73764730 Transpo Digests

7/29/2019 73764730 Transpo Digests

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G.R. No. 179446 January 10, 2011LOADMASTERS CUSTOMS SERVICES, INC., Petitioner,vs.GLODEL BROKERAGE CORPORATION and R&B INSURANCECORPORATION, Respondents.

Facts: On August 28, 2001, R&B Insurance issued Marine Policy No. MN-00105/2001 in favorof Columbia to insure the shipment of 132 bundles of electric copper cathodes against AllRisks. On August 28, 2001, the cargoes were shipped on board the vessel "Richard Rey"from Isabela, Leyte, to Pier 10, North Harbor, Manila. They arrived on the same date.

Columbia engaged the services of Glodel for the release and withdrawal of thecargoes from the pier and the subsequent delivery to its warehouses/plants. Glodel, in turn,engaged the services of Loadmasters for the use of its delivery trucks to transport thecargoes to Columbias warehouses/plants in Bulacan and Valenzuela City.

The goods were loaded on board twelve (12) trucks owned by Loadmasters, driven by itsemployed drivers and accompanied by its employed truck helpers. Six (6) truckloads ofcopper cathodes were to be delivered to Balagtas, Bulacan, while the other six (6)truckloads were destined for Lawang Bato, Valenzuela City. The cargoes in six truckloads forLawang Bato were duly delivered in Columbias warehouses there. Of the six (6) trucks en

route to Balagtas, Bulacan, however, only five (5) reached the destination. One (1) truck,loaded with 11 bundles or 232 pieces of copper cathodes, failed to deliver its cargo.Later on, the said truck, an Isuzu with Plate No. NSD-117, was recovered but without

the copper cathodes. Because of this incident, Columbia filed with R&B Insurance a claim forinsurance indemnity in the amount ofP1,903,335.39. After the requisite investigation andadjustment, R&B Insurance paid Columbia the amount ofP1,896,789.62 as insuranceindemnity.

R&B Insurance, thereafter, filed a complaint for damages against both Loadmasters

and Glodel before the Regional Trial Court, Branch 14, Manila (RTC), docketed as Civil Case

No. 02-103040. It sought reimbursement of the amount it had paid to Columbia for the loss

of the subject cargo. It claimed that it had been subrogated "to the right of the consignee to

recover from the party/parties who may be held legally liable for the loss."

Issue: Whether or not Loadmasters and Glodel are common carriers.

Held: Under Article 1732 of the Civil Code, common carriers are persons, corporations,firms, or associations engaged in the business of carrying or transporting passenger orgoods, or both by land, water or air for compensation, offering their services to the public.

Based on the aforecited definition, Loadmasters is a common carrier because it isengaged in the business of transporting goods by land, through its trucking service. It is acommon carrier as distinguished from a private carrier wherein the carriage is generallyundertaken by special agreement and it does not hold itself out to carry goods for thegeneral public. The distinction is significant in the sense that "the rights and obligations ofthe parties to a contract of private carriage are governed principally by their stipulations,not by the law on common carriers."

In the same vein, Glodel is also considered a common carrier within the context ofArticle 1732. In its Memorandum, it states that it "is a corporation duly organized and

existing under the laws of the Republic of the Philippines and is engaged in the business of

customs brokering." It cannot be considered otherwise because as held by this Court

in Schmitz Transport & Brokerage Corporation v. Transport Venture, Inc., a customs broker is

also regarded as a common carrier, the transportation of goods being an integral part of its

business.


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G.R. No. 171092 March 15, 2010EDNA DIAGO LHUILLIER, Petitioner,vs.BRITISH AIRWAYS, Respondent.

Facts: On April 28, 2005, petitioner Edna Diago Lhuillier filed a Complaint2 for damagesagainst respondent British Airways before the Regional Trial Court (RTC) of Makati City. Shealleged that on February 28, 2005, she took respondents flight 548 from London, UnitedKingdom to Rome, Italy. Once on board, she allegedly requested Julian Halliday (Halliday),one of the respondents flight attendants, to assist her in placing her hand-carried luggagein the overhead bin. However, Halliday allegedly refused to help and assist her, and evensarcastically remarked that "If I were to help all 300 passengers in this flight, I would have abroken back!"

Petitioner further alleged that when the plane was about to land in Rome, Italy,another flight attendant, Nickolas Kerrigan (Kerrigan), singled her out from among all thepassengers in the business class section to lecture on plane safety. Allegedly, Kerrigan madeher appear to the other passengers to be ignorant, uneducated, stupid, and in need oflecturing on the safety rules and regulations of the plane. Affronted, petitioner assuredKerrigan that she knew the planes safety regulations being a frequent traveler. Thereupon,Kerrigan allegedly thrust his face a mere few centimeters away from that of the petitionerand menacingly told her that "We dont like your attitude."

Upon arrival in Rome, petitioner complained to respondents ground manager anddemanded an apology. However, the latter declared that the flight stewards were "onlydoing their job."

Thus, petitioner filed the complaint for damages, praying that respondent be orderedto pay P5 million as moral damages, P2 million as nominal damages, P1 million asexemplary damages, P300,000.00 as attorneys fees,P200,000.00 as litigation expenses,and cost of the suit.

Issue: Whether Philippine courts have jurisdiction over a tortious conduct committed

against a Filipino citizen and resident by airline personnel of a foreign carrier travelling

beyond the territorial limit of any foreign country; and thus is outside the ambit of the

Warsaw Convention.

Held: The Warsaw Convention applies because the air travel, where the alleged tortiousconduct occurred, was between the United Kingdom and Italy, which are both signatories to

the Warsaw Convention.Article 1 of the Warsaw Convention provides:

1. This Convention applies to all international carriage of persons, luggage or goodsperformed by aircraft for reward. It applies equally to gratuitous carriage by aircraftperformed by an air transport undertaking.2. For the purposes of this Convention the expression "international carriage" meansany carriage in which, according to the contract made by the parties, the place ofdeparture and the place of destination, whether or not there be a break in thecarriage or a transhipment, are situated either within the territories of two High
http://www.lawphil.net/judjuris/juri2010/mar2010/gr_171092_2010.html#fnt2http://www.lawphil.net/judjuris/juri2010/mar2010/gr_171092_2010.html#fnt2


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Contracting Parties, or within the territory of a single High Contracting Party, if thereis an agreed stopping place within a territory subject to the sovereignty, suzerainty,mandate or authority of another Power, even though that Power is not a party to thisConvention. A carriage without such an agreed stopping place between territoriessubject to the sovereignty, suzerainty, mandate or authority of the same HighContracting Party is not deemed to be international for the purposes of this

Convention. (Emphasis supplied)Thus, when the place of departure and the place of destination in a contract of carriage aresituated within the territories of two High Contracting Parties, said carriage is deemed an"international carriage". The High Contracting Parties referred to herein were the signatoriesto the Warsaw Convention and those which subsequently adhered to it.

In the case at bench, petitioners place of departure was London, United Kingdomwhile her place of destination was Rome, Italy. Both the United Kingdom and Italy signedand ratified the Warsaw Convention. As such, the transport of the petitioner is deemed to bean "international carriage" within the contemplation of the Warsaw Convention.

G.R. No. 186312 June 29, 2010SPOUSES DANTE CRUZ and LEONORA CRUZ, Petitioners,

vs.SUN HOLIDAYS, INC., Respondent.

Facts: Spouses Dante and Leonora Cruz (petitioners) lodged a Complaint on January 25,

2001 against Sun Holidays, Inc. (respondent) with the Regional Trial Court (RTC) of Pasig

City for damages arising from the death of their son Ruelito C. Cruz (Ruelito) who perished

with his wife on September 11, 2000 on board the boat M/B Coco Beach III that capsized en

route to Batangas from Puerto Galera, Oriental Mindoro where the couple had stayed at

Coco Beach Island Resort (Resort) owned and operated by respondent.

On September 11, 2000, as it was still windy, Matute and 25 other Resort guestsincluding petitioners son and his wife trekked to the other side of the Coco Beach mountainthat was sheltered from the wind where they boarded M/B Coco Beach III, which was to ferry

them to Batangas.Shortly after the boat sailed, it started to rain. As it moved farther away from PuertoGalera and into the open seas, the rain and wind got stronger, causing the boat to tilt fromside to side and the captain to step forward to the front, leaving the wheel to one of thecrew members.

The waves got more unwieldy. After getting hit by two big waves which came oneafter the other, M/B Coco Beach III capsized putting all passengers underwater. Thepassengers, who had put on their life jackets, struggled to get out of the boat. Upon seeingthe captain, Matute and the other passengers who reached the surface asked him what theycould do to save the people who were still trapped under the boat. The captain replied"Iligtas niyo na lang ang sarili niyo" (Just save yourselves).

Help came after about 45 minutes when two boats owned by Asia Divers in Sabang,Puerto Galera passed by the capsized M/B Coco Beach III. Boarded on those two boats were

22 persons, consisting of 18 passengers and four crew members, who were brought to PisaIsland. Eight passengers, including petitioners son and his wife, died during the incident.

Issue: Whether or not respondent is a common carrier.

Held: The Civil Code defines "common carriers" in the following terms:Article 1732. Common carriers are persons, corporations, firms or associations engaged inthe business of carrying or transporting passengers or goods or both, by land, water, or airfor compensation, offering their services to the public.


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The above article makes no distinction between one whose principalbusiness activity is the carrying of persons or goods or both, and one who does suchcarrying only as an ancillary activity (in local idiom, as "a sideline"). Article 1732 alsocarefully avoids making any distinction between a person or enterprise offeringtransportation service on a regular or scheduled basis and one offering such service onan 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 orpopulation, and one who offers services or solicits business only from a narrow segment ofthe general population. We think that Article 1733 deliberately refrained from making suchdistinctions.

Indeed, respondent is a common carrier. Its ferry services are so intertwined with itsmain business as to be properly considered ancillary thereto. The constancy of respondentsferry services in its resort operations is underscored by its having its own Coco Beach boats.And the tour packages it offers, which include the ferry services, may be availed of byanyone who can afford to pay the same. These services are thus available to the public.

That respondent does not charge a separate fee or fare for its ferry services is of nomoment. It would be imprudent to suppose that it provides said services at a loss. The Courtis aware of the practice of beach resort operators offering tour packages to factor thetransportation fee in arriving at the tour package price. That guests who opt not to avail ofrespondents ferry services pay the same amount is likewise inconsequential. These guestsmay only be deemed to have overpaid.

G.R. No. 166250 July 26, 2010UNSWORTH TRANSPORT INTERNATIONAL (PHILS.), INC., Petitioner,vs.COURT OF APPEALS and PIONEER INSURANCE AND SURETYCORPORATION, Respondents.

Facts: On August 31, 1992, the shipper Sylvex Purchasing Corporation delivered to UTI ashipment of 27 drums of various raw materials for pharmaceutical manufacturing, consistingof: "1) 3 drums (of) extracts, flavoring liquid, flammable liquid x x x banana flavoring; 2) 2drums (of) flammable liquids x x x turpentine oil; 2 pallets. STC: 40 bags dried yeast; and 3)

20 drums (of) Vitabs: Vitamin B Complex Extract." UTI issued Bill of Lading No.C320/C15991-2, covering the aforesaid shipment. The subject shipment was insured withprivate respondent Pioneer Insurance and Surety Corporation in favor of Unilab against allrisks in the amount of P1,779,664.77 under and by virtue of Marine Risk Note Number MCRM UL 0627 92 and Open Cargo Policy No. HO-022-RIU.

On the same day that the bill of lading was issued, the shipment was loaded in asealed 1x40 container van, with no. APLU-982012, boarded on APLs vessel M/V "Pres.

Jackson," Voyage 42, and transshipped to APLs M/V "Pres. Taft" for delivery to petitioner infavor of the consignee United Laboratories, Inc. (Unilab).

On September 30, 1992, the shipment arrived at the port of Manila. On October 6,1992, petitioner received the said shipment in its warehouse after it stamped the Permit toDeliver Imported Goods procured by the Champs Customs Brokerage. Three days thereafter,or on October 9, 1992, Oceanica Cargo Marine Surveyors Corporation (OCMSC) conducted astripping survey of the shipment located in petitioners warehouse.

Consequently, Unilabs quality control representative rejected one paper bagcontaining dried yeast and one steel drum containing Vitamin B Complex as unfit for theintended purpose. On November 7, 1992, Unilab filed a formal claim for the damage againstprivate respondent and UTI. On November 20, 1992, UTI denied liability on the basis of thegate pass issued by Jardine that the goods were in complete and good condition; whileprivate respondent paid the claimed amount on March 23, 1993. By virtue of the Loss andSubrogation Receipt issued by Unilab in favor of private respondent, the latter filed acomplaint for Damages against APL, UTI and petitioner with the RTC of Makati.


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Issue: Whether or not petitioner is a common carrier.

Held: Admittedly, petitioner is a freight forwarder. The term "freight forwarder" refers to a

firm holding itself out to the general public (other than as a pipeline, rail, motor, or water

carrier) to provide transportation of property for compensation and, in the ordinary course of

its business, (1) to assemble and consolidate, or to provide for assembling and

consolidating, shipments, and to perform or provide for break-bulk and distribution

operations of the shipments; (2) to assume responsibility for the transportation of goods

from the place of receipt to the place of destination; and (3) to use for any part of the

transportation a carrier subject to the federal law pertaining to common carriers.

A freight forwarders liability is limited to damages arising from its own negligence,

including negligence in choosing the carrier; however, where the forwarder contracts to

deliver goods to their destination instead of merely arranging for their transportation, it

becomes liable as a common carrier for loss or damage to goods. A freight forwarder

assumes the responsibility of a carrier, which actually executes the transport, even though

the forwarder does not carry the merchandise itself.

Undoubtedly, UTI is liable as a common carrier. Common carriers, as a general rule,

are presumed to have been at fault or negligent if the goods they transported deterioratedor got lost or destroyed. That is, unless they prove that they exercised extraordinary

diligence in transporting the goods. In order to avoid responsibility for any loss or damage,

therefore, they have the burden of proving that they observed such diligence. 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. If

no adequate explanation is given as to how the deterioration, loss, or destruction of the

goods happened, the transporter shall be held responsible.

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73764730 Transpo Digests