail o# the services o# transportin* persons or thin*s! :: To be a common carrier, m st one be en*a*ed in the transport o# *oods;passen*ers primarily< (: (o. Still considered common carrier 111 2.+ =e & >man vs! "( - even if the carria3e of 3oods or pa4 is only an ancillary or sideline5 that person can still 6e considered a cc. #ven if the transportation is merely occasional5 sporadic or not on a re3ular 6asis. #ven thou3h the transporation is offered only to a narrow se3ment of the 3eneral population. And lastly5 even if he has not secured a certificate of pu6lic convenience.

2! ?P." vs! "( - still a common carrier even if the mode of transportation is not a motor vehicle *in this case5 pipeline+ for as lon3 as all the re7uisites8elements of a cc are present. Here5 it is not the pipeline that moves5 it is the oil. 3! (sia ,i*htera*e vs! "( )2003+ -- even if it has no fi4ed and pu6licly 9nown route5 maintains no terminals and issues no tic9ets 4! "alvo vc! B"PI - e ven if it is not in the 6usiness of pu6lic transportation: here5 "alvo was a customs 6ro9er. 8! 'chmit> vs! TJ. - even if the mode of transport is not owned 6y him F! Iascos vs! "( - even if the contract is not a contract of carria3e! 5ere, what was entered into was a contract o# lease o# the tr c$! The *oods were lost and the de#ense was that what was entered into was a lease contract! (ccordin* to the '", the name o# the contract does not matter, #or as lon* as the re4 isites are present, then that person is considered a common carrier! $H) AR# "ARR!#R% ()T ")(S!&#R#& ")MM)(

?&B vs! 'armiento )2002+ - Tr c$ owned by 'armiento carryin* re#ri*erators belon*in* to shipper, "oncepcion .nd stries! 5ere, '" said that 'armiento was not a common carrier beca se it was the e@cl sive ha ler o# "oncepcion .nd stries!
&P', bein* an e@cl sive contractor and ha ler o# "oncepcion .nd stries, .nc!, renderin* or o##erin* its services to no other individ al or entity, cannot be considered a common carrier! "ommon carriers are persons, corporations, #irms or associations

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09

en*a*ed in the b siness o# carryin* or transportin* passen*ers or *oods or both, by land, water, or air, #or hire or compensation, o##erin* their services to the p blic,K8L whether to the p blic in *eneral or to a limited clientele in partic lar, b t never on an e@cl sive basis! The tr e test o# a common carrier is the carria*e o# passen*ers or *oods, providin* space #or those who opt to avail themselves o# its transportation service #or a #ee!&iven accepted standards, &P' scarcely #alls within the term Gcommon carrier!H IBT &P' is still liable based on the contract! 5owever, there is no pres mption o# ne*li*ence in case o# loss!

,' invo$ed that it e@ercised M%=, and th s was not liable #or the loss! 5eld: .s ,' pres med to be at #a lt #or the loss o# the *oods< Co - (rticle 0D3 o# the "ivil "ode demands that a common carrier observe e@traordinary dili*ence over the *oods transported by it! 7@traordinary dili*ence is that e@treme meas re o# care and ca tion which persons o# n s al pr dence and circ mspection se #or sec rin* and preservin* their own property or ri*hts! This e@actin* standard imposed on common carriers in a contract o# carria*e o# *oods is intended to tilt the scales in #avor o# the shipper who is at the mercy o# the common carrier once the *oods have been lod*ed #or shipment! 5ence, in case o# loss o# *oods in transit, the common carrier is pres med nder the law to have been at #a lt or ne*li*ent! 5owever, the pres mption o# #a lt or ne*li*ence, may be overt rned by competent evidence showin* that the common carrier has observed e@traordinary dili*ence over the *oods! .n the instant case, we a*ree with the co rt a 4 o that the respondent ade4 ately proved that it e@ercised e@traordinary dili*ence! (ltho *h the ori*inal bills o# ladin* remained with petitioner, respondents a*ents demanded #rom (bd rahman the certi#ied tr e copies o# the bills o# ladin*! They also as$ed the latter and in his absence, his desi*nated s bordinates, to si*n the car*o delivery receipts! This practice, which respondents a*ents testi#ied to be their standard operatin* proced re, #inds s pport in (rticle 383 o# the "ode o# "ommerce! "on#ormably with the a#orecited provision, the s rrender o# the ori*inal bill o# ladin* is not a condition precedent #or a common carrier to be dischar*ed o# its contract al obli*ation! .# s rrender o# the ori*inal bill o# ladin* is not possible, ac$nowled*ment o# the delivery by si*nin* the delivery receipt s ##ices!

2! "risostomo vs. "A *,;;.+ .s a travel a*ency a common carrier<

5eld: Co! Petitioner contends that respondent did not observe the standard o# care re4 ired o# a common carrier when it in#ormed her wron*ly o# the #li*ht sched le! 'he co ld not be deemed more ne*li*ent than respondent since the latter is re4 ired by law to e@ercise e@traordinary dili*ence in the # l#illment o# its obli*ation! .# she were ne*li*ent at all, the same is merely contrib tory and not the pro@imate ca se o# the dama*e she s ##ered! 5er loss co ld only be attrib ted to respondent as it was the direct conse4 ence o# its employees *ross ne*li*ence! Petitioners contention has no merit! Iy de#inition, a contract o# carria*e or transportation is one whereby a certain person or association o# persons obli*ate themselves to transport persons, thin*s, or news #rom one place to another #or a #i@ed price! ' ch person or association o# persons are re*arded as carriers and are classi#ied as private or special carriers and common or p blic carriers! ( common carrier is de#ined nder (rticle 0D32 o# the "ivil "ode as persons, corporations, #irms or associations en*a*ed in the b siness o# carryin* or transportin* passen*ers or *oods or both, by land, water or air, #or compensation, o##erin* their services to the p blic! .t is obvio s #rom the above de#inition that respondent is not an entity en*a*ed in the b siness o# transportin* either passen*ers or *oods and is there#ore, neither a private nor a common carrier! Eespondent did not nderta$e to transport petitioner #rom one place to another since its covenant with its c stomers is simply to ma$e travel arran*ements in their behal#! Eespondents services as a travel a*ency incl de proc rin* tic$ets and #acilitatin* travel permits or visas as well as boo$in* c stomers #or to rs! -hile petitioner concededly bo *ht her plane tic$et thro *h the e##orts o# respondent company, this does not mean that the latter ipso #acto is a common carrier! (t most, respondent acted merely as an a*ent o# the airline, with whom petitioner ltimately contracted #or her carria*e to 7 rope! Eespondents obli*ation to petitioner in this re*ard was simply to see to it that petitioner was properly boo$ed with the airline #or the appointed date and time! 5er transport to the place o# destination, meanwhile, pertained directly to the airline! The ob1ect o# petitioners contract al relation with respondent is the latters service o# arran*in* and #acilitatin* petitioners boo$in*, tic$etin* and accommodation in the pac$a*e to r! .n contrast, the ob1ect o# a contract o# carria*e is the transportation o# passen*ers or *oods! .t is in this sense that the contract between the parties in this case was an ordinary one #or services and not one o# carria*e! Petitioners s bmission is premised on a wron* ass mption!
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2! .n AL vs. "A 2;@ S .A2 - '" said that the d ty o# to e@ercise the d ty o# tmost dili*ence on the part o# the "" is #or the sa#ety o# passen*ers, as well as members o# the crew! .# yo are part o# the crew, and yo are in1 red, yo can s e the the "" and the "" cannot invo$e that it is not re4 ired to e@ercise M%=! 'o there is no discrimination between crew and passen*ers!
The d ty to e@ercise the tmost dili*ence on the part o# common carriers is #or the sa#ety o# passen*ers as well as #or the members o# the crew or the complement operatin* the carrier, the airplane in the present case! (nd this m st be so #or any omission, lapse or ne*lect thereo# will certainly res lt to the dama*e, pre1 dice, nay in1 ries and even death to all aboard the plane, passen*ers and crew members ali$e!

&!L!<#("# R#=>!R#&:

Art. 1733. Common carriers, from the nature of their business and for reasons of public policy, are bound to observe extraordinary diligence in the vigilance over the goods and for the safety of the passengers transported by them, according to all the circumstances of each case. Such extraordinary diligence in the vigilance over the goods is further expressed in Articles 17 !, 17 ", and 17!", #os. ", $, and 7, while the extraordinary diligence for the safety of the passengers is further set forth in Articles 17"" and 17"$. Cotes: 0! $hat is #4tra )rdinary &ili3ence *?)&+ < That e@treme meas re o# care and ca tion which persons o# which n s al pr dence and circ mspection se #or sec rin* and preservin* their own properties or ri*hts! *(ational Truc9in3 and 'orwardin3 "orp. vs. Lorenzo Shippin3 *,;;0++
?acts: =%5 and "(E7 si*ned an a*reement where "(E7 wo ld ac4 ire #rom the B' donations to be transported to the Philippines! To deliver the *oods within the Phil, =%5 entered into a contract with CT?"! CT?" shipped the *oods thro *h ,oren>o 'hippin*! The consi*nee was (, CT?"s branch mana*er! ,' delivered the *oods b t when it re4 ested ( to ret rn the bills o# ladin*s, ( merely ret rned certi#ied tr e copies thereo#! 7very a#ter delivery, ( and his s bordinates si*ned a delivery receipt! =espite delivery however, it was alle*ed that the *oods were never received!

3! Benedicto vs. !A" - The prevailin* doctrine on common carriers ma$es the re*istered owner liable #or conse4 ences #lowin* #rom the operations o# the carrier, even though the specific vehicle involved may already have been transferred to another person. This doctrine rests pon the principle that in dealin* with vehicles re*istered nder the P blic 'ervice ,aw, the p blic has the ri*ht to ass me that the re*istered owner is the act al or law# l owner thereo# .t wo ld be very di##ic lt and o#ten impossible as a practical matter, #or members o# the *eneral p blic to en#orce the ri*hts o# action that they may have #or in1 ries in#licted by the vehicles bein* ne*li*ently operated i# they sho ld be re4 ired to prove who the act al owner is! The re*istered owner is not allowed to deny liability by provin* the identity o# the alle*ed trans#eree! Th s, contrary to petitionerNs claim, private respondent is not re4 ired to *o beyond the vehicleNs certi#icate o# re*istration to ascertain the owner o# the carrier! 4! BA 'inance vs. "A 1 the re*istered owner, the de#endant-appellant herein, is primarily responsible #or the dama*e ca sed to the vehicle o# the plainti##-appellee, b t he )de#endant-appellant+ has a ri*ht to be indemni#ied by the real or act al owner o# the amo nt that he may be re4 ired to pay as dama*e #or the in1 ry ca sed to the plainti##-appellant! )?ile a 3rd party complaint+
Eeason: -ere a re*istered owner allowed to evade responsibility by provin* who the s pposed trans#eree or owner is, it wo ld be easy #or him, by coll sion with others or otherwise, to escape said responsibility and trans#er the same to an inde#inite person, or to one who possesses no property with which to respond #inancially #or the dama*e or in1 ry done! ( victim o# rec$lessness on the p blic hi*hways is s ally witho t means to discover or .denti#y the person act ally ca sin* the in1 ry or dama*e! 5e has no means other then by a reco rse to the re*istration in the Motor Jehicles %##ice to determine who is the owner! The protection that the law aims to e@tend to him wo ld become ill sory were the re*istered owner *iven the opport nity to escape liability by disprovin* his ownership! .# the policy o# the law is to be en#orced and carried

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09

o t, the re*istered owner sho ld not be contrary to the pre1 dice o# the person in1 that a third person or another has become may thereby be relieved o# the responsibility allowed to prove the red, that is, to prove the owner, so that he to the in1 red person!

STAT# R#<>LAT!)( )' ")MM)( "ARR!#R

Art. 1765. %he &ublic Service Commission may, on its own motion or on petition of any interested party, after due hearing, cancel the certificate of public convenience granted to any common carrier that repeatedly fails to comply with his or its duty to observe extraordinary diligence as prescribed in this Section. Cotes: 0! 'o the p blic service commission has been replaced by the #ollowin* bodies: ,T% - private vehicles ,T?EI- common carrier "ivil (erona tics Ioard - p blic airplanes (T%- private planes )accordin* to ,yndon+ M(E.C( - common carriers #or sea 2! Cote: The cancellation o# certi#icate o# p blic convenience cannot be done witho t hearin*/ altho *h these bodies have the power to initiate hearin* mot propio! Ta$e note o# the *ro nd #or cancellation as provided nder (rt! 0DF8! 3! antranco vs. u6lic Service "ommission B; ,,2 1 ( certi#icate o# p blic convenience constit tes neither a #ranchise nor a contract! .t con#ers no property ri*hts and is a mere license or privile*e and there#ore can be s b1ect to re* lation #o nded on the police power o# the 'tate! 4! Medina vs. "resencia1 The sale o# "P" witho t approval o# the *overnin* bodies is not bindin* a*ainst the p blic! 'o there has to be approval #irst! .t is bindin* between the parties only! .n contemplation o# the law, the *rantee o# record contin es to be responsible nder the "P" in relation to the *overnin* body or the p blic! 8! AL vs. "AB ,B; S 0.- 1 P(, alle*ed that "(I ab sed its discretion when it *ranted to &rand (ir a Temporary %peratin* Permit! (ccd*! to P(,, &rand (ir has not been *ranted a le*islative #ranchise to operate!
The iss e in this petition is whether or not "on*ress, in enactin* Eep blic (ct DDF, has dele*ated the a thority to a thori>e the operation o# domestic air transport services to the respondent Ioard, s ch that "on*ressional mandate #or the approval o# s ch a thority is no lon*er necessary! "ivil (erona tics Ioard has the a thority to iss e a "erti#icate o# P blic "onvenience and Cecessity, or Temporary %peratin* Permit to a domestic air transport operator, who, tho *h not possessin* a le*islative #ranchise, meets all the other re4 irements prescribed by the law! ' ch re4 irements were en merated in 'ection 20 o# E!(! DDF! There is nothin* in the law nor in the "onstit tion, which indicates that a le*islative #ranchise is an indispensable re4 irement #or an entity to operate as a domestic air transport operator! (ltho *h 'ection 00 o# (rticle M.. reco*ni>es "on*ressN control over any #ranchise, certi#icate or a thority to operate a p blic tility, it does not mean "on*ress has e@cl sive a thority to iss e the same! ?ranchises iss ed by "on*ress are not re4 ired be#ore each and every p blic tility may operate! .n many instances, "on*ress has seen it #it to dele*ate this # nction to *overnment a*encies, speciali>ed partic larly in their respective areas o# p blic service! ( readin* o# 'ection 00 o# the same reveals the clear intent o# "on*ress to dele*ate the a thority to re* late the iss ance o# a license to operate domestic air transport services
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destination 0. As to how to escape lia6ility @. As to state ( "" per#orms re3ulation p blic service and is s b1ect to 'tate re* lation

=oes not per#orm p blic service/ also s b1ect to 'tate re* lation b t not too strict!

"" )' <))&S *"")<+

Art. 2B0.! The law o# the co ntry to which the *oods are to be transported shall *overn the liability o# the common carrier #or their loss, destr ction or deterioration! C%T7': 0! .# #orei*n voya*e or #li*ht #rom #orei*n co ntry inbo nd to Phil - *overned by Phil laws! .# o tbo nd, carrier lands in B' and there is complaint, can pa@ s e ""%& here< 9es, apply con#licts o# laws! )'a dia (irlines case+ T#ST T) &#T#RM!(# !' )(# !S "")<

a! 5e m st be en*a*ed in the b siness o# carryin* *oods #or others as a p blic employment, and m st hold himsel# o t as ready to en*a*e in the transportation o# *oods #or person *enerally as a b siness and not as a cas al occ pation/ b! 5e m st nderta$e to carry *oods o# the $ind to which his b siness is con#ined/ c! 5e m st nderta$e to carry by the method by which his b siness is cond cted and over his established roads/ and d! The transportation m st be #or hire! )?P." J'! "(+ (rt! 0D33! "ommon carriers, #rom the nat re o# their b siness and #or reasons o# p blic policy, are bo nd to observe e@traordinary dili*ence in the vi*ilance over the *oods M M M ' ch e@traordinary dili*ence in the vi*ilance over the *oods is # rther e@pressed in (rticles 0D34, 0D38, and 0D48, Cos! 8, F, and D, while the e@traordinary dili*ence #or the sa#ety o# the passen*ers is # rther set #orth in (rticles 0D88 and 0D8F! Cotes: -hat is M%= in the vi*ilance o# *oods< 7@traordinary dili*ence re4 ires renderin* service with the *reatest s$ill and #oresi*ht to avoid dama*e and destr ction to the *oods entr sted #or carria*e and delivery! )Leamer vs. Malayan5 ,;;0+ Art. 1734. Common carriers are responsible for the loss, destruction, or deterioration of the goods, unless the same is due to any of the following causes only' (1) *lood, storm, earth+ua,e, lightning, or other natural disaster or calamity(.) Act of the public enemy in war, whether international or civilCotes: 0! &en E le is the #irst sentence/ the e@ceptions are the 8 cases en merated! 2! =oes it mean that i# *oods are lost, dama*ed or destroyed, is the ""%& a tomatically responsible< (). There is no a tomatic liability or responsibility #or loss;deterioration;dama*e o# *oods! -hat arises is (BT%M(T." PE7'BMPT.%C o# ne*li*ence! 3! 5ow to reb t pres mption;escape liability< The ""%& m st prove that it e@ercised M%=! )Cote: =o not say Oby e@ercisin* M%=O beca se that is di##erent #rom provin* ""%& e@ercised M%=!+ Art. 1735. In all cases other than those mentioned in #os. 1, ., , !, and " of the preceding article, if the goods are lost, destroyed or deteriorated, common carriers are presumed to have been at fault

&istinctions 6etween "" and "#: (rt! 0DFF Io nd to carry all pa@ who choose to employ it %bserve M%= Ce*li*ence is pres med i# pa@ or *oods do not reach #inal

rivate "arrier

2. &efinition ,. As to whom it may contract .. &e3ree of dili3ence re7uired /. As to presumption of ne3li3ence

.nvolves a sin*le nderta$in* May choose person with whom it may contract &?%? Person who alle*es ne*li*ence m st prove the same

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 or to have acted negligently, unless they prove that they observed extraordinary diligence as re+uired in Article 17 . 4! .# any o# the 8 instances arises, the pres mption o# ne*li*ence -.,, C%T (E.'7! The e##ect is that there is no a tomatic pres mption o# ne*li*ence! -hat is the e##ect< The e##ect is that the ""%& no lon*er needs to prove that it e@ercised M%=! 8! :: .s the ""%& a tomatically e@empt #rom liability in cases o# the 8 instances mentioned in (rt! 0D34< (: C%! The ""%& m st still have to prove that it complied with the re4 irements o# (rt! 0D39, 0D40, 0D40, 0D42! F! C("HA>ST! DS. &#?T#R 1 $hat does the shipper8consi3nee have to show in order to have a prima facie case a3ainst the carrier% 0! (ct al receipt o# *oods by the carrier/ 2! ?ail re to deliver the *oods in the same conditions as it was received! .# these two are shown, the b rden o# proo# is shi#ted and it is inc mbent pon the carrier, in order to e@onerate itsel#, to both alle*e and prove that the in1 ry was d e to some circ mstances!
The mere proo# o# delivery o# *oods in *ood order to a carrier, and o# their arrival at the place o# destination in bad order, ma$es o t a prima #acie case a*ainst the carrier, so that i# no e@planation is *iven as to how the in1 ry occ rred, the carrier m st be held responsible! .t is inc mbent pon the carrier to prove that the loss was d e to accident or some other circ mstance inconsistent with its liability!

'lood5 storm5 earth7ua9e5 li3htnin35 or other natural disaster or calamity 11 in relation to 2B.A and 2B/;:

Art. 1739. In order that the common carrier may be exempted from responsibility, the natural disaster must have been the proximate and only cause of the loss. /owever, the common carrier must exercise due diligence to prevent or minimi0e loss before, during and after the occurrence of flood, storm or other natural disaster in order that the common carrier may be exempted from liability for the loss, destruction, or deterioration of the goods. %he same duty is incumbent upon the common carrier in case of an act of the public enemy referred to in Article 17 !, #o. .. Art. 1740. If the common carrier negligently incurs in delay in transporting the goods, a natural disaster shall not free such carrier from responsibility. Cotes: 0! ""%& need not prove it e@ercised M%=/ however, ""%& m st prove that: )Philam*en vs! M"& Marine+ a! the nat ral calamity or disaster m st have been the pro@imate and only ca se o# the loss/ and b! the ""%& e@ercised due diligence to prevent or minimi>e the loss and c! ""%& did not inc r delay in transportin* the *oods! 2! !s fire a natural calamity < )This was not clearly answered
by (tty! ' are>/ .n response to the s **ested answer that #ire is considered nat ral calamity i# ca sed by li*htnin*, the answer *iven by MaNam ' was: -hen yo say nat ral, it has to be nat ral! %bvio sly i# it was ca sed by somethin* that has some $ind o# h man intervention, it cannot #all nder nat ral disaster!+

7. $hat does it mean if the shipment is EcontainarizedE% *Ban9ers and Manufacturers vs. "A+
.t m st be nderscored that the shipment involved in the case at bar was Ocontaineri>edO! The *oods nder this arran*ement are st ##ed, pac$ed, and loaded by the shipper at a place o# his choice, s ally his own wareho se, in the absence o# the carrier! The container is sealed by the shipper and therea#ter pic$ed p by the carrier! "onse4 ently, the recital o# the bill o# ladin* #or *oods th s transported ordinarily wo ld declare O'aid to "ontainO, O'hipperNs ,oad and "o ntO, O? ll "ontainer ,oadO, and the amo nt or 4 antity o# *oods in the container in a partic lar pac$a*e is only prima #acie evidence o# the amo nt or 4 antity which may be overthrown by parol evidence! ( shipment nder this arran*ement is not inspected or inventoried by the carrier whose d ty is only to transport and deliver the containers in the same condition as when the carrier received and accepted the containers #or transport!
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#AST#R( SH!

!(< DS. !A"

(s a 3eneral rule, #ire is not a nat ral disaster!

Petitioner "arrier claims that the loss o# the vessel by #ire e@empts it #rom liability nder the phrase Onat ral disaster or calamity! O 5owever, we are o# the opinion that #ire may not be considered a nat ral disaster or calamity! This m st be so as it arises almost invariably #rom some act o# man or by h man means! .t does not #all within the cate*ory o# an act o# &od nless ca sed by li*htnin* or by other nat ral disaster or calamity! .t may even be ca sed by the act al #a lt or privity o# the carrier!

%# co rse the e4ception is nless it was nat rally ca sed, s ch as li*htnin*, or i# there was an earth4 a$e and s ddenly the cement r bbed a*ainst each other! This was reiterated in "o9alion3 vs. >" B )2003+
5avin* ori*inated #rom an nchec$ed crac$ in the # el oil service tan$, the #ire co ld not have been ca sed by #orce ma1e re! Iroadly spea$in*, #orce ma1e re *enerally applies to a nat ral accident, s ch as that ca sed by a li*htnin*, an earth4 a$e, a tempest or a p blic enemy! 5ence, #ire is not considered a nat ral disaster or calamity!

$hat is the re7uirement to hold the "")< lia6le if 3oods are dama3ed under this arran3ement% .n order to hold the carrier liable #or whatever loss, dama*e or deterioration that happened on the *oods inside the container, it has to be opened in #ront o# the carrier and inspected! .# the consi*nee receives the container, does not chec$ it, brin*s it to ihs wareho se and complains days later, then that is no lon*er allowed! The inspection sho ld be done in #ront o# the carrier! .# the inspection is done pon arrival, there is a pres mption that the *oods were received in *ood order! The carrier then will have to prove that the *oods were received otherwise! 8! $hat is an arrastre operator% .s an arrastre operator le*ally liable #or the loss o# a shipment in its c stody< .# so, what is the e@tent o# its liability< )Summa !nsurance vs. "A+
5: .n the per#ormance o# its obli*ations, an arrastre operator sho ld observe the same de*ree o# dili*ence as that re4 ired o# a common carrier and a wareho seman as en nciated nder (rticle 0D33 o# the "ivil "ode and 'ection 3)8+ o# the -areho se Eeceipts ,aw, respectively! Iein* the c stodian o# the *oods dischar*ed #rom a vessel, an arrastre operatorNs d ty is to ta$e *ood care o# the *oods and to t rn them over to the party entitled to their possession!

3! -hat abo t heavy rains, are they considered nat ral disasters< C%! Jessels are b ilt to withstand heavy rains and seas! #astern Shippin3 vs. "A: The heavy seas and rains re#erred to in the masterNs report were not caso #ort ito, b t normal occ rrences that an ocean-*oin* vessel, partic larly in the month o# 'eptember which, in o r area, is a month o# rains and heavy seas wo ld enco nter as a matter o# ro tine! They are not n#oreseen nor n#oreseeable! These are conditions that ocean-*oin* vessels wo ld enco nter and provide #or, in the ordinary co rse o# a voya*e! 4! ='E 'enator vs! Phoeni@ )2003+ - same r lin* as 7astern 'hippin* that #ire is not a nat ral calamity! 8! .ll stration o# (rt! 0D40: hilam3en vs. "A 222 '"E( 404 - 5ere, the *oods arrived in port b t beca se o# the heavy rains, they were not dischar*ed and so the *oods were destroyed! The iss e is did the ""%& ne*li*ently inc r in delay< Co, the ca se o# the delay was not the #a lt o# the carrier! The delay was ca sed by the decision o# the board )constr ction o# catwal$s, etc+, c stoms o# the place and heavy, intermittent rains!

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 %ther cases: D! Schmitz Transport vs. Transventure : the nat ral calamity was not the only and pro@imate ca se o# the loss! Act of the pu6lic enemy in war5 whether international or civil:

a! Southern Lines vs. "A: Petitioner claims e@emption #rom liability by contendin* that the shorta*e in the shipment o# rice was d e to s ch #actors as the shrin$a*e, lea$a*e or spilla*e o# the rice on acco nt o# the bad condition o# the sac$s at the time it received the same and the ne*li*ence o# the a*ents o# respondent "ity o# .loilo in receivin* the shipment!
5eld: The contention is ntenable, #or, i# the #act o# improper pac$in* is $nown to the carrier or his servants, or apparent pon ordinary observation, b t it accepts the *oods notwithstandin* s ch condition, it is not relieved o# liability #or loss or in1 ry res ltin* there#orm! ? rthermore, accordin* to the "o rt o# (ppeals, Oappellant )petitioner+ itsel# #ran$ly admitted that the strin*s that tied the ba*s o# rice were bro$en/ some ba*s were with holes and plenty o# rice were spilled inside the h ll o# the boat, and that the personnel o# the boat collected no less than 2F sac$s o# rice which they had distrib ted amon* themselves!O This #indin*, which is bindin* pon this "o rt, shows that the shorta*e res lted #rom the ne*li*ence o# petitioner!

Ee4 irements: a! the nat ral act o# p blic enemy m st have been the pro@imate and only ca se o# the loss/ and b! the ""%& e@ercised due diligence to prevent or minimi>e the loss Act of omission of the shipper or owner of the 3oods in relation to:

Art. 1741. If the shipper or owner merely contributed to the loss, destruction or deterioration of the goods, the proximate cause thereof being the negligence of the common carrier, the latter shall be liable in damages, which however, shall be e+uitably reduced. Cotes: 0! .n order to totally escape liability, the ""%& m st prove that the act;ne*li*ence o# the shipper is the only and pro@imate ca se o# the loss! %therwise, (rt! 0D40 applies! .# the ""%& is not able to prove that the only and pro@imate ca se o# the loss is the act o# the shipper then, there will be an e4 itable red ction o# the liability! 2! ")M A(!A MAR!T!MA DS. "A: 5ere, the shipper stated the wei*ht o# the payloader was 2!8 tons when it was D!8 tons in reality! ""%& sed a li#tin* apparat s with a 8 ton capacity, so the payloader #ell and was dama*ed!
5: -e are not pers aded by the pro#erred e@planation o# petitioner alle*ed to be the pro@imate ca se o# the #all o# the payloader while it was bein* nloaded at the "a*ayan de %ro "ity pier! Petitioner seems to have overloo$ed the e@traordinary dili*ence re4 ired o# common carriers in the vi*ilance over the *oods transported by them by virt e o# the nat re o# their b siness, which is impressed with a special p blic d ty! (nd circ mstances clearly show that the #all o# the payloader co ld have been avoided by petitionerNs crew! 7vidence on record s ##iciently show that the crew o# petitioner had been ne*li*ent in the per#ormance o# its obli*ation by reason o# their havin* #ailed to ta$e the necessary preca tion nder the circ mstances which sa*e has established amon* care# l persons, more partic larly its "hie# %##icer, Mr! ?eli@ Pisan*, who is tas$ed with the over-all s pervision o# loadin* and nloadin* heavy car*oes and pon whom rests the b rden o# decidin* as to what partic lar winch the nloadin* o# the payloader sho ld be nderta$en! -hile it was his d ty to determine the wei*ht o# heavy car*oes be#ore acceptin* them! Mr! ?eli@ Pisan* too$ the bill o# ladin* on its #ace val e and pres med the same to be correct by merely Oseein*O it! .n that sense, there#ore, private respondentNs act o# # rnishin* petitioner with an inacc rate wei*ht o# the payloader pon bein* as$ed by petitionerNs collector, cannot be sed by said petitioner as an e@c se to avoid liability #or the dama*e ca sed, as the same co ld have been avoided had petitioner tili>ed the O1 mboO li#tin* apparat s which has a capacity o# li#tin* 20 to 28 tons o# heavy car*oes!

Therefore5 i# *oods are delivered to the ""%& and the de#ect in the *oods;pac$a*in* is apparent, then the "" may accept the *oods with reservation or e@ception! .t m st be indicated in the bill o# ladin* that the *oods are already de#ective, etc! (nd i# the *oods arrived in the same condition as it was received, then that can be sed as an e@ception! .# that happens, all the carrier has to prove is (rt! 0D42 -- d e dili*ence to #orestall or lessen the loss! %therwise, the acceptance o# ""%& witho t e@ception, the "" cannot hide nder this e@ception! b! "ALD) DS. >" B: "alvo is a c stoms bro$er! The vessel arrived in Manila! The car*o was loaded on the tr c$ o# "alvo! "alvo as bro$er also vol nteered to deliver the *oods to the wareho se o# the shipper! -hen the *oods arrived, they were spoiled! "alvo denied liability #or the *oods and alle*ed that the spoila*e too$ place while the *oods were in the vessel or while with the arrastre operator! (ccordin* to the '", when did the consi*nee discover the spoila*e o# the *oods< -hen they were in the possession o# "alvo!
?or this provision to apply, the r le is that i# the improper pac$in* or, in this case, the de#ect;s in the container, is;are $nown to the carrier or his employees or apparent pon ordinary observation, b t he nevertheless accepts the same witho t protest or e@ception notwithstandin* s ch condition, he is not relieved o# liability #or dama*e res ltin* there#rom! .n this case, petitioner accepted the car*o witho t e@ception despite the apparent de#ects in some o# the container vans! 5ence, #or #ail re o# petitioner to prove that she e@ercised e@traordinary dili*ence in the carria*e o# *oods in this case or that she is e@empt #rom liability, the pres mption o# ne*li*ence as provided nder (rt! 0D38 holds!

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c! !ron 6ul9 Shippin3 vs. Remin3ton )rder or act of competent pu6lic authority.

Act of omission of the shipper or owner of the 3oods: The character of the 3oods or defects in the pac9in3 or in the containers:

ARTICLE 1743. If through the order of public authority the goods are sei0ed or destroyed, the common carrier is not responsible, provided said public authority had power to issue the order Cote: 0! 'irst re7uisite: Person iss in* order m st have power to iss e s ch! 2! Second re7uisite: The order m st be law# l or m st have been iss ed nder le*al process or a thority )<anzon vs. "A - (,owner o# the the ""%& was nloadin* the iron! Mayor I demanded P8,000 and when ( re# sed, I shot (! (#ter several days, the nloadin* res med and (ctin* Mayor " ordered M and the crew o# the vessel to d mp the iron! The iss e is, can the ""%& be held liable #or the loss o# the car*o<
5eld: 97'! -e cannot s stain the theory o# caso #ort ito! .n the co rts below, the petitionerNs de#ense was that the loss o# the scraps was d e to an Oorder or act o# competent p blic a thority,O and this contention was correctly passed pon by the "o rt o# (ppeals which r led that:

ARTICLE 1742. 1ven if the loss, destruction, or deterioration of the goods should be caused by the character of the goods, or the faulty nature of the pac,ing or of the containers, the common carrier must exercise due diligence to forestall or lessen the loss. Cotes: 0! .# there is a de#ect in the pac$a*in* or character o# the *oods, #or e@ample in a case, *rain was loaded and they were already hal#way to rottin*, i!e! there were already molds, then the re4 isite #or ""%& to escape liability is that it m st prove that it e@ercised d e dili*ence to #orsetall or lessen the loss! That is nder (rt! 0D42! 2! I t a per sal o# the cases will show that the '" is sayin* that ""%& sho ld do somethin* more than 1 st (rt! 0D42:

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09

!!! .n the second place, be#ore the appellee &an>on co ld be absolved #rom responsibility on the *ro nd that he was ordered by competent p blic a thority to nload the scrap iron, it m st be shown that (ctin* Mayor Iasilio E b had the power to iss e the disp ted order, or that it was law# l, or that it was iss ed nder le*al process o# a thority! The appellee #ailed to establish this! .ndeed, no a thority or power o# the actin* mayor to iss e s ch an order was *iven in evidence! The petitioner was not d ty bo nd to obey the ille*al order to d mp into the sea the scrap iron! Moreover, there is absence o# s ##icient proo# that the iss ance o# the same order was attended with s ch #orce or intimidation as to completely overpower the will o# the petitionerNs employees! The mere di##ic lty in the # ll#ilment o# the obli*ation is not considered #orce ma1e re!

2! .n relation to (rt! 0D38, what i# the *oods are in the c stoms wareho se and they *et destroyed, deteriorated or dama*ed beca se the processin* o# papers ta$e too lon* to process< "an the carrier be held liable< L> &) F L> CM ")R DS. B!(AM!RA 11 ().

&>RAT!)( )' L!AB!L!TC *from what point to what point is a carrier lia6le%+

ARTICLE 1736. %he extraordinary responsibility of the common carrier lasts from the time the goods are unconditionally placed in the possession of, and received by the carrier for transportation until the same are delivered, actually or constructively, by the carrier to the consignee, or to the person who has a right to receive them, without pre2udice to the provisions of article 17 3. ARTICLE 1737. %he common carrier4s duty to observe extraordinary diligence in the vigilance over the goods remains in full force and effect even when they are temporarily unloaded or stored in transit, unless the shipper or owner has made use of the right of stoppage in transitu. ARTICLE 1738. %he extraordinary liability of the common carrier continues to be operative even during the time the goods are stored in a warehouse of the carrier at the place of destination, until the consignee has been advised of the arrival of the goods and has had reasonable opportunity thereafter to remove them or otherwise dispose of them. Cotes: 'rom when: #rom the time the *oods are nconditionally placed in the possession o#, and received by the carrier #or transportation! Cot act ally place on the ship, it is eno *h even i# c stody is trans#erred to the o##ice;receivin* o##ice o# the carrier! !t ends: -hen the *oods are delivered, act ally or constr ctively, by the carrier to the consi*nee, or to the person who has a ri*ht to receive them, witho t pre1 dice to the provisions o# article 0D38! 2. "ompania Maritima vs. !cna 1 'ince the vessel o# "M was too lar*e #or the 'asa -ar#, "M sent a li*hter to pic$ p the hemp! Ie#ore the hemp co ld be loaded to the vessel, the li*hter san$! "M alle*ed that it co ld not be liable #or the loss as the *oods were not yet loaded on the vessel! Iesides, there was no bill o# ladin* yet iss ed to the shipper!
5: The claim that there can be no contract o# a##rei*htment beca se the hemp was not act ally loaded on the ship that was to ta$e it #rom =avao "ity to Manila is o# no moment, #or the delivery o# the hemp to the carriers li*hter is in line with the contract! The a thorities are to the e##ect that a bill o# ladin* is not indispensable #or the creation o# a contract o# carria*e! (s re*ards the #orm o# the contract o# carria*e it can be said that provided that there is a meetin* o# the minds and #rom s ch meetin* arise ri*hts and obli*ations, there sho ld be no limitations as to #orm! The bill o# ladin* is 1 ridically a doc mentary proo# o# the stip lations and conditions a*reed pon by both parties! The liability o# the carrier as common carrier be*ins with the act al delivery o# the *oods #or transportation, and not merely with the #ormal e@ec tion o# a receipt or bill o# ladin*/ the iss ance o# a bill o# ladin* is not necessary to complete delivery and acceptance! 7ven where it is provided by stat te that liability commences with the iss ance o# the bill o# ladin*, act al delivery and acceptance are s ##icient to bind the carrier! The test as to whether the relation o# shipper and carrier had been established is, had the control and possession o# the cotton been completely s rrendered by the shipper to the shipper< -henever the control and possession o# *oods passes to the carrier and nothin* remains to be done by the shipper, then it can be said with certainty that the relation o# shipper and carrier has been established!
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5: .t is tr e that, as a r le, a common carrier is responsible #or the loss, destr ction or deterioration o# the *oods it ass mes to carry #rom one place to another nless the same is d e to any to any o# the ca ses mentioned in (rticle 0D34 on the new "ivil "ode, and that, i# the *oods are lost, destroyed or deteriorated, #or ca ses other that those mentioned, the common carrier is pres med to have been at #a lt or to have acted ne*li*ently, nless it proves that it has observed e@traordinary dili*ence in their care , and that this e@traordinary liability lasts #rom the time the *oods are placed in the possession o# the carrier ntil they are delivered to the consi*nee, or Oto the person who has the ri*ht to receive themO , b t these provisions only apply when the loss, destr ction or deterioration ta$es place while the *oods are in the possession o# the carrier, and not a#ter it has lost control o# them! The reason is obvio s! -hile the *oods are in its possession, it is b t #air that it e@ercise e@traordinary dili*ence in protectin* them #rom dama*e, and i# loss occ rs, the law pres mes that it was d e to its #a lt or ne*li*ence! This is necessary to protect the interest the interest o# the owner who is at its mercy! The sit ation chan*es a#ter the *oods are delivered to the consi*nee! -hile we a*ree with the "o rt o# (ppeals that while delivery o# the car*o to the consi*nee, or to the person who has a ri*ht to receive themO, contemplated in (rticle 0D3F, beca se in s ch case the *oods are still in the hands o# the &overnment and the owner cannot e@ercise dominion over them, we believe however that the parties may a*ree to limit the liability o# the carrier considerin* that the *oods have still to thro *h the inspection o# the c stoms a thorities be#ore they are act ally t rned over to the consi*nee! This is a sit ation where we may say that the carrier losses control o# the *oods beca se o# a c stom re* lation and it is n#air that it be made responsible #or what may happen d rin* the interre*n m! (nd this is precisely what was done by the parties herein!

'o what can be done in cases s ch as this wherein we have no e@act provision nder the law to *overn the same< .n s ch case, the a*reement o# the parties prevail! 3! S#RDA(&) DS. H!L ST#AM (AD!<AT!)( ")

5ere, the *oods were delivered in *ood order in the wareho se o# the c stoms a thority! (t abo t 2:00 in the a#ternoon o# the same day, said wareho se was ra>ed by a #ire o# n$nown ori*in, destroyin* appelleesN car*oes! Ie#ore the #ire, however, appellee By Iico was able to ta$e delivery o# 90D cavans o# rice! .s the carrier liable<
5: Co! (rticle 0D3F o# the "ivil "ode imposes pon common carriers the d ty to observe e@traordinary dili*ence #rom the moment the *oods are nconditionally placed in their possession O ntil the same are delivered, act ally or constr ctively, by the carrier to the consi*nee or to the person who has a ri*ht to receive them, witho t pre1 dice to the provisions o# (rticle 0D38! O The co rt a 4 o held that the delivery o# the shipment in 4 estion to the wareho se o# the I rea o# " stoms is not the delivery contemplated by (rticle 0D3F/ and since the b rnin* o# the wareho se occ rred be#ore act al or constr ctive delivery o# the *oods to the appellees, the loss is char*eable a*ainst the appellant! .t sho ld be pointed o t, however, that in the bills o# ladin* iss ed #or the car*oes in 4 estion, the parties a*reed to limit the responsibility o# the carrier #or the loss or dama*e that may be ca sed to the shipment by insertin* therein the #ollowin* stip lation: "la se 04! "arrier shall not be responsible #or loss or dama*e to shipments billed NownerNs ris$N nless s ch loss or dama*e is d e to ne*li*ence o# carrier! Cor shall carrier be responsible #or loss or dama*e ca sed by #orce ma1e re, dan*ers or accidents o# the sea or other waters/ war/ p blic enemies/ ! ! ! #ire ! !!! .n the case at bar, the b rnin* o# the c stoms wareho se was an e@traordinary event which happened independently o# the will o# the appellant! The latter co ld not have #oreseen the event!

'o in this case, the b rnin* o# the c stoms wareho se was considered as a #ort ito s event in so far as the carrier is concerned. 4! SAMAR M!(!(< DS. ()R&#>T"H#R LL)C& The bill o# ladin* provided that it was e##ective only #or the transport o# the *oods #or &ermany to Manila! ?rom Manila, the *oods were to be # rther transported to =avao! The carrier had nloaded and delivered the *ood in the

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 bonded wareho se in Manila! They never reached =avao! .s Corde tcher ,loyd liable< 5eld: Co! -hen the carrier nder the terms o# the bill o# ladin* had delivered the *oods at the port o# destination, at that point he merely becomes the a*ent o# consi*nee and ceases to be liable as carrier #or loss or dama*es o# the *oods transported! Therea#ter, loss o# *oods in its hand #or ca ses beyond its control witho t ne*li*ence bein* proved, cannot s stain a claim #or dama*e a*ainst the carrier!
There is no do bt that (rt! 0D38 #inds no applicability to the instant case! The said article contemplates a sit ation where the *oods had already reached their place o# destination and are stored in the wareho se o# the carrier! The s b1ect *oods were still awaitin* transshipment to their port o# destination, and were stored in the wareho se o# a third party when last seen and;or heard o#! 5owever, (rticle 0D3F is applicable to the instant s it! Bnder said article, the carrier may be relieved o# the responsibility #or loss or dama*e to the *oods pon act al or constr ctive delivery o# the same by the carrier to the consi*nee, or to the person who has a ri*ht to receive them! .n sales, act al delivery has been de#ined as the cedin* o# corporeal possession by the seller, and the act al apprehension o# corporeal possession by the b yer or by some person a thori>ed by him to receive the *oods as his representative #or the p rpose o# c stody or disposal! Iy the same to$en, there is act al delivery in contracts #or the transport o# *oods when possession has been t rned over to the consi*nee or to his d ly a thori>ed a*ent and a reasonable time is *iven him to remove the *oods! The co rt a 4 o #o nd that there was act al delivery to the consi*nee thro *h its d ly a thori>ed a*ent, the carrier! .t becomes necessary at this point to dissect the comple@ relationship that had developed between appellant and appellee in the co rse o# the transactions that *ave birth to the present s it! Two nderta$in*s appeared embodied and;or provided #or in the Iill o# ,adin* 09 in 4 estion! The #irst is ?%E T57 TE(C'P%ET %? &%%=' #rom Iremen, &ermany to Manila! The second, T57 TE(C''5.PM7CT %? T57 '(M7 &%%=' #rom Manila to =avao, with appellant actin* as a*ent o# the consi*nee! (t the hiat s between these two nderta$in*s o# appellant which is the moment when the s b1ect *oods are dischar*ed in Manila, its personality chan*es #rom that o# carrier to that o# a*ent o# the consi*nee! Th s, the character o# appellantNs possession also chan*es, #rom possession in its own name as carrier, into possession in the name o# consi*nee as the latterNs a*ent! ' ch bein* the case, there was, in e##ect, act al delivery o# the *oods #rom appellant as carrier to the same appellant as a*ent o# the consi*nee! Bpon s ch delivery, the appellant, as erstwhile carrier, ceases to be responsible #or any loss or dama*e that may be#all the *oods #rom that point onwards! This is the # ll import o# (rticle 0D3F, as applied to the case be#ore Bs! I t even as a*ent o# the consi*nee, the appellant cannot be made answerable #or the val e o# the missin* *oods, .t is tr e that the transshipment o# the *oods, which was the ob1ect o# the a*ency, was not # lly per#ormed! 5owever, appellant had commenced said per#ormance, the completion o# which was aborted by circ mstances beyond its control! (n a*ent who carries o t the orders and instr ctions o# the principal witho t bein* * ilty o# ne*li*ence, deceit or #ra d, cannot be held responsible #or the #ail re o# the principal to accomplish the ob1ect o# the a*ency!

s pposed to be p lled by the t *boat! (ccordin* to 'chmit>, Ilac$ 'ea, the owner o# MJ (le@ander, sho ld be liable beca se the *oods have not yet been delivered to the consi*nee! 5: Co, beca se 'hcmit> is an a*ent o# the consi*nee! (nd Ilac$ 'ea already delivered the *oods once the same were trans#erred #rom the vessel MJ (le@ander to the bar*e that was s pposed to brin* the *oods to the wareho se o# ,ittle &iant, the consi*nee! Th s Ilac$ sea no lon*er had c stody over the *oods! There was already act al delivery to the person who had the ri*ht to receive them, 'chmit> -- as an a*ent o# the consi*nee! DAL!&!TC )' ST! >LAT!)(S

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"an the ""%& and the shipper a*ree that the ""%& will not be re4 ired to e@ercise M%=< C#S. As to the dili3ence re7uired5 &eneral r le: the ""%& and the shipper may enter into an a*reement;stip lation which lessens the dili*ence re4 ired, b t there are re4 isites: ARTICLE 1744. A stipulation between the common carrier and the shipper or owner limiting the liability of the former for the loss, destruction, or deterioration of the goods to a degree less than extraordinary diligence shall be valid, provided it be' (1) In writing, (.) signed by the shipper or owner( ) Supported by a valuable consideration other than the service rendered by the common carrier- and (!) 5easonable, 2ust and not contrary to public policy. "an the parties stip late that there shall be no dili*ence to be e@cercised by the ""%&< C%! Bnder (rt! 0D48, these are void stip lations beca se they are a*ainst p blic policy! ARTICLE 1745. Any of the following or similar stipulations shall be considered unreasonable, un2ust and contrary to public policy' (1) %hat the goods are transported at the ris, of the owner or shipper(.) %hat the common carrier will not be liable for any loss, destruction, or deterioration of the goods( ) %hat the common carrier need not observe any diligence in the custody of the goods(!) %hat the common carrier shall exercise a degree of diligence less than that of a good father of a family, or of a man of ordinary prudence in the vigilance over the movables transported(") %hat the common carrier shall not be responsible for the acts or omission of his or its employees($) %hat the common carrier4s liability for acts committed by thieves, or of robbers who do not act with grave or irresistible threat, violence or force, is dispensed with or diminished(7) %hat the common carrier is not responsible for the loss, destruction, or deterioration of goods on account of the defective condition of the car, vehicle, ship, airplane or other e+uipment used in the contract of carriage. Cotes: 0! &e <uzman vs. "A: "endana is not liable #or the loss o# the *oods beca se o# the hi1ac$in* incident beca se it #ell nder (rt! 0D48)F+ ! (ccordin* to the co rt,
5: (pplyin* the above-4 oted (rticles 0D34 and 0D38, we note #irstly that the speci#ic ca se alle*ed in the instant case the hi1ac$in* o# the carrierNs tr c$ does not #all within any o# the #ive )8+ cate*ories o# e@emptin* ca ses listed in (rticle 0D34! .t wo ld #ollow, there#ore, that the hi1ac$in* o# the carrierNs vehicle m st be dealt with nder the provisions o# (rticle 0D38, in other words, that the private respondent as common carrier is pres med to have been at #a lt or to have acted ne*li*ently! This pres mption, however, may be overthrown by proo# o# e@traordinary dili*ence on the part o# private respondent! Petitioner insists that private respondent had not observed e@traordinary dili*ence in the care o# petitionerNs *oods! Petitioner ar* es that in the circ mstances o# this case, private respondent sho ld have hired a sec rity * ard pres mably to ride with the tr c$ carryin* the F00 cartons o# ,iberty #illed mil$! -e do not believe, however, that in the instant case, the standard o# e@traordinary dili*ence re4 ired private respondent to retain a sec rity * ard to ride with the tr c$ and to en*a*e bri*ands in a #ireli*ht at the ris$ o# his own li#e and the lives o# the driver and his helper!

8! Macam vs. "A ?acts: Petitioner Macam e@ported watermelons and man*oes to 5on* 6on*, &reat Prospect "ompany is the consi*nee! The bill o# ladin* stated that one o# the bill m st be presented by the Pa$istan Ian$ as consi*nee and &P" as the noti#y party! Bpon arrival in 5on* 6on*, the shipment was delivered by the carrier directly to &P" and not to Pa$istan Ian$ and witho t s rrenderin* the bill o# ladin*! -as there a proper delivery<
5eld: 97'! =elivery to &P" is delivery to the consi*nee! The e@traordinary responsibility o# common carriers last ntil act al or constr ctive delivery o# the car*o to the consi*nee or his a*ent! Pa$istan was indicted as consi*nee and &P" was the noti#y party! 5owever, in the e@port invoice, &P" was clearly named as b yer or importer! Petitioner re#erred to &P" as s ch in his demand letter to respondent and his complaint be#ore the co rt! This premise brin*s into concl sion that the deliveries o# the car*o to &P" as b yer or importer is in con#ormity with (rt! 0D3F o# the "ivil "ode! There#ore, there was a valid delivery!

'o here, even i# there was no delivery to the consi*nee b t there were instr ctions #rom the shipper then the *oods are deemed delivered and the ""%& can no lon*er be held liable #or the loss o# the *oods! F! S"HM!TG TRA(S )RT DS. TD!: The car*o was on board MJ (le@ander that was par$ed o tside the brea$water! The *oods were loaded on a bar*e that was

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Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09

Bnder (rticle 0D48 )F+ above, a common carrier is held responsible and will not be allowed to divest or to diminish s ch responsibility even #or acts o# stran*ers li$e thieves or robbers, e@cept where s ch thieves or robbers in #act acted Owith *rave or irresistible threat, violence or #orce!O -e believe and so hold that the limits o# the d ty o# e@traordinary dili*ence in the vi*ilance over the *oods carried are reached where the *oods are lost as a res lt o# a robbery which is attended by O*rave or irresistible threat, violence or #orce!O Three )3+ o# the #ive )8+ hold- ppers were armed with #irearms! The robbers not only too$ away the tr c$ and its car*o b t also $idnapped the driver and his helper, detainin* them #or several days and later releasin* them in another province )in Pambales+! .n these circ mstances, we hold that the occ rrence o# the loss m st reasonably be re*arded as 4 ite beyond the control o# the common carrier and properly re*arded as a #ort ito s event! .t is necessary to recall that even common carriers are not made absol te ins rers a*ainst all ris$s o# travel and o# transport o# *oods, and are not held liable #or acts or events which cannot be #oreseen or are inevitable, provided that they shall have complied with the ri*oro s standard o# e@traordinary dili*ence!

hi*her #rei*hta*e, the carrier shall accordin*ly be liable #or *reater dama*e! )ther cases cited in ppt: 7astern vs! .(" )080 '"E( 4F3+, 'ea-,and 'ervices vs! .(" )083 '"E(+, "o$alion* 'hippin* vs! B"PI )2003+ Art. 1747. If the common carrier, without just cause, delays the transportation of the goods or changes the stipulated or usual route, the contract limiting the common carrier4s liability cannot be availed of in case of the loss, destruction, or deterioration of the goods. 7ven i# there is any limitation limitin* the liability o# the carrier, this cannot be availed o# by the carrier i# it witho t 1 st ca se, delays the transportation o# the *oods, or etc! -hat i# there is a stip lation limitin* the liability and the #li*ht is #rom =avao to Manila! I t beca se there was a typhoon in Manila, it was nable to land there so it landed in "eb ! "an the carrier avail o# the stip lation< 9es, beca se there was a 1 st ca se #or the chan*e o# #li*ht! 0D4D only applies i# there is no reason! Art. 1748. An agreement limiting the common carrier4s liability for delay on account of stri,es or riots is valid. Art. 1749. A stipulation that the common carrier4s liability is limited to the value of the goods appearing in the bill of lading, unless the shipper or owner declares a greater value, is binding. Art. 1750. A contract fixing the sum that may be recovered. by the owner or shipper for the loss, destruction, or deterioration of the goods is valid, if it is reasonable and 2ust under the circumstances, and has been fairly and freely agreed upon. Art. 1751. %he fact that the common carrier has no competitor along the line or route, or a part thereof, to which the contract refers shall be ta,en into consideration on the +uestion of whether or not a stipulation limiting the common carrier4s liability is reasonable, 2ust and in consonance with public policy. Art. 1752. 1ven when there is an agreement limiting the liability of the common carrier in the vigilance over the goods, the common carrier is disputably presumed to have been negligent in case of their loss, destruction or deterioration. That pres mption o# ne*li*ence will still arise despite the #act that there is an a*reement! The carrier still has to prove that it e@ercised 7M%= to escape liability! .# the carrier does not want to prove it, it will 1 st accept the liability, then the carrier will be liable #or the amo nt stip lated in the a*reement! %# co rse, nless any o# the circ mstances li$e nat ral disaster, etc! are present! Ba33a3e of passen3ers

ARTICLE 1746. An agreement limiting the common carrier4s liability may be annulled by the shipper or owner if the common carrier refused to carry the goods unless the former agreed to such stipulation. ARTICLE 1747. If the common carrier, without 2ust cause, delays the transportation of the goods or changes the stipulated or usual route, the contract limiting the common carrier4s liability cannot be availed of in case of the loss, destruction, or deterioration of the goods. ARTICLE 1748. An agreement limiting the common carrier4s liability for delay on account of stri,es or riots is valid. Stipulation lessenin3 the amount of lia6ility

Dalid: Provided #ollow the re4 isites nder 0D49 and 0D80 ARTICLE 1749. A stipulation that the common carrier4s liability is limited to the value of the goods appearing in the bill of lading, unless the shipper or owner declares a greater value, is binding. ARTICLE 1750. A contract fixing the sum that may be recovered by the owner or shipper for the loss, destruction, or deterioration of the goods is valid, if it is reasonable and 2ust under the circumstances, and has been fairly and freely agreed upon. Cormally, when are these stip lations present< 0! .n contracts o# carria*e by sea -- in the bill o# ladin*/ )800 pesos per $ilo+ 2! .n contracts o# carria*e by air -- in the tic$et! )normally Q20 per $ilo+ ?or the stip lation to be valid, it m st not be 1 st a stip lation! .t m st contain a statement which says that i# the shipper a*rees or has declared a hi*her val ation and has paid #or a hi*her price thereo#, then the 800 peso limitation is not applicable! The 800-peso limitation is only applicable when the shipper has not declared a hi*her val e and paid a hi*her #rei*ht! ( stip lation which e@empts the carrier #rom any or all liability #rom loss or dama*e occasioned by its own ne*li*ence is not valid! ( stip lation which provides #or an n4 ali#ied limitations, li$e 00 pesos per $ilo )only+ and th s limits liability to an a*reed val ation is not valid! )Meanin*, wala y n* stip lation that i# the shipper pays a hi*her #rei*ht, etc!+ *Heacoc9 vs. Macondray+ where the '" en merated the three $inds o# stip lation: 0! Co liability -- the carrier will not be liable at all #or the ne*li*ent acts o# its crew and employees -- void 2! ,imited ,iability -- re*ardless o# the val e o# the car*o, the ma@im m liability o# the carrier will by only to a certain amo nt, i!e! 800 per $ilo -- void! 3! : ali#ied liability- this is the only stip lation in a bill o# ladin*;tic$et which can validly limit liability/ here, the carrier #i@es a ma@im l liability in the event the shipper doe snot delcare any val e, or a val e pto a certain amo nt! 'ho ld shipper declare a hi*her val e and willin* to pay

-ith respect to ba**a*e o# passen*ers, we reco*ni>e chec$ed-in ba**a*e and hand-carried ba**a*es! Passen*er is responsible #or his hand-carry ba**a*es! Art. 1754. %he provisions of Articles 17 to 17" shall apply to the passenger4s baggage which is not in his personal custody or in that of his employee. As to other baggage, the rules in Articles 1663 and .777 to .77 concerning the responsibility of hotel8,eepers shall be applicable. -ith respect to chec$ in ba**a*es, the applicable provisions are the provisions we too$ p! 5owever, i# the l **a*e is hand-carried, di##erent provisions o# the "" will apply! )0998, 2000- 2003+ -hat is the s mmary #or hand-carried items< 0! Art. 2AA-: The carrier shall be responsible #or handcarried ba**a*es as depositaries, provided that notice was *iven to them, or to their employees, o# the e##ects bro *ht by the passen*ers and that, on the part o# the latter, they ta$e the preca tions which said carriers or their s bstit tes advised relative to the care and vi*ilance o# their e##ects! 2! Art. ,;;;! The responsibility re#erred to in the precedin* article shall incl de the loss o#, or in1 ry to the personal property o# the passen*er ca sed by the servants or employees o# the carrier as well as stran*ers/ b t not that which may proceed #rom any #orce ma1e re!

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 The #act that passen*ers are constrained to rely on the vi*ilance o# the carrier shall be considered in determinin* the de*ree o# care re4 ired o# him! 3! Art. ,;;2! The act o# a thie# or robber, who has entered the carrier is not deemed #orce ma1e re, nless it is done with the se o# arms or thro *h an irresistible #orce! )n+ Art. ,;;,! The carrier is not liable #or compensation i# the loss is d e to the acts o# the passen*er, his #amily, servants or visitors, or i# the loss arises #rom the character o# the thin*s bro *ht! )n+ Art. ,;;.! The common carrier cannot #ree himsel# #rom responsibility by postin* notices to the e##ect that he is not liable #or the articles bro *ht by the passen*ers! "ARR!A<# )' ASS#(<#RS $hat a6out hi1Hac9in3% !s it a fortuitous event%

(s a *eneral r le, hi-1ac$in* o# an airline cannot be a #ort ito s event beca se this is not n#orseen, this is e@pected! That is why sec rity chec$s are cond cted! I t in <A"AL vs. AL - this was considered a #ort ito s event beca se the inspection was done by the military, and not P(,! This case is a special case! I t what i# the hi-1ac$ happened on a b s or a tr c$< .n =e & >man, the '" said that it was a #ort ito s event! "an yo really e@pect that yo r b s will be hi1ac$ed while yo Nre travelin* alon* the hi*hway< Co, otherwise nobody will travel! !LA !L DS. "A: .t was held that a "" is not liable #or #ail re to install window *rills on its b ses to protect its passen*ers #rom in1 ries h rled at the b s by lawless elements! ')RT>(# #? R#SS DS. "A: The '" said that ?7 was liable beca se there was an early warnin* already! 'o the element o# n#orseeability was missin*! &>RAT!)( )' L!AB!L!TC

Art. 1755. A common carrier is bound to carry the passengers safely as far as human care and foresight can provide, using the ut ost !i"i#e$ce of very cautious persons, with a due regard for all the circumstances. Art. 1756. In case of death of or in2uries to passengers, common carriers are presumed to have been at fault or to have acted negligently, unless they prove that they observed extraordinary diligence as prescribed in Articles 17 and 17"". ( tomatic pres mption o# ne*li*ence, reb tted by provin* that carrier e@cercised e@traordinary dili*ence #or the sa#ety o# passen*ers accordin* to the circ mstances o# each case! Bnder the provisions o# carria*e o# *oods, in carria*e o# passen*ers, there are no e@ceptions as to the pres mption o# ne*li*ence! They will be a tomatically pres med to be ne*li*ent nder 0D8F, there are no e@ceptions! 'o that is the #irst distinction between "%& and "%P, b t the pres mption can be reb tted! Ta$e note that provin* e@traordinary dili*ence is not the only way o# escapin* liability! -e all $now that nder the *eneral provisions o# the "ivil "ode, a #ort ito s event will always e@empt the obli*or #rom liability, i# the #ort ito s event is the ca se o# the death, in1 ry o# the passen*er! R st memori>e the re4 isites o# #ort ito s events! .ss e: .# ( is a passen*er o# a ta@i and ta@i #i* red in an accident! ( s es the ta@i #or breach o# contract o# carria*e, does ( have to prove that the ta@i driver is at #a lt #or ( to collect dama*es #rom the operator o# the ta@i< (nswer: .n an action based on a contract o# carria*e, the co rt need not ma$e an e@press #indin* o# #a lt or ne*li*ence on the part o# the carrier in order to hold it responsible to pay dama*es to the passen*er! Ieca se o# the a tomatic pres mption o# ne*li*ence, the b rden o# proo# is on the carrier! .# the carrier reb ts the pres mption, then it is absolved! .# it does not reb t that pres mption, there is no need #or the passen*er or his heirs to prove ne*li*ence! -hat $ind o# #ort ito s event will e@empt a carrier #rom liability< .s a tire blow o t a #ort ito s event< .t depends! Eemember that even the '" did not cate*orically state that a tire blow o t is not a #ort ito s event! 9o always have to loo$ at the re4 isites! .n the cases *Co6ido vs. "A5 (ecesito vs. aras+5 they were all cases o# tire blow o ts and the '" always #o nd a way to remove the tire blow o t sit tation #rom covera*e o# #ort ito s events! .n (ecesito vs. aras *2A0-+, the '" said that Ode#ective parts o# vehicles cannot be considered a #ort ito s event beca se the man #act rer o# the de#ective parts is considered in law the a*ent o# the carrier, and the *ood rep te o# the man #act rer will not relieve the carrier #rom liability!O .n 9obido, the co rt discovered that the driver was drivin* too #ast, so there was ne*li*ence and participation on the part o# the carrier in brin*in* the accident!

Co provision #or "" o# pa@ #or the d ration o# liability/ only cases 0! Bataclan vs. Medina )overt rned b s which lea$ed *asoline and was set on #ire when villa*ers who wanted to help bro *ht torches+
5eld: "" is still liable even i# the b s was no lon*er in transit! .n the present case and nder the circ mstances obtainin* in the same, we do not hesitate to hold that the pro@imate ca se o# the death o# Iataclan was the overt rnin* o# the b s, this #or the reason that when the vehicle t rned not only on its side b t completely on its bac$, the lea$in* o# the *asoline #rom the tan$ was not nnat ral or ne@pected/ that the comin* o# the men with a li*hted torch was in response to the call #or help, made not only by the passen*ers, b t most probably, by the driver and the cond ctor themselves, and that beca se it was very dar$ )abo t 2:30 in the mornin*+, the resc ers had to carry a li*ht with them/ and comin* as they did #rom a r ral area where lanterns and #lashli*hts were not available, they had to se a torch, the most handy and available/ and what was more nat ral than that said resc ers sho ld innocently approach the overt rned vehicle to e@tend the aid and e##ect the resc e re4 ested #rom them! .n other words, the comin* o# the men with the torch was to be e@pected and was a nat ral se4 ence o# the overt rnin* o# the b s, the trappin* o# some o# its passen*ers and the call #or o tside help! -hat is more, the b rnin* o# the b s can also in part be attrib ted to the ne*li*ence o# the carrier, thro *h its driver and its cond ctor! (ccordin* to the witnesses, the driver and the cond ctor were on the road wal$in* bac$ and #orth! They, or at least, the driver sho ld and m st have $nown that in the position in which the overt rned b s was, *asoline co ld and m st have lea$ed #rom the *asoline tan$ and soa$ed the area in and aro nd the b s, this aside #rom the #act that *asoline when spilled, specially over a lar*e area, can be smelt and detected even #rom a distance, and yet neither the driver nor the cond ctor wo ld appear to have ca tioned or ta$en steps to warn the resc ers not to brin* the li*hted torch too near the b s! 'aid ne*li*ence on the part o# the a*ents o# the carrier come nder the codal provisions abovereprod ced, partic larly, (rticles 0D33, 0D89 and 0DF3!
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2! La Mallorca vs. "A )the child o# a Pa@ was r n over by the b s when she #ollowed her #ather who was *ettin* their ba**a*es! The b s was already movin* steadily a#ter it had dropped o## the Pa@ even tho *h the ba**a*es were still on board the tr c$!+
5eld: here can be no controversy that as #ar as the #ather is concerned, when he ret rned to the b s #or his bayon* which was not nloaded, the relation o# passen*er and carrier between him and the petitioner remained s bsistin*! ?or, the relation o# carrier and passen*er does not necessarily cease where the latter, a#ter ali*htin* #rom the car, aids the carrierNs servant or employee in removin* his ba**a*e #rom the car! The iss e to be determined here is whether as to the child, who was already led by the #ather to a place abo t 8 meters away #rom the b s, the liability o# the carrier #or her sa#ety nder the contract o# carria*e also persisted! .t has been reco*ni>ed as a r le that the )contract al+ relation o# carrier and passen*er does not cease at the moment the passen*er ali*hts #rom the carrierNs vehicle at a place selected by the carrier at the point o# destination, b t contin es ntil the passen*er has had a reasonable time or a reasonable opport nity to leave the carrierNs premises! (nd, what is a reasonable time or a reasonable delay within this r le is to be determined #rom all the circ mstances! 'o no speci#ic time or speci#ic distance!

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 3! AL vs. Gapatos: 7ven i# the pa@ are in transit, this will not terminate the contract al relations!
5eld: Bndisp tably, P(,Ns diversion o# its #li*ht d e to inclement weather was a #ort ito s event! Conetheless, s ch occ rrence did not terminate P(,Ns contract with its passen*ers! Iein* in the b siness o# air carria*e and the sole one to operate in the co ntry, P(, is deemed e4 ipped to deal with sit ations as in the case at bar! -hat we said in one case once a*ain m st be stressed, i!e!, the relation o# carrier and passen*er contin es ntil the latter has been landed at the port o# destination and has le#t the carrierNs premises! 5ence, P(, necessarily wo ld still have to e@ercise e@traordinary dili*ence in sa#e* ardin* the com#ort, convenience and sa#ety o# its stranded passen*ers ntil they have reached their #inal destination!

10

Art. 1759. Common carriers are liable for the death of or in2uries to passengers through the negligence or wilful acts of the former4s employees, although such employees may have acted beyond the scope of their authority or in violation of the orders of the common carriers. %his liability of the common carriers does not cease upon proof that they exercised all the diligence of a good father of a family in the selection and supervision of their employees. Cotes: 0! There is no e@press provision in "" o# &oods e@actly li$e (rt! 0D89! IBT, the absence o# e@press stip lation does not mean that "" o# &oods not liable #or acts o# ees! Bnder (rt! 0DD8, par! 8, the "" cannot stip late that it shall not be responsible #or the acts o# its ees! 'o this means that "" o# *oods still liable/ 2! .# driver is dr n$ and #i* res in an accident, "" cannot say that it is not liable beca se driver violated company r les o# no drin$in* while drivin*! 3! =e#ense o# =ili*ence o# &ood #ather o# #amily is available i# the ca se o# action is c lpa ac4 iliana )(rt! 20DF, 2080 o# C""+, I t i# the ca se o# action is #or breach o# contract o# carria*e, this de#ense o# &?%? cannot be invo$ed! ")(TR!B>T)RC (#<L!<#("#

&)"TR!(# )' LAST "L#AR "HA("#:

This doctrine calls #or application in s its between owners o# two collidin* vehicles! .t does not apply where a pa@ demands responsibility #rom a carrier to en#orce its contract al obli*ations!
The principle o# last clear chance is inapplicable in the instant case, as it only applies in a s it between the owners and drivers o# two collidin* vehicles! .t does not arise where a passen*er demands responsibility #rom the carrier to en#orce its contract al obli*ations, #or it wo ld be ine4 itable to e@empt the ne*li*ent driver and its owner on the *ro nd that the other driver was li$ewise * ilty o# ne*li*ence! The common law notion o# last clear chance permitted co rts to *rant recovery to a plainti## who has also been ne*li*ent provided that the de#endant had the last clear chance to avoid the cas alty and #ailed to do so! (ccordin*ly, it is di##ic lt to see what role, i# any, the common law o# last clear chance doctrine has to play in a 1 risdiction where the common law concept o# contrib tory ne*li*ence as an absol te bar to recovery by the plainti##, has itsel# been re1ected, as it has been in (rticle 20D9 o# the "ivil "ode! )Ti vs! (rries*ado+

Art. 1761. %he passenger must observe the diligence of a good father of a family to avoid in2ury to himself. Art. 1762. %he contributory negligence of the passenger does not bar recovery of damages for his death or in2uries, if the proximate cause thereof is the negligence of the common carrier, but the amount of damages shall be e+uitably reduced. Cotes: 0! &efinition of "ontri6utory (e3li3ence : .t is the principle that ne*li*ence, no matter how sli*ht, on the part o# the person in1 red which is one o# the ca ses pro@imately contrib tin* to his ne*li*ence e4 itably red ces the liability o# the ""! 2! #stacion vs. Bernardo *,;;@+: )Pa@ o# Reepney was seated in e@tension seat initially b t *ave his seat p to an old lady! ( then h n*;stood o tside the 1eepney! -hen 1eepney stopped at the c rve, an is > tr c$ with a #a lty brea$ hit the 1eepney ca sin* in1 ry to (Ns le* which had to be amp tated!+
5eld: There was contrib tory ne*li*ence on the part o# (, and both tr c$ and 1eepney were #o nd to be ne*li*ent! 'harin* o# liability: 20-40-40! 20 to be borne by (!

DAL!&!TC )' ST! >LAT!)(S

Two 9inds: 2. As to the dili3ence re7uired ,. As to the amount of lia6ility AS T) TH# &!L!<#("# R#=>!R#& Art. 1757. %he responsibility of a common carrier for the safety of passengers as re+uired in Articles 17 and 17"" cannot be dispensed with or lessened by stipulation, by the posting of notices, by statements on tic,ets, or otherwise. Eemember: =ili*ence re4 ired: M%= -hat $ind o# M%=: Btmost dili*ence o# a very ca tio s person )0+ )2+ "" o# &oods are allowed to lessened the de*ree o# dili*ence, b t C%T do away with the same completely! "" o# Pa@ "(CC%T dispense with nor lessen the de*ree o# dili*ence!

Contributory negligence is conduct on the part of the injured party, contributing as a legal cause to the harm he has suffered, which falls below the standard to which he is required to conform for his own protection. When is one considered to have contributed to his injuries: It has been held that to hold a person as having contributed to his injuries, it must be shown that he performed an act that brought about his injuries in disregard of warning or signs of an impending danger to health and body. Respondent oe!s act of hanging on the "iera is definitely dangerous to his life and limb. 3! "A(<") DS. MRR ) Rose "an*co, herein plainti##, was an employee o# the de#endant in this case, manila Eailroad "ompany! Bpon the occasion in 4 estion, plainti## was ret rnin* home by rail #rom his daily labors! (s the train drew p to the station, plainti## arose #rom his seat! (s the train slowed down, plainti## stepped o##, b t one or both o# his #eet came in contact with a sac$ o# watermelons! (s a res lt, his #eet slipped #rom nder him and he #ell violently on the plat#orm!+
5eld: The act o# the plainti## in steppin* o## the train while it as yet slowly movin* was not characteri>ed by impr dence so as to hold him * ilty o# contrib tory ne*li*ence! .n arrivin* to s ch concl sion, the co rt sed the best o# ne*li*ence en nciated in the case o# Picart vs! 'mith )3D P5., 809+ which was stated as #ollow: -as there anythin* in the circ mstances s rro ndin* the plainti## at the time he ali*hted #rom the train which wo ld have admitted a person o# avera*e pr dence that to *et o## the train nder the conditions then e@istin* was

AS T) AM)>(T )' L!AB!L!TC Art. 1758. 9hen a passenger is carried gratuitously, a stipulation limiting the common carrier4s liability for negligence is valid, but not for wilful acts or gross negligence. %he reduction of fare does not 2ustify any limitation of the common carrier4s liability. <eneral Rule: "annot be limited But under 2B0-, there are circ mstances where this liability is limited: 0! Pa@ carried *rat ito sly 2! 7@istence o# stip lation limitin* liability 3! (ccident;Ireach not ca sed by will# l acts or *ross ne*li*ence! Eemember: Minim m amo nt that #rom "" is P 80,000 beca se this "" is a tomatically liable #or this wants to lessen this amo nt, "" m heirs o# pa@ can collect is indemnity #or death! minim m amo nt/ i# it st #ollow (rt! 0D88!

L!AB!L!TC ')R A"TS )' ##S

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09

dan*ero s< .# so, the plainti## sho ld have deserted #rom ali*htin*/ and his #ail re so to desist was contrib tory ne*li*ence! .n the case at bar, the plainti## was i*norant o# the #act that the obstr ction which was ca sed by the sac$s o# melds piled on the plat#orm e@isted! Moreover, the place was dar$ or dimly li*hted! Th s, he was a #ail re on the part o# the de#endant to a##ord to its passen*ers #acilities #or sa#e e*ress #rom its trains! .t is not ne*li*ence per se #or a traveler to ali*ht #rom a slowly movin* train!

11

ordinarily pr dent person wo ld have made the attempt to board the movin* conveyance nder the same or similar circ mstances! The #act that passen*ers board and ali*ht #rom a slowly movin* vehicle is a matter o# common e@perience and both the driver and cond ctor in this case co ld not have been naware o# s ch an ordinary practice! The victim herein, by steppin* and standin* on the plat#orm o# the b s, is already considered a passen*er and is entitled to all the ri*hts and protection pertainin* to s ch a contract al relation! 5ence, it has been held that the d ty which the carrier o# passen*ers owes to its patrons e@tends to persons boardin* the cars as well as to those ali*htin* there#rom!

4! &el

rado vs. MRR

D! !saac vs. Al Ammen ?acts: Plainti## boarded de#endants b s as payin* passen*er #rom (lbay! The b s collided with a pic$- p tr c$ which was comin* #rom opposite direction tryin* to swerve #rom a pile o# *ravel! (s a res lt, his le#t arm was completely severed! Plainti## chose to hold de#endant liable on its contract al obli*ation! Plainti## bro *ht an action #or dama*es which the lower co rt dismissed holdin* the driver o# the pic$- p car ne*li*ent and not that o# the b s! .ss e: -hether or not the common carrier is liable!
5eld: The b s was r nnin* at a moderate speed! The driver o# the b s pon the speedin* pic$- p tr c$ swerved the b s to the very e@treme ri*ht o# the road! 'aid driver wo ld not move the b s # rther witho t endan*erin* the sa#ety o# his passen*ers! Cotwithstandin* all these e##orts, the rear le#t side was hit! This #indin* o# the lower co rt was s stained! (lso, o# the carriers employee is con#ronted with a s dden emer*ency, he is not held to the same de*ree o# care he wo ld otherwise, he re4 ired in the absence o# s ch emer*ency! Iy placin* his le#t arm on the window, he is * ilty o# contrib tory ne*li*ence cannot relieve the carrier b t can only red ce its liability, this is a circ m#erence which # rther mista$es a*ainst plainti##s position! .t is a prevailin* r le that it is ne*li*ence per se #or passen*ers on a railroad to protr de any part o# his body and that no recovery can be had #or an in4 iry!H

5eld: =e#endant sho ld still be held liable #or the dama*es s stained by the plainti##! The contrib tory ne*li*ence pon the latter was not the pro@imate ca se o# the in1 ry! The pro@imate ca se was the act o# the motorman in p ttin* o## on the power premat rely! ( person movin* boardin* a movin* car m st be ta$en to ass re the ris$ o# in1 ry #rom boardin* the car, b t he cannot #airly be held to ass me the ris$ that the motorman will increase his peril by acceleratin* the speed o# the car be#ore he is planted on the plat#orm! The motormans ne*li*ence s cceeded the ne*li*ence o# herein plainti##! Bnder the doctrine o# Glast clear chanceH, the contrib tory ne*li*ence o# the party in1 red will not de#eat the action i# it be shown that the carrier mi*ht be the e@ercise o# reasonable care and pr dence have avoided the conse4 ences o# the ne*li*ence o# the in1 red party!

0. Brinas vs. eople )old woman and her *randda *hter bo nd #or ,osacan! "ond ctor anno nced their stop so the lola stood p and carried her OapoO and went to e@it! -hen train door opened, be#ore they co ld *o down, the train pic$ed p speed and they both #ell and died+
5eld: .t is a matter o# common $nowled*e and e@perience abo t common carriers li$e trains and b ses that be#ore reachin* a station or #la*stop they slow down and the cond ctor anno nces the name o# the place! .t is also a matter o# common e@perience that as the train or b s slac$ens its speed, some passen*ers s ally stand and proceed to the nearest e@it, ready to disembar$ as the train or b s comes to a # ll stop! This is especially tr e o# a train beca se passen*ers #eel that i# the train res mes its r n be#ore they are able to disembar$, there is no way to stop it as a b s may be stopped! .t was ne*li*ence on the cond ctorNs part to anno nce the ne@t #la* stop when said stop was still a # ll three min tes ahead! (s the respondent "o rt o# (ppeals correctly observed, Othe appellantNs anno ncement was premat re and erroneo s and was the pro@imate ca se o# the death o# the victims! (ny ne*li*ence o# the victims was at most contrib tory and does not e@c lpate the acc sed #rom criminal liability!

Responsi6ility for acts of stran3ers

Art. 1763. A co o$ carrier is res%o$si&"e 'or i$juries su''ere! &( a %asse$#er o$ accou$t o' the wi"'u" acts or $e#"i#e$ce o' other %asse$#ers or o' stra$#ers) i' the co o$ carrier*s e %"o(ees throu#h the e+ercise o' the !i"i#e$ce o' a #oo! 'ather o' a 'a i"( cou"! ha,e %re,e$te! or sto%%e! the act or o issio$. Cotes: 0! This is one instance wherein the carrier need not prove that it e@ercised M%= to escape liability! .# the in1 ry;death o# pa@ was ca sed by the act o# a stran*er )somebody who is not an ee o# the carrier+ the carrier need only prove that its ees e@ercised dili*ence o# &?%? to prevent or stop the act or omission! -hy< .t is not the responsibility o# the "" o# Pa@ to ens re that no in1 ry #rom o tside #orces will be ca sed to the pa@, i!e! when a bomb is thrown #rom the roadside! 2! MRR vs. Ballesteros 1 5ere, the driver o# the b s allowed a stran*er to ta$e the wheel o# the b s! (#ter awhile, the driver str **led with him as the stran*er did not want to *ive the wheel bac$! The b s met an accident! "an this provision be invo$ed< -hat $ind o# dili*ence does the "" o# Pa@ have to prove here< M%= beca se by act ally allowin* a stran*er to drive the b s even i# that person ca sed the accident, b t still the driver did not e@ercise the dili*ence o# &?%? to prevent or stop the act or omission! )yan tala*a sa lect re+ 3! 'ortune #4press vs. "A- ?ort ne e@press cannot invo$e this provision!
(s already stated, despite the report o# P" a*ent &eneralao that the Maranaos were plannin* to b rn some o# petitioners b ses and the ass rance o# petitioners operations mana*er )=iosdado Iravo+ that the necessary preca tions wo ld be ta$en, nothin* was really done by petitioner to protect the sa#ety o# passen*ers!

@. &an3wa vs. "A 1 *There was no contrib tory ne*li*ence on the part o# the victim in this case+
5eld: The #ore*oin* testimonies show that the place o# the accident and the place where one o# the passen*ers ali*hted were both between I n$ho ses 83 and 84, hence the #indin* o# the "o rt o# (ppeals that the b s was at # ll stop when the victim boarded the same is correct! They # rther con#irm the concl sion that the victim #ell #rom the plat#orm o# the b s when it s ddenly accelerated #orward and was r n over by the rear ri*ht tires o# the vehicle, as shown by the physical evidence on where he was therea#ter #o nd in relation to the b s when it stopped! Bnder s ch circ mstances, it cannot be said that the deceased was * ilty o# ne*li*ence! ,,phil The contention o# petitioners that the driver and the cond ctor had no $nowled*e that the victim wo ld ride on the b s, since the latter had s pposedly not mani#ested his intention to board the same, does not merit consideration! -hen the b s is not in motion there is no necessity #or a person who wants to ride the same to si*nal his intention to board! ( p blic tility b s, once it stops, is in e##ect ma$in* a contin o s o##er to b s riders! 5ence, it becomes the d ty o# the driver and the cond ctor, every time the b s stops, to do no act that wo ld have the e##ect o# increasin* the peril to a passen*er while he was attemptin* to board the same! The premat re acceleration o# the b s in this case was a breach o# s ch d ty! .t is the d ty o# common carriers o# passen*ers, incl din* common carriers by railroad train, streetcar, or motorb s, to stop their conveyances a reasonable len*th o# time in order to a##ord passen*ers an opport nity to board and enter, and they are liable #or in1 ries s ##ered by boardin* passen*ers res ltin* #rom the s dden startin* p or 1er$in* o# their conveyances while they are doin* so! ? rther, even ass min* that the b s was movin*, the act o# the victim in boardin* the same cannot be considered ne*li*ent nder the circ mstances! (s clearly e@plained in the testimony o# the a#orestated witness #or petitioners, Jir*inia (balos, the b s had O1 st startedO and Owas still in slow motionO at the point where the victim had boarded and was on its plat#orm! .t is not ne*li*ence per se, or as a matter o# law, #or one to attempt to board a train or streetcar which is movin* slowly! (n

.ss e: (re there other ca ses #or breach o# contract o# carria*e aside #rom (rt! 0D88 and 0D8F< (nswer: 9es!

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 0! !f a passen3er is 6umped off his fli3ht and he has a confirmed 6oo9in3, that is a breach beca se the carrier in the tic$et ens red that it will deliver the pa@ to its destination on the time and date stip lated! 2! Air 'rance vs. "arrascoso S Re6oo9ed to a lower class without pa4 consent! Pa@ seated in #irst class #rom Mla to Ian*$o$! Bpon arrival in Ian*$o$, he was down*raded to economy to *ive way to a Owhite manO! There is a breach beca se his tic$et says #irst class, and by boo$in* the pa@ to economy class witho t his consent, what happens is that there is no more consent in the contract! 3! Sin3son vs. "athay acific - %n 24 May 0988 "(E,%' '.C&'%C and his co sin "rescentino Tion*son bo *ht #rom "athay Paci#ic (irways, ,td! )"(T5(9+, at its Metro Manila tic$et o tlet two )2+ open-dated, identically ro ted, ro nd trip plane tic$ets #or the p rpose o# spendin* their vacation in the Bnited 'tates! 7ach tic$et consisted o# si@ )F+ #li*ht co pons correspondin* to this itinerary: #li*ht co pon no! 0 - Manila to 5on*$on*/ #li*ht co pon no! 2 - 5on*$on* to 'an ?rancisco/ #li*ht co pon no! 3 - 'an ?rancisco to ,os (n*eles/ #li*ht co pon no! 4 - ,os (n*eles bac$ to 'an ?rancisco/ #li*ht co pon no! 8 - 'an ?rancisco to 5on*$on*/ and, #inally, #li*ht co pon no! F - 5on*$on* to Manila! The proced re was that at the start o# each le* o# the trip a #li*ht co pon correspondin* to the partic lar sector o# the travel wo ld be removed #rom the tic$et boo$let so that at the end o# the trip no more co pon wo ld be le#t in the tic$et boo$let! %n F R ne 0988 "(E,%' '.C&'%C and "rescentino Tion*son le#t Manila on board "(T5(9s ?li*ht Co! 902! They arrived sa#ely in ,os (n*eles and a#ter stayin* there #or abo t three )3+ wee$s they decided to ret rn to the Philippines! %n 30 R ne 0988 they arran*ed #or their ret rn #li*ht at "(T5(9s ,os (n*eles %##ice and chose 0 R ly 0988, a ?riday, #or their depart re! -hile Tion*son easily *ot a boo$in* #or the #li*ht, '.C&'%C was not as l c$y! .t was discovered that his tic$et boo$let did not have #li*ht co pon no! 8 correspondin* to the 'an ?rancisco-5on*$on* le* o# the trip! .nstead, what was in his tic$et was #li*ht co pon no! 3 - 'an ?rancisco to ,os (n*eles - which was s pposed to have been sed and removed #rom the tic$et boo$let! .t was not ntil F R ly 0988 that "(T5(9 was #inally able to arran*e #or his ret rn #li*ht to Manila!
5: "ATHAC undou6tedly committed a 6reach of contract when it refused to confirm petitionerEs fli3ht reservation 6ac9 to the hilippines on account of his missin3 fli3ht coupon. .ts contention that there was no contract o# carria*e that was breached beca se petitioners tic$et was open-dated is ntenable! To be*in with, the ro nd trip tic$et iss ed by the carrier to the passen*er was in itsel# a complete written contract by and between the carrier and the passen*er! .t had all the elements o# a complete written contract, to wit: )a+ the consent o# the contractin* parties mani#ested by the #act that the passen*er a*reed to be transported by the carrier to and #rom ,os (n*eles via 'an ?rancisco and 5on*$on* bac$ to the Philippines, and the carriers acceptance to brin* him to his destination and then bac$ home/ )b+ ca se or consideration, which was the #are paid by the passen*er as stated in his tic$et/ and, )c+ ob1ect, which was the transportation o# the passen*er #rom the place o# depart re to the place o# destination and bac$, which are also stated in his tic$et! .nterestin*ly, it appears that "(T5(9 was responsible #or the loss o# the tic$et! %ne o# two )2+ thin*s may be s rmised #rom the circ mstances o# this case: #irst, B' (ir )"(T5(9s a*ent+ had mista$enly detached the 'an ?rancisco-5on*$on* #li*ht co pon thin$in* that it was the 'an ?rancisco-,os (n*eles portion/ or, second, petitioners boo$let o# tic$ets did not #rom iss ance incl de a 'an ?rancisco-5on*$on* #li*ht co pon! .n either case, the loss o# the co pon was attrib table to the ne*li*ence o# "(T5(9s a*ents and was the pro@imate ca se o# the non-con#irmation o# petitionerNs ret rn #li*ht on 0 R ly 0988! -ith re*ard to the second iss e, we are o# the #irm view that the appellate co rt serio sly erred in disallowin* moral and e@emplary dama*es! (ltho *h the r le is that moral dama*es predicated pon a breach o# contract o# carria*e may only be recoverable in instances where the mishap res lts in the death o# a passen*er, or where the carrier is * ilty o# #ra d or bad #aith, there are sit ations where the ne*li*ence o# the carrier is so *ross and rec$less as to virt ally amo nt to bad #aith, in which case, the passen*er li$ewise becomes entitled to recover moral dama*es, s ch as in the instant case!

12

beca se P(, was not able to prod ce the indemnity bond e@ec ted by the minorsN parents since they were travellin* naccompanied! 5ere, there was de#initely a breach o# contract even i# the #li*ht that the minors were s pposed to ta$e is in another airline! .t was beca se o# P(,Ns ne*li*ence that they were not able board the other airline!
5: -hen an airline iss es a tic$et to a passen*er, con#irmed #or a partic lar #li*ht on a certain date, a contract o# carria*e arises! The passen*er has every ri*ht to e@pect that he be transported on that #li*ht and on that date, and it becomes the airlineNs obli*ation to carry him and his l **a*e sa#ely to the a*reed destination witho t delay! .# the passen*er is not so transported or i# in the process o# transportin*, he dies or is in1 red, the carrier may be held liable #or a breach o# contract o# carria*e! Private respondents and petitioner entered into a contract o# air carria*e when the #ormer p rchased two plane tic$ets #rom the latter! Bnder this contract, petitioner obli*ed itsel# )0+ to transport =eanna and Ci$olai, as naccompanied minors, on 2 May 0980 #rom Manila to 'an ?rancisco thro *h one o# its planes, ?li*ht 00F/ and )2+ pon the arrival o# =eanna and Ci$olai in 'an ?rancisco (irport on 3 May 0980, to transport them on that same day #rom 'an ?rancisco to ,os (n*eles via a connectin* #li*ht on Bnited (irways 99F! (s it was, petitioner #ailed to transport =eanna and Ci$olai #rom 'an ?rancisco to ,os (n*eles on the day o# their arrival at 'an ?rancisco! The sta## o# Bnited (irways 99F re# sed to ta$e aboard =eanna and Ci$olai #or their connectin* #li*ht to ,os (n*eles beca se petitionerNs personnel in 'an ?rancisco co ld not prod ce the indemnity bond accomplished and s bmitted by private respondents!.t was established in the instant case that since =eanna and Ci$olai wo ld travel as naccompanied minors, petitioner re4 ired private respondents to accomplish, si*n and s bmit to it an indemnity bond! Private respondents complied with this re4 irement! Petitioner *ave a copy o# the indemnity bond to one o# its personnel on ?li*ht 00F, since it was re4 ired #or the 'an ?rancisco-,os (n*eles connectin* #li*ht o# =eanna and Ci$olai! PetitionerNs personnel lost the indemnity bond d rin* the stop-over o# ?li*ht 00F in 5onol l , 5awaii! Th s, =eanna and Ci$olai were not allowed to ta$e their connectin* #li*ht! 7vidently, petitioner was # lly aware that =eanna and Ci$olai wo ld travel as naccompanied minors and, there#ore, sho ld be specially ta$en care o# considerin* their tender a*e and delicate sit ation! Petitioner also $new well that the indemnity bond was re4 ired #or =eanna and Ci$olai to ma$e a connectin* #li*ht #rom 'an ?rancisco to ,os (n*eles, and that it was its d ty to prod ce the indemnity bond to the sta## o# Bnited (irways 99F so that =eanna and Ci$olai co ld board the connectin* #li*ht! 9et, despite $nowled*e o# the #ore*oin*, it did not e@ercise tmost care in handlin* the indemnity bond res ltin* in its loss in 5onol l , 5awaii! This was the pro@imate ca se why =eanna and Ci$olai were not allowed to ta$e the connectin* #li*ht and were th s stranded overni*ht in 'an ?rancisco! ? rther, petitioner discovered that the indemnity bond was lost only when ?li*ht 00F had already landed in 'an ?rancisco (irport and when the sta## o# Bnited (irways 99F demanded the indemnity bond! This only mani#ests that petitioner did not chec$ or veri#y i# the indemnity bond was in its c stody be#ore leavin* 5onol l , 5awaii #or 'an ?rancisco! The #ore*oin* circ mstances re#lect petitionerNs tter lac$ o# care #or and inattention to the wel#are o# =eanna and Ci$olai as naccompanied minor passen*ers! They also indicate petitionerNs #ail re to e@ercise even sli*ht care and dili*ence in handlin* the indemnity bond! "learly, the ne*li*ence o# petitioner was so *ross and rec$less that it amo nted to bad #aith! .t is worth emphasi>in* that petitioner, as a common carrier, is bo nd by law to e@ercise e@traordinary dili*ence and tmost care in ens rin* #or the sa#ety and wel#are o# its passen*ers with d e re*ard #or all the circ mstances!K09L The ne*li*ent acts o# petitioner si*ni#ied more than inadvertence or inattention and th s constit ted a radical depart re #rom the e@traordinary standard o# care re4 ired o# common carriers! PetitionerNs claim that it cannot be entirely blamed #or the loss o# the indemnity bond beca se it *ave the indemnity bond to the immi*ration o##ice o# 5onol l , 5awaii, as a matter o# proced re d rin* the stop-over, and the said immi*ration o##ice #ailed to ret rn the indemnity bond to petitionerNs personnel be#ore ?li*ht 00F le#t 5onol l , 5awaii, deserves scant consideration! .t was petitionerNs obli*ation to ens re that it had the indemnity bond in its c stody be#ore leavin* 5onol l , 5awaii #or 'an ?rancisco! Petitioner sho ld have as$ed #or the indemnity bond #rom the immi*ration o##ice d rin* the stop-over instead o# partly blamin* the said o##ice later on #or the loss o# the indemnity bond! PetitionerNs insensitivity on this matter indicates that it #ell short o# the e@traordinary care that the law re4 ires o# common carriers! (s we have earlier #o nd, petitioner breached its contract o# carria*e with private respondents, and it acted rec$lessly and malevolently in transportin* =eanna and Ci$olai as naccompanied minors and in handlin* their indemnity bond! -e have also ascertained that private respondents are entitled to moral dama*es beca se they have s ##iciently established petitionerNs *ross

4! AL vs. "A *Sept. ,,5 ,;;-+ - 5ere, two naccompanied minors were not able to board the plane

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09

ne*li*ence which amo nted to bad #aith! This bein* the case, the award o# e@emplary dama*es is warranted!

13

8! "athay acific vs. Das7uez1 .s an invol ntary p*radin* o# an airline passen*ers accommodation #rom one class to a more s perior class at no e@tra cost a breach o# contract o# carria*e that wo ld entitle the passen*er to an award o# dama*es<
5: -e resolve the #irst iss e in the a##irmative! ( contract is a meetin* o# minds between two persons whereby one a*rees to *ive somethin* or render some service to another #or a consideration! There is no contract nless the #ollowin* re4 isites conc r: )0+ consent o# the contractin* parties/ )2+ an ob1ect certain which is the s b1ect o# the contract/ and )3+ the ca se o# the obli*ation which is established!K4L Bndo btedly, a contract o# carria*e e@isted between "athay and the Ja>4 e>es! They vol ntarily and #reely *ave their consent to an a*reement whose ob1ect was the transportation o# the Ja>4 e>es #rom Manila to 5on* 6on* and bac$ to Manila, with seats in the I siness "lass 'ection o# the aircra#t, and whose ca se or consideration was the #are paid by the Ja>4 e>es to "athay! The only problem is the le*al e##ect o# the p*radin* o# the seat accommodation o# the Ja>4 e>es! =id it constit te a breach o# contract< Ireach o# contract is de#ined as the G#ail re witho t le*al reason to comply with the terms o# a contract!H .t is also de#ined as the GK#Lail re, witho t le*al e@c se, to per#orm any promise which #orms the whole or part o# the contract!H The Ja>4 e>es never denied that they were members o# "athays Marco Polo "l b! They $new that as members o# the "l b, they had priority #or p*radin* o# their seat accommodation at no e@tra cost when an opport nity arises! I t, 1 st li$e other privile*es, s ch priority co ld be waived! The Ja>4 e>es sho ld have been cons lted #irst whether they wanted to avail themselves o# the privile*e or wo ld consent to a chan*e o# seat accommodation be#ore their seat assi*nments were *iven to other passen*ers! Cormally, one wo ld appreciate and accept an p*radin*, #or it wo ld mean a better accommodation! I t, whatever their reason was and however odd it mi*ht be, the Ja>4 e>es had every ri*ht to decline the p*rade and insist on the I siness "lass accommodation they had boo$ed #or and which was desi*nated in their boardin* passes! They clearly waived their priority or pre#erence when they as$ed that other passen*ers be *iven the p*rade! .t sho ld not have been imposed on them over their vehement ob1ection! Iy insistin* on the p*rade, "athay breached its contract o# carria*e with the Ja>4 e>es!

7@ample: ( car owned by 7 and driven by ? was speedin* alon* RP ,a rel hit a Ta@i driven by = which in t rn hit "! I the passen*er o# the ta@i was also in1 red! The ta@i is owned by (! : estion: 5ow many ca ses o# action are available to I and to "< -hat are the de#enses available to 7, = and ?<2

MAR!T!M# ")MM#R"#
Applica6le laws: "ode "%&'(/ 'alva*e ,aw <overnin3 ( thority+ 6ody: Marina o# "ommerce/ .nd stry

)Maritime

'unctions of Marina: "'

& /B/

2. .ss e certi#icate o# p blic conveniece #or the operation o# domestic and overseas water carriers/ 2! Ee*ister and iss e certi#icate, licenses, or doc ments necessary or incident thereto! :: -hat is the re4 irement #or a carrier to operate domestic sea voya*es< (: "erti#icate o# P blic "onvenience )"P"+ Iinds of D#SS#LS *under & /B/+

JDesselsJ or J$atercraftJ (ny bar*e, li*hter, b l$ carrier, passen*er ship #rei*hter, tan$er, container ship, #ishin* boats or other arti#icial contrivance tili>in* any so rce o# motive power, desi*ned, sed or capable o# bein* sed as a means o# water transportation operatin* either as common contract carrier, incl din* #ishin* vessels covered nder Presidential =ecree Co! 43, e4cept )0+ those owned and;or operated by the (rmed ?orces o# the Philippines and by #orei*n *overnments #or military p rposes, and )2+ bancas, sailboats and other waterborne contrivance o# less than three *ross tons capacity and not motori>ed! H)$ )$(#RSH! B# A"=>!R#& )' A D#SS#L MAC

'o it is not only death or in1 ry which ca ses breach o# contract o# carria*e o# pa@! (nythin* that is in violation o# a contract will constit te a breach! &!ST!("T!)(S B#T$##( "")< A(& "") &ili3ence re7uired e@traordinary Btmost dili*ence dili*ence o# very ca tio s person! $hen ,oss, destr ction death or in1 ry presumption of or deterioration and nonne3li3ence arises and non-arrival o# # l#illment o# the the *oods at contract destination and ne*li*ent delay $hen in the #ive )8+ C%C7, the presumption of instances pres mption o# ne3li3ence does mentioned/ ne*li*ence will not arise nat ral calamity, (,-(9' arise in automatically etc! case the carria*e o# P(M $8( de3ree of ?or both, it cannot be dispensed!
dili3ence can 6e dispensed with $8( de3ree of dili3ence can 6e lessened $8( lia6ility in case of 6reach can 6e lessened%

ARTICLE 573. :erchant vessels constitute property which may be ac+uired and transferred by any of the means recogni0ed by law . %he ac+uisition of a vessel must be included in a written instrument, which shall not produce any effect with regard to third persons if not recorded in the mercantile registry. %he ownership of a vessel shall also be ac+uired by the possession thereof in good faith for three years, with a good title duly recorded. In the absence of any of these re+uisites, uninterrupted possession for ten years shall be necessary in order to ac+uire ownership. A captain can not ac+uire by prescription the ship of which he is in command. Cotes: 2. =: Iind of property is a vessel% (: Movable, b t ownership m st be evidenced by certi#icate o# ownership and trans#ers m st be re*istered in the proper re*istry to bind 3rd persons! ,. Re7uisites for Le3al Ac7uisition of a Merchant Dessel:
.

yes, nder the re4 isites previo sly disc ssed yes, nder (rt! 0D48, 0D49 and 0D80/

C%

(s a *eneral r le, C%, nless carried *rat ito sly/ stip lation b t only #or simple ne*li*ence!

. did not incl de the : and ( already! Please see yo r BP Iar!

2 .n relation to (rt! D02 o# the "ivil "ode:

a! b! c! d! e! #!

D! : -hen we tal$ abo t transportation laws we sho ld not only #oc s on breach o# contract o# carria*e! -e sho ld also incl de that there are other ca ses o# action which may arise!

=onation/ law Testate or intestate s ccession/ (s a conse4 ence o# certain contracts Iy tradition Iy prescription )3 years i# possession in *ood #aith, with 1 st title d ly recorded, otherwise, 00 years+

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 0! 2! M st appear in a written instr ment/ Eecorded in the proper re*istry -- nder 7% 028, transaction m st be re*istered with the Marina b t now this is bein* cond cted by the PP(!

14

ARTICLE 586. %he owner of a vessel and the agent shall be civilly liable for the acts of the captain and for the obligations contracted by the latter to repair, e+uip, and provision the vessel, provided the creditor proves that the amount claimed was invested therein. Cotes: 0! Macondray vs.

.. Ro6iso vs. Rivera: .t is

ndeniable that the de#endant Eivera ac4 ired by p rchase the pilot boat Jalentina on a date prior to that o# the p rchase and ad1 dication made at p blic a ction, by and on behal# o# the plainti## E biso/ b t it is no less tr e that the sale o# the vessel by 'y : i to ?lorentino 7! Eivera, on Ran ary 4, 0908, was entered in the c stoms re*istry only on March 0D, 0908, while its sale at p blic a ction to ?a sto E biso on the 23d o# Ran ary o# the same year, 0908, was recorded in the o##ice o# the "ollector o# " stoms on the 2Dth o# the same month, and in the commercial re*istry on the 4th o# March, #ollowin*/ that is, the sale on behal# o# the de#endant Eivera was prior to that made at p blic a ction to E biso, b t the re*istration o# this latter sale was prior by many days to the sale made to the de#endant! The re4 isite o# re*istration in the re*istry, o# the p rchase o# a vessel, is necessary and indispensable in order that the p rchaserNs ri*hts may be maintained a*ainst a claim #iled by a third person! .n view o# said le*al provisions, it is ndeniable that the de#endant ?lorentino 7! EiveraNs ri*hts cannot prevail over those ac4 ired by ?a sto E biso in the ownership o# the pilot boat Jalentina, inasm ch as, tho *h the latterNs ac4 isition o# the vessel at p blic a ction, on Ran ary 23, 0908, was s bse4 ent to its p rchase by the de#endant Eivera, nevertheless said sale at p blic a ction was antecedently recorded in the o##ice o# the "ollector o# " stoms, on Ran ary 2D, and entered in the commercial re*istry-an nnecessary proceedin*--on March 4th/ while the private and vol ntary p rchase made by Eivera on a prior date was not recorded in the o##ice o# the "ollector o# " stoms ntil many days a#terwards, that is, not ntil March 0D, 0908!

rovident *,;;/+ 1 "anpote@, shipper, shipped and loaded on board the vessel M;J Trade "arrier, 8000 metric tons o# 'tandard &rade M riate o# Potash in b l$ #or transportation to and delivery at the port o# 'an*i, Toledo "ity, "eb , in #avor o# (T,(' ?7ET.,.P7E "%EP%E(T.%C, "onsi*nee! Bpon arrival, it was discovered that the shipment s stained losses!
M("%C=E(9 #iled (C'-7E, denyin* liability over the losses, havin* C% absol te relation with de#endant TE(=7 (C= TE(C'P%ET, the alle*ed operator o# the vessel who transported the s b1ect shipment/ that accordin*ly, M("%C=E(9 is the local representative o# the '5.PP7E/ the charterer o# M;J TE(=7 "(EE.7E and not party to this case/ that it has no control over the acts o# the captain and crew o# the "arrier and cannot be held responsible #or any dama*e arisin* #rom the #a lt or ne*li*ence o# said captain and crew! The "( a##irmed the trial co rts #indin* that petitioner was not the a*ent o# Trade and Transport! The appellate co rt r led, however, that petitioner co ld still be held liable #or the shorta*es o# the shipment, beca se the latter was the ship a*ent o# "anpote@ 'hippin* 'ervices ,td! -- the shipper and charterer o# the vessel M;J Trade "arrier! 5: .n the present case, we #ind no compellin* reason to overt rn the "o rt o# (ppeals in its cate*orical #indin* that petitioner was the ship a*ent! ' ch #act al #indin* was not in con#lict with the trial co rts r lin*, which had merely stated that petitioner was not the a*ent o# Trade and Transport! .ndeed, altho *h it is not an a*ent o# Trade and Transport, petitioner can still be the ship a*ent o# the vessel M;J Trade "arrier! (rticle 88F o# the "ode o# "ommerce states that a ship a*ent is Gthe person entr sted with provisionin* or representin* the vessel in the port in which it may be #o nd!H Hence5 whether actin3 as a3ent of the owner of the vessel or as a3ent of the charterer5 petitioner will 6e considered as the ship a3ent and may 6e held lia6le as such5 as lon3 as the latter is the one that provisions or represents the vessel. The trial co rt #o nd that petitioner Gwas appointed as local a*ent o# the vessel, which d ty incl des arran*ement #or the entrance and clearance o# the vessel!H ? rther, the "( #o nd and the evidence shows that petitioner represented the vessel! The latter prepared the Cotice o# Eeadiness, the 'tatement o# ?acts, the "ompletion Cotice, the 'ailin* Cotice and " stoms "learance! Petitioners employees were present at 'an*i, Toledo "ity, one day be#ore the arrival o# the vessel, where they stayed ntil it departed! They were also present d rin* the act al dischar*in* o# the car*o! Moreover, Mr! de la "r >, the representative o# petitioner, also prepared #or the needs o# the vessel, li$e money, provision, water and # el! These acts all point to the concl sion that it was the entity that represented the vessel in the Port o# Manila and was the ship a*ent within the meanin* and conte@t o# (rticle 88F o# the "ode o# "ommerce!

Repair and Maintenance of Dessel durin3 the Doya3e *Art. 0-.+

ARTICLE 583. If the ship being on a voyage the captain should find it necessary to contract one or more of the obligations mentioned in #os. 3 and 6 of Article "37, he shall apply to the 2udge or court if he is in &hilippine territory, and otherwise to the *ilipino Consul should there be one, and, in his absence to the 2udge or court or to the proper local authority, presenting the certificate of the registry of the vessel treated of in Article $1., and the instruments proving the obligation contracted. %he 2udge or court, the consul or the local authority as the case may be, in view of the result of the proceedings instituted, shall ma,e a temporary memorandum in the certificate of their result, in order that it may be recorded in the registry when the vessel returns to the port of her registry, or so that it can be admitted as a legal and preferred obligation in case of sale before the return, by reason of the sale of the vessel by virtue of a declaration of unseaworthiness. %he lac, of this formality shall ma,e the captain personally liable to the creditors who may be pre2udiced through his fault. Cotes: 0! (rticle 880 Cos! 8 and 93 T contract obli*ations #or the repair and e4 ipment o# the vessel and obtain loans and bottomry! 2! -hy are these #ormalities re4 ired #or the captain< Ieca se omission to #ollow these re4 irements will ma$e the captain personally liable! 5e cannot as$ #or a re# nd #rom the carrier! ersons who ta9e part in marine commerce

!!!. "A TA!(1 one who 3overns vessels and navi3ates the hi3h seas or of lar3e dimension and importance. vs. Master1 commands small ships and en3a3es e4clusively in coastwide trade. But ?or p rposes o# maritime commerce, captain, master, patron, they all mean the same! =ualifications of "aptain

!. SH! )$(#R !!. SH! A<#(T 1 Iy a*ent is nderstood the person intr sted with the provisionin* o# a vessel, or who represents her in the port in which she happens to be!

Art. 0-; *-+ The part o# the price which has not been paid the last vendor, the credits pendin* #or the payment o# material and wor$ in the constr ction o# the vessel, when it has not navi*ated, and those arisin* #rom the repair and e4 ipment o# the vessel and its provisionin* with vict als and # el d rin* its last voya*e! @ @ @ *A+ The amo nts borrowed on bottomry bonds be#ore the depart re o# the vessel, proven by means o# the contracts e@ec ted accordin* to law and recorded in the commercial re*istry/ the amo nts borrowed d rin* the voya*e with the a thority mentioned in the #ore*oin* s bdivision, #illin* the same re4 isites, and the ins rance premi m, proven by the policy o# the contract or certi#icate ta$en #rom the boo$s o# the bro$er!

ARTICLE 609. Captains and masters of vessels must be *ilipino having legal capacity to bind themselves in accordance with this Code, and must prove that they have the s,ill, capacity, and +ualifications re+uired to command and direct the vessel, as established by marine laws, ordinances, or regulations, or by those of navigation, and that they are not dis+ualified according to the same for the discharge of the duties of that position. I' the ow$er o' a ,esse" !esires to &e the ca%tai$ thereo' a$! !oes $ot ha,e the "e#a" -ua"i'icatio$s there'or) he sha"" "i it hi se"' to the 'i$a$cia" a! i$istratio$ o' the ,esse") a$! sha"" i$trust her $a,i#atio$ to a %erso$ %ossessi$# the -ua"i'icatio$s re-uire! &( sai! or!i$a$ces a$! re#u"atio$s. Cotes:

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 0! "oastwise Li3htera3e vs. "A - 5ere, the patron o# the li*hter admitted that he was not licensed!
5: "learly, petitioner "oastwise ,i*htera*eNs embar$in* on a voya*e with an nlicensed patron violates (rt! F09! .t cannot sa#ely claim to have e@ercised e@traordinary dili*ence, by placin* a person whose navi*ational s$ills are 4 estionable, at the helm o# the vessel which event ally met the #ate# l accident! .t may also lo*ically, #ollow that a person witho t license to navi*ate, lac$s not 1 st the s$ill to do so, b t also the tmost #amiliarity with the s al and sa#e ro tes ta$en by seasoned and le*ally a thori>ed ones! 5ad the patron been licensed, he co ld be pres med to have both the s$ill and the $nowled*e that wo ld have prevented the vesselNs hittin* the s n$en derelict ship that lay on their way to Pier 08! (s a common carrier, petitioner is liable #or breach o# the contract o# carria*e, havin* #ailed to overcome the pres mption o# ne*li*ence with the loss and destr ction o# *oods it transported, by proo# o# its e@ercise o# e@traordinary dili*ence!

15

re4 irements o# seaworthiness and the partic lar ris$s and perils o# the voya*e he is to embar$ pon! The applicable principle is that the captain has control o# all departments o# service in the vessel, and reasonable discretion as to its navi*ation! .t is the ri*ht and d ty o# the captain, in the e@ercise o# so nd discretion and in *ood #aith, to do all thin*s with respect to the vessel and its e4 ipment and cond ct o# the voya*e which are reasonably necessary #or the protection and preservation o# the interests nder his char*e, whether those be o# the shipowners, charterers, car*o owners or o# nderwriters! .t is a basic principle o# admiralty law that in navi*atin* a merchantman, the master m st be le#t #ree to e@ercise his own best 1 d*ment! The re4 irements o# sa#e navi*ation compel s to re1ect any s **estion that the 1 d*ment and discretion o# the captain o# a vessel may be con#ined within a strait1ac$et, even in this a*e o# electronic comm nications!

<eneral 'unctions of a "aptain:

ARTICLE 610. The 'o""owi$# %owers are i$here$t i$ the %ositio$ o' ca%tai$ or aster o' a ,esse". 1. To a%%oi$t or a/e co$tracts with the crew i$ the a&se$ce o' the a#e$t a$! %ro%ose sai! crew) shou"! sai! a#e$t &e %rese$t0 &ut the a#e$t sha"" $ot &e %er itte! to e %"o( a$( e &er a#ai$st the ca%tai$*s e+%ress re'usa". 2. To co a$! the crew a$! !irect the ,esse" to the %ort o' its !esti$atio$) i$ accor!a$ce with the i$structio$s he a( ha,e recei,e! 'ro the a#e$t. 3. To i %ose) i$ accor!a$ce with the a#ree e$ts a$! the "aws a$! re#u"atio$s o' the ercha$ts ari$e) o$ &oar! the ,esse") correctio$a" %u$ish e$t u%o$ those who !o $ot co %"( with his or!ers or who co$!uct the se",es a#ai$st !isci%"i$e) ho"!i$# a %re"i i$ar( i$,esti#atio$ o$ the cri es co itte! o$ &oar! the ,esse" o$ the hi#h seas) which sha"" &e tur$e! o,er to the authorities) who are to ta/e co#$i1a$ce thereo') at the 'irst %ort touche!. 4. To a/e co$tracts 'or the charter o' the ,esse" i$ the a&se$ce o' the a#e$t or o' her co$si#$ee) acti$# i$ accor!a$ce with the i$structio$s recei,e! a$! %rotecti$# the i$terests o' the ow$er ost care'u""(. 5. To a!o%t a"" the easures which a( &e $ecessar( to /ee% the ,esse" we"" su%%"ie! a$! e-ui%%e!) %urchasi$# 'or the %ur%ose a"" that a( &e $ecessar() %ro,i!e! there is $o ti e to re-uest i$structio$s o' the a#e$t. 6. To a/e) i$ si i"ar ur#e$t cases a$! o$ a ,o(a#e) the re%airs to the hu"" a$! e$#i$es o' the ,esse" a$! to her ri##i$# a$! e-ui% e$t which are a&so"ute"( $ecessar( i$ or!er 'or her to &e a&"e to co$ti$ue a$! co$c"u!e her ,o(a#e0 &ut i' she shou"! arri,e at a %oi$t where there is a co$si#$ee o' the ,esse") he sha"" act i$ co$curre$ce with the "atter. Cotes: 0! !nter1orient Maritime vs. (LR"- 5ere, the captain re# sed to leave the port, contrary to the ship a*entNs instr ctions, ntil the s pplies he re4 ested necessary #or the weldin*-repair o# the t rbo-char*er and the economi>er were delivered! ' bse4 ently, the captain was dismissed! .ss e: -as the captain remiss o# his d ties<
5: C%! The captain has the a thority to decide! The captain o# a vessel is a con#idential and mana*erial employee within the meanin* o# the above doctrine! ( master or captain, #or p rposes o# maritime commerce, is one who has command o# a vessel! ( captain commonly per#orms three )3+ distinct roles: )0+ he is a *eneral a*ent o# the shipowner/ )2+ he is also commander and technical director o# the vessel/ and )3+ he is a representative o# the co ntry nder whose #la* he navi*ates! %# these roles, by #ar the most important is the role per#ormed by the captain as commander o# the vessel/ #or s ch role )which, to o r mind, is analo*o s to that o# O"hie# 7@ec tive %##icerO K"7%L o# a presentday corporate enterprise+ has to do with the operation and preservation o# the vessel d rin* its voya*e and the protection o# the passen*ers )i# any+ and crew and car*o! .n his role as *eneral a*ent o# the shipowner, the captain has a thority to si*n bills o# ladin*, carry *oods aboard and deal with the #rei*ht earned, a*ree pon rates and decide whether to ta$e car*o! The ship captain, as a*ent o# the shipowner, has le*al a thority to enter into contracts with respect to the vessel and the tradin* o# the vessel, s b1ect to applicable limitations established by stat te, contract or instr ctions and re* lations o# the shipowner! 0D To the captain is committed the *overnance, care and mana*ement o# the vessel! "learly, the captain is vested with both mana*ement and #id ciary # nctions! More importantly, a shipNs captain m st be accorded a reasonable meas re o# discretionary a thority to decide what the sa#ety o# the ship and o# its crew and car*o speci#ically re4 ires on a stip lated ocean voya*e! The captain is held responsible, and properly so, #or s ch sa#ety! 5e is ri*ht there on the vessel, in command o# it and )it m st be pres med+ $nowled*eable as to the speci#ic

,. 'ar #astern Shippin3 vs. "A1 There was a E ssian vessel that arrived in Manila, owned by ?ar 7astern 'hippin*! .t was assi*ned berth no! 4! There is s ch a thin* as comp lsory pilota*e -- there is a pilot assi*ned to pilot the vessel o tside the brea$ water ntil it reaches its birth! .n this case, ( was assi*ned to the vessel! The captain o# the vessel was beside (! Bnder the r les o# comp lsory pilota*e, once a pilot ta$es over the helm, the captain will have to stand aside and s rrender all his a thority to the pilot who is more #amiliar with the doc$in* mane vers! Cow, ( hit the pier! PP( #iled a complaint a*ainst ?ar 7astern 'hippin*! .ss e: "an the captain o# the vessel be considered ne*li*ent in this case< Ieca se the only way that ?ar 7astern shippin* can be held liable is #or the co rts to declare the captain ne*li*ent!
57,=: 97'! ( pilot, in maritime law, is a person d ly 4 ali#ied, and licensed, to cond ct a vessel into or o t o# ports, or in certain waters! .n a broad sense, the term OpilotO incl des both )0+ those whose d ty it is to * ide vessels into or o t o# ports, or in partic lar waters and )2+ those entr sted with the navi*ation o# vessels on the hi*h seas! 5owever, the term OpilotO is more *enerally nderstood as a person ta$en on board at a partic lar place #or the p rpose o# cond ctin* a ship thro *h a river, road or channel, or #rom a port! Bnder 7n*lish and (merican a thorities, *enerally spea$in*, the pilot s persedes the master #or the time bein* in the command and navi*ation o# the ship, and his orders m st be obeyed in all matters connected with her navi*ation! 5e becomes the master pro hac vice and sho ld *ive all directions as to speed, co rse, stoppin* and reversin*, anchorin*, towin* and the li$e! (nd when a licensed pilot is employed in a place where pilota*e is comp lsory, it is his d ty to insist on havin* e##ective control o# the vessel, or to decline to act as pilot! Bnder certain systems o# #orei*n law, the pilot does not ta$e entire char*e o# the vessel, b t is deemed merely the adviser o# the master, who retains command and control o# the navi*ation even on localities where pilota*e is comp lsory! -hile it is ind bitable that in e@ercisin* his # nctions a pilot-is in sole command o# the shipKF9L and s persedes the master #or the time bein* in the command and navi*ation o# a ship and that he becomes master pro hac vice o# a vessel piloted by him,KD0L there is overwhelmin* a thority to the e##ect that the master does not s rrender his vessel to the pilot and the pilot is not the master! The master is still in command o# the vessel notwithstandin* the presence o# a pilot! There are occasions when the master may and sho ld inter#ere and even displace the pilot, as when the pilot is obvio sly incompetent or into@icated and the circ mstances may re4 ire the master to displace a comp lsory pilot beca se o# incompetency or physical incapacity! .#, however, the master does not observe that a comp lsory pilot is incompetent or physically incapacitated, the master is 1 sti#ied in relyin* on the pilot, b t not blindly! The master is not wholly absolved #rom his d ties while a pilot is on board his vessel, and may advise with or o##er s **estions to him! 5e is still in command o# the vessel, e@cept so #ar as her navi*ation is concerned, and m st ca se the ordinary wor$ o# the vessel to be properly carried on and the s al preca tion ta$en! Th s, in partic lar, he is bo nd to see that there is s ##icient watch on dec$, and that the men are attentive to their d ties, also that en*ines are stopped, towlines cast o##, and the anchors clear and ready to *o at the pilotNs order! ( per sal o# "apt! 6aban$ovNs testimony ma$es it apparent that he was remiss in the dischar*e o# his d ties as master o# the ship, leavin* the entire doc$in* proced re p to the pilot, instead o# maintainin* watch# l vi*ilance over this ris$y mane ver! .n s m, where a comp lsory pilot is in char*e o# a ship, the master bein* re4 ired to permit him to navi*ate it, i# the master observes that the pilot is incompetent or physically incapable, then it is the d ty o# the master to re# se to permit the pilot to act! I t i# no s ch reasons are present, then the master is 1 sti#ied in relyin* pon the pilot, b t not blindly! Bnder the circ mstances o# this case, i# a sit ation arose where the master, e@ercisin* that reasonable vi*ilance which the master o# a ship sho ld e@ercise, observed, or sho ld have observed, that the pilot was so navi*atin*

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09

the vessel that she was *oin*, or was li$ely to *o, into dan*er, and there was in the e@ercise o# reasonable care and vi*ilance an opport nity #or the master to intervene so as to save the ship #rom dan*er, the master sho ld have acted accordin*ly! The master o# a vessel m st e@ercise a de*ree o# vi*ilance commens rate with the circ mstances! .n *eneral, a pilot is personally liable #or dama*es ca sed by his own ne*li*ence or de#a lt to the owners o# the vessel, and to third parties #or dama*es s stained in a collision! ' ch ne*li*ence o# the pilot in the per#ormance o# d ty constit tes a maritime tort! (t common law, a shipowner is not liable #or in1 ries in#licted e@cl sively by the ne*li*ence o# a pilot accepted by a vessel comp lsorily!The e@emption #rom liability #or s ch ne*li*ence shall apply i# the pilot is act ally in char*e and solely in #a lt! 'ince, a pilot is responsible only #or his own personal ne*li*ence, he cannot be held acco ntable #or dama*es pro@imately ca sed by the de#a lt o# others, or, i# there be anythin* which conc rred with the #a lt o# the pilot in prod cin* the accident, the vessel master and owners are liable!

16

unloading, and the freight earned. In the same boo, he shall record the names and places of sailing of the passengers and the number of pac,ages of which their baggage consists, and the price of the passage. Cotes: 0! %# the three boo$s, the lo* boo$ is the most important/ 2! Haverton Shippin3 vs. (LR" 1 -hat is the probative val e o# the entries in the lo*boo$< "an yo se the lo* boo$ as evidence< 97'! .t is an o##icial record o# entries made by a person in the per#ormance o# his d ty re4 ired by law and are prima #acie evidence o# the #acts entered therein! I t in: 3! "entennial vs. &ela "ruz: .n -allem Maritime 'ervices, .nc! v! Cational ,abor Eelations "ommission, citin* 5averton 'hippin* ,td! v! Cational ,abor Eelations "ommission, the "o rt r led that a copy o# an o##icial entry in the lo*boo$ is le*ally bindin* and serves as an e@ception to the hearsay r le! .n the said case, however, there was no controversy as to the *en ineness o# the said entry and the a thenticity o# the copy presented in evidence!
.n the instant case, respondent has consistently assailed the *en ineness o# the p rported entry and the a thenticity o# s ch copy! 5e alle*ed that be#ore his repatriation, there was no entry in the shipNs o##icial lo*boo$ re*ardin* any incident that mi*ht have ca sed his relie#/ that "aptain 6owalews$iNs si*nat re in s ch p rported entry was #or*ed! .n s pport o# his alle*ations, respondent s bmitted three o##icial doc ments bearin* the si*nat re o# "apt! 'c>epan 6owalews$i which is di##erent #rom the one appearin* in (nne@ 7! Th s, it was inc mbent pon petitioners to prove the a thenticity o# (nne@ 7, which they #ailed to do! ,i$ewise, the p rported report o# "apt! 6owalews$i dated 'eptember 0, 2000 and the statements o# 'a#ety %##icer 6hald n Cacem ?aridi and "hie# %##icer Rosip Milin also cannot be *iven wei*ht #or lac$ o# a thentication! (ltho *h technical r les o# evidence do not strictly apply to labor proceedin*s, however, in the instant case, a thentication o# the above-mentioned doc ments is necessary beca se their *en ineness is bein* assailed, and since petitioners o##ered no corroboratin* evidence! These doc ments and their contents have to be d ly identi#ied and a thenticated lest an in1 stice wo ld res lt #rom a blind adoption o# s ch contents! Th s, the na thenticated doc ments relied pon by petitioners are mere sel#-servin* statements o# their own o##icers and were correctly disre*arded by the "o rt o# (ppeals!

.. $!L&DALL#C SH! !(< DS. "A - (lmost same #acts, e@cept in this case the vessel was ?ilipino owned and it arrived in Jelen> ela! There was a comp lsory pilota*e! -hen the pilot boarded the vessel, the captain le#t the brid*e! -hen it entered the Jene> elan channel, the vessel e@perienced some vibration and the pilot ass red the captain that the vibrations were normal - the res lt o# the shallowness o# the channel! I t the vessel ran a*ro nd therea#ter!
5eld: The captain in this case was not ne*li*ent! -e #ind that the *ro ndin* o# the vessel is attrib table to the pilot! -hen the vibrations were #irst #elt the watch o##icer as$ed him what was *oin* on, and pilot Jas4 e> replied that O)they+ were in the middle o# the channel and that the vibration was as )sic+ a res lt o# the shallowness o# the channel! The law does provide that the master can co ntermand or overr le the order or command o# the harbor pilot on board! The master o# the Philippine Eo@as deemed it best not to order him )the pilot+ to stop the vessel! The master o# the Philippine Eo@as deemed it best not to order him )the pilot+ to stop the vessel, mayhap, beca se the latter had ass red him that they were navi*atin* normally be#ore the *ro ndin* o# the vessel! Iased on these declarations, it comes as no s rprise to s that the master chose not to re*ain control o# the ship! (dmittin* his limited $nowled*e o# the %rinoco Eiver, "aptain "olon relied on the $nowled*e and e@perience o# pilot Jas4 e> to * ide the vessel sa#ely!

'o the '" *ave con#lictin* decisions, b t i# yo loo$ at it, the '" r led in these ways only #or one reason -- r lin* in #avor o# ?ilipinos! )Jery *ood, ,yndonU:=+ Boo9s to 6e carried 6y the captain

&>RAT!)( )' L!AB!L!TC of "aptain nder the "ivil "ode,

ARTICLE 612. %he following obligations are inherent in the office of captain' x x x . %o have three folioed and stamped boo,s, placing at the beginning of each one a note of the number of folios it contains, signed by the maritime official, and in his absence by the competent authority. In the first boo,, which shall be called ;"o# &oo/); he shall enter every day the condition of the atmosphere, the prevailing winds, the course sailed, the rigging carried, the horsepower of the engines, the distance covered, the maneuvers executed, and other incidents of navigation. /e shall also enter the damage suffered by the vessel in her hull, engines, rigging, and tac,le, no matter what is its cause, as well as the imperfections and averages of the cargo, and the effects and conse+uence of the 2ettison, should there be any- and in cases of grave resolutions which re+uire the advice or a meeting of the officers of the vessel, or even of the passengers and crew, he shall record the decision adopted. *or the informations indicated he shall ma,e use of the binnacle boo,, and of the steam or engine boo, ,ept by the engineer. In the second boo,, called the ;accou$ti$# &oo/); he shall enter all the amounts collected and paid for the account of the vessel, entering specifically article by article, the sources of the collection, and the amounts invested in provisions, repairs, ac+uisition of rigging or goods, fuel, outfits, wages, and all other expenses. /e shall furthermore enter therein a list of all the members of the crew, stating their domiciles, their wages and salaries, and the amounts they may have received on account, either directly or by delivery to their families. In the third boo,, called ; 'rei#ht &oo/,; he shall record the entry and exit of all the goods, stating their mar,s and pac,ages, names of the shippers and of the consignees, ports of loading and

=o not #or*et the d ration o# liability (rt! 0D3F! -ith respect to the captain:

ARTICLE 619. The ca%tai$ sha"" &e "ia&"e 'or the car#o 'ro the ti e it is tur$e! o,er to hi at the !oc/) or a'"oat a"o$#si!e the shi%) at the %ort o' "oa!i$# u$ti" he !e"i,ers it o$ the shores or o$ the !ischar#i$# whar') o' the %ort o' u$"oa!i$# u$"ess the co$trar( has &ee$ e+%ress"( a#ree! u%o$. Cotes: 0! .# the *oods are delivered to (boiti> in the wareho se, does the liability o# (boiti> start< 9es, beca se the *oods are trans#erred already to (boiti>e! =oes the liability o# the captain start< C%! %nly once the *oods are at the doc$ and ntil the *oods are delivered to the shore! 'o the captain has a shorter period o# responsibility as compared to the carrier! %# co rse, nless is a stip lation to the contrary! MAR!T!M# R)T#ST

=e#inition: This has to be done by the captain i# the vessel;car*o is lost or in1 red! .t is a written statement nder oath, made by the captain or master o# the vessel a#ter the occ rrence o# an accident or disaster in which the vessel or car*o is lost or in1 red with respect to circ mstances attendin* s ch oc rrence! P rpose: .t is s ally intended to show that the loss or dam*e res lted #rom a peril o# the sea or some other ca se #or shich neither the master or owner was responsible! .t concl des with the protestation a*ainst any liablity o# the owner #or s ch loss or dama*e!

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 ARTICLE 624. A ca%tai$ whose ,esse" has #o$e throu#h a hurrica$e or who &e"ie,es that the car#o has su''ere! !a a#es or a,era#es) sha"" a/e a %rotest thereo$ &e'ore the co %ete$t authorit( at the 'irst %ort he touches withi$ the twe$t(2'our hours 'o""owi$# his arri,a") a$! sha"" rati'( it withi$ the sa e %erio! whe$ he arri,es at the %"ace o' his !esti$atio$) i e!iate"( %rocee!i$# with the %roo' o' the 'acts) it $ot &ei$# %er itte! to o%e$ the hatches u$ti" this has &ee$ !o$e. The ca%tai$ sha"" %rocee! i$ the sa e a$$er i') the ,esse" ha,i$# &ee$ wrec/e!) he is sa,e! a"o$e or with %art o' his crew) i$ which case he sha"" a%%ear &e'ore the $earest authorit() a$! a/e a swor$ state e$t o' the 'acts. The authorit( or the co$su" a&roa! sha"" ,eri'( the sai! 'acts) recei,i$# a swor$ state e$t o' the e &ers o' the crew a$! %asse$#ers who a( ha,e &ee$ sa,e!) a$! ta/i$# the other ste%s which a( assist i$ arri,i$# at the 'acts) !ra'ti$# a certi'icate o' the resu"t o' the %rocee!i$#s i$ the "o# &oo/ a$! i$ that o' the sai"i$# ate) a$! sha"" !e"i,er the ori#i$a" recor!s o' the %rocee!i$#s to the ca%tai$) sta %e! a$! 'o"ioe!) with a e ora$!u o' the 'o"ios) which he ust ru&ricate) 'or their %rese$tatio$ to the ju!#e or court o' the %ort o' !esti$atio$. The state e$t o' the ca%tai$ sha"" &e &e"ie,e! i' it is i$ accor!a$ce with those o' the crew a$! %asse$#ers0 i' the( !isa#ree) the "atter sha"" &e acce%te!) u$"ess there is %roo' to the co$trar( Proced re: 0! Protest m st be made with a competent a thority at #irst port he to ches/ 2! within 24 ho rs #ollowin* his arrival 3! "aptain m st rati#y it within 24 ho rs when he arrives at the place o# destination where he m st proceed immediately with the proo# o# the #acts 4! 5e m st not open the hatches ntil all o# the above are done! !D. )''!"#RS A(& "R#$ )' TH# D#SS#L SA!L!(< MAT# 1 5e is the 2nd chie# o# the vessel/ ta$es place o# the captain and ass mes all his d ties and powers in case o# absence, sic$ness or death! ARTICLE 627. The sai"i$# ate) as the seco$! chie' o' the ,esse" a$! u$"ess the a#e$t or!ers otherwise) sha"" ta/e the %"ace o' the ca%tai$ i$ cases o' a&se$ce) sic/$ess) or !eath) a$! sha"" the$ assu e a"" his %owers) o&"i#atio$s) a$! res%o$si&i"ities. Cotes: 0! "entennial vs. &ela "ruz5 supra. *,;;-+ - Petitioners alle*e loss o# tr st and con#idence d e to incompetence as the *ro nd #or respondentNs dismissal! ,oss o# tr st and con#idence is premised on the #act that the employee holds a position whose # nctions may only be per#ormed by someone who has the con#idence o# mana*ement! ' ch employee may be mana*erial or ran$-and-#ile, b t the nat re o# his position determines the re4 irements #or a valid dismissal!
(rticle F2D o# the "ode o# "ommerce de#ines the "hie# Mate, also called "hie# %##icer or 'ailin* Mate, as Othe second chie# o# the vessel, and nless the a*ent orders otherwise, shall ta$e the place o# the captain in cases o# absence, sic$ness, or death, and shall then ass me all his powers, d ties, and responsibilities!O ( "hie# %##icer, there#ore, is second in command, ne@t only to the captain o# the vessel! "hie# Mate is a mana*erial employee beca se the said o##icer per#ormed the # nctions o# an e@ec tive o##icer ne@t in command to the captain/ that in the per#ormance o# s ch # nctions, he is vested with powers or prero*atives to lay down and e@ec te mana*ement policies! The e@ercise o# discretion and 1 d*ment in directin* a shipNs co rse is as m ch mana*erial in nat re as decisions arrived at in the con#ines o# the more conventional board room or e@ec tive o##ice! .mportant # nctions pertainin* to the navi*ation o# the vessel li$e assessin* ris$s and eval atin* the vesselNs sit ation are mana*erial in nat re! Th s, respondent, as "hie# %##icer, is a mana*erial employee/ hence, petitioners need to show by s bstantial evidence the basis #or their claim that respondent has breached their tr st and con#idence! PetitionersN basis #or dismissin* respondent was the alle*ed entry by "aptain 6owalews$i in the shipNs lo*boo$ re*ardin* respondentNs ine@perience and ine##iciency! ( shipNs lo*;lo*boo$ is the o##icial record o# a shipNs voya*e which its captain is obli*ated by law to $eep wherein he records the decisions he has adopted, a s mmary

17

o# the per#ormance o# the vessel, and other daily events! ( lo*boo$ is a respectable record that can be relied pon when the entries therein are presented in evidence! )"onnect with pa*e 0F+

S#")(& MAT# )which is act ally the 3rd mate since the sailin* mate is the 2nd mate+ .n case o# disability, dis4 ali#ication o# the captain and the sailin* mate, he ta$es over! Eelevant provisions: (rt F32F33, "ode o# "ommerce "R#$ )R SA!L)RS 1 Bnder the "ode o# "ommerce, they are enlisted by the captain in s ch n mber he may deem proper! I t . thin$ at present the captain has no b siness with the crew as they are hired by the carrier! Eelevant provisions: (rt! F34-F3D &!S"HAR<#:

$ho can dischar3e% The shipowner or the captain can dischar*e the crew )(rt! F3D+ $hat is the effect if the captain or the crew is dischar3ed durin3 the voya3e% #4ample5 voya3e from Manila to San 'rancisco and en route to S' they are dischar3ed: ARTICLE 604. I' the ca%tai$ or a$( other e &er o' the crew shou"! &e !ischar#e! !uri$# the ,o(a#e) the( sha"" recei,e their sa"ar( u$ti" the retur$ to the %"ace where the co$tract was a!e) u$"ess there are #oo! reaso$s 'or the !ischar#e) a"" i$ accor!a$ce with Artic"es 636 et se-. o' this Co!e. <en Rule: They shall contin e to receive their salaries ntil their ret rn to the port where the contract was made! They have to be paid the # ll ro nd trip! #4cept: .# there is a 1 st ca se or 1 st motive! Rule in case of dischar3e if the contract is for a definite period or voya3e: ARTICLE 605. I' the co$tracts o' the ca%tai$ a$! e &ers o' the crew with the a#e$t shou"! &e 'or a !e'i$ite %erio! or ,o(a#e) the( ca$ $ot &e !ischar#e! u$ti" the 'u"'i"" e$t o' their co$tracts) e+ce%t 'or reaso$s o' i$su&or!i$atio$ i$ serious atters) ro&&er() the't) ha&itua" !ru$/e$$ess) a$! !a a#e cause! to the ,esse" or to its car#o &( a"ice or a$i'est or %ro,e$ $e#"i#e$ce. (otes: 0! Madri3al vs. )3ilvie - The services o# Res s &! %*ilvie, 'alvador %rtile, (ntonio "! Militar and Mi* el M! ?ermin were en*a*ed by Man el Masc Aana, master or captain employed by the petitioner Madri*al 'hippin* "ompany, .nc!, to man and #etch the vessel O'!'! Irid*eO #rom 'aseb , Rapan! P rs ant thereto the respondents were #lown to 'aseb , Rapan, and they manned the vessel o t o# the port o# 'aseb ! %n 0F March 0948, when the vessel reached 5on*$on*, the respondents were dismissed and replaced by a crew o# "hinese nationality! The respondents were #lown bac$ to Manila and paid their respective salaries p to the date o# their dismissal!)'o they were only paid #rom Rapan to 5on*$on*+
5:The services o# the respondents were en*a*ed by the petitioner to man its vessel #or a determinate time or voya*e, with an e@press stip lation that Othis contract e@pires on the arrival o# this boat at the port o# Manila!O Cot havin* been dischar*ed #or any o# the ca ses en merated in the (rt! F08, the respondents are entitled to the amo nts they respectively see$ to collect #rom the petitioner!

2! $allem vs. Minister of La6or: -allem hired M and 9 as seamen #or 00 months! ?or insti*atin* the .nternational Transport ?ederation ).T?+ "hapter to demand hi*her wa*es they were dismissed! -as the dismissal proper< Co, the seamen cannot be dismissed witho t le*al ca se beca se the contract was #or a de#inite period o# 00 months! -hat M and 9 did was not a le*al ca se nder (rt! F08 b t an e@ercise o# the ri*hts o# all wor$men to see$ better ri*hts and hi*her bene#its @ @ @ <rounds if captain dischar3es crew: )o# co rse, the captain cannot dischar*e himsel#U+

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 ARTICLE 636. 3hou"! a 'i+e! %erio! 'or which a sai"or has si#$e! $ot &e state!) he ca$ $ot &e !ischar#e! u$ti" the e$! o' the retur$ ,o(a#e to the %ort where he e$ro""e!. ARTICLE 637. 4either ca$ the ca%tai$ !ischar#e a sai"or !uri$# the ti e o' his co$tract e+ce%t 'or su''icie$t cause) the 'o""owi$# &ei$# co$si!ere! as such. 1. The %er%etratio$ o' a cri e which !istur&s or!er o$ the ,esse". 2. Re%eate! o''e$ses o' i$su&or!i$atio$) a#ai$st !isci%"i$e) or a#ai$st the 'u"'i"" e$t o' the ser,ice. 3. Re%eate! i$ca%acit( or $e#"i#e$ce i$ the 'u"'i"" e$t o' the ser,ice to &e re$!ere!. 4. 5a&itua" !ru$/e$$ess. 5. A$( occurre$ce which i$ca%acitates the sai"or to carr( out the wor/ u$!er his char#e) with the e+ce%tio$ o' the %ro,isio$s co$tai$e! i$ Artic"e 644. 6. 6esertio$. ARTICLE 644. A sai"or who 'a""s sic/ sha"" $ot "ose his ri#ht to wa#es !uri$# the ,o(a#e) u$"ess the sic/$ess is the resu"t o' his ow$ 'au"t. At a$( rate) the costs o' the atte$!a$ce a$! cure sha"" &e !e'ra(e! 'ro the co o$ 'u$!s) i$ the 'or o' a "oa$. I' the sic/$ess shou"! &e cause! &( a$ i$jur( recei,e! i$ the ser,ice or !e'e$se o' the ,esse" the sai"or sha"" &e atte$!e! a$! cure! 'ro the co o$ 'u$!s) there &ei$# !e!ucte! &e'ore a$(thi$# e"se 'ro the %rocee!s o' the 'rei#ht) the cost o' the atte$!a$ce a$! cure. $HAT !S A S> #R"AR<)% ( person specially employed by the owner o# a car*o to ta$e char*e o# and sell to the best advanta*e merchandise which has been shipped, and to p rchase ret rnin* car*oes and to receive #rei*ht, as he may be a thori>ed! ARTICLE 649. 3u%ercar#oes sha"" !ischar#e o$ &oar! the ,esse" the a! i$istrati,e !uties which the a#e$t or shi%%ers a( ha,e assi#$e! the 0 the( sha"" /ee% a$ accou$t a$! recor! o' their tra$sactio$s i$ a &oo/ which sha"" ha,e the sa e co$!itio$s a$! re-uisites as re-uire! 'or the accou$ti$# &oo/ o' the ca%tai$) a$! sha"" res%ect the "atter i$ his !uties as chie' o' the ,esse". The %owers a$! "ia&i"ities o' the ca%tai$ sha"" cease) whe$ there is a su%ercar#o) with re#ar! to that %art o' the a! i$istratio$ "e#iti ate"( co$'erre! u%o$ the "atter) &ut sha"" co$ti$ue i$ 'orce 'or a"" acts which are i$se%ara&"e 'ro his authorit( a$! o''ice. ARTICLE 650. A"" the %ro,isio$s co$tai$e! i$ the seco$! sectio$ o' Tit"e III) 7oo/ II) with re#ar! to -ua"i'icatio$s) a$$er o' a/i$# co$tracts) a$! "ia&i"ities o' 'actors sha"" &e a%%"ica&"e to su%ercar#oes. ARTICLE 651. 3u%ercar#oes ca$ $ot) without s%ecia" authori1atio$ or a#ree e$t) a/e a$( tra$sactio$ 'or their ow$ accou$t !uri$# the ,o(a#e) with the e+ce%tio$ o' the ,e$tures which) i$ accor!a$ce with the custo o' the %ort o' !esti$atio$) the( are %er itte! to !o. 4either sha"" the( &e %er itte! to i$,est i$ the retur$ tri% ore tha$ the %ro'its 'ro the ,e$tures) u$"ess there is a s%ecia" authori1atio$ thereto 'ro the %ri$ci%a"s. ABA(&)(M#(T8&)"TR!(# )' L!M!T#& L!AB!L!TC !( MAR!(# TRA(S )RTAT!)(

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the acts of the captain, referred to in Article "37. 1ach part owner may exempt himself from this liability by the abandonment before a notary of the part of the vessel belonging to him. (nd in cases o# collision i# the same is ca sed by the captain alone, nder Art. 837' %he civil liability contracted by the shipowners in the cases prescribed in this section, shall be understood as limited to the value of the vessel with all her appurtenances and all the freight earned during the voyage. (otes: 2. $hat is a6andonment% .t is e4 ivalent to an o##er o# the val e o# the vessel, her e4 ipment and #rei*th earne in ret rn #or an e@emption #rom liability! 'o i# the vessel san$ and the sin$in* o# the vessel was ca sed entirely by the ne*li*ence o# the captain, the '% or '( can be held liable! I t i# '% or '( abandons the vessel, then the liability will only be limited to the val e o# the vessel, the #rei*hta*e and the e4 ipment! 2! The real and hypothecary nat re o# maritime law, there#ore, distin* ishes it #rom "ivil law and commercial law beca se o# this doctrine! # shipping transportation contract is $real and hypothecary$ in nature under #rt. %&' which accord(issue a shipowner(agent the right of abandonment and by necessary implication, his liability is confined to that to which he is entitled as of right to abandon, meaning the vessel and all her equipment and the freight she may have earned during the voyage. Eead: 9an*co abandonment! vs! ,aserna #or history o# ri*ht o#

.. Reasons why S)8SA are 3iven the ri3ht to a6andonment *Heirs of Amparo vs. delos Santos+ a! To o##set a*ainst the inn merable ha>ards and perils o# the sea/ b! To enco ra*e ship b ildin* and marine commerce 4! Cote that when abandonment is made in the instances provided by law, it cannot be re# sed! 8! "an a charterer ma9e an a6andonment% ()5 6ecause he cannot be considered in place o# the owner or the shipa*ent in matters re*ardin* to the reponsibility pertainin* to ownership and possession o# the vessel! 7ven i# the charter is a bareboat or demise charter! #?"# T!)(S T) R!<HT )' ABA(&)(M#(T )meanin* even i# the ri*ht to abandonment e@ists, the '%;'( will still pay #or more than the val e o# the vessel+

0! -hen the vessel is properly ins red - the ins rance will ta$e care o# the liability, the val e o# which may be more than the val e o# the vessel, #rei*ht, etc! 2! -hen the liability #or repairs o# the vessel was inc reed be#ore the loss o# s ch vessel )#avorite I:+ 3! -hen the liability is one which arises #rom the provisions o# the labor code! $hen a6andonment "A(()T B# MA&#

(s already disc ssed, the ""%& can limit its liability by stip lation! )(rt! 0D49-0D80+ ?or ""%P, liability can only be limited when Pa@ is carried #or #ree and there is a stip lation! Bnder Maritime "ommerce, there is a way #or a "" to limits its liability even witho t a stip lation beca se it is the law itsel# which proves #or this liability! Eecall: ART!"L# 0-@ and 883 )'%;'( civilly liable #or acts o# captain and obli*ations contracted+ ARTICLE 587. %he agent shall also be civilly liable for the indemnities in favor of third persons which arise from the conduct of the captain in the care of the goods which the vessel carried- &ut he a( e+e %t hi se"' there'ro &( a&a$!o$i$# the ,esse" with a"" her e-ui% e$ts a$! the 'rei#ht he a( ha,e ear$e! !uri$# the ,o(a#e. %ther provisions providin* #or abandonment: ARTICLE 590. %he owners of a vessel shall be civilly liable in the proportion of their contribution to the common fund, for the results of

0! -hen the voya*e is not maritime, b t only in a river, bay, or * l# 2! -hen the vessel is not actin* as a common carrier b t a private carrier! 3! -hen the '%;'( is at #a lt, i!e! when there is lac$ o# proper e4 ipment, lac$ o# technical trainin* o# the crew, nlicensed crew members, captain! 'o any $ind o# ne*li*ence, no matter how min te will remove the ri*ht o# abandonment! cases: a! Heirs of Amparo delos Santos vs. "A: The vessel le#t late beca se the carrier decided to load more nmani#ested passen*ers and car*o! Ieca se the vessel le#t late, it

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 enco ntered a typhoon and the vessel san$! (ccordin* to the Ioard o# Marine .n4 iry )IM.+ the sin$in* was ca sed by the #a lt o# the captain and its o##icers in operatin* the vessel! The '%;'( claimed the ri*ht to abandon, b t the '" said that the doctrine o# limited liability cannot be invo$ed in this case beca se there was #a lt or ne*li*ence on the part o# the carrier beca se it overloaded the vessel even i# it was cleared to leave! (nd everytime it is discovered that a vessel is overloaded with car*o;pa@, *oodbye abandonment!
.t m st be stressed at this point that (rticle 88D spea$s only o# sit ations where the #a lt or ne*li*ence is committed solely by the captain! .n cases where the shipowner is li$ewise to be blamed, (rticle 88D does not apply! ' ch a sit ation will be covered by the provisions o# the Cew "ivil "ode on "ommon "arriers! %win* to the nat re o# their b siness and #or reasons o# p blic policy, common carriers are tas$ed to observe e@traordinary dili*ence in the vi*ilance over the *oods and #or the sa#ety o# its passen*ers )(rticle 0D33, Cew "ivil "ode+! ? rther, they are bo nd to carry the passen*ers sa#ely as #ar as h man care and #oresi*ht can provide, sin* the tmost dili*ence o# very ca tio s persons, with a d e re*ard #or all the circ mstances )(rticle 0D88, Cew "ivil "ode+! -henever death or in1 ry to a passen*er occ rs, common carriers are pres med to have been at #a lt or to have acted ne*li*ently nless they prove that they observed e@traordinary dili*ence as prescribed by (rticles 0D33 and 0D88

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*. A6oitiz Shippin3 vs. #7uita6le *,;;-+ which affirmed the (ew !ndia rulin3. 5ere, the '" traced the history startin* #rom &(?,(" to Cew .ndia! 'o no pro-rata sharin* o# the ins rance proceeds!
The "o rt declared in the 0993 &(?,(" case that claims a*ainst (boiti> arisin* #rom the sin$in* o# M;J P! (boiti> sho ld be limited only to the e@tent o# the val e o# the vessel! Th s, the "o rt held that the e@ec tion o# 1 d*ments in cases already resolved with #inality m st be stayed pendin* the resol tion o# all the other similar claims arisin* #rom the sin$in* o# M;J P! (boiti>! "onsiderin* that the claims a*ainst (boiti> had reached more than 000, the "o rt #o nd it necessary to collate all these claims be#ore their payment #rom the ins rance proceeds o# the vessel and its pendin* #rei*hta*e! (s a res lt, the "o rt e@horted the trial co rts be#ore whom similar cases remained pendin* to proceed with trial and ad1 dicate these claims so that the pro-rated share o# each claim co ld be determined a#ter all the cases shall have been decided! .n Monarch .ns rance, the "o rt deemed it #it to settle once and #or all this #act al iss e by declarin* that the sin$in* o# M;J P! (boiti> was ca sed by the conc rrence o# the nseaworthiness o# the vessel and the ne*li*ence o# both (boiti> and the vesselNs crew and master and not beca se o# #orce ma1e re! Cotwithstandin* this #indin*, the "o rt did not reverse b t reiterated instead the prono ncement in &(?,(" to the e##ect that the claimants be treated as Ocreditors in an insolvent corporation whose assets are not eno *h to satis#y the totality o# claims a*ainst it!O 5owever, on 02 May 200F, the "o rt rendered a decision in (boiti> 'hippin* "orporation v! Cew .ndia (ss rance "ompany, ,td! )Cew .ndia+, reiteratin* the well-settled principle that the e@ception to the limited liability doctrine applies when the dama*e is d e to the #a lt o# the shipowner or to the conc rrent ne*li*ence o# the shipowner and the captain! -here the shipowner #ails to overcome the pres mption o# ne*li*ence, the doctrine o# limited liability cannot be applied! .n Cew .ndia, the "o rt clari#ied that the earlier prono ncement in Monarch .ns rance was not an abandonment o# the doctrine o# limited liability and that the circ mstances therein still made the doctrine applicable! .n Cew .ndia, the "o rt declared that (boiti> #ailed to dischar*e its b rden o# showin* that it e@ercised e@traordinary dili*ence in the transport o# the *oods it had on board in order to invo$e the limited liability doctrine! Th s, the "o rt re1ected (boiti>Ns ar* ment that the award o# dama*es to respondent therein sho ld be limited to its pro rata share in the ins rance proceeds #rom the sin$in* o# M;J P! (boiti>! The instant petitions provide another occasion #or the "o rt to reiterate the well-settled doctrine o# the real and hypothecary nat re o# maritime law! (s a *eneral r le, a ship ownerNs liability is merely co-e@tensive with his interest in the vessel, e@cept where act al #a lt is attrib table to the shipowner! Th s, as an e@ception to the limited liability doctrine, a shipowner or ship a*ent may be held liable #or dama*es when the sin$in* o# the vessel is attrib table to the act al #a lt or ne*li*ence o# the shipowner or its #ail re to ens re the seaworthiness o# the vessel! The instant petitions cannot be spared #rom the application o# the e@ception to the doctrine o# limited liability in view o# the nanimo s #indin*s o# the co rts below that both (boiti> and the crew #ailed to ens re the seaworthiness o# the M;J P! (boiti>!

b! H!LAM<#( DS. "A1 (ccordin* to the '", despite the #act that the vessel was sea worthy, it was not car*o worthy! The cases and cases o# coca-cola bottles were loaded on dec$ and the vessel was top heavy ma$in* it easy to tilt in case o# stron* winds! :: -hat i# the sin$in* o# the vessel is ca sed by #ort ito s event, is the ri*ht o# abandonment present< (: Co, the '% or '( will be e@empt #rom liability! )ther important cases: 2. A6oitiz Shippin3 v. <eneral Accident *2AA.+1 The sin$in* o# this vessel ca sed a lot o# cases to be #iled a*ainst aboiti>! .n this case, the '" applied the #indin*s o# the IM. where it was #o nd that the sin$in* o# the vessel was ca sed by a #ort ito s event! The '" even e@onerated the captain and crew so nothin* co ld be collected #rom (boiti> 2! Monarch !nsurance vs. "A *,;;;+1 .t was discovered that (boiti> was ne*li*ent! 'o the sin$in* o# the ship was not ca sed by #ort ito s event and it was not also ca sed by the captain o# the ship! 'o there#ore the ri*ht o# abandonment does not e@ist as there was #a lt or ne*li*ence on the part o# the ""! IBT in this case, there was so many claimants, abo t 000 claimants, the claim amo ntin* to abo t 43 Million and the ins rance proceeds were only 04 million! The '" said that the claimants cannot *et their 43 million claims! They have to share pro-rata the proceeds o# the ins rance! There is no pre#erence o# credit!
.n the instant case, there is, there#ore, a need to collate all claims preparatory to their satis#action #rom the ins rance proceeds on the vessel M;J P! (boiti> and its pendin* #rei*hta*e at the time o# its loss! Co claimant can be *iven precedence over the others by the simple e@pedience o# havin* completed its action earlier than the rest! Th s, e@ec tion o# 1 d*ment in earlier completed cases, even these already #inal and e@ec tory m st be stayed pendin* completion o# all cases occasioned by the s b1ect sin$in*! Then and only then can all s ch claims be sim ltaneo sly settled, either completely or pro-rata sho ld the ins rance proceeds and #rei*hta*e be not eno *h to satis#y all claims!

S #"!AL ")(TRA"TS !( MAR!T!M# ")MM#R"#: *"harter party5 6ill of ladin35 loans on 6ottomry and respondentia+

2. "HART#R ARTC 1 a contract wherein the entire ship or some principal part thereo# is let by the owner to another person #or a speci#ied time or se, in consideration o# the payment o# a #ee! Two $inds o# ";P: a! "ontract of Affrei3htment - here the owner retains control o# the vessel, he provides the crew, what is bein* leased is only the space o# the vessel! ( contract o# a##rei*htment can be a time charter or a voya*e charter! b! Bare6oat8&emise "harter wherein the owner o# the vessel *ives p the control and # ll possession o# the vessel to the charterer who becomes the owner pro hac vice. .# Joya*e or time charter T common carrier retains its nat re as a common carrier/ b t i# it is bareboat charter, the common carrier becomes a private carrier #or that partic lar charter only! 'ormal8Su6stantial re7uirements: ARTICLE 652. A charter party must be drawn in duplicate and signed by the contracting parties, and when either does not ,now how or can not do so, by two witnesses at their re+uest.

). A6oitiz Shippin3 vs. (ew !ndia *,;;@+ 1 The '" chan*ed its mind a*ain!
% r r lin* in Monarch may appear inconsistent with the e@ception o# the limited liability doctrine, as e@plicitly stated in the earlier part o# the Monarch decision! (n e@ception to the limited liability doctrine is when the dama*e is d e to the #a lt o# the shipowner or to the conc rrent ne*li*ence o# the shipowner and the captain! .n which case, the shipowner shall be liable to the # ll-e@tent o# the dama*e! -e th s #ind it necessary to clari#y now the applicability here o# the decision in Monarch! -here the shipowner #ails to overcome the pres mption o# ne*li*ence, the doctrine o# limited liability cannot be applied! There#ore, we a*ree with the appellate co rt in s stainin* the trial co rtNs r lin* that petitioner is lia6le for the total value of the lost car3o.

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 %he charter party shall include, besides the conditions unrestrictedly stipulated, the following statements' 1.%he ,ind, name, and tonnage of the vessel. ../er flag and port of registry. .%he name, surname, and domicile of the captain. !.%he name, surname, and domicile of the agent, if the latter should ma,e the charter party. ".%he name, surname, and domicile of the charterer, and if he states that he is acting by commission, that of the person for whose account he ma,es the contract. $.%he port of loading and unloading. 7.%he capacity, number of tons or weight, or measure which they respectively bind themselves to load and transport, or whether it is the total cargo. 8.The 'rei#hta#e to &e %ai!) stati$# whether it is to &e a 'i+e! a ou$t 'or the ,o(a#e or so uch %er o$th) or 'or the s%ace to &e occu%ie!) or 'or the wei#ht or easure o' the #oo!s o' which the car#o co$sists) or i$ a$( other a$$er whatsoe,er a#ree! u%o$. 89RI:A;E2 a small allowance or compensation payable to the master or owner of the vessel for the use of its cables to load and unload the goods and to the mariners for lading and unlading in port. So what you pay those who load6E:<RRA;E 2 an amount stipulated in the charter party to be paid by the charter<shipper to the ship owner for any delay. = 6.%he amount of primage to be paid to the captain. 10.The !a(s a#ree! u%o$ 'or "oa!i$# a$! u$"oa!i$#. 8"a(!a(s2 no. of days between unloading and departure= 11.%he lay days and extra lay days to be allowed and the rate of demurrage. $H) "A( R#S"!(& #ither party A "HART#R ARTC: "ase: 7##ect o# sale to 3rd person

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0!.# the charterer at the termination o# the e@tra lay days does not place the car*o alon*side the vessel! .n s ch case the charterer m st pay hal# the #rei*ht stip lated besides the dem rra*e #or the lay days and e@tra lay days elapsed! 2!.# the person #rom whom the vessel was chartered sho ld sell her be#ore the charterer has be* n to load her and the p rchaser sho ld load her #or his own acco nt! .n s ch case the vendor shall indemni#y the charterer #or the losses he may s ##er! .# the new owner o# the vessel sho ld not load her #or his own acco nt the charter party shall be respected )in s ch case, the charter party is not rescinded+ and the vendor shall indemni#y the p rchaser if the former did not inform him o# the charter pendin* at the time o# ma$in* the sale! %therwise, i# he in#ormed him, then no need to indemni#y! "harter Period arty )rdinary Lease "ontract .# the lease is #or a de#inite period, the lessee cannot terminate the contract .# the leased property is sold to one who $nows o# the e@istence o# the lease contract, the new owner m st respect the lease

.# #or de#inite period, the charterer may rescind the charter party by payin* hal# o# the #rei*hta*e Cew owner cannot be compelled to respect the charter party!

ART!"L# @--. A charter party may 6e annulled at the re7uest of the charterer: 0!.# be#ore loadin* the vessel he sho ld abandon the charter, payin* hal# o# the #rei*hta*e a*reed pon! )a6andonment of charter 6efore loadin3: pay 28, of the frei3ht+ 2!.# the capacity of the vessel should not a3ree with that stated in the certificate of the tonna3e5 or if there is an error in the statement of the fla3 nder which she sails! )"harterer will be indemni#ied by the owner+ 3!.# the vessel sho ld not be placed at the disposal o# the charterer within the period and in the manner a*reed pon! )non placement at disposal of the charterer+ 4!.#, a#ter the vessel has p t to sea, she sho ld ret rn to the port o# depart re, on account of ris9 of pirates5 enemies5 or 6ad weather5 and the frei3hters should a3ree to unload her! )charterer m st pay owner #or the voya*e o t, meanin* one way+ .n the second and third cases the person #rom whom the vessel was chartered shall indemni#y the charterer #or the losses he may s ##er! .n the #o rth case the person #rom whom the vessel was chartered shall have a ri*ht to the #rei*hta*e in # ll #or the voya*e o t! .# the charter sho ld have been made by the months, the charterers shall pay the # ll #rei*hta*e #or one month, i# the voya*e were to a port in the same waters, and two months, i# the voya*e were to a port in di##erent waters! ?rom one port to another o# the Penins la and ad1acent islands, the #rei*hta*e #or one month only shall be paid! 8!.# a vessel sho ld ma$e a port d rin* the voya*e in order to ma$e ur3ent repairs and the frei3hters sho ld pre#er to dispose o# the merchandise!)pay #or voya*e o t+ -hen the delay does not e@ceed thirty days, the #rei*hters shall pay the # ll #rei*ht #or the voya*e o t! 'ho ld the delay e@ceed thirty days, they shall only pay the #rei*ht in proportion to the distance covered by the vessel! ART!"L# @-A! At the re7uest of the person from whom the vessel is chartered the charter party may be rescinded:

Santia3o Li3htera3e vs. "A: 'eaworthiness cannot be a*reed to between the parties )paran* 1 risdiction o# the co rt+ beca se it is a #act which has to be proven!
?@: .n this case two charter parties were entered into! The owner o# the vessel was 'antia*o! 5e chartered the vessel to I )bareboat charter+! I chartered the vessel to " )voya*e charter+! The vessel was s pposed to carry an ore to 'o th 6orea! %n the way to pic$ p the ore #rom Manila to Pambales, the vessel had to nder*o repairs! .n short it never reached 6orea! The pertinent provisions o# the contract between 'antia*o and I reads: O3! =elivery S The J7''7, shall be delivered and ta$en over by the "5(ET7E7E' at the port o# the "ity o# Manila, in s ch ready berth as the "5(ET7E7E' may direct! The %-C7E shall be#ore and at the time o# delivery e@ercise d e dili*ence to ma$e the J7''7, seaworthy and in every respect ready in h ll, machinery and e4 ipment #or service here nder! The J7''7, shall be properly doc mented at time o# delivery! The delivery to the "5(ET7E7E' o# the J7''7, and the ta$in* over o# the J7''7, by the "5(ET7E7E' shall constit te a # ll per#ormance by the %-C7E o# all the %-C7E' obli*ations here nder, and therea#ter the "5(ET7E7E' shall not be entitled to ma$e or assert any claim a*ainst the %-C7E on acco nt o# the representations or warranties e@pressed or implied with respect to the J7''7, b t the %-C7E shall be responsible #or repairs or renewals occasioned by latent de#ects in the J7''7,, her machinery or app rtenances e@istin* at the time o# delivery nder this (*reement, provided s ch de#ects have mani#ested be#ore t rn-over!O -hat is the liability o# 'antia*o as the owner< Held: The mere physical trans#er o# MJ "hristine &ay #rom petitioner to Pelae> does not constit te # ll per#ormance o# its obli*ation nder their bareboat charter a*reement! Ceither is it considered a delivery! Bnder the a*reement, physical trans#er o# a seaworthy vessel is necessary to satis#y delivery! 'eaworthiness is a relative term! The de*ree o# seaworthiness varies in relation to the contemplated voya*e! To be seaworthy, a vessel Gm st have that de*ree o# #itness which an ordinary, care# l and pr dent owner wo ld re4 ire his vessel to have at the commencement o# her voya*e, havin* re*ard to all the probable circ mstances o# it!H Th s the de*ree o# seaworthiness varies in relation to the contemplated voya*e! "rossin* the (tlantic calls #or stron*er e4 ipment than sailin* across the Jisayan 'ea! .t is essential to consider that once the necessary de*ree o# seaworthiness has been ascertained, this obli*ation is an absol te one, i!e! the nderta$in* is that the vessel act ally is seaworthy! .t is no e@c se that the shipowner too$ every possible preca tion to ma$e her so, i# in #act he #ailed! .n e@aminin* what is meant by seaworthiness we m st bear in mind the d al nat re o# the carriers obli*ations nder a contract o#

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09

a##rei*htment! To satis#y these d ties the vessel m st )a+ be e##icient as an instr ment o# transport and )b+ as a storeho se #or her car*o! The latter part o# the obli*ation is sometimes re#erred to as car*oworthiness! ( ship is e##icient as an instr ment o# transport i# its h ll, tac$le and machinery are in a state o# *ood repair, i# she is s ##iciently provided with # el and ballast, and is manned by an e##icient crew! (nd a vessel is car*oworthy i# it is s ##iciently stron* and e4 ipped to carry the partic lar $ind o# car*o which she has contracted to carry, and her car*o m st be so loaded that it is sa#e #or her to proceed on her voya*e! ( mere ri*ht *iven to the charterer to inspect the vessel be#ore loadin* and to satis#y himsel# that she was #it #or the contracted car*o does not #ree the shipowner #rom his obli*ation to provide a car*oworthy ship!

21

The pres mption is that the carrier did not deliver the *oods! $ho may chan3e the consi3nee% ART!"L# .@;. The shipper may, witho t chan*in* the place where the delivery is to be made, chan*e the consi*nment o# the *oods delivered to the carrier, and the latter shall comply with his orders, provided that at the time o# ma$in* the chan*e o# the consi*nee the bill o# ladin* s bscribed by the carrier be ret rned to him, i# one were iss ed, e@chan*in* it #or another containin* the novation o# the contract! The e@penses arisin* #rom the chan*e o# consi*nment shall be de#rayed by the shipper! TRA(SSH! M#(T - .t is the act o# ta$in* car*o #rom one ship and loadin* it into another! Transshipment cannot be made i# the shipper does not consent beca se it is dan*ero s!! it will e@pose the *oods to brea$a*e, etc! 'o the e##ect i# there was transshipment witho t consent is that there is a breach in the contract o# carria*e! (nd the carrier is liable to the shipper in case o# loss, even for an otherwise e4cepted cause ! BR!(<!(< A( A"T!)(8"LA!M A<A!(ST TH# "ARR!#R

B!LLS )' LA&!(< *"': ART. .0@5 .0B5 B;A5 B2-+

(n intstr ment in writin* si*ned by the carrier or his a*ent, describin* the #rei*ht so as to identi#y it, stain* the name o# the consi*or, the terms o# the contract o# carria*e and a*reein* or directin* that the #rei*ht be delivered to the order or assi*ns o# a speci#ied person at a speci#ied place! Two fold nature: 'erves as a receipt as well as evidence o# a contract! IBT it is not important #or a contract o# carria*e to e@ist between the shipper;pa@ and the common carrier! .t is merely an evidence! $hat is the effect of the issuance 6y a carrier of an unsi3ned 6ill of ladin3 when accepted 6y the shipper or the consi3nee%

Bnder (rt! 3FF, this does not cover loss beca se it says pon receipt o# the *oods or merchandise! ARTICLE 366. 9ithin the twe$t(2'our hours following the receipt of the merchandise a claim may be brought against the carrier on account of damage or average found therein on opening the pac,ages, %ro,i!e! that the indications of the damage or average giving rise to the claim can not be ascertained from the exterior of said pac,ages, in which case said claim would only be admitted on the receipt of the pac,ages. (So if the damage is apparent, file a claim, which may be verbal, immediately upon receipt) A'ter the %erio!s e$tio$e! ha,e e"a%se!) or a'ter the tra$s%ortatio$ char#es ha,e &ee$ %ai!) $o c"ai whatsoe,er sha"" &e a! itte! a#ai$st the carrier with re#ar! to the co$!itio$ i$ which the #oo!s tra$s%orte! were !e"i,ere!. $hen does the ,/ hour period 6e3in to run% -hen the *oods are act ally received! "ase: Cew Pealand vs! "h a Roy - 5eld: .n order that the condition provided in (rticle 3FF o# the "ode o# "ommerce may be demanded there sho ld be a consi*nment o# *oods, thro *h a common carrier, by a consi*nor in one place to a consi*nee in another place! (nd said article provides that the claim #or dama*es m st be made Gwithin twenty-#o r ho rs #ollowin* the receipt o# the merchandiseH by the consi*nee #rom the carrier! .n other words, there m st be delivery o# the merchandise by the carrier to the consi*nee at the place o# destination! The car*o never reached Manila, its destination, nor was it ever delivered to the consi*nee, the o##ice o# the shipper in Manila, beca se the ship ran a*ro nd pon enterin* ,aoan* bay, 'amar on the same day o# the shipment! ' ch bein* the case, it #ollows that the car*o was never received by the consi*nee! &id the "ivil "ode repeal the prescriptive period to file a claim under the "ode of "ommerce%

A: Ien3 Hua aper roducts "o5 !nc. vs. "A: ( Obill o# ladin* delivered and accepted constit tes the contract o# carria*e even tho *h not si*ned,O beca se the O)a+cceptance o# a paper containin* the terms o# a proposed contract *enerally constit tes an acceptance o# the contract and o# all o# its terms and conditions o# which the acceptor has act al or constr ctive notice!O .n a n tshell, the acceptance o# a bill o# ladin* by the shipper and the consi*nee, with # ll $nowled*e o# its contents, *ives rise to the pres mption that the same was a per#ected and bindin* contract! $hat must 6e done to the 6ill of ladin3 upon fulfillment of the contract%

ARTICLE 353. %he legal basis of the contract between the shipper and the carrier shall be the bills of lading, by the contents of which all disputes which may arise with regard to their execution and fulfillment shall be decided without admission of other exceptions than forgery or material errors in the drafting thereof. After the contract has been complied with the bill of lading issued by the carrier shall be returned to him, and by virtue of the exchange of this certificate for the article transported, the respective obligations and actions shall be considered as canceled, unless in the same act the claims which the contracting parties desired to reserve are reduced to writing, exception being made of the provisions of Article $$. If in case of loss or for any other reason whatsoever, the consignee can not return upon receiving the merchandise the bill of lading subscribed by the carrier, he shall give said carrier a receipt for the goods delivered, this receipt producing the same effects as the return of the bill of lading. (?ter the contract has been complied with, the bill o# ladin* shall be ret rend to the carrier who may have iss ed it and it )the s rrender+ is proo# that the *oods have been delivered! (nd a#ter the deliverey or ret rn o# the bill o# ladin*, the respective obli*ations and actions between the parties shall be considered as cancelled! !n case the consi3nee cannot return upon receive the merchandise the 6ill of ladin35 he m st *ive the said carrier a receipt #or the *oods delivered, this receipt prod cin* the same e##ects as the ret rn o# the bill o# ladin*! )(rt! 383+ $hat is the presumption if the carrier does not hold the 6ill of ladin3 after the fulfillment of the contract of transportation%

Co, the limitations o# actions mentioned in the "ivil "ode are witho t pre1 dice to those speci#ied in teh "ode o# "ommerce! eriod to file for recovery of undelivered8lost car3o in the courts:*note that under the "ode of commerce5 it does not cover loss8non delivery of car3o+ .# there is a bill o# ladin*, 00 years, otherwise, F years! .# it involves overseas tradin*, 0 year #rom date when it was s pposed to be received! L)A(S )( B)TT)MRC A(& R#S )(&#(T!A

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 ARTICLE 719. A loan on bottomry or respondentia shall be considered that which the repayment of the sum loaned and the premium stipulated, under any condition whatsoever, depends on the safe arrival in port of the goods on which it is made, or of their value in case of accident. Cotes: 2. !f the collateral is the vessel K 6ottomry: if collateral is 3oods K respondentia. #4! ,oan #or 8 Million, en ro te to 'an ?rancisco, the vessel sin$s! The loan is e@tin* ished beca se the collateral is lost! 2! "haracteristics of a loan on Bottomry: .t is a loan the sec rity o# which is the vessel itsel# and conditioned on the sa#e arrival at the port o# destination! (lso the vessel m st be e@posed to maritime peril! )'o it m st be destroyed d rin* its voya*e+ .. $ho may contract such loan% )n 6ottomry: The owner o# the vessel or the captain )see previo s disc ssion, (rt! 880+/ on respondentia: owner o# the car*o! )rdinary Loan May or may not have collateral ,ollateral may be real or personal property #bsolutely repayable eed not be in writing /o be binding on )rd persons, need not be registered 0oss of collateral, if any does not e1tinguish the loan Loan Bottomry8respondentia +ust always have collateral on

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ARTICLE 807. %he petty and ordinary expenses of navigation, such as pilotage of coasts and ports, lighterage and towage, anchorage dues, inspection, health, +uarantine, la0aretto, and other so8called port expenses, costs of barges, and unloading, until the merchandise is placed on the wharf, and any other expenses common to navigation shall be considered ordinary expenses to be defrayed by the shipowner, unless there is a special agreement to the contrary. ART!"L# -;-. (vera*es shall be: 0!'imple or partic lar! 2!&eneral or *ross! ART!">LAR AD#RA<#: 'imple or partic lar avera*es shall be, as a *eneral r le, all the e@penses and dama*es ca sed to the vessel or to her car*o which have not redo nded to the bene#it and common pro#it o# all the persons interested in the vessel and her car*o @ @ @ )(rt! 809+ $ho 6ears the loss in 8A< The owner o# the *oods which *ave rise to the e@pense or s ##ered the dama*e shall bear the simple or partic lar avera*e )(rt! 800+ 1xamples of &<A' 1. %he damages suffered by the cargo from the time of its embar,ation until it is unloaded, either on account of the nature of the goods or by reason of an accident at sea or force ma2eure, and the expenses incurred to avoid and repair the same. ..%he damages suffered by the vessel in her hull, rigging, arms, and e+uipment, for the same causes and reasons, from the time she puts to sea from the port of departure until she anchored in the port of destination. .%he damages suffered by the merchandise loaded on dec,, except in coastwise navigation, if the marine ordinances allow it. !.%he wages and victuals of the crew when the vessel should be detained or embargoed by a legitimate order or force ma2eure, if the charter should have been for a fixed sum for the voyage. ".%he necessary expenses on arrival at a port, in order to ma,e repairs or secure provisions. $.%he lowest value of the goods sold by the captain in arrivals under stress for the payment of provisions and in order to save the crew, or to cover any other re+uirement of the vessel against which the proper amount shall be charged. 7.%he victuals and wages of the crew during the time the vessel is in +uarantine. 3.%he damage suffered by the vessel or cargo by reason of an impact or collision with another, if it were accidental and unavoidable. If the accident should occur through the fault or negligence of the captain, the latter shall be liable for all the damage caused. 6.Any damage suffered by the cargo through the faults, negligence, or barratry of the captain or of the crew, without pre2udice to the right of the owner to recover the corresponding indemnity from the captain, the vessel, and the freight. <#(#RAL AD#RA<#: all the dama*es and e@penses which are deliberately ca sed in order to save the vessel, her car*o, or both at the same time, #rom a real and $nown ris$ *Art. -22+ $ho 6ears the loss% ART!"L# -2,. .n order to satis#y the amo nt o# the *ross or *eneral avera*es, all the persons havin* an interest in the vessel and car*o therein at the time o# the occ rrence o# the avera*e shall contrib te! 1xample of =eneral Ave' 1. %he goods or cash invested in the redemption of the vessel or cargo captured by enemies, privateers, or pirates, and the provisions, wages, and expenses of the vessel detained during the time the arrangement or redemption is ta,ing place. .. %he goods 2ettisoned to lighten the vessel, whether they belong to the vessel, to the cargo, or to the crew, and the damage suffered through said act by the goods ,ept.

,ollateral must be a vessel or a cargo subject to maritime ris.ayment depends on the safe arrival by the collateral at the port of the loan +ust be in writing +ust be registered in the registry of vessels 0oss of collateral the loan. e1tinguishes

#ffect of loss of collateral: <en Rule: 7@tin* ishes the loan provided re4 irements o# (rt! D30 are complied with! ARTICLE 731. %he actions which may be brought by the lender shall be extinguished by the absolute loss of the goods on which the loan was made, if said loss arose from an accident of the sea at the time and during the voyage designated in the contract, and should it be proven that the cargo was on boardE>CE9TI?43' but this shall not ta,e place if the loss were caused by the inherent defect of the thingor through the fault or malice of the borrower, or through barratry on the part of the captain, or if it were caused by damages suffered by the vessel as a conse+uence of being engaged in contraband, or if it arose through loading the merchandise on a vessel other than that designated in the contract, unless this change should have been made by reason of force ma2eure. %he proof of the loss is incumbent upon the person who received the loan, as well as the proof of the existence in the vessel of the goods declared to the lender as the ob2ect thereof. R!SIS5 &AMA<#S A(& MAR!T!M# ")MM#R"# A""!&#(TS )'

ARTICLE 806. *or the purposes of this Code the following shall be considered averages' 1. All extraordinary or accidental expenses which may be incurred during the navigation for the preservation of the vessel or cargo, or both. .. All damages or deterioration the vessel may suffer from the time she puts to sea from the port of departure until she casts anchor in the port of destination, and those suffered by the merchandise from the time it is loaded in the port of shipment until it is unloaded in the port of consignment. $hat are ()T avera3es% -;B etty e4penses under Art.

Transcribed and Prepared by: Hanniyah Sevilla 4 Manresa 08-09 .%he cables and masts which are cut or rendered useless, the anchors and the chains which are abandoned in order to save the cargo, the vessel, or both. !.%he expenses of removing or transferring a portion of the cargo in order to lighten the vessel and place her in condition to enter a port or roadstead, and the damage resulting therefrom to the goods removed or transferred. ".%he damage suffered by the goods of the cargo through the opening made in the vessel in order to drain her and prevent her sin,ing. $.%he expenses caused through floating a vessel intentionally stranded for the purpose of saving her. 7.%he damage caused to the vessel which it is necessary to brea, open, scuttle, or smash in order to save the cargo. 3.%he expenses of curing and maintaining the members of the crew who may have been wounded or crippled in defending or saving the vessel. 6.%he wages of any member of the crew detained as hostage by enemies, privateers, or pirates, and the necessary expenses which he may incur in his imprisonment, until he is returned to the vessel or to his domicile, should he prefer it. 17.%he wages and victuals of the crew of a vessel chartered by the month during the time it should be embargoed or detained by force ma2eure or by order of the =overnment, or in order to repair the damage caused for the common good. 11.%he loss suffered in the value of the goods sold at arrivals under stress in order to repair the vessel because of gross average. 1..%he expenses of the li+uidation of the average. R#=>!S!T#S ')R <#(#RAL AD#RA<#:

23

5eld: 5erein, while the e@penses inc rred in p ttin* Ma*saysays vessel a#loat may well come nder n mber 2 o# article 809 V which re#ers to e@penses s ##ered by the vessel Gby reason o# an accident o# the sea or #orce ma1e reH V and sho ld there#ore be classi#ied as partic lar avera*e, the said e@penses do not #it into any o# the speci#ic cases o# *eneral avera*e en merated in article 800! C mber F o# (rticle 800 does mention Ge@penses ca sed in order to #loat a vessel,H b t it speci#ically re#ers to Ga vessel intentionally stranded #or the p rpose o# savin* itH and wo ld have no application where, as in the present case, the strandin* was not intentional! $ith respect to Re7uisites of <eneral avera3e: 0! -ith respect to the #irst re4 isite, the evidence does not disclose that the e@penses so *ht to be recovered #rom de#endant were inc rred to save vessel and car*o #rom a common dan*er! The vessel ran a*ro nd in #ine weather inside the port at the mo th o# a river, a place described as Gvery shallowH! .t wo ld th s appear that vessel and car*o were at the time in no imminent dan*er or a dan*er which mi*ht Grationally be so *ht to be certain and imminent!H 2! (s to the second re4 isite, the e@penses in 4 estion were not inc rred #or the common sa#ety o# vessel and car*o, since they, or at least the car*o, were not in imminent peril! The car*o co ld, witho t need o# e@pensive salva*e operation, have been nloaded by the owners i# they had been re4 ired to do so! 3! -ith respect to the third re4 isite, the salva*e operation was a s ccess/ however, as the sacri#ice was #or the bene#it o# the vessel V to enable it to proceed to destination V and not #or the p rpose o# savin* the car*o, the car*o owners are not in law bo nd to contrib te to the e@penses!

2. There must 6e a ")MM)( &A(<#R5 a dan3er in which the ship5 car3o and crew all participate: ,. 'or the common safety or for the purposes of avoidin3 imminent peril5 part of the car3o or vessel on 6oard is sacrificed deli6erately *part o# the crew, pwede< hehe+ .. There must 6e attempt to avoid the imminent peril must 6e successful in a sense that the vessel and some of the car3o are saved: /. &ama3es or e4penses were incurred after ta9in3 the proper le3al steps. "ases: 0! Ma3saysay vs. A3an
?acts: The ' ' G'an (ntonioH, a vessel owned and operated by (! Ma*saysay .nc!, le#t Manila on F %ctober 0949, bo nd #or Iasco, Iatanes, via (parri, "a*ayan, with *eneral car*o belon*in* to di##erent shippers, amon* them (nastacio (*an! The vessel reached (parri on the 00th o# that month, and a#ter a days stopover in that port, wei*hed anchor to proceed to Iasco! I t while still in port, it ran a*ro nd at the mo th o# the "a*ayan river, and, attempts to re#loat it nder its own power havin* #ailed, Ma*saysay had it re#loated by the , >on 'tevedorin* "o! at an a*reed compensation! The strandin* o# Ma*saysays vessel was d e to the s dden shi#tin* o# the sandbars at the mo th o# the river which the port pilot did not anticipate! %nce a#loat, the vessel ret rned to Manila to re# el and then proceeded to Iasco, the port o# destination! There the car*oes were delivered to their respective owners or consi*nees, who, with the e@ception o# (*an, made a deposit or si*ned a bond to answer #or their contrib tion to the avera*e! %n the theory that the e@penses inc rred in #loatin* the vessel constit te *eneral avera*e to which both ship and car*o sho ld contrib te, Ma*saysay bro *ht the action in the "?. o# Manila to ma$e (*an pay his contrib tion, which, as determined by the avera*e ad1 ster, amo nts to P840!40! (*an, in his answer, denies liability #or this amo nt, alle*in*, amon* other thin*s, that the strandin* o# the vessel was d e to the #a lt, ne*li*ence and lac$ o# s$ill o# its master, that the e@penses inc rred in p ttin* it a#loat did not constit te *eneral avera*e, and that the li4 idation o# the avera*e was not made in accordance with law! (#ter trial, the lower co rt #o nd #or Ma*saysay and rendered 1 d*ment a*ainst (*an #or the amo nt o# the claim, with le*al interests! ?rom this 1 d*ment, (*an has appealed directly to the ' preme "o rt! The ' preme "o rt reversed the decision appealed #rom, and dismissed Ma*saysays complaint!