Law on Transportation Case PDF

7/28/2019 Law on Transportation Case PDF

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LAW ON

TRANSPORTATION


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I. CONCEPT OF COMMON CARRIER

1. DefinitionArticle 1732 NCC,

De Guzman vs. Court of Appeals 168 SCRA 612 (1993)Planters Products Inc vs. CA 226 SCRA 76 (1993)

2. CharacteristicsFisher vs. Yangco Steamship Co. 31 Phil 1 (1915)US vs. Quinahon 31 Phil 189Loadstar Shipping Co., Inc. vs. Court of Appeals 315 SCRA 339 (1999)First Phil. Industrial vs. Court of Appeals 300 SCRA 661 (1998)

3. Distinguished from Private CarrierHome Insurance Co. vs. Americ an Steamship 23 SCRA 24 (1968)San Pablo vs. Pantranco 153 SCRA 199 (1987)National Steel Corp. vs. Court of Appeals 283 SCRA 45 (1997)

4. Government Regulation of Common Carriers Business KMU Labor Center vs. Garcia, Jr. 239 SCRA 386 (1994)Tatad vs. Garcia, Jr. 241 SCRA 334 (1997)

5. Governing LawSamar Mining Co., Inc. vs. Nordeutscher Llyod 132 SCRA 529 (1984)Eastern Shipping Lines vs. IAC 150 SCRA 464 (1984)

National Development Co. vs. Court of Appeals 164 SCRA 593 (1988)

II. CONTRACTUAL EFFECTS

A. VIGILANCE OVER GOODS

1. Extra-ordinary Diligence Required of Common Carriers (Article 1733, NCC)a. Registered Owner Rule

Gelisan vs. Alday 154 SCRA 388 (1987)Benedicto vs. IAC 187 SCRA 547 (1990)Philtranco Service Enterprises, Inc. vs. CA 273 SCRA 562 (1997)

b. Kabit System Santos vs. Sibug 104 SCRA 520 (1981)Lita Enterprises, Inc. vs. CA 148 SCRA 347 (1987)Teja Marketing vs. IAC 148 SCRA 347 (1987)

c. Boundary SystemMagboo vs. Bernardo 7 SCRA 952 (1963)


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2. Liability of Carriers for Loss, Destruction and Deterioration of Goods; Exceptions;Presumption of Negligence

Articles 1734-1735; Articles 1739-1743Eastern Shipping Lines vs. IAC, supraGanzon vs. CA 161 SCRA 646 (1985)Eastern Shipping Lines vs. Court of Appeals 196 SCRA 570 (1991)Sarkies Tours Phils., Inc. vs. Court of Appeals 280 SCRA 58 (1997)Valenzuela Hardwood & Industrial Supply vs. Court of Appeals 274 SCRA 642 (1997)Yobido vs. Court of Appeals 281 SCRA 1 (1997)

3. Commencement, Duration and Termination of carriers responsibility over the goods (Articles1736-1738, NCC)

Compania Maritima vs. Insurance Co. of North Americ a 12 SCRA 213 (1964)Lu Do vs. Binamira 101 Phil. 120 (1957)

Americ an President Lines Ltd. vs. Klepper 110 PHIL 243Servando vs. Phil. Steam 117 SCRA 832 (1982)Ganzon vs. Court of Appeals, supraSaludo, Jr. vs. Court of Appeals 207 SCRA 498 (1992)Macam vs. Court of Appeals 313 SCRA 77 (1999)

4. Stipulations Limiting Carriers Liabilitya. Articles 1744-1745, NCC; Degree of Diligence

Reasonable time in the deliveryCase: Maersk Line vs. Court of Appeals 222 SCRA 108 (1993)

b. Articles 1749-1750, NCC; Amount of Liabil ity

Ysmael vs. Barretto 51 PHIL 90 (1927)Shewaram vs. Philippine Airlines 17 SCRA 606 (1966)Ong Yiu vs. Court of Appeals 91 SCRA 223 (1966)Sea Land Services, Inc. vs. Intermediate Appellate Court 153 SCRA 552 (1987)Citadel Lines, Inc. vs. Court of Appeals 184 SCRA 544 (1990)Everett Seamship Corp. vs. Court of Appeals 297 SCRA 496 (1998)British Airways vs. Court of Appeals 285 SCRA 450 (1998)H.E. Heacock Co. vs. Macondray & Co. 42 PHIL 205 (1921)

c. Void Stipulation (Art. 1745, NCC)Case: Sweet Lines vs. Teves 83 SCRA 361 (1978)

5. Passengers Baggages (Article 1754, NCC)Quisumbing, Sr. vs. Court of Appeals 189 SCRA 605 (1990)Pan Americ an Airlines vs. Rapadas 209 SCRA 67 (1992)British Airways vs. Court of Appeals, supraAlitalia vs. Intermediate Appellate Court 192 SCRA 9 (1990)


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B. SAFETY OF PASSENGERS

1. Utmost Diligence Required of Common Carriers (Article 1755, NCC)

Nocum vs. Laguna Tayabas bus. Co. vs. CA 83 SCRA 386 (1978)Mecenas vs. CA 180 SCRA 83 (1989)Negros Navigation Co., Inc. vs. CA 281 SCRA 717 (1997)Korean Airlines Co. Ltd. vs. CA 234 SCRA 14 (1999)Fortune Express, Inc. vs. CA 305 SCRA 14 (1999)Gatchalian vs. Delim 203 SCRA 126 (1991)Del Castillo vs. Jaymalin 112 SCRA 629 (1982)

A. Doctrine of Last Clear Chance

Philippine Rabbit Bus Lines vs. IAC 189 SCRA 158 (1990)Bustamante vs. CA 193 SCRA 603 (1991)

B. Accomodation PassengerLara vs. Valenc ia 104 SCRA 65 (1958)

C. Carrier not an insurer against all risksNecessito vs. Paras 104 Phil. 75 (1958)Japan Airlines vs. CA 294 SCRA 19 (1998)

D. Res Ipsa LoquiturLayugan vs. IAC 167 SCRA 363 (1988)

2. Commencement, Duration and Termination of Carriers Responsibi lity

La Mallorca vs. De Jesus 17 SCRA 739 (1966)Aboitiz Shipping Co. vs. Court of Appeals 179 SCRA 95 (1989)Mallari Sr. vs. Court of Appeals 324 SCRA 147 (2000)

3. Presumption of Negligence: Liability of Carriers for death or injury to passengers;Exceptions (Articles 1756-1758, NCC)

Bayasen vs. Court of Appeals 103 SCRA 197 (1981)Cervantes vs. Court of Appeals 304 SCRA 27 (1999)

Calalas vs. Court of Appeals 332 SCRA 356 (2000)Pestao vs. Sumayang 346 SCRA 870 (2000)

4. Negligence or intentional assault by carriers employee

Gillaco vs. Manila Railroad Co. 97 Phil. 884 (1955)Maranan vs. Perez 20 SCRA 412 (1967)

5. Passengers duty to observe diligence to avoid injury; contributory negligence


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PNR vs. Court of Appeals 139 SCRA 87 (1985)Isaac vs. Al Ammen Trans 101 Phil 1046 (1957)

6. Injury to passenger due to acts of co-passenger or stranger

Bachelor Express, Inc vs. Court of Appeals 188 SCRA 216 (1990)Fortune Express Inc. vs. CA, supra

III . DAMAGES (Article 1764, NCC)

A. Actual/Compensatory Damages (Arts. 2199, 2201, 2203, NCC)Cariaga vs. LTB Co., & MRR 110 PHIL 346 (1960)Villa Rey Transit, Inc. vs. Court of Appeals 31 SCRA 511 (1970)Pan American World Airways vs. IAC 153 SCRA 521 (1987)Gatchalian vs. Delim 203 SCRA 126 (1991)

1. Recovery for Physical InjuriesSoberano vs. MRR & Benguet Auto Line 18 SCRA 732 (1966)Marchan vs. Mendoza 24 SCRA 888 (1968)

2. Damages in case of deathDe Caliston vs. CA 122 SCRA 958 (1983)PAL vs. CA 185 SCRA 110 (1990)

B. Moral Damages (Arts. 2206, 2216-2217, 2219-2220, NCC)Cachero vs. Mani la Yellow Taxi Cab 101 Phil. 523 (1957)

Fores vs. Miranda 105 Phil. 266 (1959)Lopez vs. Pan Americ an 16 SCRA 431 (1966)Ortigas Jr. vs. Lufthansa 64 SCRA 610 (1975)Phil. Rabbit Bus Lines vs. Esguerra 117 SCRA 741 (1982)Sweet Lines vs. Court of Appeals 121 SCRA 769 (1983)Pan American World Airways vs. IAC, supraTransWorld Airlines vs. CA 165 SCRA 143 (1988)Armovit vs. Court of Appeals 184 SCRA 476 (1990)PAL vs. CA 106 SCRA 391

C. Exemplary Damages (Arts. 2229, 2232-2233, NCC)Prudenciado vs. Alliance Transport 148 SCRA 440 (1987)

Marchan vs. Mendoza,supra.


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SUMMARY OF

CASE DOCTRINES


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De Guzman vs. Court of Appeals

Article 1732 makes no distinction between one whose principal business activity is the carrying ofpersons or goods or both, and one who does such carrying only as an ancillary activity (in local Idiom as "asideline"). Article 1732 also carefully avoids making any distinction between a person or enterprise offeringtransportation 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 c arrier offering its servicesto the "general public," i.e., the general community or population, and one who offers services or solicitsbusiness only from a narrow segment of the general population.

The Court of Appeals referred to the fact that private respondent held no certificate of publicconvenience. A certificate of public convenience is not a requisite for the incurring of liability. That liabilityarises the moment a person or firm acts as a common carrier, without regard to whether or not such carrierhas also complied with the requirements of the applicable regulatory statute and implementing regulations

and has been granted a certificate of public convenience or other franchise. To exempt private respondentfrom the liabilities of a common carrier because he has not secured the necessary certificate of publicconvenience, would be offensive to sound public policy; that would be to reward private respondentprecisely for failing to comply with applicable statutory requirements.

Planters Products, Inc. vs. CA

It is not disputed that respondent carrier, in the ordinary course of business, operates as a commoncarrier, transporting goods indiscriminately for all persons. When petitioner chartered the vessel M/V "SunPlum", the ship captain, its officers and compliment were under the employ of the shipowner and thereforecontinued to be under its direct supervision and control. Hardly then can the charterer be charged, astranger to the crew and to the ship, with the duty of caring for his cargo when the charterer did not haveany control of the means in doing so. This is evident in the present case considering that the steering of theship, the manning of the decks, the determination of the course of the voyage and other technical inc identsof maritime navigation were all consigned to the officers and crew who were screened, chosen and hired bythe shipowner. It is therefore imperative that a public carrier shall remain as such, notwithstanding thecharter of the whole or portion of a vessel by one or more persons, provided the charter is lim ited to the shiponly, as in the case of a time-charter or voyage-charter. It is only when the charter includes both the vesseland its crew, that a common carrier becomes private, at least insofar as the particular voyage covering thecharter-party is concerned. Indubitably, a shipowner in a time or voyage charter retains possession andcontrol of the ship, although her holds may, for the moment, be the property of the charterer.

Fisher vs. Yangco

In construing Act 98 for the alleged violation, the test is whether the refusal of YSC to carry theexplosives without qualification or conditions may have the effect of subjecting any person or locality or thetraffic is such explosives to an unduly unreasonable or unnecessary prejudice or discrimination. Commoncarriers in this jurisdic tion cannot lawfully decline to accept a particular class of goods unless i t appears thatfor some sufficient reason the discrimination for such is reasonable and necessary. YSC has not met thoseconditions.


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The nature of the business of a common carrier as a public employment is such that it is within thepower of the State to impose such just regulations in the interest of the public as the legislator may deemproper.

US vs. Quinahon

There is no pretense that it actually cost more to handle the rice for the province than it did for themerchants with whom the special contracts were made. There was a clear discrimination against theprovince which is prohibited by the law. It is however not believed that the law prohibits common carriersfrom making special rates for the handling and transporting of merchandise, when the same are made forthe purpose of increasing their business and to manage their important interests upon the same principleswhich are regarded as sound and adopted in other trades and pursuits. Absolute equality is not required inall cases. It is only unjust, undue and unreasonable discrimination which the law forbids. The law of equalityis in force only where the services performed in the different cases are substantially the same and thecircumstances and conditions are similar.

Loadstar Shipping Co., Inc. vs. CA

Loadstar submits that the vessel was a private carrier because it was not issued a CPC; it did nothave a regular trip or schedule nor a fixed route; and there was only one shipper, one consignee for aspecial cargo.

The SC held that Loadstar is a common carrier. It is not necessary that the carrier be issued aCPC, and this character is not altered by the fact that the carriage of the goods in question was periodic,occasional, episodic or unscheduled.

First Philippine Industrial Corporation vs. CA

Based on Article 1732 NCC, there is no doubt that petitioner is a common carrier. It is engaged inthe business of transporting or carrying goods, i.e. petroleum products, for hire as a public employment. Itundertakes to carry for all persons indifferently, that is, to all persons who choose to employ its services,and transports the goods by land and for compensation. The fact that petitioner has a limited c lientele doesnot exclude it from the definition of a common carrier. (De Guzman Ruling upheld)

Respondents argument that the term common carrier as used in Section 133(j) of the LocalGovernment Code refers only to common carriers transporting goods and passengers through movingvehicles or vessels either by land, sea or water is erroneous. The definition of common carriers in NCCmakes no distinction as to the means of transporting as long as it is by land, water or air. It does not providethat the transporting of the passengers or goods should be by motor vehic le.

Home Insurance Company vs. American Steamship Agencies, Inc.

The NCC provisions on common carriers should not apply where the common carrier is not actingas such but as a private carrier. Under American Jurisprudence, a common carrier undertaking to carry aspecial cargo or chartered to a special person only becomes a private carrier. As a private carrier, astipulation exempting the owner from liabi lity for the negligence of its agent is valid.

The stipulation in the charter party absolving the owner from liabili ty for loss due to the negligenceof its agent would be void only if strict public policy governing common carrier is applied. Such policy has no


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force where the public at large is not involved, as in the case of a ship totally chartered for the use of asingle party. The stipulation exempting the owner from liability for negligence of its agent is not againstpublic policy and is deemed valid. Recovery can t be had, for loss or damage to the cargo againstshipowners, unless the same is due to personal acts or negligence of said owner or its managers, asdistinguished from agents or employees.

San Pablo vs. PANTRANCO

Considering the environmental circumstances of the case, the conveyance of passengers, trucksand cargo from Matnog to Allen is certainly not a ferry boat service but a coastwise or interisland shippingservice. Under no circumstance can the sea between Matnog and Allen be considered a continua tion of thehighway. While a ferry boat service has been considered as a continuation of the highway when crossingrivers or even lakes, whic h are small body of waters - separating the land, however, when as in this case thetwo terminals, Matnog and Allen are separated by an open sea it can not be considered as a continuation ofthe highway. Respondent PANTRANCO should secure a separate CPC for the operation of an interisland orcoastwise shipping service in accordance with the provisions of law. Its CPC as a bus transportation cannot

be merely amended to inc lude this water service under the guise that it is a mere private ferry service.

The c ontention of private respondent PANTRANCO that its ferry service operation is as a privatecarrier, not as a common carrier for its exclusive use in the ferrying of its passenger buses and cargo trucksis absurd. PANTRANCO does not deny that it charges its passengers separately from the charges for thebus trips and issues separate tickets whenever they board the MV "Black Double" that crosses Matnog toAllen, PANTRANCO cannot pretend that in issuing tickets to its passengers it did so as a private carrier andnot as a common carrier. The Court does not see any reason why inspite of its amended franchise tooperate a private ferry boat service it cannot accept walk-in passengers just for the purpose of crossing thesea between Matnog and Allen. Indeed evidence to this effect has been submitted.

National Steel Corporation vs. CA

In the instant case, it is undisputed that VSI did not offer its services to the general public. It carriedpassengers or goods only for those it chose under a special contract of charter party. It is a private carrierthat renders tramping service and as such, does not transport cargo or shipme nt for the general public . Itsservices are available only to specific persons who enter into a special contract of charter party with itsowner. Consequently, the rights and obligations of VSI and NSC, including their respective liability fordamage to the cargo, are determined primarily by stipulations in their contracts of private carriage or charterparty.

Unlike in a contract involving a common carrier, private carriage does not involve the generalpublic. Hence, the stringent provisions of the Civil Code on common carriers protecting the general publiccannot justifiably be applied to a ship transporting commercial goods as a private carrier.

KMU vs. Garcia

The issuance of a Certificate of Public Convenience is determined by public need. The presumption ofpublic need for a service shall be deemed in favor of the applicant, while the burden of proving that there isno need for the proposed service shall be the oppositor's.


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By its terms, public convenience or necessity generally means something fitting or suited to thepublic need. As one of the basic requirements for the grant of a CPC, public convenience and necessityexists when the proposed faci lity or service meets a reasonable want of the public and supply a need whichthe existing facilities do not adequately supply. The existence or non-existence of public convenience andnecessity is therefore a question of fact that must be established by evidence, real and/or testimonial;

empirical data; statistics and such other means necessary, in a public hearing conducted for that purpose.The object and purpose of such procedure, among other things, is to look out for, and protect, the interestsof both the public and the existing transport operators.

Tatad vs. Garcia

In law, there is a clear distinction between the "operation" of a public utility and the ownership ofthe facili ties and equipment used to serve the public . The right to operate a public utility may existindependently and separately from the ownership of the fac ilities thereof. One can own said facil ities withoutoperating them as a public utility, or conversely, one may operate a public utility without owning the facil itiesused to serve the public . T he devotion of property to serve the public may be done by the owner or by the

person in control thereof who may not necessarily be the owner thereof.

Samar Mining Company, Inc. vs. Nordeutscher Lloyd

The validity of stipulations in bills of lading exempting the carrier from l iabil ity for loss or damage tothe goods when the same are not in its actual custody has been upheld. There is no doubt that Art. 1738finds no applicability to the instant case. The said article contemplates a situation where the goods hadalready reached their place of destination and are stored in the warehouse of the carrier. The subject goodswere still awaiting transshipment to their port of destination, and were stored in the warehouse of a thirdparty when last seen and/or heard of.

Article 1736 is applicable to the instant suit. Under said article, the carrier may be relieved of the

responsibili ty for loss or damage to the goods upon actual or constructive delivery of the same by the carrierto the consignee, or to the person who has a right to receive them. In sales, actual delivery has beendefined as the ceding of corporeal possession by the seller, and the actual apprehension of corporealpossession by the buyer or by some person authorized by him to rec eive the goods as his representative forthe purpose of custody or disposal. By the same token, there is actual delivery in contracts for the transportof goods when possession has been turned over to the consignee or to his duly authorized agent and areasonable time is given him to remove the goods. The court a quo found that there was actual delivery tothe consignee through its duly authorized agent, the carrier.

Eastern Shipping Lines vs. Intermediate Appellate Court

1) The law of the country to which the goods are to be transported governs the liability of the commoncarrier in case of their loss, destruction or deterioration. As the cargoes in question were transported fromJapan to the Philippines, the liability of Petitioner Carrier is governed primarily by the Civil Code. However,in all matters not regulated by said Code, the rights and obligations of common carrier shall be governed bythe Code of Commerce and by special laws. Thus, the Carriage of Goods by Sea Act, a special law, issuppletory to the provisions of the Civil Code.

(2) Under the Civil Code, common carriers, from the nature of their business and for reasons of publicpolicy, are bound to observe extraordinary diligence in the vigilance over goods, according to all the


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circumstances of each case. Common carriers are responsible for the loss, destruction, or deterioration ofthe goods unless the same is due to any of the following causes only:

(1) Flood, storm, earthquake, lightning or other natural disaster or calamity;

Petitioner Carrier c laims that the loss of the vessel by fire exempts it from liabil ity under the phrase

"natural disaster or calamity. However, the Court said that fire may not be considered a natural disaster orcalamity. This must be so as it arises almost invariably from some ac t of man or by human means. It doesnot fall within the category of an act of God unless caused by lightning or by other natural disaster orcalamity. It may even be c aused by the actual fault or privity of the carrier.

As the peril of the fire is not comprehended within the exception in Article 1734, supra, Article 1735of the Civil Code provides that all cases than those mention in Article 1734, the common carrier shall bepresumed to have been at fault or to have acted negligently, unless it proves that it has observed theextraordinary diligence required by law.

And even if fire were to be considered a "natural disaster" within the meaning of Article 1734 of theCivil Code, it is required under Article 1739 of the same Code that the "natural disaster" must have been the"proximate and only cause of the loss," and that the carrier has "exercised due diligence to prevent orminimize the loss before, during or after the occurrence of the disaster. This Petitioner Carrier has also

failed to establish satisfactorily.

National Development Company vs. CA

Significantly, under the provisions of the Code of Commerce, particularly Articles 826 to 839, theshipowner or carrier, is not exempt from liability for damages arising from collision due to the fault ornegligence of the captain. Primary liability is imposed on the shipowner or carrier in recognition of theuniversally accepted doctrine that the shipmaster or captain is merely the representative of the owner whohas the actual or constructive control over the conduct of the voyage.

The agreement between NDC and MCP shows that MCP is appointed as agent, a term broadenough to include the concept of ship agent in maritime law. In fact MCP was even conferred all the powers

of the owner of the vessel, including the power to contract in the name of the NDC. Both owner and agentshould be declared jointly and severally liable since the obligation which is the subject of the action had itsorigin in a fortuitous act and did not arise from contract.

Gelisan vs. Alday

The court has held in several decisions that the registered owner of a pub lic service is responsiblefor damages that may arise from c onsequences incident to its operation or that may be caused to any of thepassengers therein. The claim of the petitioners that he is not liable in view of the lease contract executedby and between him and Espiritu which exempts him from liability to 3rd persons, cannot be sustainedbecause it appears that the lease contract had not been approved by the Public Service Commission. It is a

settled rule in our jurisprudence that if the property covered by a Franchise is transferred or lease to anotherwithout obtaining the requisite approval, the transfer is not binding upon the public and 3rd persons.However, Gelisan is not without recourse because he has a right to be indemnified by Espiritu for theamount he may be required to pay. This is due to the fact that the lease contract in question, although noteffective against the public is valid and binding between the contracting parties.

Benedicto vs. Intermediate Appellate Court


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The prevailing doctrine in common carriers make the owner liable for consequences having fromthe operations of the carrier even though the spec ific vehicle involved may have been transferred to anotherperson. This doctrine rests upon the principle in dealing with vehic les registered under Public Service Law,the public has the right to assume that the registered owner is the actual or lawful owner thereof. It wouldbe very difficult and often impossible as a practical matter, for members of the general public to enforce the

rights of action that they may have for injuries inflicted by the vehicles being negligently operated if theyshould be required to prove who the actual owner is. The registered owner is not allowed to deny liability byproving the identity of the alleged transferee. Thus, contrary to petitioners claim, private respondents arenot required to go beyond the vehic les certificate of registration to ascertain the owner of the carrier.

PHILTRANCO Service Enterprise, Inc. vs. Court of Appeals

We have consistently held that the liability of the registered owner of a public service vehic le, likepetitioner Philtranco, for damages arising from the tortious acts of the driver is primary, direct, and joint andseveral or solidary with the driver. As to solidarity, Article 2194 expressly provides:

Art. 2194. The responsibility of two or more persons who are liable for a quasi-delict is solidary.

Since the employer's liability is primary, direct and solidary, its only recourse if the judgment fordamages is satisfied by it is to recover what it has paid from its employee who committed the fault ornegligence which gave rise to the action based on quasi-delict. Article 2181 of the Civil Code provides:

Art. 2181. Whoever pays for the damage c aused by his dependents or employees may recoverfrom the latter what he has paid or delivered in satisfaction of the claim.

Santos vs. Sibug

Although SANTOS, as the kabit was the true owner as against VIDAD, the latter, as the registeredowner/operator and grantee of the franchise, is directly and primarily responsible and liable for the damagescaused to SIBUG, the injured party, as a c onsequence of the negligent or careless operation of the vehicle.This ruling is based on the principle that the operator of record is considered the operator of the vehicle incontemplation of law as regards the public and third persons even if the vehicle involved in the acc ident hadbeen sold to another where such sale had not been approved by the then Public Service Commission.

Lita Enterprises Inc. vs. Intermediate Appellate Court

Unquestionably, the parties herein operated under an arrangement, comonly known as the "kabitsystem", whereby a person who has been granted a certificate of convenience allows another person who

owns motors vehicles to operate under such franchise for a fee. A certificate of public convenience is aspecial privilege conferred by the government . Abuse of this privilege by the grantees thereof cannot becountenanced. Although not outrightly penalized as a criminal offense, the "kabit system" is invariablyrecognized as being contrary to public policy and, therefore, void and inexistent under Article 1409 of theCivil Code, It is a fundamental principle that the court will not aid either party to enforce an illegal contract,but will leave them both where it finds them.


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Teja Marketing vs. Intermediate Appellate Court

The ruling in Lita Enterprises Inc. vs. IAC is upheld. The defect of in existence of a contract is permanentand cannot be cured by ratification or by prescription. The mere lapse of time cannot give efficacy tocontracts that are null and void.

Magboo vs. Bernardo

The features which characterize the boundary system are not sufficient to withdraw the relationship betweenthe parties from that of employer and employee. The owner continued to be the operator of the vehicle inlegal contemplation and as such, he is responsible for the consequences incident to its operation. Toexempt from liability the owner of a public vehicle who operates it under the boundary system on theground that he is a mere lessor would be not only to abet flagrant violations of the Public Service Law butalso to place the riding public at the mercy of reckless and irresponsible drivers.

Ganzon vs. CA

Petitioner Ganzon failed to show that the loss of the scrap iron due to any cause enumerated inArt. 1734. The order of the acting Mayor did not constitute valid authority for petitioner to carry out. In anycase, the intervention of the municipal officials was not of a character that would render impossible thefulfillment by the carrier of its obligation. The petitioner was not duly bound to obey the illegal order to dumpinto the sea the scrap of iron. Moreover, there is absence of sufficient proof that the issuance of the sameorder was attended with such force or intimidation as to completely overpower the will of the petitionersemployees.

By the delivery made during Dec. 1, 1956, the scraps were unconditionally placed in thepossession and control of the common carrier, and upon their receipt by the carrier of transportation, thecontract of carriage was deemed perfected. Consequently, Ganzons extraordinary responsibility for theloss, destruction or deterioration of the goods commenced. According to Art 1738, such extraordinary

responsibility would cease only upon the delivery by the carrier to the consignee or persons with right toreceive them. The fact that part of the shipment had not been loaded on board did not impair the contract oftransportation as the goods remained in the custody & control of the carrier.

Eastern Shipping Lines vs. Court of Appeals

The heavy seas and rains referred to in the masters report were not caso fortuito but normaloccurrences that an ocean-going vessel, particularly in the month of September which, in our area, is amonth of rains and heavy seas would encounter as a matter of routine. They are not unforeseen norunforeseeable. These are conditions that ocean-going vessels would encounter and provide for, in theordinary course of a voyage. That rain water (not sea water) found its way into the holds of the Jupri Venture

is a clear indication that care and foresight did not attend the closing of the ship's hatches so that rain waterwould not find its way into the cargo holds of the ship.

Since the carrier has failed to establish any caso fortuito, the presumption by law of fault ornegligence on the part of the carrier applies; and the carrier must present evidence that it has observed theextraordinary diligence required by Article 1733 of the Civil Code in order to escape liability for damage ordestruction to the goods that it had admittedly carried in this case. No such evidence exists of record. T hus,the carrier cannot escape liabil ity.


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Sarkies Tours Phils vs. Court of Appeals

Under the Civil Code, common carriers, from the nature of their business and for reasons of publicpolicy, are bound to observe extraordinary diligence in the vigilance over the goods transported by them,

and this liability lasts from the time the goods are unconditionally placed in the possession of, and receivedby the carrier for transportation until the same are delivered, actually or constructively, by the carrier to theperson who has a right to receive them, unless the loss is due to any of the excepted causes under Article1734 thereof.

Where the common carrier accepted its passenger's baggage for transportation and even had itplaced in the vehicle by its own employee, its failure to collect the freight charge is the common carrier'sown lookout. It is responsible for the consequent loss of the baggage. In the instant case, defendantappellant's employee even helped Fatima Minerva Fortades and her brother load the luggages/baggages inthe bus' baggage compartment, without asking that they be weighed, declared, receipted or paid for. Neitherwas this required of the other passengers.

Valenzuela Hardwood & Industrial Supply vs. Court of Appeals

In a contract of private carriage, the parties may validly stipulate that responsibility for the cargorests solely on the charterer, exempting the shipowner from liability for loss of or damage to the cargocaused even by the negligence of the ship captain. Pursuant to Article 1306 17 of the Civil Code, suchstipulation is valid because it is freely en tered into by the parties and the same is not contrary to law, morals,good customs, public order, or public policy. Indeed, their contract of private carriage is not even a contractof adhesion. We stress that in a contract of private carriage, the parties may freely stipulate their duties andobligations which perforce would be binding on them. Unlike in a contract involving a common carrier,private carriage does not involve the general public. Hence, the stringent provisions of the Civil Code oncommon carriers protecting the general public cannot justifiably be applied to a ship transporting commercialgoods as a private carrier. Consequently, the public policy embodied therein is not contravened by

stipulations in a charter party that lessen or remove the protection given by law in contracts involvingcommon carriers.

Yobido vs. Court of Appeals

The explosion of the new tire is not a fortuitous event. There are human factors involved in thesituation. T he fact that the tire was new did not imply that it was entirely free from manufacturing defects orthat it was properly mounted on the vehicle. Neither may the fact that the tire bought and used is of a brandname noted for quality, resulting in the conc lusion that it could not explode within five days use. It is settledthat an accident caused either by defects in the automobile or through the negligence of its driver is not acaso fortuito. Moreover, a common carrier may not be absolved from liability in case of force majeure. A

common carrier must still prove that it was not negligent in causing the death or injury resulting from theaccident. Thus, having failed to overthrow the presumption of negligence with clear and convincingevidence, petitioners are hereby held liable for damages.

Compania Maritima vs. Insurance Co. of North America


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The receipt of goods by the carrier has been said to lie at the foundation of the contract to carryand deliver, and if actually no goods are received there can be no such contract. The liability andresponsibili ty of the carrier under a contract for the carriage of goods commence on their ac tual delivery to,or receipt by, the carrier or an authorized agent and delivery to a lighter in charge of a vessel for shipmenton the vessel, where it is the custom to deliver in that way, is a good delivery and binds the vessel receiving

the freight, the liability commencing at the time of delivery to the lighter and, similarly, where there is acontract to carry goods from one port to another, and they cannot be loaded directly on the vessel andlighters are sent by the vessel to bring the goods to it, the lighters are for the time its substitutes, so that thebill of landing is applicable to the goods as soon as they are placed on the lighters.

Whenever the control and possession of goods passes to the carrier and nothing remains to bedone by the shipper, then it can be said with certainty that the relation of shipper and carrier has beenestablished. A bill of lading is not indispensable for the creation of a contract of carr iage. The bill of lading isjuridic ally a documentary proof of the stipulations and conditions agreed upon by both parties. The liability ofthe carrier as common carrier begins with the actual delivery of the goods for transportation, and not merelywith the formal execution of a receipt or bill of lading; the issuance of a bill of lading is not necessary tocomplete delivery and acceptance. Even where it is provided by statute that liability commences with the

issuance of the bill of lading, actual delivery and acceptance are sufficient to bind the carrier.

Lu Do vs. Binamira

While delivery of the cargo to the consignee, or to the person who has a right to receive them,contemplated in Article 1736, because in such case the goods are still in the hands of the Government andthe owner cannot exerc ise dominion over them, we believe however that the parties may agree to limit theliability of the carrier considering that the goods have still to through the inspection of the customsauthorities before they are actually turned over to the consignee. This is a situation where we may say thatthe carrier losses control of the goods because of a custom regulation and it is unfair that it be maderesponsible for what may happen during the interregnum.

American President Lines, Ltd. vs. Klepper

With regard to the contention of the carrier that COGSA should control in this case, the same is ofas moment. Art. 1763 of the New Civil Code provides that the laws of the country to which the goods aretransported shall govern the liability of the common carrier in case of loss, destruction and deterioration.This means that the law of the Philippines on the New Civil Code. Under 1766 of NCC, in all ma tter notregulated by this Code, the rights and obligations of common carriers shall be governed by the Code of

Commerce and by Special Laws. Art. 1736-1738, NCC governs said rights and obligations. Therefore,although Sec 4(5) of COGSA states that the carrier shall not be liable in an amount exceeding $500 perpackage unless the value of the goods had been dec lared by the shipper and asserted in the bill of lading,said section is merely supplementary to the provisions of the New Civil Code.

Servando vs. Phil. Steam

The court a quo held that the delivery of the shipment in question to the warehouse of the Bureau of


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Customs is not the delivery contemplated by Article 1736; and since the burning of the warehouse occ urredbefore actual or constructive delivery of the goods to the appellees, the loss is chargeable against theappellant.

It should be pointed out, however, that in the bills of lading issued for the cargoes in question, theparties agreed to limit the responsibility of the carrier for the loss or damage that may be caused to the

shipment therein the following stipulation:

Clause 14. Carrier shall not be responsible for loss or damage to shipments billed 'owner's risk' unless suchloss or damage is due to negligence of c arrier. Nor shall carrier be responsible for loss or damage causedby force majeure, dangers or acc idents of the sea or other waters; war; public enemies; . . . fire . ...

We sustain the validity of the above stipulation; there is nothing therein that is contrary to law,morals or public polic y.

Appellees would contend that the above stipulation does not bind them because it was printed infine letters on the back-of the bills of lading; and that they did not sign the same. This argument overlooksthe pronouncement of this Court in Ong Yiu vs. Court of Appeals, where the same issue was resolved in this

wise:While it may be true that petitioner had not signed the plane ticket, he is nevertheless bound by

the provisions thereof. 'Such provisions have been held to be a part of the contract of carriage, and validand binding upon the passenger regardless of the latter's lack of knowledge or assent to the regulation'. It iswhat is known as a contract of 'adhesion', in regards which it has been said that contracts of adhesionwherein one party imposes a ready made form of contract on the other, as the plane ticket in the case atbar, are contracts not entirely prohibited. The one who adheres to the contract is in reality free to reject itentirely; if he adheres, he gives his consent."

Saludo, Jr. vs. Court of Appeals

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 betransported. There is no law which requires that the delivery of the goods for carriage and the issuance ofthe covering bill of lading must coincide in point of time or, for that matter, that the former should precedethe latter. While we agree with petitioners' statement that "an airway bill estops the carrier from denyingreceipt of goods of the quantity and quality described in the bill," a further reading and a more faithfulquotation of the authority cited would reveal that "(a) bill of lading may contain constituent elements ofestoppel and thus become something more than a contract between the shipper and the carrier. . . .(However), as between the shipper and the carrier, when no goods have been delivered for shipment norecitals in the bill can estop the carrier from showing the true facts . . . Between the consigno r of goods andreceiving carrier, recitals in a bill of lading as to the goods shipped raise only a rebuttable presumption thatsuch goods were delivered for shipment. As between the consignor and a receiving carrier, the fact must

outweigh the recital."

There is a holding in most jurisdictions that the acceptance of a bill of lading without dissent raisesa presumption that all terms therein were brought to the knowledge of the shipper and agreed to by him, andin the absence of fraud or mistake, he is estopped from thereafter denying that he assented to such terms.This rule applies with particular force where a shipper accepts a bill of lading with full knowledge of itscontents, and acceptance under such circumstances makes it a binding contract. In order that anypresumption of assent to a stipulation in a bill of lading limiting the liability of a carrier may arise, it must


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appear that the clause containing this exemption from liability plainly formed a part of the c ontract containedin the bill of lading. A stipulation printed on the back of a receipt or bill of lading or on papers attached tosuch receipt will be quite as effective as if printed on its face, if it is shown that the consignor knew of itsterms. Thus, where a shipper accepts a receipt which states that its condi tions are to be found on the back,such receipt comes within the general rule, and the shipper is held to have accepted and to be bound by the

conditions there to be found.

Explicit is the rule under Article 1736 of the Civil Code that the extraordinary responsibility of thecommon carrier begins from the time the goods are delivered to the carrier. This responsibility remains in fullforce and effect even when they are temporarily unloaded or stored in transit, unless the shipper or ownerexercises the right of stoppage in transitu, and terminates only after the lapse of a reasonable time for theacceptance, of the goods by the consignee or such other person entitled to receive them. And, there isdelivery 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 their immediate transportation and the carrier hasaccepted them. Where such a delivery has thus been accepted by the carrier, the liability of the commoncarrier commences. Only when such fact of delivery has been unequivocally established can the liability forloss, destruction or deterioration of goods in the custody of the carrier, absent the excepting causes under

Article 1734, attach and the presumption of fault of the carrier under Article 1735 be invoked.

Macam vs. CA

The extraordinary responsibili ty of the common carriers lasts until ac tual or constructive delivery ofthe cargoes to the consignee or to the person who has a right to receive them. PAKISTAN BANK wasindicated in the bills of lading as consignee whereas GPC was the notify party. However, in the exportinvoices GPC was clearly named as buyer/importer. Petitioner also referred to GPC as such in his demandletter to respondent WALLEM and in his complaint before the trial court. This premise draws us to conc ludethat the delivery of the cargoes to GPC as buyer/importer which, conformably with Art. 1736 had, other thanthe consignee, the right to receive them was proper.

The real issue is whether respondents are liable to petitioner for releasing the goods to GPCwithout the bills of lading or bank guarantee. From the testimony of petitioner, we gather that he has beentransacting with GPC as buyer/importer for around two (2) or three (3) years already. When mangoes andwatermelons are in season, his shipment to GPC using the facilities of respondents is twice or thrice aweek. The goods are released to GPC. It has been the prac tice of petitioner to request the shipping lin es toimmediately release perishable cargoes such as watermelons and fresh mangoes through telephone callsby himself or his "people." In transactions covered by a letter of credi t, bank guarantee is normal ly requiredby the shipping lines prior to releasing the goods. But for buyers using telegraphic transfers, petitionerdispenses with the bank guarantee because the goods are already fully paid. In his several years ofbusiness relationship with GPC and respondents, there was not a single instance when the bill of lading wasfirst presented before the release of the cargoes.

Maersk Line vs. CA

While i t is true that common carriers are not obligated by law to carry and to deliver merchandise,and persons are not vested with the right to prompt delivery, unless such common carriers previously


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assume the obligation to deliver at a given date or time, delivery of shipment or cargo should at least bemade within a reasonable time.

While there was no special contract entered into by the parties indicating the date of arrival of thesubject shipment, petitioner nevertheless, was very well aware of the specific date when the goods wereexpected to arrive as indicated in the bill of lading itself. In this regard, there arises no need to execute

another contract for the purpose as it would be a mere superfluity. In the case before us, we find that adelay in the delivery of the goods spanning a period of two months and seven days falls was beyond therealm of reasonableness.

Ysmael vs. Barretto

Limiting the common carriers liability for loss or damage from any cause or for any reason for lessthan 1/8 the actual value of the goods is unconscionable and therefore against public policy. A commoncarrier cannot lawfully stipulate for exemption from liability, unless such exemption is just and reasonableand the contract is freely and fairly made.

Shewaram vs. Philippine Airlines

It can not be said that a contract has been entered into between a passenger and the commoncarrier, embodying the conditions as printed at the back of the ticket. The fact that those conditions areprinted at the back of the ticket stub in letters so small that they are hard to read would not warrant thepresumption that the passenger was aware of those conditions such that he had "fairly and freely agreed" tothose conditions. The passenger is considered not having agreed to the stipulation on the ticket, asmanifested by the fact that he did not sign the ticket.

Ong Yiu vs. Court of Appeals

While it may be true that the passenger had not signed the plane ticket, he is nevertheless boundby the provisions thereof. "Such provisions have been held to be a part of the contract of carriage, and validand binding upon the passenger regardless of the latter's lack of knowledge or assent to the regulation". It iswhat is known as a contract of "adhesion", in regards which it has been said that contracts of adhesionwherein one party imposes a ready made form of contract on the other, as the plane ticket in the case atbar, are contracts not entirely prohibited. The one who adheres to the contract is in reality free to reject itentirely; if he adheres, he gives his consent. A contract limiting liability upon an agreed valuation does notoffend against the policy of the law forbidding one from contracting against his own negligence.

Sea Land Services, Inc. vs. IAC

Since the liability of a common carrier for loss of or damage to goods transported by it under acontract of carriage so governed by the laws of the country of destination and the goods in question wereshipped from the United States to the Philippines, the liability of common carrier to the consignee isgoverned primarily by the Civil Code. Applying the Civil Code provisions (Article 1749 and 1750) thestipulation in the bill of lading limiting the liability of the common carrier for loss or damages to the shipmentcovered by said rule unless the shipper declares the value of the shipment and pays additional charges isvalid and binding on the consignee.


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Citadel Lines, Inc. vs. CA

Basic is the rule that a stipulation limiting the liability of the carrier to the value of the goodsappearing in the bil l of lading, unless the shipper or owner declares a greater value, is binding. Furthermore,

a contract fixing the sum that may be recovered by the owner or shipper for the loss, destruction ordeterioration of the goods is valid, if it is reasonable and just under the circumstances, and has been fairlyand freely agreed upon.

In this case, the award based on the alleged market value of the goods is erroneous. It is providedin a clause in the BOL that its liability is limited to US$2.00/kilo. The consignee also admits in thememorandum that the value of the goods does not appear in the bil l of lading. Hence, the stipulation on thecarriers limited liability applies.

Everett Seamship Corp. vs. CA

In the bill of lading, the carrier made it clear that all claims for which it may be liable shall beadjusted and settled on the basis of the shipper's net invoice cost plus freight and insurance premiums, ifpaid, and in no event shall the carrier be liable for any loss of possible profits or any consequential loss. Itsliability would only be up to One Hundred Thousand (Y100,000.00) Yen. However, the shipper, had theoption to declare a higher valuation if the value of its cargo was higher than the limi ted liabil ity of the carrier.Considering that the shipper did not declare a higher valuation, it had itself to blame for not complying withthe stipulations.

The commercial Invoice does not in itself sufficiently and convincingly show that the commoncarrier has knowledge of the value of the cargo as contended by the shipper.

British Airways vs. CA

The contract of transportation was exclusively between the passenger and common carrier BA.The latter merely endorsing the Manila to Hong Kong log of the formers journey to PAL, as its subcontractoror agent. Conditions of contracts were one of continuous air transportation. Well -settled rule that an agentis also responsible for any negligence in the performanc e of its function and is liable for damages which theprincipal may suffer by reason of its negligent act. When an action is based on breach of contract ofcarriage, the passenger can only sue BA and not PAL, since the latter was not a party in the contract.

The c ontention of BA with respect to limited liability was overruled although it is recognized in thePhilippines, stating that BA had waived the defense of limited liability when it allowed Mahtani(thepassenger) to testify as to the actual damages he incurred due to the misplacement of his luggage, withoutany objection.

H.E. Heacock Co. vs. Macondray

Three kinds of stipulations have often been made in a bill of lading. The first is one exempting thecarrier from any and all liability for loss or damage occasioned by its own negligence. The second is oneproviding for an unqualified limitation of such liability to an agreed valuation. And the third is one limiting theliability of the carrier to an agreed valuation unless the shipper declares a higher value and pays a higher


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rate of freight. According to an almost uniform weight of authority, the first and second kinds of stipulationsare invalid as being contrary to public policy, but the third is valid and enforceable.

If a common carrier gives to a shipper the choice of two rates and if the shipper makes such achoice, understandingly and freely, and names his valuation, he cannot thereafter recover more than the

value which he thus places upon his property. A limitation of liabilit y based upon an agreed value does notconflict with any sound principle of public pol icy; and it is not conformable to plain principles of justice that ashipper may understate value in order to reduce the rate and then recover a larger value in case of loss.

Sweet Lines Inc. vs. TEVES

Considered in the light of circumstances prevailing in the inter-island shipping industry in thecountry today, We find and hold that Condition No. 14 printed at the back of the passage tickets should beheld as void and unenforceable for the following reasons first, under circumstances obligation in the inter-island shipping industry, it is not just and fair to bind passengers to the terms of the conditions printed at theback of the passage tickets, on which Condition No. 14 is Printed in fine letters, and second, Condition No.

14 subverts the public policy on transfer of venue of proceedings of this nature, since the same willprejudice rights and interests of innumerable passengers located in different places of the country who,under Condition No. 14, will have to file suits against petitioner only in the City of Cebu. Considering theexpense and trouble a passenger residing outside of Cebu City would inc ur to prosecute a claim in the Cityof Cebu, he would most probably decide not to file the action at all. The condition will thus defeat, instead ofenhance, the ends of justice. Upon the other hand, petitioner has branches or offices in the respective portsof call of its vessels and can afford to l itigate in any of these places. Hence, the filing of the suit in the CFI ofMisamis Oriental, as was done in the instant case, will not cause inconvenience to, much less prejudice,petitioner.

Under Art. 2220 of the Civil Code, moral damages are justly due in breaches of contract where thedefendant acted fraudulently or in bad faith. Both the Trial Court and the Appellate Court found that there

was bad faith on the part of petitioner in that:

(1) Defendants- Appellants did not give notice to plaintiffs-appellates as to the change of scheduled of thevessel;(2) Knowing fully well that it would take no less than fifteen hours to effect the repairs of the damagedengine, defendants- appellants instead made announce ment of assurance that the vessel would leavewithin a short period of time, and when plaintiff-appellees wanted to leave the port and gave up the trip,defendants- appellants employees would come and say, we are leaving already.(3) Defendants- appellants did not offer to refund plaintiffs-appellees tickets nor provide them withtransportation form Tacloban to Catbalogan.

Quisumbing Sr. vs. Court of Appeals

The highjacking-robbery was force majeure. The hijackers do not board an airplane through ablatant display of firepower and violent fury. Firearms, hand-grenades, dynamite, and explosives areintroduced into the airplane surreptitiously and with the utmost cunning and stealth, although there is anoccasional use of innocent hostages who will be coldly murdered unless a plane is given to the hijackers'complete disposal.


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PAL was not negligent so as to overcome the force majeure nature of the hi-jacking. Hijackers donot board an airplane through a blatant display of firepower and violent fury. Firearms and grenades arebrought to the plane surreptitiously. PAL could not have been faulted for want of diligence, particularly forfailing to take positive measures to implement Civil Aeronautics Administration regulations prohibitingcivilians from carrying firearms on board the plane. The use of the most sophisticated electronic detection

devices may have minimized hijacking but still ineffective against truly determining hijackers.

Pan American World Airways, Inc. vs. Rapadas

The Warsaw Convention governs the availment of the liability limitations where the baggage checkis combined with or incorporated in the passenger ticket. In the case at bar, the baggage check is combinedwith the passenger ticket in one document of carriage. The passenger ticket complies with Article 3, whichprovides:

(c) a notice to the effect that, if the passenger's journey involves an ultimate destination or stop ina country other than the country of departure, the Warsaw Convention may be applicable and that theConvention governs and in most cases limits the liability of carriers for death or personal injury and in

respect of loss of or damage to baggage.

The provisions in the plane ticket are sufficient to govern the lim itations of liabil ities of the airline forloss of luggage. The passenger, upon contracting with the airline and receiving the plane ticket, wasexpected to be vigilant insofar as his luggage is concerned. If the passenger fails to adduce evidence toovercome the stipulations, he cannot avoid the application of the liability limitations.

The facts show that the private respondent actually refused to register the attache case and c hoseto take it with him despite having been ordered by the PANAM agent to check it in. In attempting to avoidregistering the luggage by going back to the line, private respondent manifested a disregard of airline ruleson allowable handcarried baggages. Prudence of a reasonably careful person also dictates that cash andjewelry should be removed from checked-in-luggage and placed in one's pockets or in a handcarried

Manila-paper or plastic envelope.

The alleged lack of enough time for him to make a declaration of a higher value and to pay thecorresponding supplementary charges cannot justify his failure to comply with the requirement that willexclude the application of limited liability.

Alitalia vs. Intermediate Appellate Court

The Warsaw Convention's provisions, do not regulate or exclude liability for other breaches ofcontract by the carrier' or misconduct of its officers and employees, or for some particular or exceptionaltype of damage, Otherwise, an air carrier would be exempt from any liability for damages in the event of its

absolute refusal, in bad faith, to comply with a contract of carriage, which is absurd. In the case at bar, nobad faith or otherwise improper conduct may be ascribed to the employees of petitioner airline; and Dr.Pablo's luggage was eventually returned to her, belatedly, it is true, but without appreciable damage.

There can be no doubt that Dr. Pablo underwent profound distress and anxiety, which graduallyturned to panic and finally despair, from the time she learned that her suitcases were missing up to the timewhen, having gone to Rome, she finally realized that she would no longer be able to take part in theconference. Certainly, the compensation for the injury suffered by Dr. Pablo cannot under the circumstancesbe restricted to that prescribed by the Warsaw Convention for delay in the transport of baggage.


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She is not, of course, entitled to be compensated for loss or damage to her luggage. As alreadymentioned, her baggage was ultimately delivered to her in Manila, tardily, but safely.

Nocum vs. Laguna Tayabas Bus Company

Fairness demands that in measuring a common carrier's duty towards its passengers, allowancemust be given to the reliance that should be reposed on the sense of responsibili ty of all the passengers inregard to their common safety. It is to be presumed that a passenger will not take with him anythingdangerous to the lives and limbs of his co-passengers, not to speak of his own. Not to be lightly consideredmust be the right to privacy to which each passenger is entitled. He cannot be subjected to any unusualsearch, when he protests the innocuousness of his baggage and nothing appears to indicate the contrary,as in the case at bar. In other words, inquiry may be verbally made as to the nature of a passenger'sbaggage when such is not outwardly perceptible, but beyond this, constitutional boundaries are already in

danger of being transgressed. Calling a policeman to his aid, as suggested by the service manual invokedby the trial judge, in compelling the passenger to submit to more rigid inspection, after the passenger hadalready declared that the box contained mere clothes and other miscellaneous, could not have justifiedinvasion of a constitutionally protected domain.

Mecenas vs. CA

The behaviour of the captain of the "Don Juan" in tills instance-playing mahjong "before and up tothe time of collision constitutes behaviour that is simply unacceptable on the part of the m aster of a vessel towhose hands the lives and welfare of at least seven hundred fifty (750) passengers had been entrusted.Whether or not Capt. Santisteban was "off-duty" or "on-duty" at or around the time of ac tual collision is quite

immaterial; there is, both realistically speaking and in contemplation of law, no such thing as "off-duty" hoursfor the master of a vessel at sea that is a common carrier upon whom the law imposes the duty ofextraordinary diligence.

The record shows that the "Don Juan" sank within ten (10) to fifteen (15) minutes after initialcontact with the "Tacloban City. While the failure of Capt. Santisteban to supervise his officers and crew inthe process of abandoning the ship and his failure to avail of measures to prevent the too rapid sinking ofhis vessel after collision, did not cause the collision by themselves, such failures doubtless contributedmaterially to the consequent loss of life and, moreover, were indicative of the kind and level of diligenceexercised by Capt. Santisteban in respect of his vessel and his officers and men prior to actual contactbetween the two (2) vessels. The officer-on-watch in the "Don Juan" admitted that he had failed to informCapt. Santisteban not only of the "imminent danger of collision" but even of "the actual coll ision itself " There

is also evidence that the "Don Juan" was carrying more passengers than she had been c ertified as allowedto carry.

Under these circumstances, a presumption of gross negligence on the part of the vessel (herofficers and crew) and of its ship-owner arises.

Negros Navigation Co., Inc. vs. CA


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The Duty to exercise due diligence includes the duty to take passengers or cargoes that are within thecarrying capacity of the vessel. (Same Ruling with Mecenas)

Korean Airlines Co., LTD. vs. CA

The status of Lapuz as standby passenger was changed to that of a confirmed passenger when hisname was entered in the passenger manifest of KAL for its Flight No. KE 903. His clearance throughimmigration and customs clearly shows that he had indeed been confirmed as a passenger of KAL in thatflight. KAL thus committed a breach of the contract of carriage between them when it failed to bring Lapuz tohis destination.

This Court has held that a contract to transport passengers is different in kind and degree from anyother contractual relation. T he business of the carrier is mainly with the traveling public . It invites people to

avail themselves of the comforts and advantages it offers. The contract of air carriage generates a relationattended with a public duty. Passengers have the right to be treated by the carrier's employees withkindness, respect, courtesy and due consideration. They are entitled to be protected against personalmisconduct, injurious language, indignities and abuses from such employees. So it is that any discourteousconduct on the part of these employees toward a passenger gives the latter an action for damages againstthe carrier.

Fortune Express Inc. vs. CA

Art. 1763 of the Civil Code provides that a common carrier is responsible for injuries suffered by apassenger on account of wilfull ac ts of other passengers, if the employees of the c ommon carrier could have

prevented the act through the exercise of the dil igence of a good father of a family. In the present case, it isclear that because of the negligence of petitioner's employees, the seizure of the bus by Mananggolo andhis men was made possible.

Despite warning by the Philippine Constabulary at Cagayan de Oro that the Maranaos wereplanning to take revenge on the petitioner by burning some of its buses and the assurance of petitioner'soperation manager, Diosdado Bravo, that the necessary precautions would be taken, petitioner did nothingto protect the safety of its passengers. Had petitioner and its employees been vigilant they would not havefailed 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 andinspecting their baggages, preferably with non-intrusive gadgets such as metal detectors, before allowingthem on board could have been employed without violating the passenger's constitutional rights.

The acts of Maranaos could not be considered as caso fortuito because there was already a

warning by the PC.No contributory negligence could be attributed to the deceased. The assailant's motive was to

retaliate for the loss of life of two Maranaos as a result of the collision between petitioner's bus and thejeepney in which the two Maranaos were riding. The armed men ac tually allowed deceased to retrievesomething from the bus. What apparently angered them was his attempt to help the driver of the bus bypleading for his life.

Gatchalian vs. Delim


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The record yields affirmative evidence of fault or negligence on the part of respondent commoncarrier. The driver did not stop to check if anything had gone wrong with the bus when the snapping soundwas heard and made known to him by the passengers, instead told them that it was normal. The driver'sreply necessarily indicated that the same "snapping sound" had been heard in the bus on previous

occasions. This could only mean that the bus had not been checked physically or mechanically to determinewhat was causing the "snapping sound" which had occurred so frequently that the driver had gottenaccustomed to it. Such a sound is obviously alien to a motor vehicle in good operating condition, and even amodicum of concern for life and limb of passengers dictated that the bus be checked and repaired. Theobvious continued failure of respondent to look after the roadworthiness and safety of the bus, coupled withthe driver's refusal or neglec t to stop the mini -bus after he had heard onc e again the "snapping sound " andthe cry of alarm from one of the passengers, constituted wanton disregard of the physical safety of thepassengers, and hence gross negligenc e on the part of respondent and his driver.

Because what is involved here is the liability of a common carrier for injuries sustained bypassengers in respect of whose safety a common carrier must exercise extraordinary diligence, we mustconstrue any such purported waiver most strictly against the common carrier. For a waiver to be valid and

effective, i t must not be contrary to law, morals, public policy or good customs. A cursory examination of thepurported waiver will readily show that appellees did not actually waive their right to claim damages fromappellant for the latter's failure to comply with their c ontract of carriage. All that said document proves is thatthey expressed a "desire" to make the waiver which obviously is not the same as making an actual waiver oftheir right. A waiver of the kind invoked by appellant must be clear and unequivocal.

A person is entitled to the physical integrity of his or her body; if that integrity is violated ordiminished, actual injury is suffered for which actual or compensatory damages are due and assessable.Petitioner Gatchalian is entitled to be placed as nearly as possible in the condition that she was beforemishap. A scar, especially one on the face of the woman, resulting from the inflic tion of injury upon her, is aviolation of bodily integrity, giving raise to a legitimate claim for restoration to her condi tion ante.

Del Castillo vs. Jaymalin

Common carriers are responsible for the death of their passengers (Articles 1764 and 2206 of theCivil Code). This liability includes the loss of the earning capacity of the deceased. It appears proven thatthe defendant corporations failed to exercise the diligence that was their duty to observe according toArticles 1733 and 1755. The conductor was apprised of the fact that Mario del Castillo was deaf and dumb.With this knowledge the conductor should have taken extra-ordinary care for the safety of the saidpassenger. In this he failed.

Phil. Rabbit Bus Lines vs. IAC

The principle about "the last clear" chance, would call for application in a suit between the ownersand drivers of the two colliding vehicles. It does not arise where a passenger demands responsibility fromthe carrier to enforce its contractual obligations. For it would be inequitable to exempt the negligent driver ofthe jeepney and its owners on the ground that the other driver was likewise guil ty of negligence."

It is the rule under the substantial factor test that if the actor's conduct is a substantial factor inbringing about harm to another, the fact that the actor neither foresaw nor should have foreseen the extentof the harm or the manner in which it occurred does not prevent him from being liable. The bus driver's


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conduct is not a substantial factor in bringing about harm to the passengers of the jeepney. It cannot be saidthat the bus was travelling at a fast speed when the accident occurred because the speed of 80 to 90kilometers per hour, assuming such calculation to be correct, is yet within the speed limit allowed inhighways.

Bustamante vs. CA

The doctrine, stated broadly, is that the negligence of the plaintiff does not preclude a recovery forthe negligence of the defendant where it appears that the defendant, by exercising reasonable care andprudence, might have avoided injurious consequences to the plaintiff notwithstanding the plaintiff'snegligence. In other words, the doctrine of last clear chance means that even though a person's own actsmay have placed him in a position of peril, and an injury results, the injured person is entitled to recovery. Asthe doctrine is usually stated, a person who has the last clear chance or opportunity of avoiding an accident,notwithstanding the negligent acts of his opponent or that of a third person imputed to the opponent isconsidered in law solely responsible for the consequences of the accident.

All premises considered, the Court is convinced that the respondent Court committed an error oflaw in applying the doctrine of last clear chance as between the defendants, since the case at bar is not asuit between the owners and drivers of the coll iding vehic les but a suit brought by the heirs of the deceasedpassengers against both owners and drivers of the colliding vehic les. Therefore, the respondent court erredin absolving the owner and driver of the cargo truck from l iabil ity.

Lara vs. Valencia

The owner and driver of a vehic le owes to accommodation passengers or invited guests merely theduty to exercise reasonable care so that they may be transported safely to their destination. Thus, "The rule

is established by weight of authority that the owner or operator of an automobile owes the duty to an invitedguest to exercise reasonable care in its operation, and not unreasonably to expose him to danger and injuryby increasing the hazard of travel. The owner of the vehicle in the case at bar is only required to observeordinary care, and is not in duty bound to exercise extraordinary diligence as required by our law.

A passenger must observe the diligence of a father of a fam ily to avoid injury to himself whichmeans that if the injury to the passenger has been proximately caused by his own negligence, the carriercannot be held liable.

Necessito vs. Paras

While the carrier is not an insurer of the safety of the passengers, it should nevertheless be held toanswer for the laws its equipment if such flaws were at all discoverable. In th is connection, the manufacturerof the defective appliance is considered in law the agent of the carrier, and the good repute of themanufacturer will not relieve the carrier from l iabil ity. The rationale of the carrier's liability is the fact that thepassenger has no privity with the manufacturer of the defective equipment; hence, he has no remedyagainst him, while the carrier usually has.

Japan Airlines vs. CA


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Accordingly, there is no question that when a party is unable to fulfill his obl igation bec ause of"force majeure," the general rule is that he cannot be held liable for damages for non-performance.Corollarily, when JAL was prevented from resuming its flight to Manila due to the effects of Mt. Pinatuboeruption, whatever losses or damages in the form of hotel and meal expenses the stranded passengers

incurred, cannot be charged to JAL. Yet it is undeniable that JAL assumed the hotel expenses ofrespondents for their unexpected overnight stay on June 15, 1991.

It has been held that airline passengers must take such risks incident to the mode of travel. In thisregard, adverse weather conditions or extreme climatic changes are some of the perils involved in air travel,the consequences of which the passenger must assume or expect.

While JAL was no longer required to defray private respondents' living expenses during their stayin Narita on account of the fortuitous event, JAL had the duty to make the necessary arrangements totransport private respondents on the first available connec ting flight to Mani la. Petitioner JAL reneged on itsobligation to look after the comfort and convenience of its passengers when it declassified privaterespondents from "transit passengers" to "new passengers" as a result of which private respondents wereobliged to make the necessary arrangements themselves for the next flight to Manila.

Layugan vs. IAC

Res ipsa loquitur is a doctrine which states thus: "Where the thing whic h causes injury is shown tobe under the management of the defendant, and the accident is such as in the ordinary course of thingsdoes not happen if those who have the management use proper care, it affords reasonable evidence, in theabsence of an explanation by the defendant, that the acc ident arose from want of care.The doctrine of Resipsa loquitur as a rule of evidence is peculiar to the law of negligence which recognizes that prima facienegligence may be established without direct proof and furnishes a substitute for specific proof ofnegligence.The doctrine can be invoked when and only when, under the circumstances involved, directevidence is absent and not readily available.

Whether the cargo truck was parked along the road or on half the shoulder of the right side of the

road would be of no moment taking into account the warning device consisting of the lighted kerosene lampplaced three or four meters from the back of the truck. But despite this warning which we rule as sufficient,the Isuzu truck driven by Daniel Serrano, an employee of the private respondent, still bumped the rear of theparked cargo truck. As a direct consequence of such accident the petitioner sustained injuries on his leftforearm and left foot. It is clear therefore that the absence or want of care of Daniel Serrano has beenestablished by clear and convincing evidence. It follows that the doc trine of Res ipsa loquitur is inapplicable,making the employer of the driver liable for the negligence of his employee.

La Mallorca vs. CA

The liability of the carrier for the child, who was already led by the father to a place about 5 meters

away from the bus for her safety under the contract of carriage, persists. The relation of carrier andpassenger does not necessarily cease where the latter, after alighting from the car, aids the carrier's servantor employee in removing his baggage from the car.

It has been recognized as a rule that the relation of carrier and passenger does not cease at themoment the passenger alights from the carrier's vehicle at a place selected by the carrier at the point ofdestination, but continues until the passenger has had a reasonable time or a reasonable opportunity toleave the carrier's premises. And, what is a reasonable time or a reasonable delay within this rule is to bedetermined from all the circumstances.


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Aboitiz Shipping Co. vs. CA

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 owner's dock or premises. Once created, therelationship will not ordinarily terminate until the passenger has, after reaching his destination, safelyalighted from the carrier's conveyance or had a reasonable opportunity to leave the carrier's premises. Allpersons who remain on the premises a reasonable time after leaving the conveyance are to be deemedpassengers, and what is a reasonable time or a reasonable delay within this rule is to be determined from allthe 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 fac t that the person transported has beencarried to his destination if, for example, such person remains in the carrier's premises to claim his baggage.

When the accident occurred, the victim was in the act of unloading his cargoes, which he hadevery right to do, from petitioner's vessel. Even if he had already disembarked an hour earlier, his presencein petitioner's premises was not without cause. The victim had to claim his baggage which was possible onlyone hour after the vessel arrived since it was admittedly standard procedure in the case of petitioner's

vessels that the unloading operations shall start only after that time.

Mallari Sr. vs. CA

Clearly, the proximate cause of the collision resulting in the death of a passenger of the jeepney,was the sole negligence of the driver of the passenger jeepney, petitioner Alfredo Mallari Jr., who recklesslyoperated and drove his jeepney in a lane where overtaking was not al lowed by traffic rules. Under Art. 2185of the Civil Code, unless there is proof to the contrary, it is presumed that a person driving a motor vehiclehas been negligent if at the time of the mishap he was violating a traffic regulation.

Under Art. 1755 of the Civil Code, a common carrier is bound to carry the passengers safely as faras human care and foresight can provide using the utmost diligence of very cautious persons with due

regard for all the c ircumstances. Moreover, under Art. 1756 of the Civil Code, in case of death or injuries topassengers, a common carrier is presumed to have been at fault or to have acted negligently, unless itproves that it observed extraordinary dil igence. Further, pursuant to Art. 1759 of the same Code, it is liablefor the death of or injuries to passengers through the negligence or willful acts of the former's employees.This l iability of the common carrier does not cease upon proof that it exercised all the diligence of a goodfather of a family in the selection of its employees.

Bayasen vs. CA

It is a well known physical tact that cars may skid on greasy or slippery roads, as in the instant case, without

fault on account of the manner of handling the car. Skidding means partial or complete loss of control of thecar under circumstances not necessarily implying negligence. It may occur without fault.

Under the particular circumstances of the instant case, the petitioner- driver who skidded could not beregarded as negligent, the skidding being an unforeseen event, so that the petitioner had a valid excuse forhis departure from his regular course.

Cervantes vs. CA


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Since the PAL agents are not privy to the said Agreement and petitioner knew that a written request to thelegal counsel of PAL was necessary, he cannot use what the PAL agents did to his advantage. The saidagents, acted without authority when they confirmed the flights of the petitioner. Under Article 1989 of theNew Civil Code, the acts of an agent beyond the scope of his authority do not bind the principal, unless the

latter ratifies the same expressly or impliedly. Furthermore, when the third person (herein petitioner) knowsthat the agent was acting beyond his power or authority, the principal cannot be held liable for the acts ofthe agent. If the said third person is aware of such limits of authority, he is to blame, and is not entitled torecover damages from the agent, unless the latter undertook to secure the principal's ratification.

Calalas vs. CA

It is immaterial that the proximate cause of the col lision between the jeepney and the truck was thenegligence of the truck driver. T he doctrine of proximate cause is applic able only in actions for quasi -delict,not in actions involving breach of contract. The doctrine is a device for imputing liability to a person wherethere 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 whocreate the obligation, and the function of the law is merely to regulate the relation thus created. Insofar ascontracts of carriage are concerned, some aspects regulated by the Civil Code are those respecting thediligence required of common carriers with regard to the safety of passengers as well as the presump tion ofnegligence in cases of death or injury to passengers.

In case of death or injuries to passengers, Art. 1756 of the Civil Code provides that commoncarriers are presumed to have been at fault or to have acted negligently unless they prove that theyobserved extraordinary diligence as defined in Arts. 1733 and 1755 of the Code. This provision necessarilyshifts to the common carrier the burden of proof.

The driver of jeepney did not carry safely as far as human care and foresight could provide, usingthe utmost diligence of very cautious persons, with due regard for all the c ircumstances" as required by Art.1755. 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. The petitioner'sdriver took in more passengers than the allowed seating capacity of the jeepney. These are violations of theLand Transportation and Traffic Code. Therefore, there is no assumption of risk by the passenger.

Pestao vs. Sumayang

In the case at bar, Pestao, as a professional driver operating a public transport bus, should haveanticipated that overtaking at a junction was a perilous maneuver and should thus have exercised extremecaution.

Under Articles 2180 and 2176 of the Civil Code, owners and managers are responsible fordamages caused by their employees. When an injury is caused by the negligence of a servant or an

employee, the master or employer is presumed to be negl igent either in the selection or in the supervision ofthat employee. This presumption may be overcome only by satisfactorily showing that the employerexercised the care and the diligence of a good father of a family in the selection and the supervision of itsemployee.

Gillaco vs. Manila Railroad


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While a passenger is entitled to protection from personal violence by the carrier or its agents oremployees, since the contract of transportation obligates the carrier to transport a passenger safely to hisdestination, the responsibi lity of the carrier extends only to those acts that the carrier could foresee or avoidthrough the exercise of the degree of care and diligence required of it. In the present case, the act of thetrain guard of the Manila Railroad Company in shooting the passenger (because of a personal grudge

nurtured against the latter since the Japanese occupation) was entirely unforseeable by the Manila Rail roadCo. The latter had no means to ascertain or anticipate that the two would meet, nor could it reasonablyforsee every personal rancor that might exist between each one of its many employees and any one of thethousands of eventual passengers riding in i ts trains. The shooting in question was therefore "caso fortuito"within the definition of Art. 1105 of the old Civil Code (which is the law applicable), being both unforeseeableand inevitable under the given circumstances; and pursuant to established doc trine, the resulting breach ofthe company's contract of safe carriage with the deceased was excused thereby.

Maranan vs. Perez

The basis of the common carrier's liability under NCC for assaults on passengers committed by its

drivers rests either on (1) the doctrine of respondeat superior or (2) the princ iple that it is the carrier's impliedduty to transport the passenger safely.

Under the first, which is the minority view, the carrier is liable only when the act of the employee iswithin the scope of his authority and duty. It is not sufficient that the act be within the course of employmentonly. Under the second view, upheld by the majority and also by the later cases, it is enough that the assaulthappens within the course of the employee's duty. It is no defense for the carrier that the act was done inexcess of authority or in disobedience of the carrier's orders. The carrier's liability here is absolute in thesense that it practically secures the passengers from assaults committed by its own employees. Art. 1759,evidently follows the rule based on the second view.

Accordingly, it is the carrier 's strict obligation to select its drivers and similar employees with dueregard not only to their technical competence and physical abili ty, but also, no less important, to their totalpersonality, including their patterns of behavior, moral fibers, and soc ial attitude.

PNR vs. CA

When a train boarded by the deceased passenger was so over-crowded that he and many otherpassengers had no choice but to sit on the open platforms between the coaches of the train, the commoncarrier is negligent.

Likewise when the

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