CHAPTER TWO FOOTNOTES CASES
Philippine Airlines (PAL)- San Francisco Manila
Fisher vs. Yangco Steamship
Facts: The complained alleges that plaintiff is a stockholder in Yangco
Steamship
Company, the owner of the large steam vessels, duly licensed to engage in
the coastwise trade of the Philippine Island; that on or about June 10, 1912,
the directors of the company, adopted a resolution which was thereafter
ratified and affirmed by the stockholders of the company expressly declaring
and providing that the classes of merchandise to be carried by the company in
its business as common carrier do not include dynamite, powder or other
explosives, and expressly prohibiting the officers, agents an d servants of the
company from offering to carry, accepting for carriage or carrying said
dynamite, powder or other explosives.
Issue: Whether the refusal of the owner and officer of a steam vessel, to
accept for carriage dynamite, powder or other explosives for carriage can be
held to be a lawful act?
Held: The traffic in dynamite gun powder and other explosive is vitally
essential to the material and general welfare of the inhabitants of this islands
and it these products are to continue in general use throughout the Philippines
they must be transported from water to port to port in various island which
make up the Archipelago.
It follows that a refusal by a particular vessel engage as a common carrier of
merchandise in coastwise trade in the Philippine Island to accept such
explosives for carriage constitutes a violation.
The prohibition against discrimination penalized under the statute, unless it
can be shown that there is so Real and substantial danger of disaster
necessarily involved in the courage of any or all of this article of merchandise
as to render such refusal a due or unnecessary or a reasonable exercise or
prudence and discreation on the part of the ship owner.
Saludo vs CA
FACTS:
Shipper - Pomierski and Son Funeral Home
Consignee Maria Saludo
Carrier - Transworld Airlines (TWA) Chicago San Francisco, and
After the death of petitioner's mother, Crispina Galdo Saludo, in
Chicago Illinois, Pomierski and Son Funeral Home of Chicago, made
the necessary preparations and arrangements for the shipment, of
the remains from Chicago to the Philippines. Philippine Vice Consul
in Chicago, Illinois, Bienvenido M. Llaneta, at the Pomierski & Son
Funeral Home, sealed the shipping case containing a hermetically
sealed casket that is airtight and waterproof wherein was contained
the remains of Crispina Saludo Galdo). On the same date, October
26, 1976, Pomierski brought the remains to C.M.A.S. (Continental
Mortuary Air Services) at the airport (Chicago) which made the
necessary arrangements such as flights, transfers, etc.; C.M.A.S. is
a national service used by undertakers to throughout the nation
(U.S.A.). C.M.A.S. booked the shipment with PAL thru the carrier's
agent Air Care International, with Pomierski F.H. as the shipper and
Mario (Maria) Saludo as the consignee. The requested routing was
from Chicago to San Francisco on board TWA Flight 131 of October
27, 1976 and from San Francisco to Manila on board PAL Flight No.
107 of the same date, and from Manila to Cebu on board PAL Flight
149 of October 29, 1976. Maria Saludo upon arriving at San
Francisco Airport, she then called Pomierski that her mother's
remains were not at the West Coast terminal, and Pomierski
immediately called C.M.A.S., which in a matter of 10 minutes
informed him that the remains were on a plane to Mexico City, that
there were two bodies at the terminal, and somehow they were
switched. The following day October 28, 1976, the shipment or
remains of Crispina Saludo arrived (in) San Francisco from Mexico
on board American Airlines. This shipment was transferred to or
received by PAL at 1945H or 7:45 p.m. (Exh. 2-PAL, Exh. 2-a-PAL).
This casket bearing the remains of Crispina Saludo, which was
mistakenly sent to Mexico and was opened (there), was resealed by
Crispin F. Patagas for shipment to the Philippines (See Exh. B-1).
The shipment was immediately loaded on PAL flight for Manila that
same evening and arrived (in) Manila on October 30, 1976, a day
after its expected arrival on October 29, 1976. Aggrieved by the
incident, the petitioners instituted an action against respondents and
were asked to pay for damages.
Petitioner allege that private respondents received the casketed
remains of petitioners' mother on October 26, 1976, as evidenced by
18
the issuance of PAL Air Waybill No. 079-01180454 by Air Care
 International as carrier's agent; and from said date, private
respondents were charged with the responsibility to exercise
extraordinary diligence so much so that for the alleged switching of
the caskets on October 27, 1976, or one day after private
respondents received the cargo, the latter must necessarily be liable.
RTC - absolved the two respondent airlines companies of liability.
CA - affirmed the decision of the lower court in toto, and in a
7 29
subsequent resolution, denied herein petitioners' motion for
reconsideration for lack of merit.
ISSUE
W/N the delay in the delivery of the casketed remains of petitioners'
mother was due to the fault of respondent airline companies,
HELD:
NO. A bill of lading is a written acknowledgment of the receipt of
the goods and an agreement to transport and deliver them at a specified
place to a person named or on his order. According to foreign and local
jurisprudence, "the issuance of a bill of lading carries the presumption that the
goods were delivered to the carrier issuing the bill, for immediate shipment,
and it is nowhere questioned that a bill of lading is prima facie evidence of the
receipt of the goods by the carrier. . . . In the absence of convincing testimony
establishing mistake, recitals in the bill of lading showing that the carrier
received the goods for shipment on a specified date controls.
However, except as may be prohibited by law, there is nothing to
prevent an inverse order of events, that is, the execution of the bill of lading
even prior to actual possession and control by the carrier of the cargo to be
transported. There is no law which requires that the delivery of the goods for
carriage and the issuance of the covering bill of lading must coincide in point
of time or, for that matter, that the former should precede the latter.
As between the shipper and the carrier, when no goods have been
delivered for shipment no recitals in the bill can estop the carrier from showing
the true facts . . . Between the consignor of goods and receiving carrier,
recitals in a bill of lading as to the goods shipped raise only a rebuttable
presumption that such goods were delivered for shipment. As between the
consignor and a receiving carrier, the fact must outweigh the recital."
In the case at bar, it was on October 26, 1976 the cargo containing
the casketed remains of Crispina Saludo was booked for PAL Flight Number
PR-107 leaving San Francisco for Manila on October 27, 1976, PAL Airway
Bill No. 079-01180454 was issued, not as evidence of receipt of delivery of
the cargo on October 26, 1976, but merely as a confirmation of the booking
thus made for the San Francisco-Manila flight scheduled on October 27,
1976. Actually, it was not until October 28, 1976 that PAL received physical
delivery of the body at San Francisco.
Explicit is the rule under Article 1736 of the Civil Code that the
extraordinary responsibility of the common carrier begins from the time the
goods are delivered to the carrier. This responsibility remains in full force and
effect even when they are temporarily unloaded or stored in transit, unless the
shipper or owner exercises the right of stoppagein transitu, and terminates
only after the lapse of a reasonable time for the acceptance, of the goods by
30
the consignee or such other person entitled to receive them. And, there is
delivery to the carrier when the goods are ready for and have been placed in
the exclusive possession, custody and control of the carrier for the purpose of
31
their immediate transportation and the carrier has accepted them. Where
such a delivery has thus been accepted by the carrier, the liability of the
common carrier commences eo instanti.
As already demonstrated, the facts in the case at bar belie the
averment that there was delivery of the cargo to the carrier on October 26,
1976. Rather, as earlier explained, the body intended to be shipped as agreed
upon was really placed in the possession and control of PAL on October 28,
1976 and it was from that date that private respondents became responsible
for the agreed cargo under their undertakings in PAL Airway Bill No. 079-
01180454. Consequently, for the switching of caskets prior thereto which was
not caused by them, and subsequent events caused thereby, private
respondents cannot be held liable.
Maerskline v. Court of Appeals
Facts:
Respondent herein is a firm engaged in the manufacture of
pharmaceutical products. It ordered from Eli Lily, Inc. of Puerto Rico empty
gelatin capsules. Said capsules were placed in 6 drums containing 100
capsules each. The drums were placed on board the M/V Anders
Maeerskline. However the capsules were shipped to Virginia, USA instead of
the Philippines. The goods arrived in the Philippines 2 months after the
original date of arrival, and respondent herein refused to accept the goods
due to its late arrival.
An action was filed by respondent to rescind the contract with Eli Lily,
Inc. and Maersk together with a claim for damages. The lower court dismissed
the complaint against Eli Lily, Inc. and held Maersk to be liable for breach of
the contract of common carriage. On appeal, the court affirmed the lower
courts decision. Hence this appeal.

Issue:
Whether or not Maersk is liable for breach of contract of common
carriage.
Held:
The Court held that Maersk is liable for the breach of contract of
common carriage. Common carriers are not obligated by law to carry and
deliver merchandise promptly unless the common carrier previously assumes
to deliver the goods at a given date or time. However, such delivery should be
made within a reasonable time.
In this case, it appears in the bill of lading that the goods will arrive on
April 3. There was no contract between the parties in this case, however the
petitioner was aware of the date of the expected arrival of the goods. The
court finds that the delay of the delivery was unreasonable. It was due to the
negligence of the petitioner why the cargo arrived so late. Petitioner did not
even explain the reason for such delay. Therefore, petitioner herein is held
liable for the breach of contract.
Reardon Smith Line Ltd vs Black Sea and Baltic Insurance (1939) -
Online Digest Not found
Magellan Mfg. Marketing Corp. V. Ca Supra (1991)
Facts:
Choju Co., Ltd purchased from Magellan Manufacturers Marketing
Corp. (MMMC) 136,000 anahaw fans for $23,220
MMMC contracted with F.E. Zuellig, a shipping agent of Orient
Overseas Container Lines, Inc., (OOCL) specifying that he needed an
on-board bill of lading and that transhipment is not allowed under the
letter of credit
MMMC paid F.E. Zuellig the freight charges and secured a copy of
the bill of lading which was presented to Allied Bank. The bank then
credited the amount of US$23,220 covered by the letter of credit to
MMMC
When MMMC's President James Cu, went back to the bank later, he
was informed that the payment was refused by the buying for lack of
bill of lading and there was a transhipment of goods
The anahaw fans were shipped back to Manila through OOCL who
are demanding from MMMC P246,043.43 (freight charges from Japan
to Manila, demurrage incurred in Japan and Manila from October 22,
1980 up to May 20, 1981 and charges for stripping the container van
of the Anahaw fans on May 20, 1981)
MMMC abandoned the whole cargo and asked OOCL for damages
OOCL: bill of lading clearly shows that there will be a
transhipment and that petitioner was well aware that MV
(Pacific) Despatcher was only up to Hongkong where the
subject cargo will be transferred to another vessel for Japan
RTC: favored OOCL:
consented because the bill of lading where it is clearly
indicated that there will be transhipment
MMMC was the one who ordered the reshipment of the cargo
from Japan to Manila
CA: Affirmed with modification of excluding demurrage in Manila
ISSUE: W/N the bill of lading which reflected the transhipment against the
letter of credit is consented by MMMC
HELD: YES. CA Affirmed with modification
Transhipment
act of taking cargo out of one ship and loading it in another
the transfer of goods from the vessel stipulated in the contract
of affreightment to another vessel before the place of
destination named in the contract has been reached
transfer for further transportation from one ship or
conveyance to another
the fact of transhipment is not dependent upon the ownership of the
transporting ships or conveyances or in the change of carriers, as the
petitioner seems to suggest, but rather on the fact of actual physical
transfer of cargo from one vessel to another
appears on the face of the bill of lading the entry "Hong Kong" in the
blank space labeled "Transhipment," which can only mean that
transhipment actually took place
bill of lading
operates both as a receipt and as a contract
receipt for the goods shipped
contract to transport and deliver the same as therein
stipulated
names the parties, which includes the
consignee, fixes the route, destination, and
freight rates or charges, and stipulates the
rights and obligations assumed by the parties
 law between the parties who are bound by its
terms and conditions provided that these are
not contrary to law, morals, good customs,
public order and public policy
GR: acceptance of the bill without dissent raises the presumption that
all the terms therein were brought to the knowledge of the shipper and
agreed to by him and, in the absence of fraud or mistake, he is
estopped from thereafter denying that he assented to such term
There clearly appears on the face of the bill of lading under column
"PORT OF TRANSHIPMENT" an entry "HONGKONG'
On board bill of lading vs. received for shipment bill of lading:
on board bill of lading
stated that the goods have been received on board
the vessel which is to carry the goods
received for shipment bill of lading
stated that the goods have been received for
shipment with or without specifying the vessel by
which the goods are to be shipped
issued whenever conditions are not normal and there
is insufficiency of shipping space
certification of F.E. Zuellig, Inc. cannot qualify the bill of lading, as
originally issued, into an on board bill of lading as required by the
terms of the letter of credit issued in favor of petitioner - it is a
received for shipment bill of lading
issued only on July 19, 1980, way beyond the expiry date of
June 30, 1980 specified in the letter of credit for the
presentation of an on board bill of lading
Demurrage
compensation provided for in the contract of affreightment for
the detention of the vessel beyond the time agreed on for
loading and unloading
claim for damages for failure to accept delivery
before it could be charged for demurrage charges it should have been
notified of the arrival of the goods first
Since abandon option was communicated, the same is binding upon
the parties on legal and equitable considerations of estoppel
Trans-Asia Shipping vs. Court of Appeals
(254 SCRA 260)
Facts:
Plaintiff (herein private respondent Atty. Renato Arroyo) bought a ticket from
herein petitioner for the voyage of M/V Asia Thailand Vessel to Cagayan de
Oro from Cebu City. Arroyo boarded the vessel in the evening of November
12, 1991 at around 5:30. At that instance, plaintiff noticed that some repair
works were being undertaken on the evening of the vessel. The vessel
departed at around 11:00 in the evening with only one engine running. After
an hour of slow voyage, vessel stopped near Kawit Island and dropped its
anchor threat. After an hour of stillness, some passenger demanded that they
should be allowed to return to Cebu City for they were no longer willing to
continue their voyage to Cagayan de Oro City. The captain acceded to their
request and thus the vessel headed back to Cebu City. At Cebu City, the
plaintiff together with the other passengers who requested to be brought back
to Cebu City was allowed to disembark. Thereafter, the vessel proceeded to
Cagayan de Oro City. Plaintiff, the next day boarded the M/V Asia Japan for
its voyage to Cagayan de Oro City, likewise a vessel of the defendant. On
account of this failure of defendant to transport him to the place pf destination
on November 12, 1991, plaintiff filed before the trial court a complaint for
damages against the defendant.
Issue:
Whether or not the failure of a common carrier to maintain in seaworthy
condition its vessel involved in a contract of carriage a breach of its duty?
Held:
Undoubtedly, there was, between the petitioner and private respondent a
contract of carriage. Under Article 1733 of the Civil Code, the petitioner was
bound to observed extraordinary diligence in ensuring the safety of the private
respondent. That meant that the petitioner was pursuant to the Article 1755 off
the said Code, bound to carry the private respondent safely as far as human
care and foresight could provide, using the utmost diligence of very cautious
persons, with due regard for all the circumstances. In this case, the Supreme
Court is in full accord with the Court of Appeals that the petitioner failed or
discharged this obligation.
Before commencing the contact of voyage, the petitioner undertook some
repairs on the cylinder head of one of the vessels en
gines. But even before it could finish these repairs it allowed the vessel to
leave the port of origin on only one functioning engine, instead of two.
Moreover, even the lone functioning engine was not in perfect condition at
sometime after it had run its course, in conked out. Which cause the vessel to
stop and remain adrift at sea, thus in order to prevent the ship from capsizing,
it had to drop anchor. Plainly, the vessel was unseaworthy even before the
voyage begun. For the vessel to be seaworthy, it must be adequately to make the common carrier an insurer of the safety of its passengers
equipped for the voyage and manned with the sufficient number of competent In relation thereto, does the principle of res judicata apply?
officers and crew. The Failure of the common carrier to maintain in seaworthy
condition its vessel involved in a contract of carriage is a clear breach of its RULING:
duty prescribed in Article 1755 of the Civil Code No.
The issue in Civil Case No. 3490 was whether Salva and his driver Verena
Calalas v. CA were liable for quasi-delict for the damage caused to petitioner's jeepney. On
the other hand, the issue in this case is whether petitioner is liable on his
FACTS: contract of carriage.
At 10 o'clock in the morning of August 23, 1989, private respondent Eliza
Jujeurche G. Sunga, then a college freshman majoring in Physical Education
at the Siliman University, took a passenger jeepney owned and operated by Quasi-delict / culpa aquiliana / culpa extra contractual
petitioner Vicente Calalas. As the jeepney was filled to capacity of about 24 1. Has as its source the negligence of the tortfeasor
passengers, Sunga was given by the conductor an "extension seat," a 2. negligence or fault should be clearly established because it is the basis of
wooden stool at the back of the door at the rear end of the vehicle. the action
On the way to Poblacion Sibulan, Negros Occidental, the jeepney stopped to 3. doctrine of proximate cause is applicable
let a passenger off. As she was seated at the rear of the vehicle, Sunga gave (device for imputing liability to a person where there is no relation between
way to the outgoing passenger. Just as she was doing so, an Isuzu truck him and another party, obligation is created by law itself)
driven by Iglecerio Verena and owned by Francisco Salva bumped the left
rear portion of the jeepney. As a result, Sunga was injured. Breach of contract / culpa contractual
On October 9, 1989, Sunga filed a complaint for damages against Calalas, 1. premised upon the negligence in the performance of a contractual
alleging violation of the contract of carriage by the former in failing to exercise obligation
the diligence required of him as a common carrier. Calalas, on the other hand, 2. action can be prosecuted merely by proving the existence of the contract
filed a third-party complaint against Francisco Salva, the owner of the Isuzu and the fact that the obligor (here, the common carrier) failed to transport his
truck. passenger safely to his destination
3. not available; it is the parties themselves who create the obligation and the
DECISION OF LOWER COURTS: function of the law is merely to regulate the relation thus created
1. RTC Dumaguete rendered judgment against Salva holding that the In case of death or injuries to passengers, Art. 1756 of the Civil Code provides
driver of the Isuzu truck was responsible that common carriers are presumed to have been at fault or to have acted
It took cognizance of another case (Civil Case No. 3490), filed by Calalas negligently unless they prove that they observed extraordinary diligence as
against Salva and Verena, for quasi-delict, in which Branch 37 of the same defined in Arts. 1733 and 1755 of the Code. This provision necessarily shifts
court held Salva and his driver Verena jointly liable to Calalas for the damage to the common carrier the burden of proof.
to his jeepney.
2. CA reversed the RTC, awarding damages instead to Sunga as plaintiff in Hence, Vicente Calalas (operator) is liable since he did not exercise utmost
an action for breach of contract of carriage since the cause of action was diligence.
based on such and not quasi delict. 1. Jeepney was not properly parked;
Hence, current petition for review on certiorari. 2. Overloading of passengers.

ISSUE: Belgian Overseas v. PH First Insurance Co.

Whether (per ruling in Civil Case) negligence of Verena was the proximate Facts:
cause of the accident negates his liability and that to rule otherwise would be
- CMC Trading A.G. shipped on board the M/V Anangel Sky at Hamburg,
Germany 242 coils of various Prime Cold Rolled Steel sheets for
transportation to Manila consigned to the Philippine Steel Trading
Corporation.
- On July 28, 1990, M/V Anangel Sky arrived at the port of Manila and,
within the subsequent days, discharged the subject cargo. Four (4) coils were
found to be in bad order.
- Finding the four (4) coils in their damaged state to be unfit for the intended
purpose, the consignee Philippine Steel Trading Corporation declared the
same as total loss.
- Philippine First Insurance paid the claim of Philippine Steel and was thus
subrogated.
- Philippine First then instituted a complaint for recovery of the amount paid
to the consignee as insured.
- Belgian claims that the damage and/or loss was due to pre-shipment
damage, to the inherent nature, vice or defect of the goods, or to perils,
danger and accidents of the sea, or to insufficiency of packing thereof, or to
the act or omission of the shipper of the goods or their representatives.
Belgian further argued that their liability, if there be any, should not exceed the
limitations of liability provided for in the bill of lading and other pertinent laws.
Finally, Belgian averred that, in any event, they exercised due diligence and
foresight required by law to prevent any damage/loss to said shipment.
- The RTC dismissed the complaint.
- The CA reversed and ruled that Belgian were liable for the loss or the
damage of the goods shipped, because they had failed to overcome the
presumption of negligence imposed on common carriers. As to the extent of
Belgians liability, the CA held that the package limitation under COGSA was
not applicable, because the words "L/C No. 90/02447" indicated that a higher
valuation of the cargo had been declared by the shipper.
Issues:
- Whether the notice of loss was timely filed. (Belgian claims that pursuant
to Section 3, paragraph 6 of COGSA, respondent should have filed its Notice
of Loss within three days from delivery. They assert that the cargo was
discharged on July 31, 1990, but that respondent filed its Notice of Claim only
on September 18, 1990.)
Whether the package limitation of liability under COGSA is applicable.
(Belgian contends that assuming that they are liable their liability should be
limited to US$500 per package as provided in the Bill of Lading and by
Section 4(5)of COGS
Held:
- NO. Mere proof of delivery of the goods in good order to a common carrier
and of their arrival in bad order at their destination constitutes a prima facie
case of fault or negligence against the carrier.
- In this case, Belgian failed to rebut the prima facie presumption of
negligence. First, as stated in the Bill of Lading, Belgian received the subject
shipment in good order and condition in Germany. Second, prior to the
unloading of the cargo, an Inspection Report prepared and signed by
representatives of both parties showed the steel bands broken, the metal
envelopes rust-stained and heavily buckled, and the contents thereof exposed
and rusty. Third, Bad Order Tally Sheet issued by Jardine Davies Transport
Services stated that the four coils were in bad order and condition. Normally,
a request for a bad order survey is made in case there is an apparent or a
presumed loss or damage.Fourth, the Certificate of Analysis stated that,
based on the sample submitted and tested, the steel sheets found in bad
order were wet with fresh water. Fifth, Belgian -- in a letteraddressed to the
Philippine Steel --admitted that they were aware of the condition of the four
coils found in bad order and condition.
- YES. First, the provision of COGSA provides that the notice of claim need
not be given if the state of the goods, at the time of their receipt, has been the
subject of a joint inspection or survey. Here, prior to unloading the cargo, an
Inspection Report as to the condition of the goods was prepared and signed
by representatives of both parties. Second, as stated in the same provision, a
failure to file a notice of claim within three days will not bar recovery if it is
nonetheless filed within one year. This one-year prescriptive period also
applies to the shipper, the consignee, the insurer of the goods or any legal
holder of the bill of lading.
- A claim is not barred by prescription as long as the one-year period has
not lapsed. In the present case, the cargo was discharged on July 31, 1990,
while the Complaint51 was filed by respondent on July 25, 1991, within the
one-year prescriptive period.
- YES. In this case, there was no stipulation in the Bill of Lading limiting the
carrier's liability. Neither did the shipper declare a higher valuation of the
goods to be shipped. This fact notwithstanding, the insertion of the words "L/C
No. 90/02447 cannot be the basis for Belgians liability.
- First, a notation in the Bill of Lading which indicated the amount of the
Letter of Credit obtained by the shipper for the importation of steel sheets did
not effect a declaration of the value of the goods as required by the bill. That
notation was made only for the convenience of the shipper and the bank
processing the Letter of Credit.
- Second, a bill of lading is separate from the Other Letter of Credit
arrangements. Thus, Belgians liability should be computed based on US$500
per package and not on the per metric ton price declared in the Letter of
Credit.
Victory Liner v. Gammad
FACTS:
Marie Grace Gammad was a passenger of petitioners bus when it fell on a
ravine, which resulted to her death. Hence, heirs of the deceased Marie
Grace filed a case for damages against Victory Liner, Inc. for breach of
contract of carriage. Rosalito Gammad, husband of deceased, completed his
testimony and was scheduled for cross-examination. However, counsel of
peritioner failed to appear even after a reschedule, and thus the court deemed
the petitioner to have waived cross-examination. The petitioners counsel also
failed to appear at the presentation of evidence. The court already deemed
the case submitted for resolution when it received belatedly the telegram of
petitioners counsel requesting for postponement.
ISSUE:
(1) Is the petitioner bound by the negligence of the counsel?
(2) Is the petitioner liable for breach of contract of carriage?
RULING:
(1) Yes. As a general rule, client is bound by negligence of counsel. Any
act performed by a counsel within the scope of his general or implied authority
is regarded as an act of his client. Consequently, the mistake or negligence of
counsel may result in the rendition of an unfavorable judgment against the
client. However, exceptions have been recognized by the court in cases
where reckless or gross negligence of counsel deprives the client of due
process of law, or when its application will result in outright deprivation
of the clients liberty or property or where the interests of justice so
require, and accord relief to the client who suffered by reason of the
lawyers gross or palpable mistake or negligence.
The exceptions, however, are not present in this case. Petitioners claim that it
was denied due process lacks basis. Petitioner too is not entirely blameless.
(2) Petitioner was correctly found liable for breach of contract of carriage. A
common carrier is bound to carry its passengers safely as far as human care
and foresight can provide, using the utmost diligence of very cautious
persons, with due regard to all the circumstances. In a contract of carriage, it
is presumed that the common carrier was at fault or was negligent when a
passenger dies or is injured. Unless the presumption is rebutted, the court
need not even make an express finding of fault or negligence on the part
of the common carrier. This statutory presumption may only be overcome by
evidence that the carrier exercised extraordinary diligence.
In the instant case, there is no evidence to rebut the statutory presumption
that the proximate cause of Marie Graces death was the negligence of
petitioner. Hence, the courts below correctly ruled that petitioner was guilty of
breach of contract of carriage.
Ganzon V. Ca (1988)
G.R. No. L-48757 May 30, 1988
Lessons Applicable: Actionable Document
Laws Cited: Art. 1736,Art. 1734
FACTS: Gelacio > Ganzon (via Capt. Niza) > Lighter Batman (common
carrier) (loaded half)
November 28, 1956: Gelacio Tumambing (Gelacio) contracted the
services of of Mauro B. Ganzon to haul 305 tons of scrap iron from
Mariveles, Bataan, to the port of Manila on board the light LCT
Batman
December 1, 1956: Gelacio delivered the scrap iron to Filomeno Niza,
captain of the lighter, for loading which was actually begun on the
same date by the crew of the lighter under the captains supervisor.
When about half of the scrap iron was already loaded, Mayor Jose
Advincula of Mariveles, Bataan arrived and demanded P5000 from
Gelacio
Upon resisting, the Mayor fired at Gelacio so he had to be
taken to the hospital
Loading of the scrap iron was resumed
 December 4, 1956: Acting Mayor Basilio Rub (Rub), accompanied by
3 policemen, ordered captain Filomeno Niza and his crew to dump the
scrap iron where the lighter was docked
Later on Rub had taken custody of the scrap iron
RTC: in favor of Gelacio and against Ganzon
ISSUE: W/N Ganzon should be held liable under the contract of carriage
HELD: YES. Petition is DENIED.
Ganzon thru his employees, actually received the scraps is freely
admitted.
Pursuant to Art. 1736, such extraordinary responsibility would cease
only upon the delivery, actual or constructive, by the carrier to the
consignee, or to the person who has a right to receive them.
The fact that part of the shipment had not been loaded on board the
lighter did not impair the said contract of transportation as the goods
remained in the custody and control of the carrier, albeit still
unloaded.
failed to show that the loss of the scraps was due to any of the
following causes enumerated in Article 1734 of the Civil Code,
namely:
(1) Flood, storm, earthquake, lightning, or other natural disaster or calamity;
(2) Act of the public enemy in war, whether international or civil;
(3) Act or omission of the shipper or owner of the goods;
(4) The character of the goods or defects in the packing or in the containers;
(5) Order or act of competent public authority.
Hence, the petitioner is presumed to have been at fault or to have acted
negligently.
By reason of this presumption, the court is not even required to make
an express finding of fault or negligence before it could hold the
petitioner answerable for the breach of the contract of carriage.
exempted from any liability had he been able to prove that he
observed extraordinary diligence in the vigilance over the
goods in his custody, according to all the circumstances of
the case, or that the loss was due to an unforeseen event or
to force majeure. As it was, there was hardly any attempt on
the part of the petitioner to prove that he exercised such
extraordinary diligence.
We cannot sustain the theory of caso fortuito - "order or act of
competent public authority"(Art. 1174 of the Civil Code)
no authority or power of the acting mayor to issue such an
order was given in evidence. Neither has it been shown that
the cargo of scrap iron belonged to the Municipality of
Mariveles.
Ganzon was not duty bound to obey the illegal order
to dump into the sea the scrap iron.
Moreover, there is absence of sufficient proof that the
issuance of the same order was attended with such
force or intimidation as to completely overpower the
will of the petitioner's employees. The mere difficulty
in the fullfilment of the obligation is not
considered force majeure.
Republic vs. Lorenzo Shipping Lines
G.R. No. 153563. February 07, 2005
Facts: The Republic of the Philippines signed an agreement through the
Department of Health and the Cooperative for American Relief Everywhere,
Inc. (CARE) wherein it would acquire from the US government donations of
Non-Fat Dried Milk and other food products. In turn, the Philippines will
transport and distribute the donated to the intended beneficiaries of the
country. As a result, it entered into a contract of carriage of goods with the
herein respondent. The latter shipped 4,868 bags of non-fat dried milk from
Sept-Dec 1988. The consignee named in the bills was Abdurahman Jama,
petitioners branch supervisor in Zamboanga City. Upon reaching the port of
Zamboanga, respondents agent, Efren Ruste Shipping Agency unloaded the
said milks. Before each delivery, Rogelio Rizada and Ismael Zamora both
delivery checkers of Efren Ruste requested Abdurahman to surrender the
originals of the Bill of Lading. However, the petitioner alleged that they did not
receive anything and they filed a claim against the herein respondent. The
petitioner contended that the respondents failed to exercise extraordinary
diligence.
Issue: Whether the respondents failed to exercise extraordinary diligence
required by law?
Held: The surrender of the Bill of Lading is not a condition precedent for a
common carrier to be discharged of its contractual obligation. If the surrender
is not possible, acknowledgment of the delivery by signing the receipt suffices.
The herein respondent did not even bother to prevent the resignation of
abdurhaman Jama to be utilized as a witness.
G.R. No. 165647, March 26, 2009
Philippines First Insurance Co., Inc.
vs Wallem Phils. Shipping, Inc.
Facts:
October 1995, Anhui Chemicals Import and Export Corp. loaded on board
M/S Offshore Master a shipment consisting of sodium sulphate anhydrous,
complete and in good order for transportation to and delivery at the port of
Manila for consignee, covered by a clean bill of lading.
On October 16, 1995, the shipment arrived in port of manila and was
discharged which caused various degrees of spillage and losses as evidence
by the turn over survey of the arrastre operator. Asia Star Freight delivered
the shipments from pier to the consignees in Quezon City, during the
unloading, it was found by the consignee that the shipment was damaged and
in bad condition.
April 29, 1996, the consignee filed a claim with Wallem for the value of the
damaged shipment, to no avail. Since the shipment was insured with Phil.
First Insurance against all risks in the amount of P2,470,213.50. The
consignee filed a claim against the First Insurance. First insurance after
examining the turn-over survey, the bad order certificate and other documents
paid the consignee but later on sent a demand letter to Wallem for the
recovery of the amount paid to the consignee (in exercise of its right of
subrogation). Wallem did not respond to the claim.
First Insurance then instituted an action before RTC for damages against
Wallem. RTC held the shipping company and the arrastre operator solidarily
liable since both are charged with the obligation to deliver the goods in good
order condition.
The CA reversed and set aside the RTC's decision. CA says that there is no
solidary liability between the carrier and the arrastre because it was clearly
established that the damage and losses of the shipment were attributed to the
mishandling by the arrastre operator in the discharge of the shipment.
Issues:
1. Whether or not the Court of Appeals erred in not holding that as a common
carrier, the carriers duties extend to the obligation to safely discharge the
cargo from the vessel;
2. Whether or not the carrier should be held liable for the cost of the damaged
shipment;
3. Whether or not Wallems failure to answer the extra judicial demand by
petitioner for the cost of the lost/damaged shipment is an implied admission of
the formers liability for said goods;
4. Whether or not the courts below erred in giving credence to the testimony
of Mr. Talens.
Ruling:
(1) Yes, the vessel is a common carrier, and thus the determination of the
existence or absence of liability will be gauged on the degree of diligence
required of a common carrier. (2) The first and second issue will be resolved
concurrently.
(3) The damage of the shipment was documented by the turn0over survey
and request for bad order survey, with these documents, petitioner insist that
the shipment incurred damages while still in the care and responsibility of
Wallem before it was turned over to the arrastre operator. However, RTC
found the testimony of Mr. Talens (cargo surveyor) that the loss was caused
by the mishandling of the arrastre operator. This mishandling was affirmed by
the CA which was the basis for declaring the arrastre operator solely liable for
the damage.
It is established that damage or losses were incurred by the shipment during
the unloading. As common carrier, they are bound to observe extraordinary
diligence in the vigilance over the goods transported by them. Subject to
certain exceptions enumerated under Article 1734 of the Civil Code, common
carriers are responsible for the loss, destruction, or deterioration of the goods.
The 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.
For marine vessels, Article 619 of the Code of Commerce provides that the
ship captain is liable for the cargo from the time it is turned over to him at the
dock or afloat alongside the vessel at the port of loading, until he delivers it on
the shore or on the discharging wharf at the port of unloading, unless agreed
otherwise.
COGSA provides that under every contract of carriage of goods by sea, the
carrier in relation to the loading, handling, stowage, carriage, custody, care,
and discharge of such goods, shall be subject to the responsibilities and
liabilities and entitled to the rights and immunities set forth in the Act. Section
3 (2) thereof then states that among the carriers responsibilities are to
properly and carefully load, handle, stow, carry, keep, care for, and discharge
the goods carried.
On the other hand, the functions of an arrastre operator involve the handling
of cargo deposited on the wharf or between the establishment of the
consignee or shipper and the ship's tackle. Being the custodian of the goods
discharged from a vessel, an arrastre operator's duty is to take good care of
the goods and to turn them over to the party entitled to their possession.
Handling cargo is mainly the arrastre operator's principal work so its
drivers/operators or employees should observe the standards and measures
necessary to prevent losses and damage to shipments under its custody.
Thus, in this case the appellate court is correct insofar as it ruled that an
arrastre operator and a carrier may not be held solidarily liable at all times.
But the precise question is which entity had custody of the shipment during its
unloading from the vessel?
The records are replete with evidence which show that the damage to the
bags happened before and after their discharge and it was caused by the
stevedores of the arrastre operator who were then under the supervision of
Wallem.
It is settled in maritime law jurisprudence that cargoes while being unloaded
generally remain under the custody of the carrier. In the instant case, the
damage or losses were incurred during the discharge of the shipment while
under the supervision of the carrier. Consequently, the carrier is liable for the
damage or losses caused to the shipment. As the cost of the actual damage
to the subject shipment has long been settled, the trial courts finding of actual
damages in the amount of P397,879.69 has to be sustained.
(4) Mr Talens credibility must be respected.
CA's decision is set aside. Wallem is liable.
Cokaliong v. UCPB
DOCTRINE: The liability of a common carrier for the loss of goods may, by
stipulation in the bill of lading, be limited to the value declared by the
shipper. On the other hand, the liability of the insurer is determined by the
actual value covered by the insurance policy and the insurance premiums
paid therefor, and not necessarily by the value declared in the bill of lading.
FACTS:
Shipper: ZosimaMercardo, Nestor Amelia
Carrier: EDGAR COKALIONG SHIPPING LINES, INC.
Vessel: M/V Tandag
Insurer: UCPB General Insurance Co. Inc. (Feliciana Legaspi insured the
cargoes)
Event: FIRE
Edgar did not pay UCPB. UCPB filed a complaint. RTC absolved Edgar of any
liability. CA affirmed.
ISSUE:
1. W/N Edgar is liable
2. What is the basis of liability? Amount in the bill of lading or actual amount?
RULING:
1. Yes. The uncontroverted findings of the Philippine Coast Guard show that
the M/V Tandag sank due to a fire, which resulted from a crack in the auxiliary
engine fuel oil service tank. Fuel spurted out of the crack and dripped to the
heating exhaust manifold, causing the ship to burst into flames. The crack
was located on the side of the fuel oil tank, which had a mere two-inch gap
from the engine room walling, thus precluding constant inspection and care by
the crew.
Having originated from an unchecked crack in the fuel oil service tank, the fire
could not have been caused by force majeure. May refer to Eastern Shipping
Lines, Inc. v. Intermediate Appellate Court.
A stipulation that limits liability is valid as long as it is not against public policy.
Art. 1749. A stipulation that the common carriers 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 just under the circumstances, and has been freely and fairly
agreed upon.
2. Bill of lading. The bill of lading subject of the present controversy
specifically provides, among others:
18. All claims for which the carrier may be liable shall be adjusted and settled
on the basis of the shippers net invoice cost plus freight and insurance
premiums, if paid, and in no event shall the carrier be liable for any loss of
possible profits or any consequential loss.
The carrier shall not be liable for any loss of or any damage to or in any
connection with, goods in an amount exceeding One Hundred Thousand Yen
in Japanese Currency (100,000.00) or its equivalent in any other currency
per package or customary freight unit (whichever is least) unless the value of
the goods higher than this amount is declared in writing by the shipper before
receipt of the goods by the carrier and inserted in the Bill of Lading and extra
freight is paid as required.
In the present case, the stipulation limiting petitioners liability is not contrary
to public policy. In fact, its just and reasonable character is evident. The
shippers/consignees may recover the full value of the goods by the simple
expedient of declaring the true value of the shipment in the Bill of Lading.
Other than the payment of a higher freight, there was nothing to stop them
from placing the actual value of the goods therein. In fact, they committed
fraud against the common carrier by deliberately undervaluing the goods in
their Bill of Lading, thus depriving the carrier of its proper and just transport
fare.
It is well to point out that, for assuming a higher risk (the alleged actual value
of the goods) the insurance company was paid the correct higher premium by
Feliciana Legaspi; while petitioner was paid a fee lower than what it was
entitled to for transporting the goods that had been deliberately undervalued
by the shippers in the Bill of Lading. Between the two of them, the insurer
should bear the loss in excess of the value declared in the Bills of Lading.
Del Prado vs Manila Electric Co
Facts:
Teodorico Florenciano, Meralcos motorman, was driving the companys
street car along Hidalgo Street. Plaintiff Ignacio Del Prado ran across the
street to catch the car. The motorman eased up but did not put the car into
complete stop. Plaintiff was able to get hold of the rail and step his left foot
when the car accelerated. As a result, plaintiff slipped off and fell to the
ground. His foot was crushed by the wheel of the car. He filed a complaint for
culpa contractual.
Issues:
(1) Whether the motorman was negligent
(2) Whether Meralco is liable for breach of contract of carriage
(3) Whether there was contributory negligence on the part of the plaintiff
Held:
(1) We may observe at the outset that there is no obligation on the part of a
street railway company to stop its cars to let on intending passengers at other
points than those appointed for stoppage. Nevertheless, although the
motorman of this car was not bound to stop to let the plaintiff on, it was his
duty to do no act that would have the effect of increasing the plaintiff's peril
while he was attempting to board the car. The premature acceleration of the
car was, in our opinion, a breach of this duty.
(2) The relation between a carrier of passengers for hire and its patrons is of a
contractual nature; and a failure on the part of the carrier to use due care in
carrying its passengers safely is a breach of duty (culpa contractual).
Furthermore, the duty that the carrier of passengers owes to its patrons
extends to persons boarding the cars as well as to those alighting therefrom.
Where liability arises from a mere tort (culpa aquiliana), not involving a breach
of positive obligation, an employer, or master, may exculpate himself by
proving that he had exercised due diligence to prevent the damage; whereas
this defense is not available if the liability of the master arises from a breach
of contractual duty (culpa contractual). In the case before us the company
pleaded as a special defense that it had used all the diligence of a good father
of a family to prevent the damage suffered by the plaintiff; and to establish this
contention the company introduced testimony showing that due care had
been used in training and instructing the motorman in charge of this car in his
art. But this proof is irrelevant in view of the fact that the liability involved was
derived from a breach of obligation.
(3) It is obvious that the plaintiff's negligence in attempting to board the
moving car was not the proximate cause of the injury. The direct and
proximate cause of the injury was the act of appellant's motorman in putting
on the power prematurely. Again, the situation before us is one where the
negligent act of the company's servant succeeded the negligent act of the
plaintiff, and the negligence of the company must be considered the
proximate cause of the injury. The rule here applicable seems to be
analogous to, if not identical with that which is sometimes referred to as the
doctrine of "the last clear chance." In accordance with this doctrine, the
contributory negligence of the party injured will not defeat the action if it be
shown that the defendant might, by the exercise of reasonable care and
prudence, have avoided the consequences of the negligence of the injured
party. The negligence of the plaintiff was, however, contributory to the
accident and must be considered as a mitigating circumstance.
La Mallorca v. CA
Facts:
Plaintiffs husband and wife, together with their minor children, boarded a La
Mallorca bus. Upon arrival at their destination, plaintiffs and their children
alighted from the bus and the father led them to a shaded spot about 5 meters
from the vehicle. The father returned to the bus to get a piece of
baggage which was not unloaded. He was followed by her daughter Raquel.
While the father was still on the running board awaiting for the conductor to
give his baggage, the bus started to run so that the father had to jump.
Raquel, who was near the bus, was run over and killed.
Lower court rendered judgment for the plaintiff which was affirmed by CA,
holding La Mallorca liable for quasi-delict and ordering it to pay P6,000 plus
P400. La Mallorco contended that when the child was killed, she was no
longer a passenger and therefore the contract of carriage terminated.
Issue:
Whether or not the contractual obligation between the parties ceases the
moment the passenger alighted form the vehicle.
Held:
On the question whether the liability of the carrier, as to the child who was
already led a place 5 meters from the bus under the contract of carrier, still
persists, we rule in the affirmative. It is a recognized rules that the relation
between carrier and passengers does not cease at the moment the
passenger alights from the carriers premises, to be determined from the
circumstances. In this case, there was no utmost diligence. Firstly, the driver,
although stopping the bus, did not put off the engine. Secondly, he started to
run the bus even before the bus conductor gave him the signal and while the
latter was unloading cargo. Here, the presence of said passenger near the
bus was not unreasonable and the duration of responsibility still exists.
Averment of quasi-delict is permissible under the Rules of Court, although
incompatible with the contract of carriage. The Rules of Court allows the
plaintiffs to allege causes of action in the alternative, be they compatible with
each other or not (Sec. 2, Rule 1). Even assuming arguendo that the contract
of carriage has already terminated, herein petitioner can be held liable for the
negligence of its driver pursuant to Art. 2180 of NCC. Decision MODIFIED.
Only question raised in the briefs can be passed upon, and as plaintiffs did
not appeals the award of P3,000.00 the increase by the CA of the award to
P6,000.00 cannot be sustained.
Dangwa Transportation Co. Inc. V. Ca Et Al. (1991)
G.R. No. 95582 October 7, 1991
Lessons Applicable: Actionable Document (Transportation)
Laws Applicable: Art. 1733, Art. 1755
FACTS:
May 13, 1985: Theodore M. Lardizabal was driving a passenger bus
belonging to Dangwa Transportation Co. Inc. (Dangwa)
The bus was at full stop bet. Bunkhouses 53 and 54 when
Pedro alighted
Pedro Cudiamat fell from the platform of the bus
when it suddenly accelerated forward
Pedro was ran over by the rear right tires of
the vehicle

Theodore first brought his other passengers and cargo to
their respective destinations before bringing Pedro to Lepanto
Hospital where he expired
Private respondents filed a complaint for damages against Dangwa
for the death of Pedro Cudiamat
Dangwa: observed and continued to observe the
extraordinary diligence required in the operation of the co.
and the supervision of the employees even as they are not
absolute insurers of the public at large
RTC: in favour of Dangwa holding Pedrito as negligent and his
negligence was the cause of his death but still ordered to pay in
equity P 10,000 to the heirs of Pedrito
CA: reversed and ordered to pay Pedrito indemnity, moral damages,
actual and compensatory damages and cost of the suit
ISSUE: W/N Dangwa should be held liable for the negligence of its driver
Theodore
HELD: YES. CA affirmed.
A public utility once it stops, is in effect making a continuous offer to
bus riders (EVEN when moving as long as it is still slow in motion)
Duty of the driver: do NOT make acts that would have the
effect of increasing peril to a passenger while he is attempting
to board the same
Premature acceleration of the bus in this case =
breach of duty
Stepping and standing on the platform of the bus is already
considered a passenger and is entitled all the rights and protection
pertaining to such a contractual relation
Duty extends to boarding and alighting
GR: By contract of carriage, the carrier assumes the express
obligation to transport the passenger to his destination safely and
observe extraordinary diligence with a due regard for all the
circumstances, and any injury that might be suffered by the
passenger is right away attributable to the fault or negligence of the
carrier
EX: carrier to prove that it has exercised extraordinary diligence as
prescribed in Art. 1733 and 1755 of the Civil Code
Failure to immediately bring Pedrito to the hospital despite his serious
condition = patent and incontrovertible proof of their negligence
Hospital was in Bunk 56
st
1 proceeded to Bunk 70 to allow a passenger (who later
called the family of Pedrito on his own will) to alight and
deliver a refrigerator
In tort, actual damages is based on net earnings
ABOITIZ SHIPPING V. CA (G.R. NO. 84458)
Facts:
Anacleto Viana boarded the vessel M/V Antonia owned by petitioner Aboitiz
Shipping Corp at the port at San Jose, Occidental Mindoro, bound for Manila.
The vessel arrived at Pier 4, North Harbor, Manila and was taken over by
Pioneer Stevedoring for the latter to unload the cargoes from the said vessel
pursuant to their Memorandum of Agreement. An hour after the passengers
and Viana had disembarked the vessel the crane operator began its
unloading operation. While the crane was being operated, Viana who had
already disembarked the vessel remembered that some of his cargoes were
still loaded there. He went back and while he was pointing to the crew where
his cargoes were, the crane hit him pinning him between the side of the
vessel and the crane resulting to his death. A complaint for damages was filed
against petitioner for breach of contract of carriage. Petitioner contends that
Viana ceased to be a passenger when he disembarked the vessel and that
consequently his presence there was no longer reasonable. CA affirmed the
trial courts order holding Aboitiz liable. Hence the petition.
Issue:
Whether or not petitioner is still responsible as a carrier to Viana after the
latter had already disembarked the vessel.
Ruling: YES.
The rule is that the relation of carrier and passenger continues until the
passenger has been landed at the port of destination and has left the vessel
owners dock or premises. Once created, the relationship will not ordinarily
terminate until the passenger has, after reaching his destination, safely
alighted from the carriers conveyance or had a reasonable opportunity to
leave the carriers premises. All persons who remain on the premises a
reasonable time after leaving the conveyance are to be deemed passengers,
and what is a reasonable time or a reasonable delay within this rule is to be
determined from all the circumstances, and includes a reasonable time to see
after his baggage and prepare for his departure. The carrier-passenger
relationship is not terminated merely by the fact that the person transported
has been carried to his destination if, for example, such person remains in the
carriers premises to claim his baggage.
The primary factor to be considered is the existence of a reasonable cause as
will justify the presence of the victim on or near the petitioners vessel. We
believe there exists such a justifiable cause. When the accident occurred, the
victim was in the act of unloading his cargoes, which he had every right to do,
from petitioners vessel. As earlier stated, a carrier is duty bound not only to
bring its passengers safely to their destination but also to afford them a
reasonable time to claim their baggage.
Consequently, under the foregoing circumstances, the victim Anacleto Viana
is still deemed a passenger of said carrier at the time of his tragic death.
011 TAN CHIONG SIAN, plaintiff-appellee, vs. INCHAUSTI AND CO.,
defendant-appellant. G.R. No. L-6092 March 8, 1912
TOPIC: Fortuitous event/liability of owner and shipper
FACTS:
Three bill of lading were executed.
To this end 3 bills of lading were executed (38, 39, and 76). The steamer
Sorsogo arrived at the port of Gubat on 28 November 1908 and as the lorcha
Pilar the other vessel to which the merchandise was to be transshipped for its
transportation to Samar was not yet there. The cargo was unloaded and
stored in the defendant companys warehouses at that port. The lorcha Pilar
arrived several days later and the merchandise owned by Sip and other goods
were transported to Catarman, Samar.
On 5 December 1908, however, before the Pilar could leave for its destination
a heavy and strong wind caused the lorcha to wrecked and its cargo including
Sips package were scattered. Workmen of Inchausti tried to save the
merchandize but it is already futile so they proceeded to have it sold at public
auction before a notary for the sum of P1,693.67
A complaint was filed against Inchausti because the same neither carried nor
delivered his merchandise to Ong Bieng Sip, in Catarman, but unjustly and
negligently failed to do so, with the result that the said merchandise was
almost totally lost, and thus claimed the value of the merchandise which was
P20,000, legal interest thereon from 25 November 1908, and the cost of the
suit.
*include the lower court and appellate decision and ratio if applicable
*include as well the respective contentions/ allegations of the petitioner(s) and
respondent(s)
ISSUE(S): WON Inchausti is liable for the shipwreck?
HELD: NO.
RTC- infavor of the Chinese man
SC- The Supreme Court reversed the judgment appealed from, and absolved
Inchausti & Co., without special finding as to costs; holding that Inchausti is
not liable for the loss and damage of the goods shipped on the lorcha Pilar by
the Chinaman, Ong Bieng Sip, in asmuch as such loss and damage were the
result of a fortuitous event or force majeure, and there was no negligence or
lack of care and diligence on the part of Inchausti or its agents.
RATIO:
NO. . Wreck of lorcha due to fortuitous event; Loss cannot be attributed to
Inchausti or its agents From the moment that it is held that the loss of the said
lorcha was due to force majeure, a fortuitous event, with no conclusive proof
of negligence or of the failure to take the precautions such as diligent and
careful persons usually adopt to avoid the loss of the boat and its cargo, it is
neither just nor proper to attribute the loss or damage of the goods in question
to any fault, carelessness, or negligence on the part of Inchausti and its
agents and, especially, the patron of the lorcha Pilar. Inchausti took all
measures for he salvage of goods recoverable after the accident
Herein, subsequent to the wreck, Inchaustis agent took all the requisite
measures for the salvage of such of the goods as could be recovered after the
accident, which he did with the knowledge of the shipper, Ong Bieng Sip, and,
in effecting their sale, he endeavored to secure all possible advantage to the
Chinese shipper; in all these proceedings, he acted in obedience to the law
Article 1601 of the Civil Code prescribes that Carriers of goods by land or by
water shall be subject with regard to the keeping and preservation of the
things entrusted to them, to the same obligations as determined for
innkeepers by articles 1783 and 1784. The provisions of this article shall be
understood without prejudice to what is prescribed by the Code of Commerce
with regard to transportation by sea and land.
The general rule established in Article 840 is that the loss of the vessel and of
its cargo, as the result of shipwreck, shall fall upon the respective owners
thereof, save for the exceptions specified in the second of the said articles.
These legal provisions are in harmony with those of articles 361 and 362 of
the Code of Commerce, and are applicable whenever it is proved that the loss
of, or damage to, the goods was the result of a fortuitous event or of force
majeure; but the carrier shall be liable for the loss or the damage arising from
the causes aforementioned, if it shall have been proven that they occurred
through his own fault or negligence or by his failure to take the same
precautions usually adopted by diligent and careful persons.
CASE LAW/ DOCTRINE:
LAWS AND ANNOTATIONS
Article 1602 NCC
Article 1602 of the Civil Code reads Carriers are also liable for the loss of and
damage to the things
which they receive, unless they prove that the loss or damage arose from a
fortuitous event or force majeure.
Articles 1783 NCC
Article 1783 of the Civil Code provides that the depositum of goods made by
travelers in inns or
hostelries shall also be considered a necessary one. The keepers of inns and
hostelries are liable for them as such bailees, provided that notice thereof may
have been given to them or to their employees, and that the travelers on their
part take the precautions which said innkeepers or their substitutes may have
advised them concerning the care and vigilance of said goods.
Article 1784 NCC
Article 1784 of the Civil Code provides that the liability referred to in the
preceding article shall include damages to the goods of the travelers caused
by servants or employees of the keepers of inns or hostelries as well as by
strangers, but not those arising from robbery or which may be caused by any
other case of force majeure.
Article 361, Code of Commerce
Article 361 of the Code of Commerce provides that Merchandise shall be
transported at the risk and
venture of the shipper, unless the contrary was expressly stipulated.
Therefore, all damages and impairment suffered by the goods in
transportation, by reason of accident, force majeure, or by virtue of the nature
or defect of the articles, shall be for the account and risk of the shipper. The
proof of these accidents is incumbent on the carrier.
Article 362, Code of Commerce
Article 362 of the Code of Commerce provides that the carrier, however, shall
be liable for the losses
and damages arising from the causes mentioned in the foregoing article if it is
proved that they occurred onaccount of his negligence or because he did not
take the precautions usually adopted by careful persons, unless the shipper
committed fraud in the bill of lading, stating that the goods were of a class or
quality different from what they really were. If, notwithstanding the precaution
referred to in this article, the goods transported run the risk of being lost on
account of the nature or by reason of an unavoidable accident, without there
being time for the owners of the same to dispose thereof, the carrier shall
proceed to their sale placing them for this purpose at the disposal of the
Judicial authority or of the officials determined by special provisions.
Article 363, Code of Commerce
Article 363 of the Code of Commerce provides that with the exception of the
cases prescribed in the second paragraph of article 361, the carrier shall be
obliged to deliver the goods transported in the same condition in which,
according to the bill of lading, they were at the time of their receipt, without
any detriment or impairment, and should he not do so, he shall be obliged to
pay the value of the goods not delivered at the point where they should have
been and at the time the delivery should have taken place. If part of the goods
transported should be delivered the consignee may refuse to receive them,
when he proves that he cannot make use thereof without the others.
Contract between Ong Bieng Sip and Inchausti; Awareness of Ong Bieng Sip
as to manner
goods are to be transported, no objection or protest was made The contract
entered into between the Chinese shipper, Ong Bieng Sip, and the firm of
Inchausti & Co., provided that transportation should be furnished from Manila
to Catarman, although the merchandise taken aboard the steamer Sorsogon
was to be transshipped at Gubat to another vessel which was to convey it
from that port to Catarman; it was not stipulated in the said contract that the
Sorsogon should convey the goods to their final destination, nor that the
vessel into which they were to be transshipped, should be a steamer. The
shipper, Ong Bieng Sip, therefore assented to these arrangements and made
no protest when his
205 packages of merchandise were unloaded from the ship and, on account
of the absence of the lorcha Pilar, stored in the warehouses at Gubat nor did
he offer any objection to the lading of his merchandise on to this lorcha as
soon as it arrived and was prepared to receive cargo; moreover, he knew that
to reach the port of Catarman with promptness and dispatch, the lorcha had to
be towed by some vessel like the launch Texas, which Inchausi had been
steadily using for similar operations in those waters. Hence the shipper, Ong
Bieng Sip, made no protest or objection to the methods adopted by the agents
of Inchausti for the transportation of his goods to the port of their destination,
and the record does not show that in Gubat, Inchausti possessed any other
means for the conveyance and transportation of merchandise, at least for
Catarman, than the lorcha Pilar, towed by the said launch and exposed during
its passage to all sorts of accidents and perils from the nature and seafaring
qualities of a lorcha, from the circumstances then present and the winds
prevailing on the Pacific Ocean during the months of November and
December.
Lorcha provided with all proper and necessary equipment and has sufficient
crew for its management and preservation On account of the condition of the
sea, he dropped the 4 anchors that the lorcha had on board and immediately
went ashore to get another anchor and a new cable in order more securely to
hold the boat in view of the predicted storm. This testimony was corroborated
by the said representative, Melchor Muoz. So the lorcha, when the storm
broke upon it, was held fast by five anchors and was well found and provided
with all proper and necessary equipment and had a sufficient crew for its
management and preservation.
Shipwrecks, Article 840 of the Code of Commerce
Treating of shipwrecks, article 840 of the Code of Commerce prescribes that
The losses and
damages suffered by a vessel and he cargo by reason of shipwreck or
stranding shall be individually for the account of the owners, the part of the
wreck which may be saved belonging to them in the same proportion.
Shipwrecks, Article 841 of the Code of Commerce
Article 841 of the same code reads: If the wreck or stranding should arise
through the malice,
negligence, or lack of skill of the captain, or because the vessel put to sea
insufficiently repaired and supplied, the owner or the freighters may demand
indemnity of the captain for the damages caused to the vessel or cargo by the
accident, in accordance with the provisions contained in articles 610, 612, 614
and 621.
Articles 840 and 841 are in harmony with Articles 361 and 362 of the Code of
Commerce
The general rule established in Article 840 is that the loss of the vessel and of
its cargo, as the result
of shipwreck, shall fall upon the respective owners thereof, save for the
exceptions specified in the second of the said articles. These legal provisions
are in harmony with those of articles 361 and 362 of the Code of Commerce,
and are applicable whenever it is proved that the loss of, or damage to, the
goods was the result of a fortuitous event or of force majeure; but the carrier
shall be liable for the loss or the damage arising from the causes
aforementioned, if it shall have been proven that they occurred through his
own fault or negligence or by his failure to take the same precautions usually
adopted by diligent and careful persons.
No delay, negligence or abandonment in the shipment of Ong Bieng Sips
merchandise
In the contract made and entered into by and between the owner of the goods
and the defendant, no
term was fixed within which the said merchandise should be delivered to the
former at Catarman, nor was it proved that there was any delay in loading the
goods and transporting them to their destination. From 28 November, when
the steamer Sorsogon arrived at Gubat and landed the said goods belonging
to Ong Bieng Sip to await the lorcha Pilar which was to convey them to
Catarman, as agreed upon, no vessel carrying merchandise made the voyage
from Gubat to the said pueblo of the Island of Samar, and with Ong Bieng
Sips merchandise there were also to be shipped goods belonging to
Inchausti, which goods were actually taken on board the said lorcha and
suffered the same damage as those belonging to the Chinaman. So that there
was no negligence, abandonment, or delay in the shipment of Ong Bieng
Sips merchandise, and all that was done by the carrier, Inchausti & Co., was
what it regularly and usually did in the transportation by sea from Manila to
Catarman of all classes of merchandise. No attempt has been made to prove
that any course other than the foregoing was pursued by that firm on this
occasion.
Article 361 of the Code of Commerce; Merchandise at risk of shipper unless
contrary is
expressly stipulated According to article 361 of the Code of Commerce,
merchandise shall be transported at the risk and venture of the shipper,
unless the contrary be expressly stipulated. No such stipulation appears of
record, therefore, all damages and impairment suffered by the goods in
transportation, by reason of accident, force majeure, or by virtue of the nature
or defect of the articles, are for the account and risk of the shipper.
Article 361 of the Code of Commerce; Burden of proof of accidents upon the
carrier
A final clause of this same article adds that the burden of proof of these
accidents is upon the carrier.
Herein, the loss and damage of the goods shipped by the Chinaman, Ong
Bieng Sip, was due to the stranding and wreck of the lorcha Pilar in the heavy
storm or hurricane; this Tan Chiong Sian did not deny, and admitted that it
took place between the afternoon of the 5th and early in the morning of the
6th of December, 1908, so it is evident that Inchausti is exempt from the
obligation imposed by the law to prove the occurrence of the said storm,
hurricane, or cyclone in the port of Gubat, and, therefore, if the said goods
were lost or damaged and could not be delivered in Catarman, it was due to a
fortuitous event and a superior, irresistible natural force, or force majeure,
which completely disabled the lorcha intended for their transportation to the
said port of the Island of Samar.
Inchausti took precautions usually adopted by careful and diligent persons,
as required by
Article 362 of the Code of Commerce Herein, Inchausti, his agents and the
patron did take the measures which they deemed necessary and proper in
order to save the lorcha and its cargo from the impending danger;
accordingly, the patron, as soon as he was informed that a storm was
approaching, proceeded to clear the boat of all gear which might offer
resistance to the wind, dropped the four anchors he had, and even procured
an extra anchor from the land, together with a new cable, and cast it into the
water, thereby adding, in so far as possible, to the stability and security of the
craft, in anticipation of what might occur, as presaged by the violence of the
wind and the heavy sea; and Inchausti & Companys agent furnished the
articles requested by the patron of the lorcha for the purpose of preventing the
loss of the boat; thus did they all display all the diligence and care such as
might have been employed by anyone in similar circumstances, especially the
patron who was responsible for the lorcha under his charge; nor is it possible
to believe that the latter failed to adopt all the measures that were
necessary to save his own life and those of the crew and to free himself from
the imminent peril of shipwreck.
Wreck of lorcha due to fortuitous event; Loss cannot be attributed to Inchausti
or its agents
From the moment that it is held that the loss of the said lorcha was due to
force majeure, a fortuitous
event, with no conclusive proof of negligence or of the failure to take the
precautions such as diligent and careful persons usually adopt to avoid the
loss of the boat and its cargo, it is neither just nor proper to attribute the loss
or damage of the goods in question to any fault, carelessness, or negligence
on the part of Inchausti and its agents and, especially, the patron of the lorcha
Pilar.
ISSUE: W/N Ganzon should be held liable under the contract of carriage
Inchausti took all measures for he salvage of goods recoverable after the
accident
HELD: YES. Petition is DENIED.
Herein, subsequent to the wreck, Inchaustis agent took all the requisite
measures for the salvage of
such of the goods as could be recovered after the accident, which he did with
the knowledge of the shipper, Ong Bieng Sip, and, in effecting their sale, he
endeavored to secure all possible advantage to the Chinese shipper; in all
these proceedings, he acted in obedience to the law
Ganzon v. CA
FACTS: Gelacio > Ganzon (via Capt. Niza) > Lighter Batman (common
carrier) (loaded half)
November 28, 1956: Gelacio Tumambing (Gelacio) contracted the
services of of Mauro B. Ganzon to haul 305 tons of scrap iron from
Mariveles, Bataan, to the port of Manila on board the light LCT
Batman
December 1, 1956: Gelacio delivered the scrap iron to Filomeno Niza,
captain of the lighter, for loading which was actually begun on the
same date by the crew of the lighter under the captains supervisor.
When about half of the scrap iron was already loaded, Mayor Jose
Advincula of Mariveles, Bataan arrived and demanded P5000 from
Gelacio
Upon resisting, the Mayor fired at Gelacio so he had to be
taken to the hospital
Loading of the scrap iron was resumed
December 4, 1956: Acting Mayor Basilio Rub (Rub), accompanied by
3 policemen, ordered captain Filomeno Niza and his crew to dump the
scrap iron where the lighter was docked
Later on Rub had taken custody of the scrap iron
RTC: in favor of Gelacio and against Ganzon
Ganzon thru his employees, actually received the scraps is freely
admitted.
Pursuant to Art. 1736, such extraordinary responsibility would cease
only upon the delivery, actual or constructive, by the carrier to the
consignee, or to the person who has a right to receive them.
The fact that part of the shipment had not been loaded on board the
lighter did not impair the said contract of transportation as the goods
remained in the custody and control of the carrier, albeit still
unloaded.
failed to show that the loss of the scraps was due to any of the
following causes enumerated in Article 1734 of the Civil Code,
namely:
(1) Flood, storm, earthquake, lightning, or other natural disaster or calamity;
(2) Act of the public enemy in war, whether international or civil;
(3) Act or omission of the shipper or owner of the goods;
(4) The character of the goods or defects in the packing or in the containers;
(5) Order or act of competent public authority.
Hence, the petitioner is presumed to have been at fault or to have acted
negligently.
By reason of this presumption, the court is not even required to make
an express finding of fault or negligence before it could hold the
petitioner answerable for the breach of the contract of carriage.
exempted from any liability had he been able to prove that he
observed extraordinary diligence in the vigilance over the
goods in his custody, according to all the circumstances of
the case, or that the loss was due to an unforeseen event or
to force majeure. As it was, there was hardly any attempt on
the part of the petitioner to prove that he exercised such
extraordinary diligence.
We cannot sustain the theory of caso fortuito - "order or act of
competent public authority"(Art. 1174 of the Civil Code)
no authority or power of the acting mayor to issue such an
order was given in evidence. Neither has it been shown that
the cargo of scrap iron belonged to the Municipality of
Mariveles.
Ganzon was not duty bound to obey the illegal order
to dump into the sea the scrap iron.
Moreover, there is absence of sufficient proof that the
issuance of the same order was attended with such
force or intimidation as to completely overpower the
will of the petitioner's employees. The mere difficulty
in the fullfilment of the obligation is not
considered force majeure.
Tiu vs. Arriesgado
G.R. No. 138060, September 1, 2004
Facts: At about 10:00 p.m. of March 15, 1987, the cargo truck marked
"Condor Hollow Blocks and General Merchandise" bearing plate number
GBP-675 was loaded with firewood in Bogo, Cebu and left for Cebu City.
Upon reaching Sitio Aggies, Poblacion, Compostela, Cebu, just as the truck
passed over a bridge, one of its rear tires exploded. The driver, Sergio
Pedrano, then parked along the right side of the national highway and
removed the damaged tire to have it vulcanized at a nearby shop, about 700
meters away. Pedrano left his helper, Jose Mitante, Jr. to keep watch over the
stalled vehicle, and instructed the latter to place a spare tire six fathoms away
behind the stalled truck to serve as a warning for oncoming vehicles. The
trucks tail lights were also left on. It was about 12:00 a.m., March 16, 1987.
At about 4:45 a.m., D Rough Riders passenger bus with plate number PBP-
724 driven by Virgilio Te Laspias was cruising along the national highway of
Sitio Aggies, Poblacion, Compostela, Cebu. The passenger bus was also
bound for Cebu City, and had come from Maya, Daanbantayan, Cebu. Among
its passengers were the Spouses Pedro A. Arriesgado and Felisa Pepito
Arriesgado, who were seated at the right side of the bus, about three (3) or
four (4) places from the front seat.
As the bus was approaching the bridge, Laspias saw the stalled truck, which
was then about 25 meters away. He applied the breaks and tried to swerve to
the left to avoid hitting the truck. But it was too late; the bus rammed into the
trucks left rear. The impact damaged the right side of the bus and left several
passengers injured. Pedro Arriesgado lost consciousness and suffered a
fracture in his right colles. His wife, Felisa, was brought to the Danao City
Hospital. She was later transferred to the Southern Island Medical Center
where she died shortly thereafter.
Respondent Pedro A. Arriesgado then filed a complaint for breach of contract
of carriage, damages and attorneys fees before the Regional Trial Court of
Cebu City, Branch 20, against the petitioners, D Rough Riders bus operator
William Tiu and his driver, Virgilio Te Laspias on May 27, 1987. The
respondent alleged that the passenger bus in question was cruising at a fast
and high speed along the national road, and that petitioner Laspias did not
take precautionary measures to avoid the accident.
The petitioners, for their part, filed a Third-Party Complaint against the
following: respondent Philippine Phoenix Surety and Insurance, Inc. (PPSII),
petitioner Tius insurer; respondent Benjamin Condor, the registered owner of
the cargo truck; and respondent Sergio Pedrano, the driver of the truck. They
alleged that petitioner Laspias was negotiating the uphill climb along the
national highway of Sitio Aggies, Poblacion, Compostela, in a moderate and
normal speed. It was further alleged that the truck was parked in a slanted
manner, its rear portion almost in the middle of the highway, and that no early
warning device was displayed. Petitioner Laspias promptly applied the
brakes and swerved to the left to avoid hitting the truck head-on, but despite
his efforts to avoid damage to property and physical injuries on the
passengers, the right side portion of the bus hit the cargo trucks left rear.
HELD: The rules which common carriers should observe as to the safety of
their passengers are set forth in the Civil Code, Articles 1733, 1755and 1756.
It is undisputed that the respondent and his wife were not safely transported
to the destination agreed upon. In actions for breach of contract, only the
existence of such contract, and the fact that the obligor, in this case the
common carrier, failed to transport his passenger safely to his destination are
the matters that need to be proved. This is because under the said contract of
carriage, the petitioners assumed the express obligation to transport the
respondent and his wife to their destination safely and to observe
extraordinary diligence with due regard for all circumstances. Any injury
suffered by the passengers in the course thereof is immediately attributable to
the negligence of the carrier. Upon the happening of the accident, the
presumption of negligence at once arises, and it becomes the duty of a
common carrier to prove that he observed extraordinary diligence in the care
of his passengers. It must be stressed that in requiring the highest possible
degree of diligence from common carriers and in creating a presumption of
negligence against them, the law compels them to curb the recklessness of
their drivers. While evidence may be submitted to overcome such
presumption of negligence, it must be shown that the carrier observed the
required extraordinary diligence, which means that the carrier must show the
utmost diligence of very cautious persons as far as human care and foresight
can provide, or that the accident was caused by fortuitous event. As correctly
found by the trial court, petitioner Tiu failed to conclusively rebut such
presumption. The negligence of petitioner Laspias as driver of the passenger
bus is, thus, binding against petitioner Tiu, as the owner of the passenger bus
engaged as a common carrier.
Philippine Charter Insurance Corp. v. Unknown Owner of Vessel M/V
Facts:
Petitioner Philippine Charter Insurance Corporation (PCIC) is the insurer of a
shipment on board the vessel M/V National Honor, represented in the
Philippines by its agent, National Shipping Corporation of the Philippines
(NSCP). The M/V National Honor arrived at the Manila International
Container Terminal (MICT). The International Container Terminal Services,
Incorporated (ICTSI) was furnished with a copy of the crate cargo list and bill
of lading, and it knew the contents of the crate. The following day, the vessel
started discharging its cargoes using its winch crane. The crane was operated
by Olegario Balsa, a winchman from the ICTSI, exclusive arrastre operator of
MICT. Denasto Dauz, Jr., the checker-inspector of the NSCP, along with the
crew and the surveyor of the ICTSI, conducted an inspection of the cargo.
They inspected the hatches, checked the cargo and found it in apparent good
condition. Claudio Cansino, the stevedore of the ICTSI, placed two sling
cables on each end of Crate No. 1. No sling cable was fastened on the mid-
portion of the crate. In Dauzs experience, this was a normal procedure. As
the crate was being hoisted from the vessels hatch, the mid-portion of the
wooden flooring suddenly snapped in the air, about five feet high from the
vessels twin deck, sending all its contents crashing down hard, resulting in
extensive damage to the shipment. PCIC paid the damage, and as subrogee,
filed a case against M/V National Honor, NSCP and ICTSI. Both RTC and CA
dismissed the complaint.
Issue: WON the presumption of negligence is applicable
Held: No
No. I agree with the contention of the petitioner that common carriers, from
the nature of their business and for reasons of public policy, are mandated 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. he Court has defined extraordinary diligence in
the vigilance over the goods as follows:
The extraordinary diligence in the vigilance over the goods tendered for
shipment requires the common carrier to know and to follow the required
precaution for avoiding damage to, or destruction of the goods entrusted to it
for sale, carriage and delivery. It requires common carriers to render service
with the greatest skill and foresight and to use all reasonable means to
ascertain the nature and characteristic of goods tendered for shipment, and to
exercise due care in the handling and stowage, including such methods as
their nature requires.
The common carriers duty to observe the requisite diligence in the shipment
of goods lasts from the time the articles are surrendered to or unconditionally
placed in the possession of, and received by, the carrier for transportation
until delivered to, or until the lapse of a reasonable time for their acceptance,
by the person entitled to receive them.] >When the goods shipped are either
lost or arrive in damaged condition, a presumption arises against the carrier of
its failure to observe that diligence, and there need not be an express finding
of negligence to hold it liable. To overcome the presumption of negligence in
the case of loss, destruction or deterioration of the goods, the common carrier
must prove that it exercised extraordinary diligence.
However, under Article 1734 of the New Civil Code, the presumption of
negligence does not apply to any of the ff causes
1. Flood, storm, earthquake, lightning or other natural disaster or calamity;
2. Act of the public enemy in war, whether international or civil;
3. Act or omission of the shipper or owner of the goods
4. The character of the goods or defects in the packing or in the containers; 5.
5. Order or act of competent public authority.
It bears stressing that the enumeration in Article 1734 of the New Civil Code
which exempts the common carrier for the loss or damage to the cargo is a
closed list. To exculpate itself from liability for the loss/damage to the cargo
under any of the causes, the common carrier is burdened to prove any of the
aforecited causes claimed by it by a preponderance of evidence. If the carrier
succeeds, the burden of evidence is shifted to the shipper to prove that the
carrier is negligent.
Defect is the want or absence of something necessary for completeness or
perfection; a lack or absence of something essential to completeness; a
deficiency in something essential to the proper use for the purpose for which a
thing is to be used. On the other hand, inferior means of poor quality,
mediocre, or second rate. A thing may be of inferior quality but not necessarily
defective. In other words,
In the present case, the trial court declared that based on the record, the loss
of the shipment was caused b the negligence of the petitioner as the shipper.
The same may be said with respect to defendant ICTSI. The breakage and
collapse of Crate No. 1 and the total destruction of its contents were not
imputable to any fault or negligence on the part of said defendant in handling
the unloading of the cargoes from the carrying vessel, but was due solely to
the inherent defect and weakness of the materials used in the fabrication of
said crate. The crate should have three solid and strong wooden batten
placed side by side underneath or on the flooring of the crate to support the
weight of its contents.
Lasam vs. Smith
FACTS
Frank Smith was engaged in the business of carrying passengers for hire
from the one point to another
in the Province of La Union and the surrounding provinces. Smith undertook
to convey Honorio Lasam and Joaquina Sanchez in a Ford automobile.
On leaving, the automobile was operated by a licensed chauffeur, but the
chauffeur allowed his
assistant, Remigio Bueno, to drive the car.
Bueno held no drivers license, but had some experience in driving, and with
the exception of some
slight engine trouble.
The defects developed in the steering gear so as to make accurate steering
impossible, and after
zigzagging for a distance of about half a kilometer, the car left the road and
went down a steep
embankment.
The automobile was overturned and the plaintiffs pinned down under it. Mr.
Lasam escaped with a few contusions and a dislocated rib but his wife
received serious injuries, among which was a compound fracture of one of the
bones in her left wrist.
Plaintiff Lasam brought the action to recover damages against Smith for the
physical injuries sustained in an automobile accident.
The Trial court ruled in favor of the plaintiff.
Both the plaintiffs and the defendant appeal, Lasam maintained that the
damages awarded are
insufficient while the Smith denies all liability for any damages whatever.
ISSUE: W/N Smith is liable to the injuries caused by the accident
RULING:
Yes. Smiths liability is contractual. The source of the its liability is the contract
of carriage; that by
entering into that contract he bound himself to carry the plaintiffs safely and
securely to their
destination; and that having failed to do so he is liable in damages unless he
shows that the failure to fulfill his obligation was due to causes mentioned in
article 1105 of the Civil Code.
Some extraordinary circumstance independent of the will of the obligor of his
employees is an essential element of a caso fortuito. This element is lacking.
It is not suggested that the accident was due to an act of God or to adverse
road conditions which could not have been foreseen. The accident was
caused either by defects in the automobile or else through the negligence of
its driver.
Neither under the American nor Spanish law is a carrier of passengers an
absolute insurer against the risks of travel from which the passenger may
protect himself by exercising ordinary care and diligence.
Here, the passengers had no means of avoiding the danger or escaping the
injury.
In determining the extent of the liability for losses or damages resulting from
negligence in the
fulfillment of a contractual obligation, the courts have a discretionary power to
moderate the liability according to the circumstances.
Phil Am Gen Insurance Co, Et Al. V. Pks Shipping Co (2003)
FACTS:
Davao Union Marketing Corporation (DUMC) contracted the services
of PKS Shipping Company (PKS Shipping) for the shipment to
Tacloban City of 75,000 bags of cement worth P3,375,000.
DUMC insured the goods for its full value with Philippine American
General Insurance Company (Philamgen).
The goods were loaded aboard the dumb barge Limar I belonging to
PKS Shipping.
December 22, 1988 9 pm: While Limar I was being towed by PKS
tugboat MT Iron Eagle, the barge sank a couple of miles off the coast
of Dumagasa Point, in Zamboanga del Sur, bringing down with it the
entire cargo of 75,000 bags of cement.
DUMC filed a formal claim with Philamgen for the full amount of the
insurance. Philamgen promptly made payment; it then sought
reimbursement from PKS Shipping of the sum paid to DUMC but the
shipping company refused to pay so Philamgen to file suit against
PKS Shipping
RTC: dismissed the complaint - fortuitous event
CA:Affirmed - not a common carrier but a casual occupation
ISSUE: W/N PKS Shipping is NOT liable since it was NOT a common carrier
HELD: NO. Petition is DENIED
Article 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
Complementary is Section 13, paragraph (b), of the Public Service
Act
public service" to be
"x x x 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, subway
motor vehicle, either for freight or passenger, or both, with or without fixed
route and whatever may be its classification, freight or carrier service of any
class, express service, steamboat, or steamship, or steamship line, pontines,
ferries and water craft, engaged in the transportation of passengers or freight
or both, shipyard, marine repair shop, wharf or dock, ice plant, ice
refrigeration plant, canal, irrigation system, gas, electric light, heat and power,
water supply and power petroleum, sewerage system, wire or wireless
communication systems, wire or wireless broadcasting stations and other
similar public services
So understood, the concept of `common carrier under Article 1732
may be seen to coincide neatly with the notion of `public service,
under the Public Service Act
 distinction between:
common or public carrier
private or special carrier - character of the business, such that
if the undertaking is an isolated transaction , not a 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
EX: charter party which includes both the vessel and
its crew, such as in a bareboat or demise, where the
charterer obtains the use and service of all or some
part of a ship for a period of time or a voyage or
voyages and gets the control of the vessel and its
crew.
The regularity of its activities in this area indicates more than just a
casual activity on its part
The appellate court ruled, gathered from the testimonies and sworn
marine protests of the respective vessel masters of Limar I and MT
Iron Eagle, that there was no way by which the barges or the
tugboats crew could have prevented the sinking of Limar I. The
vessel was suddenly tossed by waves of extraordinary height of 6 to 8
feet and buffeted by strong winds of 1.5 knots resulting in the entry of
water into the barges hatches. The official Certificate of Inspection of
the barge issued by the Philippine Coastguard and the Coastwise
Load Line Certificate would attest to the seaworthiness of Limar I and
should strengthen the factual findings of the appellate court.
Findings of fact of the Court of Appeals generally conclude this Court;
none of the recognized exceptions from the rule - (1) when the factual
findings of the Court of Appeals and the trial court are contradictory;
(2) when the conclusion is a finding grounded entirely on speculation,
surmises, or conjectures; (3) when the inference made by the Court of
Appeals from its findings of fact is manifestly mistaken, absurd, or
impossible; (4) when there is a grave abuse of discretion in the
appreciation of facts; (5) when the appellate court, in making its
findings, went beyond the issues of the case and such findings are
contrary to the admissions of both appellant and appellee; (6) when
the judgment of the Court of Appeals is premised on a
misapprehension of facts; (7) when the Court of Appeals failed to
notice certain relevant facts which, if properly considered, would
justify a different conclusion; (8) when the findings of fact are
themselves conflicting; (9) when the findings of fact are conclusions
without citation of the specific evidence on which they are based; and
(10) when the findings of fact of the Court of Appeals are premised on
the absence of evidence but such findings are contradicted by the
evidence on record would appear to be clearly extant in this
instance.
Gacal vs. Philippine Airlines
(183 SCRA 189, G.R. No. 55300 March 16, 1990)
Facts: Plaintiffs Franklin Gacal, his wife and three others were passengers of
PAL plane at Davao Airport for a flight to Manila, not knowing that the flight,
were Commander Zapata with other members of Moro National Liberation
Front. They were armed with grenades and pistols. After take off, the
members of MNLF announced a hijacking and directed the pilot to fly directly
to Libya, later to Sabah. They were, however, forced to land in Zamboanga
airport for refueling, because the plane did not have enough fuel to make
direct flight to Sabah. When the plane began to taxi at the runaway of
Zamboanga airport, it was met by two armored cars of the military.
An armored car subsequently bumped the stairs leading inside the plane.
That commenced the battle between the military and the hijackers, which led
ultimately to the liberation of the planes surviving crew and passengers with
the final score of ten passengers and three hijackers dead.
Issue: Whether or not hijacking is a case fortuito or force majeure, which
would exempt an aircraft from liability for, damages to its passengers and
personal belongings that were lost during the incident?
Held: In order to constitute a caso fortuito that would exempt from liability
under Art 1174 of the civil code, it is necessary that the following elements
must occur: (a) the cause of the breach of obligation must be independent of
human will; (b) the event must be unforeseeable or unavoidable; (c) the event
must be such as to render it impossible for the debtor to fulfill his obligation in
a normal manner; (d) the debtor must be free from any participation in or
aggravation of the injury to the creditor.
Applying the above guidelines, the failure to transport the petitioners safely
from Davao to Manila was due to the skyjacking incident staged buy the
MNLF without connection to the private respondent, hence, independent of
will of PAL or its passengers.
The events rendered it impossible for PAL to perform its obligation in a normal
manner and it cannot be faulted for negligence on the duty performed by the
military. The existence of force majeure has been established thus exempting
PAL from payment of damages.
Bacarro v. Castano
FACTS:
Respondent Castano boarded a jeep driven by Petitioner Montefalcon who
thereafter drove it at around 40 kilometers per hour. While approaching
Sumasap Bridge at the said speed, a cargo truck coming from behind,
blowing its horn to signal its intention to overtake the jeep. The jeep, without
changing its speed, gave way by swerving to the right, such that both vehicles
ran side by side for a distance of around 20 meters. Thereafter as the jeep
was left behind, its driver was unable to return it to its former lane and instead
it obliquely or diagonally ran down an inclined terrain towards the right until it
fell into a ditch pinning down and crushing Castanos right leg in the process.
Castano filed a case for damages against Rosita Bacarro, William Sevilla, and
Felario Montefalcon. Defendants alleged that the jeepney was sideswiped by
the overtaking cargo truck. After trial, the CFI of Misamis Oriental ordered
Bacarro, et.al. to jointly and severally pay Castano. It was affirmed by the CA
upon appeal.
ISSUES:
1. Whether or not there was a contributory negligence on the part of the
jeepney driver.
2. Whether or not extraordinary diligence is required of the jeepney driver.
3. Whether or not the sideswiping is a fortuitous event.
HELD:
1.) Yes. X x x. The fact is, petitioner-driver Montefalcon did not slacken his
speed but instead continued to run the jeep at about forty (40) kilometers per
hour even at the time the overtaking cargo truck was running side by side for
about twenty (20) meters and at which time he even shouted to the driver of
the truck.
Thus, had Montefalcon slackened the speed of the jeep at the time the truck
was overtaking it, instead of running side by side with the cargo truck, there
would have been no contact and accident. He should have foreseen that at
the speed he was running, the vehicles were getting nearer the bridge and as
the road was getting narrower the truck would be to close to the jeep and
would eventually sideswiped it. Otherwise stated, he should have slackened
his jeep when he swerved it to the right to give way to the truck because the
two vehicles could not cross the bridge at the same time.
2.) Yes. x x x [T]he fact is, there was a contract of carriage between the
private respondent and the herein petitioners in which case the Court of
Appeals correctly applied Articles 1733, 1755 and 1766 of the Civil Code
which require the exercise of extraordinary diligence on the part of petitioner
Montefalcon.
Indeed, the hazards of modern transportation demand extraordinary diligence.
A common carrier is vested with public interest. Under the new Civil Code,
instead of being required to exercise mere ordinary diligence a common
carrier is exhorted to carry the passengers safely as far as human care and
foresight can provide "using the utmost diligence of very cautious persons."
(Article 1755). Once a passenger in the course of travel is injured, or does not
reach his destination safely, the carrier and driver are presumed to be at fault.
3.) The third assigned error of the petitioners would find fault upon respondent
court in not freeing petitioners from any liability, since the accident was due to
a fortuitous event. But, We repeat that the alleged fortuitous event in this case
- the sideswiping of the jeepney by the cargo truck, was something which
could have been avoided considering the narrowness of the Sumasap Bridge
which was not wide enough to admit two vehicles. As found by the Court of
Appeals, Montefalcon contributed to the occurrence of the mishap.
Central Shipping Co vs Insurance Co of NA
Facts:
1. On July 25, 1990 at Puerto Princesa, Palawan, the petitioner received on
board its vessel, the M/V Central Bohol, 376 pieces of Philippine Apitong
Round Logs and undertook to transport said shipment to Manila for delivery to
Alaska Lumber Co., Inc.
2. During the voyage the degree of the position of the ship would change
due to the shifting of the logs inside. Eventually at about 15 degrees the
captain ordered for everyone to abandon the ship.
3. Respondent alleged that the total loss of the shipment was caused by the
fault and negligence of the petitioner and its captain. Petitioner while admitting
the sinking of the vessel, interposed the defense that the vessel was fully
manned, fully equipped and in all respects seaworthy; that all the logs were
properly loaded and secured; that the vessels master exercised due diligence
to prevent or minimize the loss before, during and after the occurrence of the
storm.
4. It raised as its main defense that the proximate and only cause of the
sinking of its vessel and the loss of its cargo was a natural disaster, a tropical
storm which neither [petitioner] nor the captain of its vessel could have
foreseen.
5. The RTC was unconvinced that the sinking of M/V Central Bohol had
been caused by the weather or any other caso fortuito. It noted that
monsoons, which were common occurrences during the months of July to
December, could have been foreseen and provided for by an ocean-going
vessel. Applying the rule of presumptive fault or negligence against the
carrier, the trial court held petitioner liable for the loss of the cargo.
6. The CA affirmed the trial courts finding that the southwestern monsoon
encountered by the vessel was not unforeseeable. Given the season of rains
and monsoons, the ship captain and his crew should have anticipated the
perils of the sea. Citing Arada v. CA,7 it said that findings of the BMI were
limited to the administrative liability of the owner/operator, officers and crew of
the vessel. However, the determination of whether the carrier observed
extraordinary diligence in protecting the cargo it was transporting was a
function of the courts, not of the BMI.
Issue:
Whether or not the Doctrine of Limited Liability applies.
Held:
No it does not.
Common carriers are bound to observe extraordinary diligence over the
goods they transport, according to all the circumstances of each case; In all
other cases not specified under Article 1734 of the Civil Code, common
carriers are presumed to have been at fault or to have acted negligently,
unless they prove that they observed extraordinary diligence. From the nature
of their business and for reasons of public policy, common carriers are bound
to observe extraordinary diligence over the goods they transport, according to
all the circumstances of each case. In the event of loss, destruction or
deterioration of the insured goods, common carriers are responsible; that is,
unless they can prove that such loss, destruction or deterioration was brought
aboutamong othersby flood, storm, earthquake, lightning or other natural
disaster or calamity. In all other cases not specified under Article 1734 of the
Civil Code, common carriers are presumed to have been at fault or to have
acted negligently, unless they prove that they observed extraordinary
diligence.
The doctrine of limited liability under Article 587 of the Code of Commerce is
not applicable to the present case. This rule does not apply to situations in
which the loss or the injury is due to the concurrent negligence of the ship-
owner and the captain. It has already been established that the sinking of M/V
Central Bohol had been caused by the fault or negligence of the ship captain
and the crew, as shown by the improper stowage of the cargo of logs. Closer
supervision on the part of the shipowner could have prevented this fatal
miscalculation. As such, the shipowner was equally negligent. It cannot
escape liability by virtue of the limited liability rule.
Delsan transport line vs CA 2001
FACTS: Caltex Philippines entered into a contract of affreightment with the
petitioner, Delsan Transport Lines, Inc., for a period of one year whereby the
said common carrier agreed to transport Caltex's industrial fuel oil from the
Batangas-Bataan Refinery to different parts of the country. Under the
contract, petitioner took on board its vessel, MT Maysun, 2,277.314 kiloliters
of industrial fuel oil of Caltex to be delivered to the Caltex Oil Terminal in
Zamboanga City which was insured by private respondent, American Home
Assurance Corporation.
MT Maysun set sail from Batangas for Zamboanga City. Unfortunately, the
vessel sank in the early morning of August 16, 1986 near Panay Gulf in the
Visayas taking with it the entire cargo of fuel oil. Subsequently, private
respondent paid Caltex P5,096,635.57 representing the insured value of the
lost cargo. Exercising its right of subrogation, the private respondent
demanded of the petitioner the same amount it paid to Caltex.
Due to its failure to collect from the petitioner despite prior demand, private
respondent filed a complaint
with the RTC. The RTC dismissed the complaint when it found that the vessel, Petitioner is liable for the insured value of the lost cargo of industrial fuel oil
MT Maysun, was seaworthy to undertake the voyage as determined by the belonging to Caltex for its failure to rebut the presumption of fault or
Philippine Coast Guard and the incident was caused by unexpected inclement negligence as common carrier occasioned by the unexplained sinking of its
weather condition or force majeure. vessel, MT Maysun, while in transit.
CA reversed the decision which held that in the absence of any explanation JOSE PILAPIL vs. COURT OF APPEALS and ALATCO
as to what may have caused the sinking of the vessel coupled with the finding TRANSPORTATION COMPANY, INC.
that the same was improperly manned, petitioner is liable. (G.R. No. 52159, December 22, 1989)
Before the Court, petitioner theorized that when private respondent paid FACTS:
Caltex the value of its lost cargo, the act of the private respondent is
equivalent to a tacit recognition that the ill-fated vessel was seaworthy; Petitioner Pilapil, on board respondents bus was hit above his eye by a stone
otherwise, private respondent was not legally liable to Caltex due to the hurled by an unidentified bystander. Respondents personnel lost no time in
latter's breach of implied warranty under the marine insurance policy that the bringing him to a hospital, but eventually petitioner partially lost his left eyes
vessel was seaworthy. vision and sustained a permanent scar.
ISSUE: Whether or not the payment made by the private respondent to Caltex
for the insured value of the lost cargo amounted to an admission that the Thus, Petitioner lodged an action for recovery of damages before the Court of
vessel was seaworthy, thus precluding any action for recovery against the First Instance of Camarines Sur which the latter granted. On appeal, the Court
petitioner. of Appeals reversed said decision.

HELD: NO. The payment made by the private respondent for the insured
value of the lost cargo operates as waiver of its (private respondent) right to
enforce the term of the implied warranty against Caltex under the marine
insurance policy. However, the same cannot be validly interpreted as an
automatic admission of the vessel's seaworthiness by the private respondent
as to foreclose recourse against the petitioner for any liability under its
contractual obligation as a common carrier.
In order to escape liability for the loss of its cargo of industrial fuel oil
belonging to Caltex, petitioner attributes the sinking of MT Maysun to
fortuitous event or force majeure. From the testimonies of Jaime Jarabe and
Francisco Berina, captain and chief mate, respectively of the ill-fated vessel, it
appears that a sudden and unexpected change of weather condition that day
contending that there were strong winds with velocity of 30 knots per hour and
waves 18-20 feet high. However, this tale was rebutted by the weather report
from PAGASA which showed that the wind speed was only at 10-20 knots
and waves .7-2 meters high. Thus, as the appellate court correctly ruled,
petitioner's vessel, MT Maysun, sank with its entire cargo for the reason that it
was not seaworthy. There was no squall or bad weather or extremely poor
sea condition in the vicinity when the said vessel sank.
ISSUE:
Whether or not common carriers assume risks to passengers such as the
stoning in this case?
HELD:
In consideration of the right granted to it by the public to engage in the
business of transporting passengers and goods, a common carrier does not
give its consent to become an insurer of any and all risks to passengers and
goods. It merely undertakes to perform certain duties to the public as the law
imposes, and holds itself liable for any breach thereof.
xxx
While the law requires the highest degree of diligence from common carriers
in the safe transport of their passengers and creates a presumption of
negligence against them, it does not, however, make the carrier an insurer of
the absolute safety of its passengers.
xxx
Article 1763. A common carrier is responsible for injuries suffered by a
passenger on account of the wilful acts or negligence of other passengers or
of strangers, if the common carrier's employees through the exercise of the
diligence of a good father of a family could have prevented or stopped the act
or omission.
Clearly under the above provision, a tort committed by a stranger which
causes injury to a passenger does not accord the latter a cause of action
against the carrier. The negligence for which a common carrier is held
responsible is the negligent omission by the carrier's employees to prevent
the tort from being committed when the same could have been foreseen and
prevented by them. Further, under the same provision, it is to be noted that
when the violation of the contract is due to the willful acts of strangers, as in
the instant case, the degree of care essential to be exercised by the common
carrier for the protection of its passenger is only that of a good father of a
family.
FORTUNE EXPRESS, INC. vs. COURT OF APPEALS
G.R. No. 119756. March 18, 1999
FACTS:
A bus of Fortune Express, Inc. (FEI) gured in an accident with a
jeepney which resulted in the death of several passengers including
two Maranaos. It was found out that a Maranao owns said jeepney
and certain Maranaos were planning to take revenge by burning some
of FEIs buses. The operations manager of FEI was advised to take
precautionary measures but just the same, three armed Maranaos
were able to seize a bus of FEI and set it on re.
ISSUE:
Whether petitioner had breach the contract of carriage, making it liable for
damages?
Art. 1763 of the Civil Code provides that a common carrier is
responsible for injuries suffered by a passenger on account of the wilful acts
of other passengers, if the employees of the common carrier could have
prevented the act the exercise of the diligence of a good father of a family. In
the present case, it is clear that because of the negligence of petitioners
employees, the seizure of the bus by Mananggolo and his men was made
possible.
Despite warning by the Philippine Constabulary at Cagayan de Oro
that the Maranaos were planning to take revenge on the petitioner by burning
some of its buses and the assurance of petitioners operation manager,
Diosdado Bravo, that the necessary precautions would be taken, petitioner did
nothing to protect the safety of its passengers.
Had petitioner and its employees been vigilant they would not have failed to
see that the malefactors had a large quantity of gasoline with them. Under the
circumstances, simple precautionary measures to protect the safety of
passengers, such as frisking passengers and inspecting their baggages,
preferably with non-intrusive gadgets such as metal detectors, before allowing
them on board could have been employed without violating the passengers
constitutional rights. As this Court intimated in Gacal v. Philippine Air Lines,
Inc., a common carrier can be held liable for failing to prevent a hijacking by
frisking passengers and inspecting their baggages.
From the foregoing, it is evident that petitioners employees failed to prevent
the attack on one of petitioners buses because they did not exercise the
diligence of a good father of a family. Hence, petitioner should be held liable
for the death of Atty. Caorong.
Calvo v. UCPB Gen Insurance Co. (2002)
FACTS:
At the time material to this case, Transorient Container Terminal
Services, Inc. (TCTSI) owned by Virgines Calvo entered into a
contract with San Miguel Corporation (SMC) for the transfer of 114
reels of semi-chemical fluting paper and 124 reels of kraft liner board
from the Port Area in Manila to SMC's warehouse at the Tabacalera
Compound, Romualdez St., Ermita, Manila.
o The cargo was insured by respondent UCPB General
Insurance Co., Inc.
July 14, 1990: arrived in Manila on board "M/V Hayakawa Maru" and
later on unloaded from the vessel to the custody of the arrastre
operator, Manila Port Services, Inc
July 23 to July 25, 1990: Calvo withdrew the cargo from the arrastre
operator and delivered it to SMC's warehouse in Ermita, Manila
July 25, 1990: goods were inspected by Marine Cargo Surveyors,
who found that 15 reels of the semi-chemical fluting paper were
"wet/stained/torn" and 3 reels of kraft liner board were likewise torn
 SMC collected payment from UCPB the total damage
of P93,112 under its insurance contract
UCPB brought suit against Calvo as subrogee of SMC
o Calvo: Art. 1734(4) The character of the goods or defects in
the packing or in the containers
spoilage or wettage" took place while the goods were
in the custody of either the carrying vessel "M/V
Hayakawa Maru," which transported the cargo to
Manila, or the arrastre operator, to whom the goods
were unloaded and who allegedly kept them in open
air for 9 days notwithstanding the fact that some of
the containers were deformed, cracked, or otherwise
damaged
Trial Court: Calvo liable
CA: affirmed
ISSUE: W/N Calvo can be exempted from liability under Art. 1734(4)
HELD: NO. CA AFFIRMED.
mere proof of delivery of goods in good order to a carrier, and of their
arrival at the place of destination in bad order, makes out a prima
facie case against the carrier, so that if no explanation is given as to
how the injury occurred, the carrier must be held responsible
extraordinary responsibility 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 the right to receive the same
Article 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."
The above article makes no distinction between one
whose principal business activity is the carrying of persons or goods
or both, and one who does such carrying only as an ancillary activity .
. . Article 1732 also carefully avoids making any distinction between a
person or enterprise offering transportation service on a regular or
scheduled basis and one offering such service on an occasional,
episodic or unscheduled basis. Neither does Article 1732 distinguish
between a carrier offering its services to the "general public," i.e., the
general community or population, and one who offers services or
solicits business only from a narrow segment of the general
population.
concept of "common carrier" under Article 1732 may be seen to
coincide neatly with the notion of "public service," under the Public
Service Act (Commonwealth Act No. 1416, as amended) which at
least partially supplements the law on common carriers set forth in the
Civil Code
Under Section 13, paragraph (b) of the Public Service Act, "public
service" includes:
" x x x 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 and whatever may
be its classification, freight or carrier service of any class, express
service, steamboat, or steamship line, pontines, ferries and water
craft, engaged in the transportation of passengers or freight or both,
shipyard, marine repair shop, wharf or dock, ice plant, ice-refrigeration
plant, canal, irrigation system, gas, electric light, heat and power,
water supply and power petroleum, sewerage system, wire or
wireless communications systems, wire or wireless broadcasting
stations and other similar public services. x x x"
when Calvo's employees withdrew the cargo from the arrastre
operator, they did so without exception or protest either with regard to
the condition of container vans or their contents
Calvo must do more than merely show the possibility that some other
party could be responsible for the damage. It must prove that it used
"all reasonable means to ascertain the nature and characteristic of
goods tendered for transport and that it exercised due care in the
handling
Isaac v. Ammen Trans. Co
FACTS:
 May 31, 1951: Cesar Isaac boarded Bus No. 31 from Ligao, Albay
bound for Pili, Camarines Sur and seated himself on the left side
resting his left arm on the window sill but with his left elbow outside
the window
Before reaching his destination, a pick-up car at full speed
and was running outside of its proper lane came from the
opposite direction
The driver of the bus swerved the bus to the very
extreme right of the road until its front and rear
wheels have gone over the pile of stones or gravel
situated on the rampart of the road.
The bus could not bus farther right and run over a
greater portion of the pile of gravel, the peak of which
was about 3 feet high, without endangering the safety
of his passengers.
Despite efforts, the rear left side of the bus was hit by
the pick-up car
He was rushed to a hospital in Iriga, Camarines Sur where he
was given blood transfusion to save his life
After 4 days, he was transferred to another hospital in Tabaco, Albay,
where he under went treatment for 3 months
Later, he was moved to the Orthopedic Hospital where he was
operated on and stayed for another 2 months.
He incurred expenses of P623.40, excluding medical fees which were
paid by A.L. Ammen Trans. Co.
Trial Court: Dismissed the complaint - collision occurred due to the
negligence of the driver of the pick-up car
ISSUE: W/N if there is no negligence on the part of the common carrier but
that the accident resulting in injuries is due to causes which are inevitable and
which could not have been avoided or anticipated notwithstanding the
exercise of that high degree of care and skill which the carrier is bound to
exercise for the safety of his passengers neither the common carrier nor the
driver is liable therefor
HELD: YES. Appealed decision is AFFIRMED.
ART. 1733. Common carriers, from the nature of their business and for
reasons of public policy, are bound to observe extra ordinary 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 1734, 1735, and 1745, Nos. 5, 6, and 7, while the
extraordinary diligence for the safety of the passengers is further set forth in
articles 1755 and 1756 Ooom.
ART. 1755. A common carrier is bound to carry the passengers safely as far
as human care and foresight can provide, using the utmost diligence of very
cautious persons, with a due regard for all the circumstances.
ART. 1756. In case of death of or injuries 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
1733 and 1755.
Principles governing the liability of a common carrier:
1. the liability of a carrier is contractual and arises upon breach of its
obligation. There is breach if it fails to exert extraordinary diligence
according to all circumstances of each case
2. a carrier is obliged to carry its passenger with the utmost diligence of
a very cautious person, having due regard for all the circumstances
3. a carrier is presumed to be at fault or to have acted negligently in
case of death of, or injury to, passengers, it being its duty to prove
that it exercised extraordinary diligence
4. the carrier is not an insurer against all risks of travel
where a carrier's employee is confronted with a sudden emergency,
the fact that he is obliged to act quickly and without a chance for
deliberation must be taken into account, and he is held to the some
degree of care that he would otherwise be required to exercise in the
absence of such emergency but must exercise only such care as any
 ordinary prudent person would exercise under like circumstances and reference to the reckless and negligent manufacture of "adulterated food
conditions, and the failure on his part to exercise the best judgment items intended to be sold for public consumption."
the case renders possible does not establish lack of care and skill on
his part The PH American General Insurance Co. vs. MCG Marine services

Considering all the circumstances, we are persuaded to On March 1, 1987, San Miguel Corporation insured several beer bottle
conclude that the driver of the bus has done what a prudent cases with an aggregate value of P5,836,222.80 with petitioner Philippine
[2]
man could have done to avoid the collision American General Insurance Company. The cargo were loaded on board
the M/V Peatheray Patrick-G to be transported from Mandaue City to Bislig,
It is true that Isaac's contributory negligence cannot relieve A.L. Surigao del Sur.
Ammen of its liability but will only entitle it to a reduction of the amount
of damage caused (Article 1762, new Civil Code), but this is a After having been cleared by the Coast Guard Station in Cebu the
circumstance which further militates against the position taken by previous day, the vessel left the port of Mandaue City for Bislig, Surigao del
Isaac Sur on March 2, 1987. The weather was calm when the vessel started its
voyage.
COCA-COLA BOTTLERS PHILIPPINES, INC. vs. CA and MS. LYDIA The following day, March 3, 1987, M/V Peatheray Patrick-G listed and
GERONIMO subsequently sunk off Cawit Point, Cortes, Surigao del Sur. As a
G.R. No. 110295 October 18, 1993 consequence thereof, the cargo belonging to San Miguel Corporation was
Petition for review on certiorari (under Rule45) the decision of the CA lost.
DAVIDE, JR., J.:
Subsequently, San Miguel Corporation claimed the amount of its loss
FACTS: Private respondent was the proprietress of Kindergarten Wonderland from petitioner.
Canteen in Dagupan City. In August 1989, some parents of the students
complained to her that the Coke and Sprite soft drinks sold by her contained Upon petitioners request, on March 18, 1987, Mr. Eduardo Sayo, a
fiber-like matter and other foreign substances. She brought the said bottles for surveyor from the Manila Adjusters and Surveyors Co., went to Taganauan
examination to DOH and it was found out that the soft drinks are Island, Cortes, Surigao del Sur where the vessel was cast ashore, to
adulterated. As a result, her per day sales of soft drinks severely plummeted investigate the circumstances surrounding the loss of the cargo. In his report,
that she had to close her shop on 12 December 1989 for losses. She Mr. Sayo stated that the vessel was structurally sound and that he did not see
demanded damages from petitioner before the RTC which dismissed the any damage or crack thereon. He concluded that the proximate cause of the
same on motion by petitioner based on the ground of Prescription. On appeal, listing and subsequent sinking of the vessel was the shifting of ballast water
the CA annulled the orders of the RTC. from starboard to portside. The said shifting of ballast water allegedly affected
the stability of the M/V Peatheray Patrick-G.
ISSUE: WON the action for damages by the proprietress against the soft Thereafter, petitioner paid San Miguel Corporation the full amount of
drinks manufacturer should be treated as one for breach of implied warranty P5,836,222.80 pursuant to the terms of their insurance contract.
under article 1561 of the CC which prescribes after six months from delivery
of the thing sold. On November 3, 1987, petitioner as subrogee of San Miguel Corporation
filed with the RTC a case for collection against private respondents to recover
RULING: Petition Denied. the amount it paid to San Miguel Corporation for the loss of the latters cargo.
The SC agrees with the CAs conclusion that the cause of action in the case
Meanwhile, the Board of Marine Inquiry conducted its own investigation
at bar is found on quasi-delict under Article 1146 of the CC which prescribes
of the sinking of the M/V Peatheray Patrick-G to determine whether or not the
in four years and not on breach of warranty under article 1562 of the same
captain and crew of the vessel should be held responsible for the incident. On
code. This is supported by the allegations in the complaint which makes
May 11, 1989, the Board rendered its decision exonerating the captain and
crew of the ill-fated vessel for any administrative liability. It found that the
cause of the sinking of the vessel was the existence of strong winds and
enormous waves in Surigao del Sur, a fortuitous event that could not have
been forseen at the time the M/V Peatheray Patrick-G left the port of
Mandaue City.It was further held by the Board that said fortuitous event was
the proximate and only cause of the vessels sinking.
ISSUE: WON the private respondents should be liable
HELD: Common carriers, from the nature of their business and for reasons of
public policy, are mandated to observe extraordinary diligence in the vigilance
over the goods and for the safety of the passengers transported by them.
Owing to this high degree of diligence required of them, common carriers, as
a general rule, are presumed to have been at fault or negligent if the goods
transported by them are lost, destroyed or if the same deteriorated
However, this presumption of fault or negligence does not arise in the
cases enumerated under Article 1734 of the Civil Code:
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) Flood, storm, earthquake, lightning or other natural disaster or calamity;
(2) Act of the public enemy in war, whether international or civil;
(3) Act or omission of the shipper or owner of the goods;
(4) The character of the goods or defects in the packing or in the containers;
(5) Order or act of competent public authority.
In order that a common carrier may be absolved from liability where the
loss, destruction or deterioration of the goods is due to a natural disaster or
calamity, it must further be shown that the such natural disaster or calamity
was the proximate and only cause of the loss; there must be an entire
exclusion of human agency from the cause of the injury of the loss.
Moreover, even in cases where a natural disaster is the proximate and
only cause of the loss, a common carrier is still required to exercise due
diligence to prevent or minimize loss before, during and after the occurrence
of the natural disaster, for it to be exempt from liability under the law for the
[11]
loss of the goods. If a common carrier fails to exercise due diligence--or
[12]
that ordinary care which the circumstances of the particular case demand --
to preserve and protect the goods carried by it on the occasion of a natural
disaster, it will be deemed to have been negligent, and the loss will not be
considered as having been due to a natural disaster under Article 1734 (1).
In the case at bar, the issues may be narrowed down to whether the loss
of the cargo was due to the occurrence of a natural disaster, and if so,
whether such natural disaster was the sole and proximate cause of the loss or
whether private respondents were partly to blame for failing to exercise due
diligence to prevent the loss of the cargo.
The parties do not dispute that on the day the M/V Peatheray Patrick-G
sunk, said vessel encountered strong winds and huge waves ranging from six
to ten feet in height. The vessel listed at the port side and eventually sunk at
Cawit Point, Cortes, Surigao del Sur.
The Court of Appeals, citing the decision of the Board of Marine Inquiry in
the administrative case against the vessels crew (BMI--646-87), found that the
loss of the cargo was due solely to the existence of a fortuitous event,
particularly the presence of strong winds and huge waves at Cortes, Surigao
del Sur on March 3, 1987
In the case at bar, it was adequately shown that before the M/V
Peatheray Patrick-G left the port of Mandaue City, the Captain confirmed with
the Coast Guard that the weather condition would permit the safe travel of the
vessel to Bislig, Surigao del Sur. Thus, he could not be expected to have
foreseen the unfavorable weather condition that awaited the vessel in Cortes,
Surigao del Sur. It was the presence of the strong winds and enormous waves
which caused the vessel to list, keel over, and consequently lose the cargo
contained therein. The appellate court likewise found that there was no
negligence on the part of the crew of the M/V Peatheray Patrick-G, citing the
following portion of the decision of the Board of Marine Inquiry.
Roberto Juntilla V. Clemente Fontanar
G.R. No. L-45637 May 31, 1985
Lessons Applicable: Fortuitous Event (Torts and Damages)
FACTS:
Jeepney was driven by Berfol Camoro from Danao City to Cebu
City. It was Clemente Fontanar but was actually owned by defendant
Fernando Banzon.
 When the jeepney reached Mandaue City, the right rear tire exploded
causing the vehicle to turn turtle. Roberto Juntilla was sitting at the
front seat was thrown out of the vehicle.
Upon landing on the ground, he momentarily lost
consciousness. When he came to his senses, he found that
he had a lacerated wound on his right palm. He also injured
his left arm, right thigh and on his back.
Because of his shock and injuries, he went back to Danao City but on
the way, he discovered that his "Omega" wrist watch worth P
852.70 was lost. Upon his arrival in Danao City, he immediately
entered the Danao City Hospital to attend to his injuries, and also
requested his father-in-law to proceed immediately to the place of the
accident and look for the watch.
Roberto Juntilla filed for breach of contract with damages
Respondents: beyond the control since tire that exploded was
newly bought and was only slightly used
RTC: favored Roberto Juntilla
CA: Reversed since accident was due to fortuitous event
ISSUE: W/N there is a fortuitous event
HELD: NO. CA reversed, RTC reinstated.
passenger jeepney was running at a very fast speed before the
accident
at a regular and safe speed will not jump into a ditch when its
right rear tire blows up
passenger jeepney was overloaded
3 passengers in the front seat
14 passengers in the rear
caso fortuito presents the following essential characteristics:
(1) The cause of the unforeseen and unexpected occurrence, or of
the failure of the debtor to comply with his obligation, must be
independent of the human will.
(2) It must be impossible to foresee the event which constitutes
the caso fortuito, or if it can be foreseen, it must be impossible to
avoid.
(3) The occurrence must be such as to render it impossible for the
debtor to fulfill his obligation in a normal manner.
(4) the obligor (debtor) must be free from any participation in the
aggravation of the injury resulting to the creditor.
In the case at bar, the cause of the unforeseen and unexpected
occurrence was not independent of the human will. The accident was
caused either through the negligence of the driver or because of
mechanical defects in the tire. Common carriers should teach their
drivers not to overload their vehicles, not to exceed safe and legal
speed limits, and to know the correct measures to take when a tire
blows up thus insuring the safety of passengers at all times
the source of a common carrier's legal liability is the contract of
carriage, and by entering into the said contract, it binds itself to carry
the passengers safely as far as human care and foresight can
provide, using the utmost diligence of a very cautious person, with a
due regard for all the circumstances. The records show that this
obligation was not met by the respondents. Respondents likewise
argue that the petitioner cannot recover any amount for failure to
prove such damages during the trial findings of facts of the City Court
of Cebu
SOUTHERN LINES INC vs CA
FACTS:
The City of Iloilo requisitioned for rice from the National Rice and Corn
Corporation (NARIC).
NARIC shipped 1,726 sacks of rice consigned to the City of Iloilo on
board of SS General Wright belong to Southern Lines.
The City of Iloilo received the shipment and paid the amount stated in
the bill of lading (around Php 63K).
However, at the bottom of the bill of lading, it was noted that City of
Iloilo received the merchandise in the same condition as when
shipped, except that it received only 1,685 sacks.
Upon actual weighing, it was discovered that the shortage was equal
to 41 sacks of rice.
Thus, the City of Iloilo filed a complaint against NARIC and Southern
Lines for the recovery of the value of the shortage of the shipment of
rice (Php 6,486.35).
The lower court absolved NARIC but sentenced Southern Lines to
pay the amount.
CA affirmed.
Hence, this petition for review.
Southern Lines claims exemption from liability by contending that the
shortage in the shipment of rice was due to such factors as shrinkage,
leakage or spillage of the rice on account of the bad condition of the
sacks at the time it received the same and negligence of the agents of
City of Iloilo in receiving the shipment.
ISSUES:
1. Whether Southern Lines is liable for the loss or shortage of the rice
shipped.
2. Whether the City of Iloilo is precluded from filing an action for
damages on account of its failure to present a claim within 24 hours
from receipt of the shipment as stated in the bill of lading.
HELD:
- YES. The SC held that the contention of Southern Lines with respect to the
improper packing is untenable.Under Art. 361 of the Code of Commerce, the
carrier, in order to free itself from liability, was only obliged to prove that the
damages suffered by the goods were by virtue of the nature or defect of the
articles. Under Art. 362, the plaintiff, in order to hold the defendant liable, was
obliged to prove that the damages to the goods is by virtue of their nature,
occurred on account of its negligence or because the defendant did not take
the precaution adopted by careful persons.It held that if the fact of improper
packing is known to the carrier or his servants, or apparent upon ordinary
observation, but it accepts the goods notwithstanding such condition, it is not
relieved of liability for loss or injury resulting therefrom.
- NO. The SC noted that Southern Lines failed to plead this defense in its
answer to City of Iloilos complaint and, therefore, the same is deemed
waived and cannot be raised for the first time.The SC also cited the finding
of the CA that City of Iloilo filed the action within a reasonable time; that the
action is one for the refund of the amount paid in excess, and not for
damages or the recovery of shortage; the bill of lading does not at all limit
the time for the filing of action for the refund of money paid in excess.
Yu Con vs. Ipil | Araullo (1916)
FACTS
Respondent, Yu Con (Yu Con), chartered the banca Maria owned
by petitioner Narciso Lauron (Lauron) with Gilcerio Ipil (Ipil) as its
master and Juto Solamo (Solamo) as it supercargo to transport certain
merchandise and money from the port of Cebu to Catmon.
Yu Con loaded the merchandise and delivered the money, placed in
a trunk, to Ipil and Solamo.
Allegedly because there was no more room for Yu Cons trunk, Ipil and
Solamo transferred the money to their own trunk in the stateroom.
Before the ship could sail, the trunk and the money placed therein
disappeared.
ISSUES/HELD
Are the petitioners liable for the loss? YES.
RATIONALE
It is therefore beyond all doubt that the loss of the money occurred
through the manifest fault and negligence of Ipil and Solamo.
o They failed to take the necessary precautions in order that the
stateroom containing the trunk in which they kept the money should
be properly guarded by members of the crew and they also did not
expressly station some person inside the stateroom for the guarding
and safe-keeping of the trunk.
o All of these circumstances, together with that of its having been
impossible to know who took the trunk and the money, make the
conduct of Ipil, Solamo, and the other crew members eminently
supicious and prevent our holding that the disappearance or loss of
the money was due to a fortuitous event, to force majeure.
Ipil and Solamo were depositaries of the sum in question and, having
failed to exercise the diligence required by the nature of the obligation of
safe-keeping assumed by them and by the circumstances of the time and
the place, it is evident that they are liable for its loss or misplacement and
must restore it.
With respect to Lauron, he is also liable in accordance with the
provisions of the Code of Commerce in force because, as the proprietor
and owner of the vessel who executed a contract of carriage with Yu
Con, there occurred the loss, theft, or robbery of the P450 that belonged
to Yu Con through the negligence of Ipil and Solamo and which theft does
not appear to have been committed by a person not belonging to the craft.
The old Code of Commerce absolved the shipowner from liability for
the negligence of the captain and its crew but, in the light of the
principles of modern law, this doctrine on the non-liability of the
shipowner for the unlawful acts, crimes or quasi crimes, committed
by the captain and the crew can no longer be maintained in its
absolute and categorical terms.
o In maritime commerce, the shippers and passengers in making
contracts with the captain do so through the confidence they have in
the shipowner who appointed him; they presume that the owner made
a most careful investigation before appointing him, and, above all,
 they themselves are unable to make such an investigation, and even
though they should do so, they could not obtain complete security,
inasmuch as the shipowner can, whenever he sees fit, appoint
another captain instead.
Thus, it is only proper that the shipowner should be made liable.
Son v. Cebu Autobus
The plaintiff, Jose Son, instituted in the Court of First Instance of Cebu an
action seeking to recover from the defendant, Cebu Autobus Company,
damages in the total sum of P2,660, alleged to have been suffered by the
plaintiff as a result of the fact that the defendant's TPTJ truck No. 312 fell into
a canal in the barrio of Macaas, municipality of Catmon, Cebu, on September
18, 1948, due to a defect of its engine or to the negligence of its driver, the
plaintiff (then a passenger of the vehicle) having received serious injuries and
two of his hogs (loaded therein) having been killed. The defense set up by the
defendant is that the accident was caused by events which were unforeseen
or, even if foreseen, were inevitable. After trial the court rendered a decision,
sentencing the defendant to pay to the plaintiff the sum of P2,000 as moral
damages, and the sum of P286.80 as plaintiff's actual expenses, together with
his loss and unrealized profit in connection with the seven hogs loaded by the
plaintiff in defendant's truck. From this decision the defendant has appealed.
As the defendant has elevated the case directly to this Court on questions of
law, we are bound by the findings of fact contained in the appealed decision.
We quote hereunder the conclusions pertinent to and decisive of the present
appeal:
"The evidence adduced conclusively shows that TPU-Truck No. 312 of the
defendant Cebu Autobus Company left Cebu City on September 17, 1948, at
about 10:00 a.m. bound for Maya, municipality of Daan Bantayan, Cebu
Province, arriving in the latter place at about 5:00 p.m. of the same day. It
passed the night in Maya. It left Maya, Daan Bantayan, Oebu, on its return trip
to Cebu City at about 4:00 a.m., September 18, 1948, without having been
inspected or examined by the mechanic. The plaintiff boarded defendant's
truck in barrio Maya, Daan Bantayan, Cebu, and loaded seven hogs for his
home at Yati, Liloan, Cebu, paying the usual fare and freight. The plaintiff did
not reach his destination safely, because the truck of the defendant fell into a
canal at kilometer No. 56, barrio of Macaas, municipality of Catmon, Cebu. He
was pinned down or pressed by the truck on September 18, 1948, and, as a
consequence, he suffered complete fractures on his pelvic bone. Because of
the shock and pain he lost his consciousness for sometime. He was brought
to his house at Yati, municipality of Liloan, Cebu, unconscious on board
another truck. Later, on the same day, he was brought in a special wagon to
the City of Cebu, and was confined in the Velez Clinic for fourteen days, from
September 18, 1948, to October 2, 1948. On October 2, 1948, the plaintiff
went out of the Velez Clinic, but according to Dr. Jacinto Velez, physician and
proprietor of the Velez Clinic, "the plaintiff needed 60 days more of treatment
and rest before he could resume his former habitual work, inasmuch as he
suffered complete fractures on his pelvic bone.
"The evidence further shows that two hogs of the plaintiff loaded on TPU
Truck No. 312 of the defendant on September 18, 1948 died when the said
truck fell into a canal at Macaas, Catmon, Cebu.
*******
"The theory of the defendant is that the accident was unforeseen, or even if
foreseen, was inevitable. This theory cannot be sustained. Whether the
accident was caused by the defect of the engine of the truck of the defendant,
or by the negligence of the driver, or by the breakage of the drag-link spring,
the defendant is civilly liable to the plaintiff for the damages suffered by him.
The evidence shows that the drag-link spring of the truck in question was not
inspected or examined when it left Maya, Daan Bantayan, Cebu, on
September 1, 1948, for Cebu City. If it were inspected or examined, the
accident might have been avoided. The plaintiff had no means of avoiding the
danger or escaping the injury. When he boarded at dawn of September 18,
1948, in Maya, Daan Bantayan, Cebu, defendant's TPU Truck No. 312, bound
for his home at Yati Liloan, Cebu, and loaded on said truck seven hogs, he
had every right to presume the truck perfectly in good condition which could
transport him safely and securely to his destination. He paid the regular fare
and the freight of the seven hogs."
The plaintiff is suing the defendant upon its contract of carriage which the
latter had failed to perform by virtue of its failure to safely carry the plaintiff to
his destination at the barrio of Yati, Liloan, Cebu, as distinguished from an
action based on culpa acquiliana under which it is necessary, in order to
recover damages, to prove fault or negligence on the part of the carrier. The
[*]
distinction is clearly set out in the case of Castro vs. Aero Taxicab Co., 46
Off. Gaz., 2023, as follows: "La culpa aquiliana determina y engendra la
responsabilidad y por eso es sustantiva, independiente; mientras que la culpa
contractual presupone la preexistencia de una obligacion, por tanto es solo
incidental es decir, la infraccion o incumplimiento de esa obligacion es lo que
genera la culpa contractual. Una implicacion o consecuencia caracteristica de
la diferencia entre ambos conceptos juridicos es que, tratandose de la culpa
extracontractual o aquiliana, el demandante que reclame indemnizacion de
danos y perjuicios tiene que probar, como requisite indispensable para que
prospere su accion, la culpa o negligencia del demandado, mientras que,
tratandose de la culpa contractual, es bastante que se pruebe la existencia
del contrato y que la obligacion resultante del mismo se ha infringido o no se
ha cumplido, siguiendose danos de esta infraccion e incumplimento."
The trial court based its decision in favor of the plaintiff upon the finding that
the defendant had defaulted in its contract of carriage due to the accident,
regardless of whether it was caused by a defect of the engine of the
defendant's truck, by the negligence of its driver, or by the breakage of the
drag-link spring; the evidence showing that the said drag-link spring was not
inspected or examined when the vehicle left Maya, Daan Bantayan, Cebu, for
Cebu City. In other words, the trial court overruled the defense interposed by
the defendant that the accident was due to an event (unexpected breakage of
the drag-link spring) which could not be foreseen or which, even if foreseen,
was inevitable. In our opinion, the trial court was correct. Its express finding as
to the cause of the accident in effect blames the defendant for it and logically
rejects the defendant's theory that the cause emanated from an unforeseen or
inevitable event. In essence, the trial court held that the drag-link spring of the
truck in question was defective. In the case of Lazam vs. Smith, 45 Phil., 660,
it was already held that an accident cause either by defects in the automobile
or through the negligence of its driver is not a caso fortuito.
The conclusion of the trial court with respect to the amount of damages
sustained by and award in favor of the plaintiff, is being factual, conclusive
herein, since, as hereinbefore noted, the defendant has appealed directly to
this Court solely on questions of law.
Upon the other hand, plaintiff's claim that the amount of moral damages
awarded to him by the trial court should be raised to P300, cannot be
sustained, because no appeal was taken by him from the decision a quo.
Wherefore, the appealed decision is affirmed and it is so ordered with costs7
against the defendant-appellant.
Cangco vs Manila Railroad Co.
FACTS
Jose Cangco was an employee of Manila Railroad Company as clerk. He
lived in San Mateo which is located upon the line of the defendant railroad
company. He used to travel by trade to the office located in Manila for free.
On January 21, 1915, on his way home by rail and when the train drew up to
the station in San Mateo, he rose from his seat, making his exit through the
door. When he stepped off from the train, one or both of his feet came in
contact with a sack of watermelons causing him to slip off from under him and
he fell violently on the platform. He rolled and was drawn under the moving
car. He was badly crushed and lacerated. He was hospitalized which resulted
to amputation of his hand. He filed the civil suit for damages against
defendant in CFI of Manila founding his action upon the negligence of the
employees of defendant in placing the watermelons upon the platform and in
leaving them so placed as to be a menace to the security of passengers
alighting from the train. The trial court after having found negligence on the
part of defendant, adjudged saying that plaintiff failed to use due caution in
alighting from the coach and was therefore precluded from recovering, hence
this appeal.
ISSUE
Is the negligence of the employees attributable to their employer whether the
negligence is based on contractual obligation or on torts?
HELD
YES. It cannot be doubted that the employees of defendant were guilty of
negligence in piling these sacks on the platform in the manner stated. It
necessarily follows that the defendant company is liable for the damage
thereby occasioned unless recovery is barred by the plaintiffs own
contributory negligence. It is to note that the foundation of the legal liability is
the contract of carriage. However Art. 1903 relates only to culpa aquiliana and
not to culpa contractual, as the Court cleared on the case of Rakes v. Atlantic
Gulf. It is not accurate to say that proof of diligence and care in the selection
and control of the servant relieves the master from liability fro the latters act.
The fundamental distinction between obligation of this character and those
which arise from contract, rest upon the fact that in cases of non-contractual
obligations it is the wrongful or negligent act or omission itself which creates
the vinculum juris, whereas in contractual relations the vinculum exists
independently of the breach of the voluntary duty assumed by the parties
when entering into the contractual relation. When the source of obligation
upon which plaintiffs cause of action depends is a negligent act or omission,
the burden of proof rest upon the plaintiff to prove negligence. On the other
hand, in contractual undertaking, proof of the contract and of its
nonperformance is suffient prima facie to warrant recovery. The negligence of
employee cannot be invoked to relieve the employer from liability as it will
make juridical persons completely immune from damages arising from breach
of their contracts. Defendant was therefore liable for the injury suffered by
plaintiff, whether the breach of the duty were to be regarded as constituting
culpa aquiliana or contractual. As Manresa discussed, whether negligence
occurs as an incident in the course of the performance of a contractual
undertaking or is itself the source of an extra-contractual obligation, its
essential characteristics are identical. There is always an act or omission
productive of damage due to carelessness or inattention on the part of the
defendant. The contract of defendant to transport plaintiff carried with it, by
implication, the duty to carry him in safety and to provide safe means of
entering and leaving its trains. Contributory negligence on the part of
petitioner as invoked by defendant is untenable. In determining the question
of contributory negligence in performing such act- that is to say, whether the
passenger acted prudently or recklessly- age, sex, and physical condition of
the passenger are circumstances necessarily affecting the safety of the
passenger, and should be considered. It is to be noted that the place was
perfectly familiar to plaintiff as it was his daily routine. Our conclusion is there
is slightly underway characterized by imprudence and therefore was not guilty
of contributory negligence. The decision of the trial court is REVERSED.
Landingin vs. Pantranco
Facts: In the morning of 20 April 1963, Leonila Landingin, daughter of
Marcelo Landigin and Racquel Bocasas, and Estrella Garcia, daughter of
Pedro Garcia and Eufracia Landingin, were among the passengers in the bus
driven by Marcelo Oligan and owned and operated by Pantranco on an
excursion trip from Dagupan City to Baguio City and back. Upon reaching the
uphill point at Camp 8, a sudden snapping or breaking of metal below the floor
of the bus was heard, and the bus abruptly stopped, rolling back a few
moments later; that as a result, some of the passengers jumped out of the
bus, while others stepped down. The driver maneuvered the bus safely to and
against the side of the mountain where its rear end was made to rest,
ensuring the safety of the many passengers still inside the bus. While the
driver was steering the bus towards the mountainside, he advised the
passengers not to jump, but to remain seated. Leonila and Estrella were not
thrown out of the bus, but that they panicked and jumped out. Leonila and
Estrella suffered serious injuries as a result of which Leonila and Estrella died
at the hospital on the same day.
In connection with the incident, however, the driver had been charged with
and convicted of multiple homicide and multiple slight physical injuries on
account of the death of Leonila and Estrella and of the injuries suffered by
four others. Said criminal case, however, is pending appeal in a higher court.
Civil Cases D-1468 and D-1470 were filed by the spouses Landingin and
spouses Garcia for damages suffered by them in connection with the death of
their respective daughters, Leonila and Estrella, due to the alleged negligence
of Pangasinan Transport Co. and Marcelo Oligan and/or breach of contract of
carriage. By agreement of the parties, the two cases were tried jointly. On 17
October 1966, the court a quo rendered its decision therein concluding that
the accident was caused by a fortuitous event or an act of God brought about
by some extra-ordinary circumstances independent of the will of the
Pantranco or its employees. The Court thus absolved the defendants from
any liability on account of negligence on their part and therefore dismissing
the complaints in the two cases. However, it ordered Pantranco to pay to the
spouses Marcelo Landingin and Racquel Bocasas in Civil Case D-1468 the
amount of P6,500.00; and the amount of P3,500.00 to the spouses Pedro
Garcia and Eufracia Landingin in Civil Case D-1470, not in payment of liability
because of any negligence on the part of the defendants but as an expression
of sympathy and goodwill. Pantranco appealed.
The Supreme Court modified the judgment appealed from, and ordered
PANTRANCO to pay the spouses Landingin and spouses Garcia the amounts
stated in the judgment appealed from, as damages for breach of contracts,
with interest thereon at the legal rate from the date of the filing of the
complaints; with costs against PANTRANCO.
1. PANTRANCO guilty of breach of contract of carriage The argument
the court should not have ordered them to assume any pecuniary liability
inasmuch as it has found them to be absolutely free from fault or negligence,
and having in fact dismissed the complaints against them would have been
meritorious if not for the fact that PANTRANCO was guilty of breach of
contract of carriage. Each of the two complaints averred that two buses,
including the one in which the two deceased girls were riding, were hired to
transport the excursionist passengers from Dagupan City to Baguio City, and
return, and that the said two passengers did not reach destination safely.
2. Duty of a common carrier As a common carrier, PANTRANCO was duty
bound to carry its passengers safely as far as human care and foresight can
provide, using the utmost diligence of very cautious persons, with a due
regard for all the circumstances. (Article 1755, Civil Code.)
3. Pantranco did not measure up to the degree of care and foresight
required it under the circumstances The cross-joint of the bus in which the
deceased were riding broke, which caused the malfunctioning of the motor,
which in turn resulted in panic among some of the passengers. In Lasam vs.
Smith (45 Phil. 660), the Court held that an accident caused by defects in the
automobile is not a caso fortuito. The rationale of the carriers liability is the
fact that the passenger has neither the choice nor control over the carrier in
the selection and use of the equipment and appliances in use by the carrier.
(Necesito, et al. vs. Paras, et al., 104 Phil. 75)
4. Conclusion of act of God conjectural and speculative The lower
courts conclusion that the accident was caused by a fortuitous event or an
act of God brought about by some extraordinary circumstances independent
of the will of the Pantranco or its employees, is in large measure conjectural
and speculative, and was arrived at without due regard to all the
circumstances, as required by Article 1755.
5. Presumption of negligence when a passenger dies or is injured When
a passenger dies or is injured, the presumption is that the common carrier is
at fault or that it acted negligently (Article 1756). This presumption is only
rebutted by proof on the carriers part that it observed the extraordinary
diligence required in Article 1733 and the utmost diligence of very cautious
persons required in Article 1755 (Article 1756).
6. Carrier should give due regard for all circumstances in connection
with inspection The lower court considered the presumption rebutted on the
strength of Pantrancos evidence that only the day before the incident, the
cross-joint in question was duly inspected and found to be in order. It does not
appear, however, that the carrier gave due regard for all the circumstances in
connection with the said inspection. The bus in which the deceased were
riding was heavily laden with passengers, and it would be traversing
mountainous, circuitous and ascending roads. Thus the entire bus, including
its mechanical parts, would naturally be taxed more heavily than it would be
under ordinary circumstances. The mere fact that the bus was inspected only
recently and found to be in order would not exempt the carrier from liability
unless it is shown that the particular circumstances under which the bus
would travel were also considered.
Philippine Rabbit Bus Lines, Inc. vs. IAC
DOCTRINE
: (1) The principle of "the last clear" chance is applicable in a suit between the
owners and
drivers of the two colliding vehicles. It does not arise where a passenger
demands responsibility from the carrier to enforce its contractual obligations.
For it would be inequitable to exempt the negligent driver and its owners on
the ground that the other driver was likewise guilty of negligence.
(2)In culpa contractual, the moment a passenger dies or is injured, the carrier
is presumed to have
been at fault or to have acted negligently, and this disputable presumption
may only be overcome by evidence that he had observed extra-ordinary
diligence as prescribed in Articles 1733, 1755 and 1756 of the New Civil Code
or that the death or injury of the passenger was due to a fortuitous event.
(3) The driver cannot be held jointly and severally liable with the carrier in
case of breach of the contract of carriage. Firstly, the contract of carriage is
between the carrier and the passenger, and in the event of contractual
liability, the carrier is exclusively responsible to the passenger, even if such
breach be due to the negligence of his driver. In other words, the carrier can
neither shift his liability on the contract to his driver nor share it with him, for
his driver's negligence is his. Secondly, that would make the carrier's liability
personal instead of merely vicarious and consequently, entitled to recover
only the share which corresponds to the driver contradictory to the explicit
provision of Article 2181 of the New Civil Code.
Anuran V. Buno (1966)
FACTS:
January 12, 1958 noon: passenger jeepney owned by Pedro Gahol
and Luisa Alcantara and driven by Pepito Buo overloaded with (14-
16 passengers) was parked on the road to Taal, Batangas when a
speeding motor truck owned by Anselmo Maligaya and Ceferina Aro
driven by Guillermo Razon negligently bumped it from behind, with
such violence that three passengers died and two others suffered
injuries that required their confinement at the Provincial Hospital for
many days
Jeepney was parked to let a passenger alight in such a way
that 1/2 of its width (the left wheels) was on the asphalted
pavement of the road and the other half, on the right shoulder
of the road
suits were instituted by the representatives of the dead and of the
injured, to recover consequently damages against the driver and the
 owners of the truck and also against the driver and the owners of the
jeepney
CFI: absolving the driver of the jeepney and its owners, but it required
the truck driver and the owners to make compensation
CA: Affirmed exoneration of the jeepney
ISSUE: W/N the doctrine of last clear chance can apply so that truck driver
guilty of greater negligence which was the efficient cause of the collision will
be solely liable
HELD: NO. The three defendants last mentioned are required to pay solidarily
with the other defendants-respondents the amounts fixed by the appealed
decision.
New Civil Code requires "utmost diligence" from the carriers (Art.
1755) who are "presumed to have been at fault or to have acted
negligently, unless they prove that they have observed extraordinary
diligence" (Art. 1756)
principle about the "last clear chance" would call for application in a
suit between the owners and drivers of the two colliding vehicles. It
does not arise where a passenger demands responsibility from the
carrier to enforce its contractual obligations. For it would be
inequitable to exempt the negligent driver of the jeepney and its
owners on the ground that the other driver was likewise guilty of
negligence
Calalas v. CA
Facts:
Private respondent Eliza Jujeurche G. Sunga took a passenger jeepney
owned and operated by petitioner Vicente Calalas. As the jeepney was
already full, Calalas gave Sunga an stool at the back of the door at the rear
end of the vehicle. Along the way, the jeepney stopped to let a passenger off.
Sunga stepped down to give way when an Isuzu truck owned by Francisco
Salva and driven by Iglecerio Verena bumped the jeepney. As a result, Sunga
was injured. Sunga filed a complaint against Calalas for violation of contract of
carriage. Calalas filed a third party complaint against Salva. The trial court
held Salva liable and absolved Calalas, taking cognisance of another civil
case for quasi-delict wherein Salva and Verena were held liable to Calalas.
The Court of Appeals reversed the decision and found Calalas liable to Sunga
for violation of contract of carriage.
Issues:
(1) Whether the decision in the case for quasi delict between Calalas on one
hand and Salva and Verena on the other hand, is res judicata to the issue in
this case
(2) Whether Calalas exercised the extraordinary diligence required in the
contract of carriage
(3) Whether moral damages should be awarded
Held:
(1) The argument that Sunga is bound by the ruling in Civil Case No. 3490
finding the driver and the owner of the truck liable for quasi-delict ignores the
fact that she was never a party to that case and, therefore, the principle of res
judicata does not apply. Nor are the issues in Civil Case No. 3490 and in the
present case the same. The issue in Civil Case No. 3490 was whether Salva
and his driver Verena were liable for quasi-delict for the damage caused to
petitioner's jeepney. On the other hand, the issue in this case is whether
petitioner is liable on his contract of carriage. The first, quasi-delict, also
known as culpa aquiliana or culpa extra contractual, has as its source the
negligence of the tortfeasor. The second, breach of contract or culpa
contractual, is premised upon the negligence in the performance of a
contractual obligation. Consequently, in quasi-delict, the negligence or fault
should be clearly established because it is the basis of the action, whereas in
breach of contract, the action can be prosecuted merely by proving the
existence of the contract and the fact that the obligor, in this case the common
carrier, failed to transport his passenger safely to his destination. In case of
death or injuries to passengers, Art. 1756 of the Civil Code provides that
common carriers are presumed to have been at fault or to have acted
negligently unless they prove that they observed extraordinary diligence as
defined in Arts. 1733 and 1755 of the Code. This provision necessarily shifts
to the common carrier the burden of proof. It is immaterial that the proximate
cause of the collision between the jeepney and the truck was the negligence
of the truck driver. The doctrine of proximate cause is applicable only in
actions for quasi-delict, not in actions involving breach of contract. The
doctrine is a device for imputing liability to a person where there is no relation
between him and another party. In such a case, the obligation is created by
law itself. But, where there is a pre-existing contractual relation between the
parties, it is the parties themselves who create the obligation, and the function
of the law is merely to regulate the relation thus created.
(2) We do not think so. First, the jeepney was not properly parked, its rear
portion being exposed about two meters from the broad shoulders of the
highway, and facing the middle of the highway in a diagonal angle. Second, it
is undisputed that petitioner's driver took in more passengers than the allowed
seating capacity of the jeepney. The fact that Sunga was seated in an
"extension seat" placed her in a peril greater than that to which the other
passengers were exposed. Therefore, not only was petitioner unable to
overcome the presumption of negligence imposed on him for the injury
sustained by Sunga, but also, the evidence shows he was actually negligent
in transporting passengers. We find it hard to give serious thought to
petitioner's contention that Sunga's taking an "extension seat" amounted to an
implied assumption of risk. It is akin to arguing that the injuries to the many
victims of the tragedies in our seas should not be compensated merely
because those passengers assumed a greater risk of drowning by boarding
an overloaded ferry. This is also true of petitioner's contention that the
jeepney being bumped while it was improperly parked constitutes caso
fortuito. A caso fortuito is an event which could not be foreseen, or which,
though foreseen, was inevitable. This requires that the following requirements
be present: (a) the cause of the breach is independent of the debtor's will; (b)
the event is unforeseeable or unavoidable; (c) the event is such as to render it
impossible for the debtor to fulfill his obligation in a normal manner, and (d)
the debtor did not take part in causing the injury to the creditor. Petitioner
should have foreseen the danger of parking his jeepney with its body
protruding two meters into the highway.
(3) As a general rule, moral damages are not recoverable in actions for
damages predicated on a breach of contract for it is not one of the items
enumerated under Art. 2219 of the Civil Code. As an exception, such
damages are recoverable: (1) in cases in which the mishap results in the
death of a passenger, as provided in Art. 1764, in relation to Art. 2206(3) of
the Civil Code; and (2) in the cases in which the carrier is guilty of fraud or
bad faith, as provided in Art. 2220. In this case, there is no legal basis for
awarding moral damages since there was no factual finding by the appellate
court that petitioner acted in bad faith in the performance of the contract of
carriage.
Sarkies Tours Phils. V. IAC
Facts:
On August 31, 1984, Fatima boarded petitioners bus from Manila to Legazpi.
Her belongings consisting of 3 bags were kept at the baggage compartment
of the bus, but during the stopover in Daet, it was discovered that only one
remained. The others might have dropped along the way. Other passengers
suggested having the route traced, but the driver ignored it. Fatima
immediately told the incident to her mother, who went to petitioners office in
Legazpi and later in Manila. Petitioner offered P1,000 for each bag, but she
turned it down. Disapointed, she sought help from Philtranco bus drivers and
radio stations. One of the bags was recovered. She was told by petitioner that
a team is looking for the lost luggage. After nine months of fruitless waiting,
respondents filed a case to recover the lost items, as well as moral and
exemplary damages, attorneys fees and expenses of litigation. The trial court
ruled in favor of respondents, which decision was affirmed with modification
by the Court of Appeals, deleting moral and exemplary damages.
Issues:
(1) Whether petitioner is liable for the loss of the luggage
(2) Whether the damages sought should be recovered
Held:
(1) The cause of the loss in the case at bar was petitioner's negligence in not
ensuring that the doors of the baggage compartment of its bus were securely
fastened. As a result of this lack of care, almost all of the luggage was lost, to
the prejudice of the paying passengers.
(2) There is no dispute that of the three pieces of luggage of Fatima, only one
was recovered. Respondents had to shuttle between Bicol and Manila in their
efforts to be compensated for the loss. During the trial, Fatima and Marisol
had to travel from the United States just to be able to testify. Expenses were
also incurred in reconstituting their lost documents. Under these
circumstances, the Court agrees with the Court of Appeals in awarding
P30,000.00 for the lost items and P30,000.00 for the transportation expenses,
but disagrees with the deletion of the award of moral and exemplary damages
which, in view of the foregoing proven facts, with negligence and bad faith on
the fault of petitioner having been duly established, should be granted to
respondents in the amount of P20,000.00 and P5,000.00, respectively.
Marchan v. Mendoza
Facts:
A passenger bus of the Philippine Rabbit Bus Lines, driven by Silverio
Marchan, fell into a ditch while travelling on its way to Manila. As a result of
which respondents Arsenio Mendoza, his wife and child, passengers of the
said bus were thrown out to the ground resulting in their multiple injuries. It
was proven that the bus was traveling at high speed without due regard to the
safety of its passengers and that passengers complained and asked Machan,
the driver to slow down. On the contrary, Marchan increased its speed while
approaching a truck which was then parked, apparently to avoid collision with
the incoming vehicle from the opposite direction. The rear tires of the bus
skidded because of its high speed which caused the bus to fall into a ditch.
Subsequently, Marchan was convicted for physical injuries through reckless
imprudence.
Issue:
Whether or not Marchan and Philippine Rabbit Bus Lines are liable for
the injuries suffered by its passengers.
Held:
The Supreme Court held that the proximate cause of the accident was
the gross negligence of Marchan who when driving is expected to have
employed the highest degree of care. He should have been assiduously
prudent in handling his vehicle to insure the safety of his passengers. There is
no reason why he shouldnt stop the vehicle upon noticing a parked truck in
front of him. He must have taken precautionary measures in securing the
safety of his passengers. Philippine Rabbit is also liable because common
carriers cannot escape liability for the death or injuries to passengers through
the negligence and willful acts of the former's employees, although such
employees may have acted beyond the scope of their authority or in violation
of the orders. The awarding of compensatory damages is reasonable because
Arsenio Mendoza had suffered paralysis on the lower extremities, which will
incapacitate him to engage in his customary occupation throughout the
remaining years of his life. The awarding of exemplary damages likewise is
found just although the plaintiffs did not specify such claim. The court is called
upon the exercise and can use its discretion in the imposition of punitive or
exemplary damages even though not expressly prayed or pleaded in the
plaintiffs' complaint.
Maranan vs. Perez
G.R. No. L-22272
Facts:
Rogelio Corachea, a passenger in a taxicab owned and operated by Pascual
Perez, was stabbed and killed by the driver, Simeon Valenzuela. Valenzuela
was found guilty for homicide by the Court of First Instance and was
sentenced to suffer Imprisonment and to indemnify the heirs of the deceased
in the sum of P6000. While pending appeal, mother of deceased filed an
action in the Court of First Instance of Batangas to recover damages from
Perez and Valenzuela. Defendant Perez claimed that the death was a caso
fortuito for which the carrier was not liable. The court a quo, after trial, found
for the plaintiff and awarded her P3,000 as damages against defendant
Perez. The claim against defendant Valenzuela was dismissed. From this
ruling, both plaintiff and defendant Perez appealed to this Court, the former
asking for more damages and the latter insisting on non-liability. Defendant-
appellant relied solely on the ruling enunciated in Gillaco vs. Manila Railroad
Co. that the carrier is under no absolute liability for assaults of its employees
upon the passengers.
Issue:
Whether or not Perez should be held liable for the death of the passenger?
Held:
Yes. The basis of the carrier's liability for assaults on passengers committed
by its drivers rests on the principle that it is the carrier's implied duty to
transport the passenger safely. As between the carrier and the passenger, the
former must bear the risk of wrongful acts or negligence of the carrier's
employees against passengers, since it, and not the passengers, has power
to select and remove them. Common carriers are liable for the death of or
injuries to passengers through the negligence or willful acts of the formers
employees, although such employees may have acted beyond the scope of
their authority or in violation of the orders of the common carriers. The 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. (Art. 1759)
The attendant facts and controlling law of that case and the one at bar were
very different. In the Gillaco case, the passenger was killed outside the scope
and the course of duty of the guilty employee. The Gillaco case was decided
under the provisions of the Civil Code of 1889 which, unlike the present Civil
Code, did not impose upon common carriers absolute liability for the safety of
passengers against willful assaults or negligent acts committed by their
employees. The death of the passenger in the Gillaco case was truly a
fortuitous event which exempted the carrier from liability. It is true that Art.
1105 of the old Civil Code on fortuitous events has been substantially
reproduced in Art. 1174 of the Civil Code of the Philippines but both articles
clearly remove from their exempting effect the case where the law expressly
provides for liability in spite of the occurrence of force majeure. The Civil Code
provisions on the subject of Common Carriers are new and were taken from
Anglo-American Law. The basis of the carrier's liability for assaults on
passengers committed by its drivers rested either on the doctrine of
respondent superior or the principle that it was the carrier's implied duty to
transport the passenger safely. Under the second view, upheld by the majority
and also by the later cases, it was enough that the assault happens within the
course of the employee's duty. It was no defense for the carrier that the act
was done in excess of authority or in disobedience of the carrier's orders. The
carrier's liability here was absolute in the sense that it practically secured the
passengers from assaults committed by its own employees.
COMPANIA MARITIMA VS. CA | 1988
FACTS
- Private respondent Concepcion of Consolidated Construction had a contract
with the Civil Aeronautics Administration for the construction of the airport in
Cagayan de Oro.
- Being a Manila-based contractor, Concepcion had to ship his construction
equipment to CDO City. Concepcion negotiated with petitioner Compania for
the shipment of one (1) unit payloader. A Bill of Lading was issued to him.
- The equipment was loaded aboard the MV. It arrived safely in CDO City.
While the payloader was about two (2) meters above the pier in the course of
unloading, the swivel pin of the heel block Hatch No. 2 gave way, causing the
payloader to fall. The payloader was completely damaged.
- Meanwhile, petitioner Compania shipped the payloader to Manila where it
was weighed at the SMC. Finding that the payloader weighed 7.5 tons and
not 2.5 tons as declared in the Bill of Lading, petitioner denied the claim for
damages, contending that had Concepcion declared the actual weight of the
payloader, damage to the payloader could have been prevented.
- Concepcion filed an action for damages.
- CFI: dismissed; the proximate cause of the fall of the payloader was
Concepcion's act or omission in having misrepresented the weight of the
payloader, which underdeclaration led the Chief Officer of the vessel to use
the heel block of hatch No. 2 (which only has a 5-ton capacity) in unloading
the payloader.
- CA reversed. Ordered Petitioner to pay Concepcion. But reduced the value
of the payloader by 20% due to Concepcions contributory negligence.
ISSUE/S & HELD:
WON the act of private respondent Concepcion in furnishing petitioner
Compaia Maritima with an inaccurate weight was the proximate cause of the
damage, as would absolutely exempt petitioner from liability for damages. NO.
RATIONALE
- Petitioner argues: The loss, destruction, or deterioration of the goods was
due to an act or omission of the shipper or owner of the goods (Art. 1734).
- SC: Mere proof of delivery of the goods in good order to a common carrier,
and of their arrival at the place of destination in bad order, makes out prima
facie case against the common carrier, so that if no explanation is given as to
how the loss, deterioration or destruction of the goods occurred, the common
carrier must be held responsible.
- The extraordinary diligence in the vigilance over goods requires common
carriers to render service with the greatest skill and foresight and "to use all
reasonable means to ascertain the nature and characteristic of goods
tendered for shipment, and to exercise due care in the handling and stowage.
- In the case at bar: Petitioner, upon the testimonies of its own crew, failed to
take the necessary and adequate precautions for avoiding damage to the
payloader.
- CA found that petitioner used a 5-ton capacity lifting apparatus to lift and
unload a visibly heavy cargo like a payloader. There was laxity and
carelessness of petitioner's crew in their methods of ascertaining the weight of
heavy cargoes offered for shipment before loading and unloading them.
- The weight submitted by private respondent Concepcion was entered into
the bill of lading by petitioners company collector, without seeing the
equipment to be shipped.
-
Mr. Mariano Gupana, assistant traffic manager of petitioner, confirmed in his
testimony that the company never checked the information entered in the bill
of lading.
- The Chief Officer took the bill of lading on its face value and presumed the
same to be correct by merely "seeing" it.
- Acknowledging that there was a "jumbo" in the MV Cebu (w/ a 20-25 ton
capacity), The Chief Officer chose not to use it. Extraordinary care and
diligence compel the use of the "jumbo" lifting apparatus as the most prudent
course for petitioner.
- 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 equitably reduced.
- We find equitable the conclusion of the Court of Appeals reducing the
recoverable amount of damages by 20%. Decision AFFIMED.
Nicholas Cervantes v. CA
Facts:
 In compliance with a Compromise Agreement entered into by the
contending parties, PAL issued to petitioner Nicholas Cervantes on March 27,
1989, a round trip ticket for Manila-Honolulu-Los Angeles-Honolulu-Manila.
Such ticket expressly provided an expiry date of one year from issuance. Four
days before the expiration of the subject ticket, Cervantes used it. Upon his
arrival in Los Angeles, he immediately booked his return ticket to Manila with
PAL. The same was confirmed for April 2, 1990. Upon learning that PAL was
making a stop-over to San Francisco, Cervantes made arrangements with
PAL for him to board such flight. On April 2, when Cervantes checked in the
PAL counter in San Francisco, he was not allowed to board. The PAL
personnel marked ticket TICKET NOT ACCEPTED DUE TO EXPIRATION
OF VALIDITY on his ticket. Cervantes filed a complaint for breach of
contract.
Issue:
Whether or not PAL is liable for breach of contract.
Held:
The Supreme Court held that PAL is not liable. Petitioner Cervantes
was fully aware that there was a need to send a letter to the legal counsel of
PAL for the extension of the period of validity of his ticket. The PAL agent was
not privy to the said agreement, thus the agent acted without authority when
they confirmed the flights of the petitioner. When the petitioner knows that the
agent was acting beyond his power, the principal cannot be held liable for the
acts of the agent. It further held that Cervantes acted in bad faith since he
bought a back-up ticket to ensure his departure. The employees of PAL were
guilty only of simple negligence.
Cango v. Manila Railroad
Facts: On January 20, 1915, Cangco was riding the train of Manila Railroad
Co (MRC). He was an employee of the latter and he was given a pass so that
he could ride the train for free. When he was nearing his destination at about
7pm, he arose from his seat even though the train was not at full stop. When
he was about to alight from the train (which was still slightly moving) he
accidentally stepped on a sack of watermelons which he failed to notice due
to the fact that it was dim. This caused him to lose his balance at the door and
he fell and his arm was crushed by the train and he suffered other serious
injuries. He was dragged a few meters more as the train slowed down.
It was established that the employees of MRC were negligent in piling the
sacks of watermelons. MRC raised as a defense the fact that Cangco was
also negligent as he failed to exercise diligence in alighting from the train as
he did not wait for it to stop.
ISSUE: Whether or not Manila Railroad Co is liable for damages.
HELD: Yes. Alighting from a moving train while it is slowing down is a
common practice and a lot of people are doing so every day without suffering
injury. Cangco has the vigor and agility of young manhood, and it was by no
means so risky for him to get off while the train was yet moving as the same
act would have been in an aged or feeble person. He was also ignorant of the
fact that sacks of watermelons were there as there were no appropriate
warnings and the place was dimly lit.
But, if the master has not been guilty of any negligence whatever in the
selection and direction of the servant, he is not liable for the acts of the latter,
whatever done within the scope of his employment or not, if the damage done
by the servant does not amount to a breach of the contract between the
master and the person injured.
The liability arising from extra-contractual culpa is always based upon a
voluntary act or omission which, without willful intent, but by mere negligence
or inattention, has caused damage to another.
These two fields, figuratively speaking, concentric; that is to say, the mere fact
that a person is bound to another by contract does not relieve him from extra-
contractual liability to such person. When such a contractual relation exists
the obligor may break the contract under such conditions that the same act
which constitutes the source of an extra-contractual obligation had no contract
existed between the parties.
Manresa: Whether negligence occurs an incident in the course of the
performance of a contractual undertaking or in itself the source of an extra-
contractual undertaking obligation, its essential characteristics are identical.
Vinculum Juris: (def) It means an obligation of law, or the right of the
obligee to enforce a civil matter in a court of law.
Philippine National Railways (PNR) vs.
CAf (GR L-55347, 4 October 1985)
Facts:
On 10 September 1972, at about 9:00 p.m.,
Winifredo Tupang, husband of Rosario
 Tupang, boarded Train 516 of the Philippine
National Railways at Libmanan, Camarines
Sur, as a paying passenger bound for Manila.
Due to some mechanical defect, the train
stopped at Sipocot, Camarines Sur, for
repairs, taking some two hours before the
train could resume its trip to Manila.
Unfortunately, upon passing Iyam Bridge at
Lucena, Quezon, Winifredo Tupang fell off
the train resulting in his death. The train did
not stop despite the alarm raised by the
other passengers that somebody fell from
the train. Instead, the train conductor,
Perfecto Abrazado, called the station agent
at Candelaria, Quezon, and requested for
verification of the information. Police
authorities of Lucena City were dispatched to
the Iyam Bridge where they found the lifeless
body of Winifredo Tupang. As shown by the
autopsy report, Winifredo Tupang died of
cardio-respiratory failure due to massive
cerebral hemorrhage due to traumatic injury.
Tupang was later buried in the public
cemetery of Lucena City by the local police
authorities.
Upon complaint filed by the deceaseds
widow, Rosario Tupang, the then CFI Rizal,
after trial, held the PNR liable for damages
for breach of contract of carriage and
ordered it to pay Rosario Tupang the sum of
P12,000.00 for the death of Winifredo
Tupang, plus P20,000.00 for loss of his
earning capacity, and the further sum of
P10,000.00 as moral damages, and
P2,000.00 as attorneys fees, and cost.
On appeal, the Appellate Court sustained the
holding of the trial court that the PNR did not
exercise the utmost diligence required by
law of a common carrier. It further increased
the amount adjudicated by the trial court by
ordering PNR to pay the Rosario Tupang an
additional sum of P5,000,00 as exemplary
damages. Moving for reconsideration of the
above decision, the PNR raised for the first
time, as a defense, the doctrine of state
immunity from suit. The motion was denied.
Hence the petition for review.
I
ssue:
WON there was contributory
negligence on the part of Tupang.
Held:
PNR has the obligation to transport its
passengers to their destinations and to
observe extraordinary diligence in doing so.
Death or any injury suffered by any of its
passengers gives rise to the presumption
that it was negligent in the performance of
its obligation under the contract of carriage.
PNR failed to overthrow such presumption of
negligence with clear and convincing
evidence, inasmuch as PNR does not deny,
(1) that the train boarded by the deceased
Winifredo Tupang was so overcrowded that
he and many other passengers had no
choice but to sit on the open platforms
between the coaches of the train, (2) that
the train did not even slow down when it
approached the Iyam Bridge which was
under repair at the time, and (3) that neither
did the train stop, despite the alarm raised
by other passengers that a person had fallen
off the train at Iyam Bridge.
While PNR failed to exercise extraordinary
diligence as required by law, it appears that
the deceased was chargeable with
contributory negligence. Since he opted to
sit on the open platform between the
coaches of the train, he should have held
tightly and tenaciously on the upright metal
bar found at the side of said platform to
avoid falling off from the speeding train.
Such contributory negligence, while not
exempting the PNR from liability,
nevertheless justified the deletion of the
amount adjudicated as moral damages.