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ANNOTATION
COMMON CARRIER, REVISITED
By
*
ROGELIO E. SUBONG
________________
I. Introduction, p. 233
II. Common Carrier: A Brief Background, p. 235
III. Definitions, p. 235
a) Websters New World College Dictionary, 14th
Edition, p. 295, p. 235
b) Black Law Dictionary, Abridged Fifth Edition, p.
143, p. 236
c) From 13 Am. Jur 2d. 561562, p. 236
d) Ballantines Law Dictionary, Third Edition, p. 226,
p. 236
e) Sec. 13 of Act No. 3108, as amended by Act No.
3316, p. 236
f) Sec. 13 (a) the Public Service Act, as amended, or
Com. Act No. 146, as amended, p. 237
IV. Elements of a Common Carrier, p. 237
a) Any person, corporation, firm or association, p. 237
b) Engaged in the business of carrying or
transporting, p. 238
c) Carrying or transporting passengers or goods or
both, p. 238
d) Carrying or transporting passengers or goods or
both by land, water or air, p. 238

e) The carrying or transporting of passengers or goods

or both for a fee or compensation, p. 239
f) Offering their services to the public as a general or
limited clientele, whether permanent, occasional or
accidental, p. 239
V. Constitutional and Legal Basis for Regulation
of Common Carriers, p. 240
VI. Pertinent Supreme Court Decisions on
Common Carriers, p. 241
a) U.S. v. Quinajon, et al. and U.S. vs. Tan Piaco, p.
241
b) Two (2) Luzon Brokerage vs. PSC cases, p. 242
c) Mendoza vs. PAL, p. 243
_______________
*

A.B (UP) and LL.B (UP).

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d) Home Insurance Inc. vs. American Steamship

Agencies, Inc., et al., 23 SCRA 24 (1968), p. 244
e) San Pablo vs. Pantranco South Express, Inc., p. 245
f) De Guzman vs. CA, p. 247
g) Planters Products, Inc. vs. CA, 226 SCRA 476
(1993), p. 248
h) Valenzuela Hardwood and Industrial Supply, Inc.
vs. CA, p. 250
i) National Steel Corp. vs. CA, p. 251
j) Philippine American General Insurance Co. vs.
PKS Shipping Co., p. 252
VII. Summary of the Pertinent Holdings on the
Nature of Common Carriers, p. 253
VIII. Significance of the Case under Annotation, p.
255

a) A continuing ambivalence, p. 255

b) Determination crucial, p. 256
c) Akin to the case of a flatfooted draft dodger, p. 256
d) Was fortuitous event or force majeure established?,
p. 256
e) Several instances when findings of the CA may be
reviewed on appeal, p. 257
f) Affirmation of the holding in De Guzman vs. CA &
Planters Products, Inc. vs. CA, p. 257
IX. Conclusion, p. 257
________________

I. Introduction
Legal concepts are usually constant in their meanings yet
must yield to changes and expansions as demanded by
moment. This is akin to the minor enigma made famous by
Harvard Law School Dean Roscoe Pound: Law must be
stable, but it cannot stand still. In Constitutional Law
alone, numerous concepts and doctrines have been modified
and expanded to include matters which could not have
been conceived by the founding fathers at the drafting of
the fundamental law yet are fairly comprehended under
the rudiments of justice and fairplay. The right to privacy
has been expanded to include wiretapping and wireless
mode of snooping although such right had a limited scope
before the electronic age. The right to employment as
property within Constitutional protection was not as
fortified then as they are now when labor rights were not
as established as they are today. Copyrights have expanded
to computer programs, databases, and computergenerated
words, things unheard of before circa 1980s. And other
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legal rights, which used to have a limited ambit have been

pushed into the frontiers of cyberspace.

Expansion of the coverage of legal concepts is inevitable

if law is to be responsive to the felt necessities of the
times as per Justice Oliver Wendell Holmes. This holds
true in public utility jurisprudence, particularly on the
concept of public utility service and common carrier. The
basic idea of a public utility operator used to include
ownership of the equipment used in the service being
provided. This has been modified with the advent of Tatad
vs. Garcia, 243 SCRA 477 (1995) where such ownership of
the equipment by the granteeoperator may not be
necessary. Furthermore, a common carrier has been
traditionally viewed as a rolling or moving equipment that
transfers passengers and cargoes from one place to
another. This idea has now been expanded to include
permanently immobile iron pipelines through which flow
oil or gas, linking distant refineries or plants to their depot
deep into the metropolis with the promulgation First
Philippine Industrial Corp. vs. Court of Appeals, 300 SCRA
661 (1998).
Philippine American General Insurance Co. vs. PKS
Shipping Co., G.R. No. 149038 promulgated on April 9,
2003 highlights a continuing uncertainty as to the precise
nature of a common carrier. The trial court and the Court
of Appeals differed in their conclusions in classifying the
ship owner whether a common carrier or a private carrier.
The High Court made its own holding on this issue by
relying upon settled jurisprudence on the nature of a
common carrier. In this regard, there appears a need to re
examine conflicting decisions on whether a charter party
contract renders the service of the carrier a private carrier
(Home Insurance Co. vs. American Steamship Agencies Inc.,
et al., 23 SCRA 24 (1968) and Planters Products, Inc. vs.
Court of Appeals, 226 SCRA 476 (1993).
In the case under Annotation, the trial court and the
two (2) appellate courts arrived at the same conclusion
absolving the ship owner from liability not because of the
nature of its service as carrier but due to fortuitous event
or force majeure which caused the loss of the cargoes
carried by the ship owner. Hence, this is as good a time as
any to revisit this concept of common carrier whether there
have been changes since the latest jurisprudence on the
matter. An accurate determination of a transport facility
whether a private or common carrier will also determine
the quantum of proof needed and the level of diligence the
latter has to exercise

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over passengers and cargoes in transporting them to their

destination.
II. Common Carrier: A Brief Background
The concept of common carrier was generally unheard of
during the Spanish regime. Public utility regulation
formally started with the Americans at the turn of the
century. Besides, motorized vehicles for the movement of
people and goods arrived in the country from the United
States during the earlier decades of the 1900. Then as now,
transport facilities, especially the motorized ones were
sorely needed by the inhabitants who regularly commute to
the seat of government in Manila from their respective
provinces in Luzon and viceversa. During the early days of
the American regime or better known as the prewar years,
transport service was not organized, let alone,
institutionalized. Some enterprising Filipinos who had the
fortune of acquiring these new contraptions from the
United States engaged in colorum service (operation
without authority or franchise) because of demand from
local travellers. During the early decades of the 1900s the
United States, started producing cars, trucks and buses,
thanks to Mr. John Henry Ford who introduced the
assembly line method of mass production with its car
models. This development resulted in the increase of the
number of motor vehicles that reach our transport starved
country.
With the arrival of motor vehicles or transport systems
from the U.S. that carry passengers like cars, trucks and
buses and even railway trains, the concept of a common
carrier was developed. What comes to mind when the term
common carrier is mentioned is a mode of transportation
of people and goods from one place to another for a fee. This
is fairly correct but it has legal definitions recognized
through the years in American as well as in Philippine
jurisdiction.

 III. Definitions
For a better appreciation of the concept of a common
carrier, let us reproduce its various definitions:
a) Websters New World College Dictionary, 14th
Edition, p. 295A person or company in the
business of transporting passengers or goods for a
fee, at uniform rates available to all persons
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b) Black Law Dictionary, Abridged Fifth Edition, p.

143Any carrier required by law to convey
passengers or freight without refusal if the
approved fare or charge is paid in contrast to
private or contract carrier. One who holds himself
out to the public as engaged in business of
transportation of person or property from place to
place for compensation, and who offers services to
the public generally.
c) From 13 Am Jur 2d. 561562A common carrier
may be defined, very generally, as one who holds
himself out to the public as engaged in the business
of transporting persons or property from place to
place, for compensation, offering his services to the
public generally. The dominant and controlling
factor in determining the status of one as a common
carrier is his public profession or holding out, by
words or by a course of conduct, as to the service
offered or performed, with the result that he may be
held liable for refusal, if there is no valid excuse, to
carry for all who apply. The distinctive
characteristic of a common carrier is that he
undertakes to carry for all people indifferently, and
he is regarded in some respects, as a public servant.
Hence, one performing transportation service for
himself only is not a common carrier. One does not
have the status of a common carrier where he
undertake carriage for a particular group or class of

persons under a special arrangement, or for a

particular person only.
d) Ballantines Law Dictionary, Third Edition, p. 226)
One who holds himself out to the public as
engaged in transporting persons or property from
place to place, for compensation, offering his
services to the public generally. 13 Am Jur 2d Car
S. 2. xxx xxx The dominant and controlling factor in
determining the status of a common carrier is his
public profession or holding out by words, or by a
course of conduct, as to the services offered or
performed. (AceHigh Dresses v. J.C. Trucking Co.,
122 Conn 578, 191 A 536, 112 ALR 86.)
e) Sec. 13 of Act No. 3108, as amended by Act No. 3316
This was an earlier public utility law wherein
common carrier is a species of the term public
utility or public service which has been defined, to
wit:
x x x x x x x x x
The term public service is hereby defined to include every individual, co
partnership, etc. x x x
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x x x x that now or thereafter may own, operate, manage, or control
within the Philippine Islands for hire or compensation, any common
carrier, railroad, street railway, traction railway, subway, freight and/or
passenger motor vehicles, with or without fixed route, freight or any
other car service, x x x x x x engaged in the transportation of passengers
or cargoes x x x (Sec. 13 of Act No. 3108, as amended by Act No. 3316).

In this definition, the following phrase was not yet included:

with general or limited clientele, whether permanent, occasional
or accidental, and done for general business purposes. Act No.
3108 was the earlier Public Service Law which was thereafter
superseded and repealed by Com. Act No. 146, as amended or the
Public Service Act, as amended.

f) Sec. 13. (a) the Public Service Act, as amended, or

Com. Act No. 146, as amended.We should note that
under this subsequent law, common carrier is still

comprehended within the concept of public service

which is defined, to wit:
SEC. 13. (a) x x x x
xxxx
xxxx
(b) The term public service includes every person
that now or hereafter may own, operate, manage, or
control in the Philippines, for hire or compensation,
with general or limited clientele, whether
permanent, occasional or accidental, and done for
general business purposes, any common carrier,
railroad, street railway, traction railway, subway,
motor vehicle, either for freight or passenger, or
both with or without fixed route x x x x (The
underlined phrase were added, among others.)

IV. Elements of a Common Carrier

While there are several definitions of common carrier as set
forth above, the basic elements are about the same. From
the above definitions, we can deduce the following basic
elements:
a) Any person, corporation, firm or associationA
natural or juridical person is the usual applicant
and/or grantee of a certificate of public convenience
or franchise which makes for a franchised common
carrier. However, it has been held that
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a Certificate of Public Convenience (CPC) or a

franchise is not necessary to be classified as a
common carrier (De Guzman vs. Court of Appeals,
168 SCRA 612 [1988]). So long as the elements as
per definition of a common carrier are present, such
operator is a common carrier, whether or not
covered by a franchise. In other words, a CPC or a
franchise is not a part of the definition of a common
carrier as set forth above. The list of common

carriers has expanded to include even nonstock

and supposedly nonprofit corporations like the
cooperatives, e.g., transport cooperatives. Although
from their Articles of Incorporation, the transport
cooperatives are organized for the main purpose of
mutually helping its members, they are allowed to
operate transport public utility service for which
they charge a fee or for which they earn profit.
b) Engaged in the business of carrying or transporting
As the term common carrier suggests, the
business is in the nature of carrying or
transporting. The traditional notion of carrying or
transporting is through a moving or rolling
equipment or vehicles that load and hold persons
and goods for transfer from one place to another
and viceversa. But this concept has been expanded
to include even immobile and miles of iron pipes
mainly embedded underground through which flow
gas or oil en route from one destination to another
(First Philippine Industrial Corp. vs. Court of
Appeals, 300 SCRA 661 [1998])
c) Carrying or transporting passengers or goods or
bothAs stated above, a common carrier usually
transports persons or goods or both, from one place
to another with the use of moving equipment or
rolling vehicles. But due to THE expanded meaning
of the term common carrier with First Philippine
Industrial Corp. vs. Court of Appeals, et al. supra.,
the idea of carrying or transporting which
traditionally conjures up physical movement of a
rolling equipment from one place to another and
viceversa would not seem to be accurate anymore
d) Carrying or transporting passengers or goods or
both by land, water or airAgain the traditional
notion of common carrier as physical transport of
people and goods from one place to another by land,
water or air has been expanded to include travel
through pipelines of goods or commodities in
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239

the nature of oil or gas. How do we classify the

route travelled by oil or gas through these extended
pipes which as in the case of AlaskaUS pipeline,
is sometimes buried underground, constructed
above the grounds or crosses the sea sitting on the
ocean floor?
e) The carrying or transporting of passengers or goods
or both for a fee or compensationThis implies
profit incentive. In spite of claims of applicants for
public utility service or common carrier that they
aim to serve the public or to respond to public need,
the overriding consideration is still profit. This is
why charging fee is expected even by supposed non
stock and nonprofit corporations. Profit is the
universal denominator. All these incantations about
serving public need and convenience are pure shield
to profit motive. Perhaps to serve public need and
convenience is a factor for the proposed service, but
to think that that is the main motivation for
entering into the business of public utility is pure
naivet
f) Offering their services to the public as a general or
limited clientele, whether permanent, occasional or
accidentalThis element has been added in the
definition under Com. Act No. 146, as amended. It
was not included in the definition in Act No. 3108, a
prior law. The earlier definition of common carrier
in U.S. vs. Quinajon & Quitoriano, 31 Phil. 189
promulgated
in
1915,
or
prior
to
the
Commonwealth Period did not contain this element:
A common carrier is a person or corporation whose
regular business is to carry passengers or property
for all persons who may choose to employ and
remunerate him. A common carrier is a person or
corporation who undertakes to carry goods or
persons for hire. Note also the phrase to carry
persons or property which implies physical
delivery by a moving equipment of persons or
property from one place to another. Flow of gas or
oil inside a pipeline has not been anticipated then.
From the above and in light of the subsequent High Court
ruling in First Philippine Industrial Corp. vs. CA, supra,
the above definitions and elements/requisites of a common
carrier may need revision. This case declared pipelines

owner/operator as a common carrier. This is unmaking a

lot of settled views on common carrier. There is truly a
need to restudy this holding notwithstanding the
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provisions of Art. 86 (Pipe line concessionaire as common

carrier) of Rep. Act No. 387, or the Petroleum Act of the
Philippines.
V. Constitutional and legal Basis for Regulation of
Common Carriers
The State is vested with inherent powers for its survival
and the wellbeing of its citizenry. Most basic of these
inherent powers is police power which is power of the State
or government vested in the legislature to enact laws for
the general welfare (Gonzales, Neptali, Political Law
Reviewer, p. 234 citing 16 C.J.S. 537, 1965, ed.)
particularly for the regulation of human activities that
have adverse impact upon the populace if left to the private
sector to regulate. These human activities could be in the
nature of harnessing private property for public use or for
use which is opened to the public for a certain fee.
A public utility service is a kind of human activity using
private property or equipment for the satisfaction of certain
needs of the citizenry, e.g., water system, electrical system,
telephone system, common carriers, etc. These kinds of
human activities, more than any other, are subject to
regulation because they affect the lives, limbs and health of
the public. Their operation is subject to regulation in the
interest of public protection. If the water system were
polluted or cutoff by the concessionaire, the sufferings and
inconvenience are not hard to imagine if electric service
were also cutoff, people may even rise in revolt unless the
same were restored and if telephone or wireless
communications were blocked, it is as if the world stood
still for the citizenry who would feel isolated and insecure
like in the early hours of Martial Law circa 1972 when TV
and radio stations where cut off the air then.
Thus the legal basis for regulation is nothing more but

order and community welfare. If every one who has the

wherewithal operates at will an electric, water or telephone
service in a single municipality or city, there would be
confusion, overlapping of infrastructures and ruinous
competition. This holds true with the operation of common
carriers, in land, sea and air. If everyone can just operate a
common carrier without securing franchise and without
being subjected to a higher standards of care, the riding
public and their goods would be at constant risk let alone
covered by lesser degree of care while in transit.
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Common Carrier, Revisited

There is public interest in the use of private property for

public utility service, like ships, airplanes or trucks and
buses so much so that regulatory bodies concerned are
empowered to oversee their operations. If such private
property were no longer in harness for public use, then its
public character and the interest of the regulatory body in
its use also ceases. This is well expounded in that leading
US case of Munn vs. Illinois, 94 U.S. 113 (1877) and
reiterated by Justice Laurel in Pantranco vs. PSC, 70 Phil.
221:
This brings us to the principles upon which this power of
regulations rests, in order that we may determine what is within
and what without its operative effect. Looking, then, to the
common law, from whence came the right the Constitution
protects, we find that when property is affected with a public
interest, it ceases to be juris privati only. This was said by Lord
Chief Justice Hale more than two hundred years ago . . . . . .
Property does become clothed with a public interest when used in
a manner to make it of public consequence, and affects the
community at large. When therefore, one devotes his property to a
use in which the public has an interest, he, in effect grants to the
public an interest in that use, and must submit to be controlled by
the public for the common good, to the extent of the interest he
has thus created. He may withdraw his grant by discontinuing
the use, but so long as he maintains the use, he must submit to
the control. . . .
xxx
xxx

From the same source comes the power to regulate the

charges of common carriers, which was done in England as long
ago as the third year of the reign of William and Mary, and
continued until within a comparatively recent period. . .
Common carriers exercise a sort of public office, and have
duties to perform in which the public is interested . . . . . . . . Their
business is, therefore, affected with a public interest within the
meaning of the doctrine which Lord Hale has so forcibly stated.

VI. Pertinent Supreme Court Decisions on Common

Carrier
a) U.S vs. Quinajon, et al. and U.S vs. Tan Piaco
The High Court relies heavily upon American
jurisprudence for authority in public utility as in other
areas of the law. Many of our laws come from American
jurisdiction, especially that of public utility. The earliest
case on common carrier was the US vs. Quinajon and
Quitoriano, 31 Phil. 189 (1915) which involved the viola
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tion of an old law (Act No. 98) requiring uniform charges by

a common carrier. In this case, two (2) operators of
virayas/barges charged differently or overcharged in
transporting sacks of rice. The accused were found to have
violated Act No.98 and were directed to refund the
overcharge. The High Court then came up with about the
earliest definition of this term: A common carrier is a
person or corporation whose regular business is to carry
passengers or property for all persons who may choose to
employ and remunerate him. A common carrier is a person
or corporation who undertakes to carry goods or persons for
hire.
Then in U.S. vs. Tan Piaco, et al., 40 Phil. 853 (1920) the
High Court applied the definition of common carrier in US
vs. Quinajon, et al., supra. which resulted in the acquittal
of the accused. The accused was charged with operating a
common carrier by using two (2) automobile trucks for hire

in the province of Leyte carrying passengers and freight

without the required authority from the then Public Utility
Commission. Upon conviction, accused appealed claiming
that he had not held himself out to the public. Applying
the definition then of a common carrier the High Court
acquitted the accused because it found that he was not
operating a common carrier which required securing the
corresponding franchise. The High Court found that the
accused furnished service under special agreements to
carry particular persons and property and did not hold
himself out to the public.
b) Two (2) Luzon Brokerage vs. PSC cases
In Luzon Brokerage Co. vs. PSC, 57 Phil. 536 (1932) a
brokerage firm was exempted from securing a franchise or
certificate of public convenience as it was not considered a
public utility or specifically, a common carrier. The High
Court found that the brokerage firm only offered its
services to a limited clientele the customers of said
brokerage firm. Under Act No. 3108, the public utility law
in 1932 when this case was decided, the definition of a
public utility which comprehended common carrier did not
include services offered even to a limited clientele. But
this ruling was later abandoned in a subsequent case
involving the same brokerage firm in Luzon Brokerage Co.,
Inc. vs. Comision de Servicios Publico, 70 Phil. 148 (1940).
Since said company insisted that its trucking service solely
catered to its brokerage customer, a limited clientele, it
should still be exempted from securing a franchise for
trucking service. Act No. 3108 which was the governing law
then was sub
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sequently amended by Act No. 454 which included in the

definition of a public serviceeven trucking service
rendered by a brokerage firm solely to its customers. The
pertinent portion of the decision written in Spanish
decreed:
La ley No. 454 es clara encuantro incluye en la definicion de lo

que servicio publico el que se preta mediante compensacion,

aunque esta limitado exclusivamente a los parroquinos de la
recurrente (Italics supplied).

This was also the holding in Ohkawa vs. PSC, 70 Phil. 168
(1940). It pertained also to the same service of a customs
brokerage firm to its customers. The High Court noted that
the definition of public service was enlarged or broadened
to include even such brokerage firms trucking service
although limited exclusively to its customers.
c) Mendoza vs. PAL
After the war the High Court decided the case of Mendoza
vs. PAL, 90 Phil. 836 (1952). This was a suit for damages
filed against the Philippine Airlines (PAL) for failure to
deliver on time a film entitled Himala ng Birhen for
showing during the fiesta in Naga City. The film actually
reached the airport in Pili before the scheduled showing
date, but was returned for unexplained reasons. Thus the
theater owner sued PAL for damages. The trial court found
that the theater owner suffered damages for the late
arrival of the film but it absolved the airline company from
liability.
On appeal the High Court sustained the trial court
ruling citing failure of the theater owner to make suitable
arrangement for the prompt delivery of the film and notice
of possible damages he would suffer in case of delay in
delivery.
On appeal the High Court affirmed the trial court
decision and cited U.S. authorities on the nature of a
common carrier. It was about the first Philippine case that
recognized airline operator as common carrier:
x x x x But an airplane owner cannot be classed as a common
carrier of passengers unless he undertakes, for hire, to carry all
persons who apply for passage indiscriminately as long as there is
room and no legal excuse for refusing x x x x Am Jur., Aviation,
Sec. 58, pp. 3435.
The test of whether one is a common carrier by air is whether
he holds out that he will carry for hire, so long as he has room,
goods of everyone bringing goods to him for carriage, not whether
he is carrying as a
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public employment or whether he carries to a fixed place. (Ibid.,

Sec. 39, p. 99).

d) Home Insurance Inc. vs. American Steamship

Agencies Inc., et al., 23 SCRA 24 (1968)
A firm in Peru shipped several thousands of jute bags of
Peruvian fish meal to the Philippines consigned to San
Miguel Corp. The cargo was carried by a vessel of the
American Steamship Agencies, Inc. (ASAI) and insured
with the Home Insurance Inc. (HII). When said cargo
arrived, it was loaded onto the lighters of Luzon
Stevedoring Co. (LSC) for final delivery to consignee. Upon
verification, there were shortages of more than P12,000
worth of the cargo.
After claims were made, the HII paid the value of the
lost cargo which amounted to over P14,000. HII then filed
suit against LSC and ASAI. The trial court absolved the
LSC and found the ASASI liable because, among others,
while there was a provision in the charter party contract
exempting the ship owner from liability, the court found
the same as against public policy under Art. 1744 of the
Civil Code. ASAI appealed raising the validity of this
provision in the charter party contract.
Held: Decision reversed. The ship owner was a private
carrier for which such stipulation limiting its liability is not
contrary to public policy.
A perusal of the charter party referred to shows that while the
possession and control of the ship were not entirely transferred to
the charterer, the vessel was chartered to its full and complete
capacity (Exh. 3). Furthermore, the charter had the option to go
north or south or viceversa, loading, stowing and discharging at
its risk and expense. Accordingly, the charter party contract is
one of affreightment over the whole vessel rather than a demise.
As such, the liability of the ship owner for acts or negligence of its
captain and crew, would remain in the absence of stipulation.
The High Court pointed out that Section 2 of par. 2 of the
charter party contract provided that the ship owner is liable for
loss of goods arising from want of diligence on its part or its
manager in making the vessel seaworthy and in the operations of
the said vessel. But it also noted that Said paragraph however
exempts the owner of the vessel from any loss

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or damage or delay arising from any other source, even from the
neglect or fault of the captain or crew or some other person
employed by the owner on board, for whose acts the owner would
ordinarily be liable except for said paragraph.
The High Court held that the character of the carrier because
of the charter party contract or affreightment, is that of a private
carrier and not a common carrier. Accordingly, the ship owner can
enter into a contract that would limit its liability.
The provision of our Civil Code on common carrier were taken
from AngloAmerican law. Under American jurisprudence, a
common carrier undertaking to carry a special cargo or chartered
to a special person only, becomes a private carrier. As a private
carrier, a stipulation exempting the owner from liability for the
negligence of its agent is not against public policy, and is deemed
valid.
Such doctrine. We find reasonable. The Civil Code provisions
on common carriers should not be applied where the carrier is not
acting as such but as a private carrier. The stipulation in the
charter party absolving the owner from liability for loss due to the
negligence of its agent would be void only if the strict public policy
governing common carriers is applied. Such policy has no force
where the public at large is not involved, as in the case of a ship
totally chartered for the use of a single party.

e) San Pablo vs. Pantranco South Express Inc.

There is this interesting case in maritime public utility
jurisprudence known as the seaasacontinuationofthe
highway case, San Pablo vs. Pantranco South Express,
Inc., 153 SCRA 199 (1987). This writer had the privilege of
representing the late Petitioner Epitacio San Pablo before
the Board of Transportation. He brought the appeal to the
Supreme Court which resulted in this important decision.
Hence, his familiarity with the facts of the case. Pantranco
South Express, Inc. (PSEI) was a big bus company with
large fleet with lines from Pasay City to Tacloban City via
MatnogAllen sea route crossing the San Bernardino
Strait and viceversa. The buses were loaded on the RORO
vessels of E San Pablo and another shipping operator, the
Cardinal Shipping Corp.

246

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Common Carrier, Revisited

for a fee. Then PSEI bought its own RORO vessel

purportedly to load its own buses along the MatnogAllen
crossing.
Prior to acquiring this vessel, PSEI tried to secure an
authority to purchase from the Maritime Industry
Authority (Marina) but was denied since the route where it
intended to serve was already adequately served by San
Pablo and Cardinal Shipping. Just the same, Pantranco
bought the vessel named, M/V Black Double and to avoid
applying for a separate franchise it then contrived a novel
theory that what it proposes to operate is private ferryboat
service across a small body of water for the exclusive use of
its buses, trucks and passengers as an incident to its
franchise to convey passengers and cargo on land from
Pasay City to Tacloban City. And based on this
representation, no less than the Secretary of Justice
(Ricardo Puno) was led to render an affirmative opinion on
October 20, 1981.
Armed with this opinion, Pantranco fielded its RORO
vessel which led to the filing of complaint by San Pablo and
Cardinal Shipping. After a brief hearing, the Board of
Transportation rendered its decision, the pertinent portion
held: The ferryboat service of Pantranco is a continuation
of the highway traversed by its buses from Pasay City to
Samar, Leyte passing through Matnog (Sorsogon) through
San Bernardino Strait to Allen (Samar). It is a private
carrier because it will be used exclusively to transport its
own buses, passengers and freight trucks traversing its
route. San Pablo and Cardinal Shipping directly appealed
to the Supreme Court.
Held: The appealed decision was setaside. Pantranco
had to apply for a separate water transportation franchise
and that it operated as a common carrier its supposed ferry
service. The High Court rejected the claim of Pantranco
that the San Bernardino Strait portion of its route is a
mere ferry crossing or a continuation of the highway
traversed by its buses because said strait is a large body of
water facing an open sea (Pacific Ocean) with occasional
strong winds and huge waves making it dangerous to small

sea craft, and involving great distance with 1and 1/2 to 2

hours travel time.
The High Court also dismissed the claim of Pantranco as
absurd that its ferry service was a private carrier. It did
not deny it charged separately and issued separate tickets
for the sea voyage. It cannot pretend that in issuing
tickets to its passengers it did so
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as a private carrier and not as a common carrier. And

evidence to show that it accepted walkin passengers just
for the purpose of crossing the MatnogAllen sea corridor
had been submitted.
f) De Guzman vs. Court of Appeals
Then came De Guzman vs. Court of Appeals, 168 SCRA 612
(1988) which is now a leading case on the concept of a
common carrier. A junk dealer from Pangasinan was
engaged in the business of buying used bottles and scrap
iron from his province which he sold in Manila. He used
two (2) big trucks to carry these bottles and scrap from
Pangasinan to Manila and in one return trip he was
contracted to carry cartons of milk. However, one of the
trucks was hijacked and several cartons of milk were lost.
The owner of the goods sued the truck owner for the value
of the lost goods.
After trial, the court a quo found the junk dealer
operating as common carrier and liable for the loss of the
goods. He appealed to the Court of Appeals claiming error
in finding him a common carrier that he habitually offered
trucking services to the public in not exempting him from
liability on the ground of force majeure, etc. The CA
reversed the holding of the trial court and ruled that the
truck owner was not a common carrier since carrying goods
in the return trip from Manila was a casual occupationa
sideline to his scrap business. On appeal the shipper
raised the following errors in the findings of the CA that:
a) the truck owner was not a common carrier
b) the hijacking of the truck was force majeure

c) and truck owner was not liable for the loss of the
goods.
Held: The decision of the CA affirmed. However the High
Court found that the junk dealer was a common carrier
although it absolved the former from liability for the loss of
the goods. It held that armed robbery was a fortuitous
event which was beyond the control of the junk dealer.
As to the conclusion that the junk dealer was a common
carrier, the High Court cited the definition of a common
carrier under Art. 1732 of the Civil Code: 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. It also
held that: The above article makes no distinction between
one whose principal business activity is the carrying of
persons or goods or
248

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Common Carrier, Revisited

both, and one who does such carrying only as an ancillary

activity (in local idiom, as a sideline.)
It found the junk dealer to be operating as common
carrier even with general or limited clientele, whether
permanent or accidental x x x. It finally declared that: It
appears to the Court that private respondent is properly
characterized as a common carrier even though he merely
back hauled goods for other merchants from Manila to
Pangasinan, although such backhauling was done on a
periodic or occasional rather than regular or scheduled
manner, and even though private respondents occupation
was not the carriage of goods for others.
It also noted that the concept of common carrier under
Art. 1732 may seem to coincide neatly with the notion of
public service under the Public Service Act, as amended,
which at least partially supplements the law on common
carriers set forth in the Civil Code.
g) Planters Products, Inc. vs. Court of Appeals, 226
SCRA 476 (1993)

In 1974, Planters Products Inc. (PPI) bought from

Mitsubishi International of New York, several metric tons
of urea 46% fertilizer which were shipped through a vessel
owned by a Japanese shipping firm from Alaska, USA to
Poro Point, San Fernando, La Union, Philippines. A time
charter party contract was executed on the vessel prior to
departure.
Upon arrival in the Philippines, several metric tons
were discovered lost as well as contaminated, PPI sued the
resident agent of the ship owner for this loss. The ship
owner argued that strict public policy on common carrier of
presumption of negligence does not apply to it because of
the charter party contract which has transformed it into a
private carrier. The trial court found for the PPI.
On appeal to the Court of Appeals the latter court
reversed the trial court ruling and absolved the shipper
from liability for the value of the lost and damaged cargo.
The CA ruled that that the ship owner was a private
carrier by reason of the charter party contract and not a
common carrier in line with the Home Insurance case. As
such the presumption of negligence under the Civil Code on
common carrier cannot apply to the ship owner.
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PPI appealed to the High Court arguing that the Home

Insurance Inc. case has no relevance as it involved
delimitation of liability pursuant to a charter party
agreement and not whether the presumption of negligence
under the Civil Code applies only to common carriers and
not to private carriers.
Held: The CA decision was reversed and the trial court
decision reinstated. The High Court actually abandoned or
reversed the holding in Home Insurance on the effect of
charter party contract on the nature of the carrier. In Home
Insurance Inc., the charter contract makes the ship owner a
private carrier whereas in the instant case, the High Court
departed from said holding by insisting that said charter
contract does not the change nature of the service of the
ship owner into a private carrier unless the contract is
demise or bareboat charter.
A charter party is defined as a contract by which an

entire ship, or some principal part thereof, is let by the

owner to another person for a specified time or use, a
contract of affreightment by which the owner of a ship or
other vessel lets the whole or a part of her to a merchant or
other person for the conveyance of goods, on a particular
voyage, in consideration of the payment of freight.
xxx
xxx
It is therefore imperative that a public carrier shall remain as
such, notwithstanding the charter of the whole or portion of a
vessel by one or more persons, provided the charter is limited to the
ship only, as in the case of timecharger or voyagecharter. It is
only when the charter includes both the vessel and its crew, as in
bareboat or demise that a common carrier becomes private, at
least insofar as the particular voyage covering the charterparty
concerned. (Italics supplied)

It actually abandoned the holding in Home Insurance Inc.,

supra.:
At any rate, the rule in the United States that a ship chartered by
a single shipper to carry special cargo is not a common carrier,
does not find application in our jurisdiction, for we have observed
that the growing concern for safety in the transportation of
passengers and/or carriage of goods by sea requires a more
exacting interpretation of admiralty laws,
250

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Common Carrier, Revisited

more particularly, the rules governing common carriers. (Italics

supplied)

However, even as the finding of the High Court is that the

ship owner remains a common carrier regardless of the
charter party contract, the latter is still absolved from
liability as it was not remiss in the exercise of due
diligence in order to minimize the loss or damage to the
goods it carried.
h) Valenzuela Hardwood and Industrial Supply, Inc.
vs. Court of Appeals

In Valenzuela Hardwood and Industrial Supply, Inc. vs.

Court of Appeals, 274 SCRA 642 (1997), a logging firm
chartered a ship of the Seven Brothers Shipping Corp. to
carry 940 lauan logs from Isabela to Manila. The logs were
insured insured with South Sea Surety and Inc., Co. for P2
million. The vessel sank and the cargo lost.
Valenzuela sued ship owner and insurer before the
Regional Trial Court. After trial, the RTC found the insurer
liable as well as the ship owner, in the alternative. It found
the stipulation contrary to public policy which absolved the
shipowner for the loss of the cargo. Both appealed to the
Court of Appeals (CA) which modified the decision and
absolved the shipowner. Valenzuela Hardwood appealed
CA the decision absolving the ship owner from liability.
The sole issue was whether the provision in the charter
party absolving the ship owner from liability arising from
the negligence of its (Seven Brothers) captain was valid?
Held: Court of Appeals decision affirmed. Petition
dismissed.
It is undisputed that the loss of the cargo was due to the
negligence of the captain. The High Court held that the
shipowner was a private carrier when it contracted to
transport the cargo of Petitioner Valenzuela. And as
private carrier, the parties may stipulate in the charter
party that responsibility for loss of the cargo may rest
solely upon the charterer and may even exempt the ship
owner from liability for loss due to the negligence of its
captain. Pursuant to Article 1306 of the Civil Code such
stipulation is valid because it its freely entered into by the
parties and the same is not contrary to law, mores, morals,
good customs, public order, or public policy.
The High Court inexplicably still quoted with approval
that portion of Home Insurance case where a carrier
undertaking to
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Common Carrier, Revisited

carry a special cargo or chartered to a special person only

becomes a private carrier. As against the contention of
petitioner that the Home Insurance case is not applicable,
the High Court insisted that: Undoubtedly, Home
Insurance is applicable to the case at bar. This is a little

strange because this holding was clearly abandoned by the

High Court in Planters Product, Inc. vs. Court of Appeals,
supra.
i) National Steel Corp. vs. Court of Appeals
This case also involved the charter of a vessel owned by
Vlasons Shipping Inc. (VLI) to carry steel for the National
Steel Corp (NSC) from Iligan City to Manila. When the
cargo arrived in Manila, they were damaged with rusts,
etc. The vessel involved was a tramping vessel which has
been declared at the outset by the High Court as a private
carrier. The refusal of the ship owner to pay for the damage
led to this suit by NSC against VSI. After trial the
complaint was dismissed and the counterclaim of VSI
granted. On appeal, the Court of Appeals affirmed the trial
court decision but reduced the award of damages and
eliminated attorneys fees.
Both litigants appealed to the High Court. Several
issues were raised but what is pertinent to this
Annotation is: Whether or not the provisions of the Civil
Code of the Philippines on common carriers pursuant to
which there exists a presumption of negligence against the
common carrier in case of loss or damage to the cargo are
applicable to a private carrier?
Held: Decision affirmed. And as to the question of
whether the shipping company was a common carrier or a
private carrier the High Court held:
Article 1732 of the Civil Code defines a common carrier as
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. It has been held that the true test of a common carrier
is the carriage of passengers or goods, provided it has space, for
all who opt to avail themselves of its transportation service for a
fee. A carrier which does not qualify under the above test is
deemed a private carrier. Generally, private carriage is
undertaken by special agreement and the carrier does not hold
himself out to carry goods for the general public. The most typical,
although not the only contract by which the charterer, a party
other than the shipowner, obtains the use and services of all or
some part of a ship for a period of time or voyages.
252

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Common Carrier, Revisited

In the instant case, it is undisputed that VSI did not offer its
services to the general public. As found by the Regional Trial
Court, it carried passengers or goods only for those it chose under
a special contract of charter party. As correctly concluded by the
Court of Appeals, the MV Vlasons I was not a common carrier but
a private carrier. Consequently, the rights and obligations of VSI
and NSC, including their respective liability for damage to the
cargo, are determined primarily by stipulations in their contract
or carriage or charter party.

j) Philippine American General Insurance Co. vs. PKS

Shipping Co.
This case under Annotation involves a petition for review
of the decision of the Court of Appeals which affirmed the
decision of the trial court finding lack of merit in the
complaint for reimbursement and damages filed by
plaintiff.
This case started when Davao Union Marketing Corp.
(DMUC) hired the services of PKS Shipping Corporation
(PKS Shipping) to transport 75,000 bags of cement valued
at P3 million plus pesos to Tacloban City. DMUC insured
the goods with Phil. American General Insurance Co.
(Philamgen) for the value of the cement. Along the way the
barge carrying the cement sank resulting in the total loss
of the goods.
DMUC collected payment from Philamgen by virtue of
the insurance agreement. Philamgen thereafter demanded
reimbursement from PKS Shipping which refused and this
resulted in a suit.
The trial court dismissed the complaint after finding
that the total loss of the cargo could have been due to
fortuitous event for which the shipping company was not
liable. Or if through the negligence of the captain and crew,
under the limited liability rule under Art. 487 of the Code
of Commerce, the ship owner is still not liable if it
abandoned the vessel, which it did.
On appeal to the Court of Appeals, it affirmed in toto the
decision. It however noted that the evidence to establish
that PKS Shipping was a common carrier was wanting
because the peculiar method of the shipping companys
carrying goods for others was not generally held out as a

business but as a casual occupation. Thus the CA

concluded that the PKS Shipping was not a common carrier
and was not duty bound to exercise extraordinary diligence
in the care of goods transported by it. Besides, it also found
that the loss was due to fortuitous eventtyphoon that hit
the area.
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Issue: Is the PKS Shipping a common carrier or private

carrier?
Held: It is a common carrier. The High Court reasoned:
Much of the distinction between a common or public carrier and
a private or special carrier lies in the character of the business,
such that if the undertaking is an isolated transaction, not part of
the business or occupation, and the carrier does not hold itself out
to carry the goods for the general public or to a limited clientele,
although involving the carriage of goods for a fee, the person or
corporation providing such service could very well be just a
private carrier. x x x
xxx
Contrary to the conclusions made by the appellate court, its
factual findings indicate that PKS Shipping has engaged itself in
the business of carrying goods for others, although for a limited
clientele, undertaking to carry such goods for a fee. The regularity
of its activities in this area indicates more than just casual
activity on its part.

But then, even as the High Court held that the PKS
Shipping is a common carrier which reversed the
conclusion of the CA that it was a private carrier, it still
absolved the latter from liability. It found that under Art.
1734 a common carrier is absolved from any liability if the
loss of goods is due, but not limited to the following causes:
(1) Flood, storm, earthquake, lightning, or other natural
disaster or calamity. It found that the waves were
unusually high and the winds very strong which caused the
barge to sink. This situation was considered as a fortuitous
event as a natural calamity.
VII. Summary of the Pertinent Holdings on the

Nature of Common Carriers

We heavily rely upon American authorities in the
adjudication of our public utility cases. In US vs. Quinajon,
et al., supra. initial basic elements of a common carrier are
culled from American sources: a person or corporation in
the regular business of carrying passengers and property
for all persons who may avail of such service and for a fee.
These elements were reiterated in US vs. Tan Piaco, et al.
and the first Luzon Brokerage Co vs. PSC, 57 Phil. 536
case. But in the second Luzon Brokerage Co. vs. PSC (70
Phil. 148) case, the meaning of common carrier was
broadened to include service even to a limited clientele, the
brokerage customers. This was the same holding in
Okhawa vs. PSC, supra.
254

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Common Carrier, Revisited

Mendoza vs. PAL, supra, made an official recognition that

an airplane operator was a new type of common carrier.
This case cited US authorities to the effect that a common
carrier undertakes to carry all persons as long as there is
room and there is no legal excuse for refusing. Home
Insurance Co. vs. American Steamship Agencies Inc. supra.
came out with this strange ruling that a ship owner who
enters into a charter party contract, like for affreightment
(voyage or time charter), the ship owner is classified as a
private carrier. Then San Pablo vs. Pantranco, supra. held
that a carrier that issues separate tickets and accepts
walkin passengers is not a private carrier but a common
carrier. De Guzman vs. Court of Appeals, supra,
acknowledged by the Supreme Court as a leading case on
the nature of common carrier, highlighted its expanded
meaning which includes limited clientele for which the
carrier merely back hauled goods. In this case, the main
business was selling used bottles and scrap iron for which
he used his trucks to deliver these items from Pangasinan
to Manila. And he merely back hauled other goods on the
way backa limited and occasional activity. Yet, he was
classified as a common carrier.
Then in Planters Products, Inc. vs. Court of Appeals,
supra, the holding in Home Insurance Inc. vs. American

Steamship Agencies, Inc., supra. was abandoned, if not

reversed, but without the High Court explicitly saying so.
It declared that: It is therefore imperative that a public
carrier shall remain as such, notwithstanding the charter
of the whole or portion of a vessel by one or more persons,
provided the charter is limited to the ship only, as in the
case of timecharger or voyagecharter. This is actually the
more sensible view because even if the entire vessel were
hired or chartered, so long as this excludes the crew, there
is no reason why the carrier becomes a private carrier. This
is akin to a franchised bus hired in its entirety for
excursion or special trip. Such contract or hiring does not
change the basic nature of his service from a common
carrier to a private carrier. With more reason that it should
remain a common carrier for there is need for a higher
degree of care of its passengers. Then in Valenzuela
Hardwood and Industrial Supply, Inc. vs. Court of Appeals,
supra, the High Court appears to have reinstated the
holding in Home Insurance Co. vs. American Steamship
Agencies, Inc., supra, where a common carrier undertaking
to carry a special cargo or chartered to a special person
only becomes a private carrier. The High Court even
assured that: Undoubtedly, Home Insurance is applicable
to the case at bar. There seems
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Common Carrier, Revisited

to be ambivalence here. And conflict with the more correct

view held in Planters Products, Inc. vs. Court of Appeals,
supra. Which is which really?
In National Steel Corp. vs. Court of Appeals, supra, the
High Court at the outset declared that a tramping vessel is
a private carrier. This should not be the case because a
tramping vessel is the counterpart of a TH or truck for
hire in land transportation which has no point to point
route and for cargo hauling only. This is definitely a
common carrier. Then it also held that the ship owner in
this case did not offer its services to the general public
and it carried passengers or goods under a special contract
of charter party, and therefore, it was not a common
carrier but a private carrier. So what, if it carried goods
under special contract of charter party? That does not

change anything at all. Precisely the amendment to the

definition of common carrier under Sec. 13 of Com Act No.
146, as amended and the holding in De Guzman vs. Court
of Appeals, supra. hold that a common carrier includes
operation for a limited clientele and on occasional or
periodic basis.
Finally, with the case under annotation, the Philippine
American General Insurance Co. vs. PKS Shipping Co.
supra, the High Court actually reiterated the De Guzman
vs. Court of Appeals, supra, ruling in finding that the ship
owner in this case as a common carrier for it has engaged
itself in the business of carrying goods for others, although
for a limited clientele, undertaking to carry such goods for
a fee. The regularity of its activities in this area indicates
more than just casual activity on its part.
VIII. Significance of the Case Under Annotation
a) A continuing ambivalence
This case highlights the continuing ambivalence over the
distinction between a private carrier and common carrier.
In this case, there was variance in the findings of the trial
court and the Court of Appeals as to what to classify the
ship owner. The trial court found that the shipping
company was a common carrier. On the other hand, the
Court of Appeals held that the evidence that PKS
Shipping was a common carrier at the time it undertook to
transport the bags of cement was wanting. This difference
in the conclusions in the nature of the carrier between the
trial court and the Court of Appeals had previously
occurred in De Guzman vs.
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SUPREME COURT REPORTS ANNOTATED

Common Carrier, Revisited

Court of Appeals, supra. and Planters Products, Inc. vs.

Court of Appeals, supra.
b) Determination crucial
This determination as to the nature of the carrier is crucial

as it determines the burden of prove between the parties. If

the ship owner were a private carrier, the shipper has to
prove the fact of loss and the failure to exercise due
diligence in the care of the goods involved in this case. On
the other hand, if the ship owner were a common carrier,
all that the shipper has to prove is the fact of loss and the
presumption of negligence follows. In other words, to be
absolved from liability, after the fact of loss has been
established, the ship owner must prove that it has
exercised extraordinary diligence in the care of the goods
while in transit. This is often a tough order, in a manner of
speaking.
c) Akin to the case of a flatfooted draft dodger
What is however curious about this case, is that while the
trial court found the ship owner to be a common carrier,
the Court of Appeals found it to be a private carrier.
Finally, the Supreme Court agreed with the findings of the
trial court that the shipper was a common carrier.
However, regardless of the nature of the service, the three
(3) courts absolved the shipper from liability on the ground
of fortuitous event or force majeure. Sometimes, it is a little
amusing how the three (3) courts took pains in discussing
with authorities the actual nature of the service of the ship
owner in this case only to absolve it due to fortuitous event
or force majeure. Why waste time and scholarship over a
point which was not relied upon as the basis of liability? In
an analogous manner, we are reminded of an American
draft dodger before the Second World War. He took pains
in coming up with all sorts of excuses to avoid being
compelled to join the armed forces. He even had all his
teeth to certain of rejection from military service. When the
result of his physical examinations was released, he was
indeed denied draft. He learned the reason, his utter
consternation: he was flatfooted.
d) Was fortuitous event or force majeure established?
In this case, reliance upon fortuitous event or force majeure
seems not so convincing. The ship owner was freed from
liability due to supposed force majeure or fortuitous event
like strong winds and big waves. It was a little strange that
there was a finding of
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this natural calamity under Art. 1733 although the shipper

claimed that tropical storm Asiang then had not yet
entered the Philippine area of responsibility. There appears
no mention of any evidence to dispute the same. Thus
under Art. 1733, the ship owner is absolved from
responsibility in case of loss of goods due to among others,
flood, storm, etc. But there was no finding that it was really
a storm that caused the sinking, as its presence was
disputed and there appeared no counterveiling evidence
against this claim.
e) Several instances when findings of the Court of
Appeals may be reviewed on appeal
It is also significant that in this decision the High Court
took pains in enumerating numerous instances (ten
instances in all) wherein the findings of the Court of
Appeals may be reviewed by the former.
f) Affirmation of the holding in De Guzman vs. Court
of Appeals & Planters Products Inc. vs. Court of
Appeals
Finally, there was no new holding introduced in the
concept of common carrier but at least there was continued
adherence to the guidelines set forth in Sec. 13 of Com. Act
No. 146, as amended and in the decision of De Guzman vs.
Court of Appeals, 168 SCRA 612 (1988). And on the effect of
charter party contract on the nature of the carrier, the
High court reaffirmed the holding in Planters Products Inc.
vs. Court of Appeals in spite of the more recent decisions of
Valenzuela Hardwood and Industrial Supply vs. Court of
Appeals and National Steel Corp. vs. Court of Appeals,
supra.
IX. Conclusion
The concept of common carrier continues to confuse and
bedevil lawyers and students of public utility
jurisprudence. In the case of De Guzman vs. Court of
Appeals, supra. and the case under Annotation, there was
variance in the conclusions reached by the trial court and

the Court of Appeals as to nature of the transport service in

these two (2) cases. If anything, this demonstrates the
lingering difficulty in getting a precise handle on this term,
so to speak. The uncertainty may be attributed to the latest
element introduced under Sec. 13 (b) of Com. Act No. 146,
as amended: Offering their services to the public as a
general or limited clientele, whether permanent, occasional
or accidental. There is often confusion in
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258

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Common Carrier, Revisited

the interpretation of this element as against the facts of the

case or the nature of the service being determined. In the
De Guzman vs. Court of Appeals, supra, case, the basic
business for which the trucks in question in the case was
junk dealership for which these motor vehicles are
specifically used to transport empty bottles and scrap iron.
In the return trip, the truck owner took in cartons of milk
to compensate for the gasoline used on the return trip. For
this act of hauling for a fee cartons of milk, the CA
classified the truck owner as a private carrier whereas the
Supreme Court held him to be a common carrier. This
confusion spills over into shipping service when the entire
ship is under a charter agreement.
Then, there is this fairly recent holding in First
Philippine Industrial Corp. vs. Court of Appeals, supra.
That pipeline owner or operator or concessionaire is a
common carrier. While the heading of Art. 86 of Rep. Act
No. 387 or Petroleum Act of the Philippines is Pipeline
Concessionaire as common carrier it was not explained
how and why. Then with the decision, this bare statutory
declaration was fortified into jurisprudence and part of the
law of the land (Art. 8, New Civil Code). Perhaps, there is a
need to reexamine this holding that a pipeline
owner/operator is a common carrier. After all is said and
done, after all that beautiful rationale of law, and after all
that enlightened vision of jurisprudence are sang in lyrical
prose and poetry, it all boils down to one dictum: Law is
common sense. In other words, if a legal concept has no
foundation in common sense, it would be constantly grating
against the general notion of what is right and fair.
Finally, in the review of pertinent cases, it would seem

that there is this lingering issue of whether entering into a

charter party contract (except bareboat or demise whereby
the entire vessel and crew are leased and hired by the
charterer) changes the complexion of the service of the
shipper into a private carrier. This was the holding in
Home Insurance Inc. vs. Court of Appeals, supra. This was
supposed to be abandoned in Planters Products Inc. vs.
Court of Appeals, supra. but seems to have been revived or
resurrected in Valenzuela Hardwood and Industrial
Supply Inc. vs. Court of Appeals, supra. and National Steel
Corp. vs. Court of Appeals, supra. How could this have
happened in so short a time without any clarification is a
veritable source of wonderment. Indeed, a hard look and a
serious reexamination of these cases are in order.
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