1 SARKIES TOURS PHILIPPINES, INC. petitionervs.

HONORABLE
COURT OF APPEALS (TENTH DIVISION), DR. ELINO G. FORTADES,
MARISOL A. FORTADES and FATIMA A. FORTADES., respondent.
Characters:
Sarkies Tours Phils> petitioner-common carrier
Fatima Fortades> private respondent, angnawalan ng
mgagamit
Marisol Fortades> private respondent, nanayni Fatima
aul > !rother o" Fatima, tumulongkay Fatima mag-load
ng !aggage nyasa !us# e$tra langsyadito
%ature o" the Case: &amage suit against petitioner "or !reach o"
contract o" carriage allegedly attended !y !ad "aith'
FACTS:
Fatima !oarded petitioner(s !us )&e *u$e +us %o',- in
Manila on her way to *ega.pi City'
/er !rother aul helped her load three pieces o" luggage
containing all o" her optometry review !ooks, materials and
e0uipment, trial lenses, trial contact lenses, passport and visa,
as well as her mother Marisol(s 1'S' immigration )green- card,
among other important documents and personal !elongings'
/er !elongings were kept in the !aggage compartment o"
the !us, !ut during a stopover at &aet, it was discovered that
only one !ag remained in the open compartment' The others,
including Fatima(s things, were missing and could have
dropped along the way'
Some o" the passengers suggested retracing the route to
try to recover the lost items, !ut the driver ignored them and
proceeded to *ega.pi City'
2""orts were then made on the part o" private respondents
to recover the lost !aggage'
Marisol went petitioner(s o""ice in *ega.pi, then in
Manila' )Petitioner here o""ered them P3k "or each
luggage lost, w4c o""er Marisol turned down'-
5sked assistance "rom radio stations'
5sked helped o" Philtranco !us drivers who plied the
same route'
eported the incident to the %+6 "ield o""ice in *ega.pi
City and local police'
7ne o" Fatima(s !ags was recovered'
espondents, through counsel, "ormally demanded
satis"action o" their complaint "rom petitioner' Petitioner,
through a letter, apologi.ed "or the delay and said that a team
has !een sent out to +icol "or the purpose o" recovering or at
least getting the "ull detail8o" the incident'
espondents "iled the case a"ter nine months o" "ruitless
waiting'
espondent(s Contention: The loss was due to petitioner(s "ailure
to o!serve e$traordinary diligence in the care o" Fatima(s luggage
and that petitioner dealt with them in !ad "aith "rom the start'
Petitioner(s &e"ense: &isowned any lia!ility "or the loss on the
ground that Fatima allegedly did not declare any e$cess !aggage
upon !oarding its !us'
Trial Court ruled in "avor o" private respondents ordering petitioner
to pay respondents the value o" the personal !elongings )plus
transpo e$penses, moral 9 e$emplary damages, attorney(s "ees,
litigation e$penses-'
C5 a""irmed trial court )!ut deleted moral 9 e$emplary damages-'
ISSUE: 5s a common carrier, is petitioner responsi!le "or the
loss:
HELD: 7" course'
1nder the Civil Code, ;)c-ommon carriers, "rom the nature o" their
!usiness and "or reasons o" pu!lic policy, are !ound to o!serve
e$traordinary diligence in the vigilance over the goods $ $$
transported !y them,8 and this lia!ility ;lasts "rom the time the
goods are unconditionally placed in the possession o", and
received !y the carrier "or transportation until the same are
delivered, actually or constructively, !y the carrier "or
transportation until the same are delivered, actually or
constructively, !y the carrier to $ $$ the person who has a right to
receive them,8 unless the loss is due to any o" the e$cepted
causes under 5rticle 3<=> thereo"'
The cause o" the loss in the case at !ar was petitioner(s
negligence in not ensuring that the doors o" the !aggage
compartment o" its !us were securely "astened' 5s a result o" this
lack o" care, almost all o" the luggage was lost, to the pre?udice o"
the paying passengers'
5s the C5 correctly o!served:
;$ $$' @here the common carrier accepted its passenger(s
!aggage "or transportation and even had it placed in the vehicle
!y its own employee, its "ailure to collect the "reight charge is the
common carrier(s own lookout' 6t is responsi!le "or the
conse0uent loss o" the !aggage' 6n the instant case, de"endant
appellant(s employee even helped Fatima Minerva Fortades and
her !rother load the luggages4!aggages in the !us( !aggage
compartment, without asking that they !e weighed, declared,
receipted or paid "or' %either was this re0uired o" the other
passengers'
Favorite ni*ardiitanong: @hat are the circumstances:
Petitioner claims that Fatima did not !ring any piece o"
luggage with her, and even i" she did, none was declared at
the start o" the trip' +ut evidence show that Fatima had indeed
!rought w4 her = pieces o" luggage as testi"ied !y her !rother
aul and one o" the !ags was even recovered !y the
Philtranco !us drivers'
Petitioner also admitted its lia!ility !y apologi.ing to
respondents and assuring them that e""orts were !eing made
to recover the lost items'
ecords reveal that respondents made e""orts and incurred
e$penses ?ust to recover the lost items' );Clearly, they would
not have gone through all that trou!le in pursuit o" a "ancied
loss'8-
eported incident to %+6A)re"er to e""orts a!ove-
They had to e$ecute a""idavit "or the loss o" Mirasol(s
immigration documents'
&uring the trial, they had to travel "rom the 1'S' ?ust to
testi"y'
7ther !aggage o" other passengers were also lost'
&6SP7S6T6B2: C5 a""irmed w4 modi"ication that petitioner is
ordered to pay respondents moral and e$emplary damages
!ecause it was proven that petitioner acted w4 negligence and !ad
"aith'
5PP*6C5+*2 P7B6S67%S: Civil Code 3<==, 3<=C, 3<=>
2 BENITO MACAM d!n" #$%!n&%% $nd&' ()& na*& and %(+,& BEN-
MAC ENTERPRISES, .&(!(!n&', /%.
COURT OF APPEALS, CHINA OCEAN SHIPPING CO., and0'
1ALLEM PHILIPPINES SHIPPING, INC.,'&%.nd&n(%.
Characters:
Benito Macam- doing business under the name and style Ben-Mac Enterprises
China Ocean Shipping Company- owner and operator of vessel Nen Jiang
allem !hilippines Shipping" #nc- local agent of China Ocean Shipping" #nc$
Goods:
atermelons and fresh mangoes
FACTS:
!etitioner Benito Macam" doing business under the name and
style Ben-Mac Enterprises" shipped on board the vessel Nen
Jiang" owned and operated by respondent China Ocean Shipping
Co$" through local agent respondent allem !hilippines Shipping"
#nc$ %hereinafter &''EM(" covered by Bill of 'ading and
e)ported through 'etter of Credit issued by !&*#S+&N B&N*$
+he Bills of 'ading contained the following pertinent provision,
"One of the Bills of Lading must be surrendered duly endorsed in
exchange for the goods or delivery order"

+he shipment was bound for -ong.ong with !&*#S+&N B&N* as
consignee and /reat !rospect Company of *owloon" -ong.ong
%hereinafter /!C( as notify party$
0pon arrival in -ong.ong" the shipment was delivered by
respondent &''EM directly to /!C" not to !&*#S+&N B&N*"
and without the re1uired bill of lading having been surrendered$
Subse1uently" /!C failed to pay !&*#S+&N B&N* such that the
latter" still in possession of the original bills of lading" refused to
pay petitioner through SO'#2B&N*$ Since SO'#2B&N* already
pre-paid petitioner the value of the shipment" it demanded
payment from respondent &''EM through five %3( letters but
was refused$
!etitioner was thus allegedly constrained to return the amount
involved to SO'#2B&N*" then demanded payment from
respondent &''EM in writing but to no avail$
!etitioner sought collection of the value of the shipment from
respondents before the 4+C Manila" based on delivery of the
shipment to /!C without presentation of the bills of lading and
ban. guarantee$
!etitoner5s contention,
6$ the fact that the shipment was not delivered to the consignee as
stated in the bill of lading or to a party designated or named by
the consignee constitutes a misdelivery thereof$
7$ that from the te)t of the tele)" assuming there was such an
instruction" the delivery of the shipment without the re1uired bill of
lading or ban. guarantee should be made only to the designated
consignee" referring to !&*#S+&N B&N*$
4espondents5 defense,
6$ the shipment was delivered to /!C without presentation of the
bills of lading and ban. guarantee per re1uest of petitioner himself
because the shipment consisted of perishable goods$
7$ that it is a standard maritime practice" when immediate delivery is
of the essence" for the shipper to re1uest or instruct the carrier to
deliver the goods to the buyer upon arrival at the port of
destination without re1uiring presentation of the bill of lading as
that usually ta.es time$
8$ &s proof thereof" respondents apprised the trial court that for the
duration of their two-year business relationship with petitioner
concerning similar shipments to /!C deliveries were effected
without presentation of the bills of lading$
4+C, in favor of Macam" respondents to pay" 9ointly and severally the
costs$
C&, 4E:E4SE2
ISSUES:
6$ ON the respondents are liable for the shipped goods
7$ ON respondents are liable to petitioner for releasing the goods to
/!C without the bills of lading or ban. guarantee
SC, &ffirmed C&
HELD:
6$ &rticle 6;8< of the Civil Code provides -
!rt "#$% &he extraordinary responsibility of the common carriers lasts
from the time the goods are unconditionally placed in the possession of'
and received by the carrier for transportation until the same are delivered'
actually or constructively' by the carrier to the consignee' or to the person
(ho has a right to receive them' (ithout pre)udice to the provisions of
article "#$*
+he e)traordinary responsibility of the common carriers lasts until actual
or constructive delivery of the cargoes to the consignee or to the person who has
a right to receive them$ !&*#S+&N B&N* was indicated in the bills of lading as
consignee whereas /!C was the notify party$ -owever" in the e)port invoices
/!C was clearly named as buyer=importer$ !etitioner also referred to /!C as
such in his demand letter to respondent &''EM and in his complaint before the
trial court$ +his premise draws us to conclude that the delivery of the cargoes to
/!C as buyer=importer which" conformably with &rt$ 6;8< had" other than the
consignee" the right to receive them was proper$
7$ 4espondents submitted in evidence a tele) dated 3 &pril 6>?> as
basis for delivering the cargoes to /!C without the bills of lading
and ban. guarantee$ +he tele) instructed delivery of various
shipments to the respective consignees without need of
presenting the bill of lading and ban. guarantee per the
respective shipper5s re1uest since @for prepaid shipt ofrt charges
already fully paid$A !etitioner was named therein as shipper and
/!C as consignee with respect to Bill of 'ading Nos$ -*/ >>B67
and -*/ >>B68$ !etitioner disputes the e)istence of such
instruction and claims that this evidence is self-serving$
Crom the testimony of petitioner" we gather that he has been transacting
with /!C as buyer=importer for around two %7( or three %8( years already$
hen mangoes and watermelons are in season" his shipment to /!C
using the facilities of respondents is twice or thrice a wee.$ +he goods
are released to /!C$ #t has been the practice of petitioner to re1uest the
shipping lines to immediately release perishable cargoes such as
watermelons and fresh mangoes through telephone calls by himself or his
@people$A #n transactions covered by a letter of credit" ban. guarantee is
normally re1uired by the shipping lines prior to releasing the goods$ But
for buyers using telegraphic transfers" petitioner dispenses with the ban.
guarantee because the goods are already fully paid$ #n his several years
of business relationship with /!C and respondents" there was not a
single instance when the bill of lading was first presented before the
release of the cargoes$
&dditional,
5llegation o" complaint does not deal with misdelivery o" cargoes
The su!mission o" Macam that ;the "act that the shipment was not
delivered to the consignee as
stated in the +ill o" *ading or to a party designated or named !y
the consignee constitutes a misdelivery
thereo"8 is a deviation "rom his cause o" action !e"ore the trial
court' 6t is clear "rom the allegation in his
complaint that it does not deal with misdelivery o" the cargoes !ut
o" delivery to DPC without the re0uired !ills o" lading and !ank
guarantee, i'e' ;)C- The goods arrived in /ongkong and were
released !y the de"endant @allem directly to the !uyer4noti"y
party, Dreat Prospect Company and not to the consignee, the
%ational +ank o" Pakistan, /ongkong, without the re0uired !ills o"
lading and !ank guarantee "or the release o" the shipment issued
!y the consignee o" the goods'8
Misdelivery never an issue when Macam wrote @allem "or the
payment o" the value o" the
Cargoes
/erein, when Macam wrote @allem demanding payment o" the
value o" the cargoes, misdelivery o"
the cargoes did not come into the picture' The letter, in part, states
;@e are writing you on !ehal" o" our client, +en-Mac 2nterprises
who in"ormed us that +ills o" *ading %o' EEF3G and EEF3= with a
total value o" 1SHGF,GG='>C were released to Dreat Prospect,
/ongkong without the necessary !ank guarantee' @e were "urther
in"ormed that the consignee o" the goods, %ational +ank o"
Pakistan, /ongkong, did not release or endorse the original !ills o"
lading' 5s a result thereo", neither the consignee, %ational +ank o"
Pakistan, /ongkong, nor the importer, Dreat Prospect Company,
/ongkong, paid our client "or the goods'8
2 MAERSK LINE, .&(!(!n&', /%.
COURT OF APPEALS AND EFREN V. CASTILLO, d!n" #$%!n&%%
$nd&' ()& na*& and %(+,& 3 E()&"a, La#'a('!&%, '&%.nd&n(%.
Bidin, J (baka tanungin eh #Insurance)
2li *illy, 6nc - shipper
M52SI *ine J carrier, engaged in the !usiness o"
transportation o" goods !y sea
Compania Deneral de Ta!acos de Filipinas J agent o"
M52SI
2"ren Castillo J consignee, manu"acturer o" pharmaceutical
products
F5CTS:
- 7n %ovem!er 3G, 3E<C, Castillo ordered "rom 2li *illy, 6nc
o" Puerto ico CFF,FFF empty gelatin capsules "or the
manu"acture o" his pharmaceutical products' The capsules
were placed in C drums o" 3FF,FFF capsules each valued
at 1SH3,CCK'<3' Shipper 2li *illy, 6nc advised Castillo that
the products were already shipped on !oard MB ;5nders
Maerskline8 via 7akland, Cali"ornia and the e$pected
arrival date would !e 5pril =, 3E<<'
- /owever, "or unknown reasons, said cargoes o" capsule
were diverted to ichmond, Birginia hence need to !e
transported !ack to 7akland'
- 7n Lune 3F, 3E<<, the goods "inally arrived in Manila !ut
Castillo re"used to take the delivery o" the goods on
account o" its "ailure to arrive on time'
- /e "iled an action "or rescission o" contract with damages
against Maersk and 2li *illy alleging gross negligence and
undue delay'
&2F2%S2 o" the carrier )Maersk-:
- The shipment was transported in accordance with the
provisions o" the covering !ill o" lading and that its lia!ility
under the law on transportation o" good attaches only in
case o" loss, destruction or deterioration o" the goods as
provided "or in 5rticle 3<=> o" the Civil Code'
- 6t acted in good "aith and there was no special contract
under which the carrier undertook to deliver the shipment
on or !e"ore a speci"ic date'
&2F2%S2 o" the shipper )2li *illy, 6nc-:
- Filed its answer with compulsory and cross-claim' 6n its
cross-claim, it alleged that the delay in the arrival o" the
su!?ect merchandise was due solely to the gross
negligence o" Maersk *ine'
TC 1*6%D:
- &ismissed 2li *illy, 6nc and the latter withdrew cross claim'
- The court !elieves that Maersk *ine committed !reach in
the per"ormance o" their o!ligation consisting o" their
negligence to ship the C drums o" empty Delatin capsules
hence, ordered Maersk to pay "or the unreali.ed pro"it o"
Castillo, moral and e$emplary damages, the cost o"
Castillo(s credit line and attorney(s "ees'
C5 1*6%D:
- 5""irmed the TC ruling with some modi"ications as to the
amount o" damages'
6SS12:
3' @hether or not a cause o" action e$ists against Maersk
*ine given that there was a dismissal against 2li *illy, 6nc'
and withdrawal o" its cross-claim'
G' @hether or not Castillo is entitled to damages resulting
"rom delay in the delivery o" the shipment in the a!sence o"
stipulations in the !ill o" lading'
SC 1*6%D:
3' %o' 6t should !e recalled that the complaint was "iled
originally against 2li *illy 6nc as shipper-supplier and
petitioner as carrier' Petitioner !eing an original party
de"endant upon whom the delayed shipment is imputed
cannot claim that the dismissal o" the complaint against 2li
*illy, 6nc inured to its !ene"it'
G' Mes' Castillo claims that during the period !e"ore the
speci"ied date o" the arrival o" the goods, he had made
several commitments and contract o" adhesion' There"ore,
Maersk *ine can !e held lia!le "or damages su""ered !y
Castillo "or the cancellation o" the contracts he entered
into'
- Petitioner contends that it cannot !e held lia!le !ecause
there was no special contract under which the carrier
undertook to deliver the shipment on or !e"ore a speci"ic
date and that the +ill o" *ading provides that ;The carrier
does not undertake that the goods shall arrive at port o"
discharge or the place o" delivery at any particular timeA8
This provision in the !ill o" lading is undisputed to !e a
contract o" adhesion and generally, contract o" adhesion
are considered void since almost all the provisions o" these
types o" contracts are prepares and dra"ted only !y one
party, usually the carrier' %onetheless, settled is the rule
that !ills o" lading are contracts are not entirely prohi!ited'
+ill o" lading operates !oth as a receipt and as a contract
to transport and deliver the same a therein stipulated' 5s
a contract, it names the parties, which includes the
consignee, "i$es the route, destination and parties' +eing
a contact, it is the law !etween the parties who are !ound
!y its terms and conditions provided that these are not
contrary to law, morals, pu!lic policy, good customs and
pu!lic order' 5 !ill o" lading usually !ecomes e""ective
upon its delivery to and acceptance !y the shipper' 6t is
presumed that the stipulations o" the !ill were, in the
a!sence o" "raud, concealment or improper conduct,
known to the shipper, and he is generally !ound !y his
acceptance whether he reads it or not'
- /owever, the a!ovementioned ruling applies only i" such
contracts will not create a!surd situation as in the case at
!ar' The 0uestioned provision in the !ill o" lading
practically leaving the date o" arrival o" the su!?ect
shipment on the sole determination and will o" the carrier'
6t is esta!lished that without any stipulation o" date, the
delivery o" shipment or cargo should !e made within a
reasonable time. 6n the case at !ar, SC declared that a
delay in the delivery o" the goods spanning o" G months
and < days "alls !eyond the realm o" reasona!leness
there"ore, the petitioner is lia!le "or such delay and
damages'
- Petition denied, C5 ruling a""irmed'
4 SPOUSES TEODORO
1
and NANETTE PERENA, P&(!(!n&'%, /%.
SPOUSES TERESITA PHILIPPINE NICOLAS and L. 5ARATE,
NATIONAL RAIL1A6S, and ()& COURT OF APPEALS R&%.nd&n(%.
Characters:
a. Sps' Teodoro and %anette Perena J petitioner, operator o" a
School +us on which it transports students "rom Parana0ue
City to &on +osco, Makati'
b. Sps' Narate J respondents, parents o" 5aron Narate
)deceased-, who contracted the services o" the petitioners as
school service
c. P% J operator o" the commuter train %o' =FG that hit the
school service Ban !y the petitioners
d. 5aron Narate J a high school student o" &on +osco, Makati,
who was killed during the collision o" his school !us and the
train o" P%
e. Clement 5l"aro J employee o" the petitioners and driver o"
I65 Ceres Ban used as a school service
f. Lhonny 5lano J operator4 driver o" the commuter train that hit
the van o" the petitioners
FACTS:
The Narates contracted the petitioner to transport their
child 5aron to and "rom &on +osco, Makati'
The school !us have )3>- "ourteen passenger students'
C 5M is the usual time that the school service picks up the
child "rom the Narates( residence as he us seated in the
le"t corner , near the door o" the school !us'
&uring the day o" the accident, they were running late
since students were due !y <:3, 5M' The driver )5l"aro-,
took a shortcut, traversing the railroad in Magallanes
6nterchange which is commonly used !y Makati-!ound
vehicles' &uring this time, the railroad crossing was le"t
open, without any railroad marks, signs or !arriers that
could have warned motorists in the area'
*oud music was played during the school !us travel to
school'
5l"aro overtake a passenger !us, which !locks his view o"
the incoming commuter train driven !y 5lano' %oticing the
upcoming collision, ,F meters away "rom the van, the
driver o" the train applied its emergency !rakes !ut yet it
collided with the school service van'
The train hit the rear end o" the van, which
instantaneously thrown o"" E out o" 3G students outside
the van' 5aron, hit his head and was killed during the
tragedy'
The train driver )5lano-, "led the scene without waiting "or
investigators to arrive'
Case was "iled in the TC J Parana0ue !y the Sps' Narate,
claiming "or damages against the Sps' Perena "or !reach o"
contract o" carriage while P% was sued "or torts or 0uasi-delict'
DEFENSE 3 PERENAS:
adduced evidence to show that they had exercised the
diligence of a good father of the family in the selection and
supervision of Alfaro, by making sure that Alfaro had been
issued a drivers license and had not been involved in any
vehicular accident prior to the collision; that their own son
had taken the van daily; and that Teodoro Perea had
sometimes accompanied Alfaro in the vans trips
transporting the students to school
DEFENSE OF PNR:
tended to show that the proximate cause of the collision had
been the reckless crossing of the van whose driver had not
first stopped, looked and listened; and that the narrow path
traversed by the van had not been intended to be a railroad
crossing for motorists
RTC 7 Pa'ana8$& D&9!%!n:
Favored the Sps' Narate, and ordered the Petitioners
together with P% as ?ointly and severally lia!le to pay "or
the damages caused against the "ormer'
+oth parties were negligent and such award o" damages
were not e$cessive contrary to the claim o" the
petitioners'
BOTH a..&a,&d ( ()& C$'( 3 A..&a,%:
7n %ov' 3=, GFFG, C5 a""irmed the decision o" the TC
!ut limited the moral damages to PG', Million and deleted
the attorney(s "ee'
C5 gave consideration the loss o" income "rom 5aron,
reckoning his li"e e$pectancy "rom age G3 and also
considering minimum wage earnings "rom the child'
6SS12:
3' @4% the Sps' Perenas is considered a common carrier:
G' @4% the Sps' Perenas and P% are !oth negligent:
=' @4% the respondents are entitled o" the loss o" earning
capacity "rom their child 5aron considering that he was still a
high school student when he was killed:
SC HELD:
The Court denied the petition o" Sps' Parenas and a""irm the C5
decision' The Court considered that the !usiness o" having a
school service is considered a common carrier and governed !y
the laws o" civil code on common carriers, as to its duties and
lia!ilities' The Court also considered !oth the petitioner and P%
negligent as a common carrier and as to the neglect o" putting up
railroad signs and warnings !y P%' The Sps' Narate were also
awarded compensatory damages considering the loss o" income
!y their high school child who was killed in the accident'
3' Mes' The Court considered them as a common carrier and
shall !e governed !y the provisions o" common carriers in the
%ew Civil Code with regard to their duty and lia!ility to the
pu!lic' The de"ense o" the Perenas was no considered since
it is inappropriate in an action "or !reach o" contract o"
carriage' The standard o" care was e$traordinary diligence,
not ordinary diligence o" a good "ather o" a "amily'
M2S' School !us is a common carrier' 5s ruled in this case:
;5lthough in this ?urisdiction the operator o" a school !us service
has !een usually regarded as a private carrier, primarily !ecause
he only caters to some speci"ic or privileged individuals, and his
operation is neither open to the inde"inite pu!lic nor "or pu!lic
use, the e$act nature o" the operation o" a school !us service has
not !een "inally settled' This is the occasion to lay the matter to
rest'8
DEFINITION 3 a :Ca''!&';
!A carrier is a person or corporation who undertakes to transport
or convey goods or persons from one place to another,
gratuitously or for hire The carrier is classified either as a
private"special carrier or as a common"public carrier#
DEFINITION 3 a :P'!/a(& Ca''!&';
;5 private carrier is one who, without making the activity a
vocation, or without holding himsel" or itsel" out to the pu!lic as
ready to act "or all who may desire his or its services, undertakes,
!y special agreement in a particular instance only, to transport
goods or persons "rom one place to another either gratuitously or
"or hire' The provisions on ordinary contracts o" the Civil Code
govern the contract o" private carriage' The diligence re0uired o"
a private carrier is only ordinary, that is, the diligence o" a good
"ather o" the "amily'8

6" the undertaking is a single transaction, not a part o"

the general !usiness or occupation engaged in, as
advertised and held out to the general pu!lic, the
individual or the entity rendering such service is a
private, not a common, carrier'

DEFINITION 3 a :C**n Ca''!&';

;6n contrast, a common carrier is a person, corporation, "irm

or association engaged in the !usiness o" carrying or transporting
passengers or goods or !oth, !y land, water, or air, "or
compensation, o""ering such services to the pu!lic' Contracts o"
common carriage are governed !y the provisions on common
carriers o" the Civil Code, the Pu!lic Service 5ct, and other
special laws relating to transportation' 5 common carrier is
re0uired to o!serve e$traordinary diligence, and is presumed to
!e at "ault or to have acted negligently in case o" the loss o" the
e""ects o" passengers, or the death or in?uries to passengers'8

The true test "or a common carrier is not the 0uantity or

e$tent o" the !usiness actually transacted, or the num!er and
character o" the conveyances used in the activity, !ut whether the
undertaking is a part o" the activity engaged in !y the carrier that
he has held out to the general pu!lic as his !usiness or
occupation'

The 0uestion must !e determined !y the character o" the

!usiness actually carried on !y the carrier, not !y any secret
intention or mental reservation it may entertain or assert when
charged with the duties and o!ligations that the law imposes'
:P$#,!9 U%&;
OPu!lic useO is the same as Ouse !y the pu!licO' The essential
"eature o" the pu!lic use is not con"ined to privileged individuals,
!ut is open to the inde"inite pu!lic' 6t is this inde"inite or
unrestricted 0uality that gives it its pu!lic character'
To determine whether a use is pu!lic:
3' we must look not only to the character o" the
!usiness to !e done# !ut also
G' to the proposed mode o" doing it'
To determine i" not "or pu!lic use:
6" the use is merely optional with the owners, or the pu!lic
!ene"it is merely incidental, it is not a pu!lic use,
authori.ing the e$ercise o" the ?urisdiction o" the pu!lic
utility commission' There must !e, in general, a right
which the law compels the owner to give to the general
pu!lic' 6t is not enough that the general prosperity o" the
pu!lic is promoted'
Pu!lic use is not synonymous with pu!lic interest'
The true criterion !y which to ?udge the character o"
the use is whether the pu!lic may en?oy it !y right or
only !y permission'
T <$%(!3+ ()a( P&'&na% a% ()& .&'a('% 3 a %9), #$%
%&'/!9&:
a$ were engaged in transporting passengers
generally as a !usiness, not ?ust as a casual
occupation#
b$ undertaking to carry passengers over esta!lished
roads !y the method !y which the !usiness was
conducted# and
c$ transporting students "or a "ee' &espite catering to
a limited clientPle, the PereQas operated as a
common carrier !ecause they held themselves
out as a ready transportation indiscriminately to
the students o" a particular school living within or
near where they operated the service and "or a
"ee'
G' Mes' +oth Perenas and P% were negligent'
Perenas was not a!le to present any compelling de"ense or
reason !y which the Court might reverse the C5(s "indings on its
lia!ilities' Perenas was negligent when the driver overtook the
passenger !us, !locking its view o" the train, that caused the
collision' The common carrier did not "ully stop, look and listen
despite o!servance o" the right o" way o" rail road tracks'
+ecause o" the loud music played, the school !us driver might
have not heard the approaching train and that he even traversed
the railroad tracks on which P% does not permit to !e driven
"rom'
;To success"ully "end o"" lia!ility in an action upon the death or
in?ury to a passenger, the common carrier must prove his or its
o!servance o" that e$traordinary diligence# otherwise, the legal
presumption that he or it was at "ault or acted negligently would
stand' %o device, whether !y stipulation, posting o" notices,
statements on tickets, or otherwise, may dispense with or lessen
the responsi!ility o" the common carrier as de"ined under 5rticle
3<,, o" the Civil Code'8
The omissions o" care on the part o" the van driver constitutes
negligence'
7M6SS67% 7F C52:
Othe omission to do something which a reasona!le man,
guided !y those considerations which ordinarily regulate the
conduct o" human a""airs, would do, or the doing o" something
which a prudent and reasona!le man would not do, or as Ludge
Cooley de"ines it, R)t-he "ailure to o!serve "or the protection o" the
interests o" another person, that degree o" care, precaution, and
vigilance which the circumstances ?ustly demand, where!y such
other person su""ers in?ury'(O
5s to P%(s guilt o" negligence:
;P% also guilty o" negligence despite the school van o" the
PereQas traversing the railroad tracks at a point not dedicated !y
the P% as a railroad crossing "or pedestrians and motorists,
!ecause the P% did not ensure the sa"ety o" others through the
placing o" cross!ars, signal lights, warning signs, and other
permanent sa"ety !arriers to prevent vehicles or pedestrians "rom
crossing there'8
=' Mes' The Sps' Narate are entitled to the loss o" earning
capacity o" 5aron'
The Court ?usti"ies such claim:
3' ;The computation o" 5aron(s earning capacity was
premised on him !eing a lowly minimum wage
earner despite his !eing then enrolled at a
prestigious high school like &on +osco in Makati,
a "act that would have likely ensured his success
in his later years in li"e and at work'8
G' ;The "act that 5aron was then without a history o"
earnings should not !e taken against his parents
and in "avor o" the de"endants whose negligence
not only cost 5aron his li"e and his right to work
and earn money, !ut also deprived his parents o"
their right to his presence and his services as
well'8
=' ;The compensation o" this nature is awarded not
"or loss o" time or earnings !ut "or loss o" the
deceased(s power or a!ility to earn money8'
= IRON BULK SHIPPING PHILIPPINES, CO., LTD., .&(!(!n&', /%.
REMINGTON INDUSTRIAL SALES CORPORATION, '&%.nd&n(.
C)a'a9(&'%: )kelngan pa !an g character traits:-
3' 67% +1*I S/6PP6%D P/6*6PP6%2S, C7', *T&',
petitioner J the Filipino counterpart o" the "oreign vessel
owner4charterer'
G' 2M6%DT7% 6%&1ST65* S5*2S C7P75T67%,
respondent' J!uyer o" hot rolled steel sheets transported
!y 6ron +ulk'
=' @angs Company, 6nc' J the supplier o" emington
>' +urwill )5gencies- *td J @ang(s supplier# the "oreign
vessel owner4charterer o" MB R6ndian eliance(
,' Pioneer 5sia 6nsurance Corporation J insurer o" the goods
in transport'
Fa9(%:
Sometime in the latter part o" 3EE3, plainti"" emington
6ndustrial Sales Corporation )herea"ter emington "or short-
ordered "rom de"endant @angs Company, 6nc' )herea"ter @angs
"or short- 3E> packages o" hot rolled steel sheets, weighing
CKC',C, metric tons' 7n or a!out %ovem!er GC, 3EE3, the 3E>
packages were loaded on !oard the vessel MB R6ndian eliance(
at the Port o" Ddynia, Poland, "or transportation to the Philippines,
under +ill o" *ading %o' G<' The vessel(s owner4charterer is
represented in the Philippines !y de"endant 6ron +ulk Shipping
Phils', 6nc' )herea"ter 6ron +ulk "or short-' emington insured the
said cargo to Pioneer 5sia insurance Corp' 1pon arrival o" the
shipment to the port o" Manila, it was "ound a"ter inspection that
the hot rolled sheets were wet )with slight trace o" salt- and rusty,
e$tending "rom ,FS to KFS o" each plate' Plainti"" "iled "ormal
claims "or loss amounting to P,>>,K<,'3< with Pioneer, 6ron +ulk,
Manila Port Services, 6nc' )MPS- and 2S2 +rokerage Corporation
)2S2-' %o one honored such claims' Thus, plainti"" "iled an action
"or collection, plus attorney(s "ees, against @angs, Pioneer and
6ron +ulk'
CA R$,!n" (a33!'*!n" RTC '$,!n" !n ((): 5"ter considering the
"oregoing test results and the other evidence on record, the Court
"ound no clear and su""icient proo" showing that the water which
stayed in the cargo hold o" the vessel and which contaminated the
merchandise was seawater' The Court, however, is convinced
that the su!?ect goods were e$posed to salt conditions as
evidenced !y the presence o" a!out 3<S Sodium on the rust
sample'
%evertheless, since 6ron +ulk(s own evidence shows that there
was water inside the cargo hold o" the vessel and that the goods
stored therein were wet and "ull o" rust, without su""icient
e$planation on its part as to when and how water "ound its way
into the vessel holds, the Court "inds and so holds that 6ron +ulk
"ailed to e$ercise the e$traordinary diligence re0uired !y law in the
handling and transporting o" the goods'
' ' ' ' '
6ron +ulk did not even e$ercise due diligence !ecause admittedly,
water was dripping "rom the cargoes at the time they were !eing
discharged "rom the vessel' /ad 6ron +ulk done so, it could have
discovered !y ordinary inspection that the cargo holds and the
cargoes themselves were a""ected !y water and it could have
provided some remedial measures to prevent or minimi.e the
damage to the cargoes' +ut it did not, showing its lack o" care and
diligence over the goods'
+esides, since the goods were undou!tedly damaged, and as 6ron
+ulk "ailed to esta!lish !y any clear and convincing evidence any
o" the e$empting causes provided "or in 5rticle 3<=> o" the Civil
Code, it is presumed to have !een at "ault or to have acted
negligently'
' ' ' ' '
@/22F72, the Court "inding preponderance o" evidence "or
the plainti"" here!y renders ?udgment in "avor o" it and against all
the de"endants
I%%$&: That the Court o" 5ppeals erred in not "inding that the
contamination and rusting was chemically to have !een caused !y
"resh water# and that the appellate court erred in "inding that
petitioner "ailed to e$ercise the re0uisite diligence under the law'
I'n B$,> D&3&n%&: Gd% ?&'& a,'&ad+ da*a"&d #&3'&
('an%.'(.
SC R$,!n": P&(!(!n&'@% a'"$*&n(% !n %$..'( 3 ()& a%%!"n&d
&'''% a'& n( .,a$%!#,&. E/&n "'an(!n", 3' ()& %a>& 3
a'"$*&n(, ()a( ()& %$#<&9( 9a'" ?a% a,'&ad+ !n a da*a"&d
9nd!(!n a( ()& (!*& !( ?a% a99&.(&d 3' ('an%.'(a(!n, ()&
9a''!&' !% n( '&,!&/&d 3'* !(% '&%.n%!#!,!(+ ( &A&'9!%& d$&
9a'& !n )and,!n" ()& *&'9)and!%& and !n &*.,+!n" ()&
n&9&%%a'+ .'&9a$(!n% ( .'&/&n( ()& 9a'" 3'* 3$'()&'
d&(&'!'a(!n". I( !% %&((,&d ()a( ()& &A('a'd!na'+ d!,!"&n9& !n
()& /!"!,an9& /&' ()& "d% (&nd&'&d 3' %)!.*&n( '&8$!'&%
()& 9**n 9a''!&' ( >n? and ( 3,,? ()& '&8$!'&d
.'&9a$(!n 3' a/!d!n" da*a"& (, ' d&%('$9(!n 3 ()&
"d% &n('$%(&d ( !( 3' %a3& 9a''!a"& and d&,!/&'+.1= I(
'&8$!'&% 9**n 9a''!&'% ( '&nd&' %&'/!9& ?!() ()& "'&a(&%(
%>!,, and 3'&%!")( and ( $%& a,, '&a%na#,& *&an% (
a%9&'(a!n ()& na($'& and 9)a'a9(&'!%(!9 3 "d% (&nd&'&d 3'
%)!.*&n(, and ( &A&'9!%& d$& 9a'& !n ()& )and,!n" and
%(?a"&, !n9,$d!n" %$9) *&()d% a% ()&!' na($'& '&8$!'&%.1B
Und&' A'(!9,& 1C42 3 ()& C!/!, Cd&, &/&n !3 ()& ,%%,
d&%('$9(!n, ' d&(&'!'a(!n 3 ()& "d% %)$,d #& 9a$%&d,
a*n" ()&'%, #+ ()& 9)a'a9(&' 3 ()& "d%, ()& 9**n
9a''!&' *$%( &A&'9!%& d$& d!,!"&n9& ( 3'&%(a,, ' ,&%%&n ()&
,%%. T)!% &A('a'd!na'+ '&%.n%!#!,!(+ ,a%(% 3'* ()& (!*& ()&
"d% a'& $n9nd!(!na,,+ .,a9&d !n ()& .%%&%%!n 3, and
'&9&!/&d #+ ()& 9a''!&' 3' ('an%.'(a(!n $n(!, ()& %a*& a'&
d&,!/&'&d, a9($a,,+ ' 9n%('$9(!/&,+, #+ ()& 9a''!&' ( ()&
9n%!"n&&, ' ( ()& .&'%n ?) )a% a '!")( ( '&9&!/&
()&*.1C In ()& !n%(an( 9a%&, !3 ()& 9a''!&' !nd&&d 3$nd ()&
%(&&, %)&&(% ( )a/& #&&n 9/&'&d #+ '$%( a( ()& (!*& ()a( !(
a99&.(&d ()& %a*& 3' ('an%.'(a(!n, %$9) 3!nd!n" %)$,d
)a/& .'*.(&d !( ( a..,+ add!(!na, %a3&(+ *&a%$'&% ( *a>&
%$'& ()a( ()& 9a'" !% .'(&9(&d 3'* 9''%!n. T)!%, ()&
9a''!&' 3a!,&d ( d. EA9&.( !n ()& 9a%&% *&n(!n&d $nd&'
A'(!9,& 1C24, !3 ()& "d% a'& ,%(, d&%('+&d ' d&(&'!'a(&d,
9**n 9a''!&'% a'& .'&%$*&d ( )a/& #&&n a( 3a$,( ' (
)a/& a9(&d n&",!"&n(,+, $n,&%% ()&+ .'/& ()a( ()&+ #%&'/&d
&A('a'd!na'+ d!,!"&n9& a% '&8$!'&d $nd&' ()& ,a?.1D T)&
C$'( 3 A..&a,% d!d n( &'' !n 3!nd!n" ()a( n 9*.&(&n(
&/!d&n9& ?a% .'&%&n(&d ( .'/& ()a( ()& d&(&'!'a(!n 3 ()&
%$#<&9( 9a'" ?a% #'$")( a#$( #+ an+ 3 ()& 9a$%&%
&n$*&'a(&d $nd&' ()& a3'&8$(&d A'(!9,& 1C24 3 ()& %a!d
Cd&. 1& ,!>&?!%& a"'&& ?!() a..&,,a(& 9$'(@% 3!nd!n" ()a(
()& 9a''!&' 3a!,&d ( .'&%&n( .'3 ()a( !( &A&'9!%&d
&A('a'd!na'+ d!,!"&n9& !n !(% /!"!,an9& /&' ()& "d%. T)&
.'&%$*.(!n ()a( ()& 9a''!&' ?a% a( 3a$,( ' ()a( !( a9(&d
n&",!"&n(,+ ?a% n( /&'9*& #+ an+ 9$n(&'/a!,!n"
&/!d&n9&.
B FGU INSURANCE CORPORATION, P&(!(!n&'%, /%.
THE COURT OF APPEALS, SAN MIGUEL CORPORATION, and
ESTATE OF ANG GUI, '&.'&%&n(&d #+ LUCIO, EULIAN, and EAIME,
a,, %$'na*&d ANG, and CO TO, R&%.nd&n(%.
G.R. N. 14FCF4. Ma'9) 21, 2FF=
ESTATE OF ANG GUI, R&.'&%&n(&d #+ LUCIO, EULIAN and EAIME,
a,, %$'na*&d ANG, and CO TO,P&(!(!n&'%, /%.
THE HONORABLE COURT OF APPEALS, SAN MIGUEL CORP., and
FGU INSURANCE CORP., R&%.nd&n(%.
Characters:
3
st
civil case
5%C7 > plainti""
FD1> de"endant
G
nd
civil case
SMC> plainti""
2state o" 5ng Dui represented !y *ucio, Lulian and Laime
5ng and co To > de"endants
FD1> as third party de"endant impleaded !y the 2state''
%ature o" the Case: 3
st
action "or Speci"ic Per"ormance and
&amages !ased on FD1 Marine /ull 6nsurance Policy %o' BMF-
M/-3=,3E covering the vessel &4+ *ucio
G
nd
action "or +reach o" Contract o" Carriage
and &amages "iled !y SMC against 5%C7 !ased on +ill o" *ading
%o' 3 and %o' G, with de"endant 5%C7 seeking reim!ursement
"rom FD1 under 6nsurance Policy %o' M5-,K>KC, should the
"ormer !e held lia!le to pay SMC
FACTS:
5%C7 a partnership !etween 5ng Dui and Co To, was
engaged in the shipping !usiness' 6t owned the M4T 5%C7
tug!oat and the &4+ *ucio !arge which were operated as
common carriers' Since the &4+ *ucio had no engine o" its
own, it could not maneuver !y itsel" and had to !e towed !y a
tug!oat "or it to move "rom one place to another
San Miguel Corporation shipped "rom Ce!u, on !oard the
&4+ *ucio, "or towage !y M4T 5%C7 various cargoes )cases o"
!eer-
The &4+ *ucio was towed !y the M4T 5%C7 to 5nti0ue'
The tug!oat M4T 5%C7 le"t the !arge immediately a"ter
reaching San 5nti0ue
The arrastre workers unloading the cargoes o" SMC on
!oard the &4+ *ucio !egan to complain a!out their di""iculty in
unloading the cargoes !ecause o" !ig waves due to a storm'
SMC(s &istrict Sales Supervisor, Fernando Maca!uag,
re0uested 5%C7(s representative to trans"er the !arge to a
sa"er place !ecause the vessel might not !e a!le to withstand
the !ig waves
5%C7(s representative did not heed the re0uest !ecause
he was con"ident that the !arge could withstand the waves'
the crew o" &4+ *ucio a!andoned the vessel !ecause the
!arge(s rope attached to the whar" was cut o"" !y the !ig
waves' 5t around midnight, the !arge run aground and was
!roken and the cargoes o" !eer in the !arge were swept away
5s a result, 5%C7 "ailed to deliver to SMC(s consignee
"iled a complaint "or +reach o" Contract o" Carriage and
&amages against 5%C7
1pon 5ng Dui(s death, 5%C7, as a partnership, was
dissolved hence, SMC "iled a second amended complaint
which was admitted !y the Court impleading the surviving
partner, Co To and the 2state o" 5ng Dui represented !y
*ucio, Lulian and Laime, all surnamed 5ng' The su!stituted
de"endants adopted the original answer with counterclaim o"
5%C7 Osince the su!stantial allegations o" the original
complaint and the amended complaint are practically the
same'
5%C7(s contention:
- had an agreement with SMC that 5%C7 would not !e
lia!le "or any losses or damages resulting to the cargoes
!y reason o" "ortuitous event
- that there was an agreement !etween them and SMC to
insure the cargoes in order to recover indemnity in case o"
loss' Pursuant to that agreement, the cargoes to the e$tent
o" Twenty Thousand )GF,FFF- cases was insured with
FD1
- with leave o" court, "iled a Third-Party Complaint against
FD1
FD1(s contention:
- maintained that the alleged loss o" the cargoes covered !y
the said insurance policy cannot !e attri!uted directly or
indirectly to any o" the risks insured against in the said
insurance policy
- Third-Party Plainti"" 5%C7 and Plainti"" SMC "ailed to
e$ercise ordinary diligence or the diligence o" a good
"ather o" the "amily in the care and supervision o" the
cargoes insured to prevent its loss and4or destruction
- &ismissal o" the =
rd
party complaint
TC:
"ound that while the cargoes were indeed lost due to "ortuitous
event, there was "ailure on 5%C7(s part, through their
representatives, to o!serve the degree o" diligence re0uired
that would e$onerate them "rom lia!ility' The trial court thus
held the 2state o" 5ng Dui and Co To lia!le to SMC "or the
amount o" the lost shipment
on appeal C5: court a""irmed in toto the decision o" the lower
court
/ence this petition'
ISSUES: @4%
a' 5%C7 "ailed to e$ercise the e$traordinary degree
o" diligence re0uired !y the law to e$culpate them
"rom lia!ility "or the loss o" the cargoes
!' The loss was due to a caso fortuito or force
majeure
HELD:
a'-
- Mes' since it is the duty o" the de"endant to e$ercise and
o!serve e$traordinary diligence in the vigilance over the
cargo o" the plainti"", the patron or captain o" M4T 5%C7,
representing the de"endant could have placed &4+ *ucio in
a very sa"e location !e"ore they le"t knowing or sensing at
that time the coming o" a typhoon' The presence o" !ig
waves and dark clouds could have warned the patron or
captain o" M4T 5%C7 to insure the sa"ety o" &4+ *ucio
including its cargo' &4+ *ucio !eing a !arge, without its
engine, as the patron or captain o" M4T 5%C7 knew, could
not possi!ly maneuver !y itsel"'
- /ad the patron or captain o" M4T 5%C7, the representative
o" the de"endants o!served e$traordinary diligence in
placing the &4+ *ucio in a sa"e place, the loss to the cargo
o" the plainti"" could not have occurred
- 5%C7(s representatives had "ailed to e$ercise
e$traordinary diligence re0uired o" common carriers in the
shipment o" SMC(s cargoes' Such !latant negligence !eing
the pro$imate cause o" the loss o" the cargoes
- de"endants through their representatives, "ailed to o!serve
the degree o" diligence re0uired o" them under the
provision o" A'(. 1C22 3 ()& C!/!, Cd& 3 ()&
P)!,!..!n&%
A'(. 1C22' Common carriers, "rom the nature o" their !usiness and
"or reasons o" pu!lic policy are !ound to o!serve e$traordinary
diligence in the vigilance over the goods and "or the sa"ety o" the
passengers transported !y them, according to all the
circumstances o" each case'
Such e$traordinary diligence in vigilance over the goods is "urther
e$pressed in 5rticles 3<=>, 3<=,, and 3<>, %os' ,, C, and < ' ' '
!'-
- Caso fortuito or force majeure )which in law are identical
inso"ar as they e$empt an o!ligor "rom lia!ility-
3K
!y
de"inition, are e$traordinary events not "oreseea!le or
avoida!le, events that could not !e "oreseen, or which
though "oreseen, were inevita!le' 6t is there"ore not enough
that the event should not have !een "oreseen or
anticipated, as is commonly !elieved !ut it must !e one
impossi!le to "oresee or to avoid'
- 6n this case, the calamity which caused the loss o" the
cargoes was not un"oreseen nor was it unavoida!le' 6n
"act, the other vessels in the port o" San Lose, 5nti0ue,
managed to trans"er to another place, a circumstance
which prompted SMC(s &istrict Sales Supervisor to re0uest
that the &4+ *ucio !e likewise trans"erred, !ut to no avail
- @hile the loss o" the cargoes was admittedly caused !y
the typhoon Sisang, a natural disaster, 5%C7 could not
escape lia!ility to respondent SMC' The records clearly
show the "ailure o" petitioners( representatives to e$ercise
the e$traordinary degree o" diligence mandated !y law' To
!e e$empted "rom responsi!ility, the natural disaster
should have !een the pro$imate and only cause o" the loss
A'(. 1C24' Common carriers are responsi!le "or the loss,
destruction, or deterioration o" the goods, unless the same is due
to any o" the "ollowing causes only:
)3- Flood, storm, earth0uake, lightning, or other natural disaster or
calamity#
A'(. 1C2G' In order that the common carrier may be exempted
rom responsibility, the natural disaster must have been the
proximate and only cause o the loss' /owever, the common
carrier must e$ercise due diligence to prevent or minimi.e loss
!e"ore, during and a"ter the occurrence o" "lood, storm, or other
natural disaster in order that the common carrier may !e
e$empted "rom lia!ility "or the loss, destruction, or deterioration o"
the goods
The SC "urther said that:
;taking into account the circumstances present in the instant case,
concludes that the !latant negligence o" 5%C7(s employees is o"
such gross character that it amounts to a wrong"ul act which must
e$onerate FD1 "rom lia!ility under the insurance contract8
DISPOSITIVE: &ecision o" the Court o" 5ppeals here!y
5FF6M2& with M7&6F6C5T67% dismissing the third-party
complaint
C DSR-SENATOR LINES AND C.F. SHARP AND COMPAN6,
INC., .&(!(!n&'%, /%.
FEDERAL PHOENIH ASSURANCE CO., INC., '&%.nd&n(.
DSR S&na(' L!n&% /. F&d&'a,, GR 12=2CC. O9(#&' C, 2FF2
FACTS: +erde Plants delivered arti"icial trees to CF Sharp, the
general ship agent o" &S-Senator *ines, a "oreign shipping
corporation, "or transportation and delivery to consignee, 5l-Mohr
6nt(l Droup, in iyadh' 1nder the +o*, the port o" discharge "or the
cargo was at the Ihor Fakkan port and the port o" delivery was
iyadh via Port &ammam' The cargo was loaded in MS 5ra!ian
Senator and was insured !y Federal Phoeni$ 5ssurance' The
vessel le"t Manila "or Saudi 5ra!ia with the cargo on !oard' @hen
the vessel arrived in Ihor Fakkan Port, the cargo was reloaded on
!oard &S-Senator *ines( "eeder vessel, M4B OIapitan Sakharov,O
!ound "or Port &ammam, Saudi 5ra!ia' /owever, while in transit,
the vessel and all its cargo caught "ire' &S-Senator *ines
in"ormed +erde Plants a!out the incident' Conse0uently, Federal
Phoeni$ 5ssurance paid +erde Plants PE>3,>GE'C3 corresponding
to the amount o" insurance "or the cargo' 6n turn +erde Plants
e$ecuted in its "avor a OSu!rogation eceipt8' Federal Phoeni$
5ssurance sent a letter to C'F' Sharp demanding payment o"
PE>3,>GE'C3 on the !asis o" the Su!rogation eceipt' C'F' Sharp
denied any lia!ility on the ground that such lia!ility was
e$tinguished when the vessel carrying the cargo was gutted !y
"ire' Federal Phoeni$ 5ssurance "iled with the TC-Manila a
complaint "or damages against &S-Senator *ines and C'F'
Sharp, praying that the latter !e ordered to pay actual damages o"
PE>3,>GE'C3, compensatory damages o" P3FF,FFF'FF and costs'
RTC: The TC rendered a &ecision in "avor o" Federal Phoeni$
5ssurance'
CA: O6n the present recourse, the appellant carrier was presumed
to have acted negligently "or the "ire that gutted the "eeder vessel
and the conse0uent loss or destruction o" the cargo' /ence, the
appellant carrier is lia!le "or appellee(s claim under the %ew Civil
Code o" the Philippines' OContrary to C'F' Sharp and Co', 6nc'(s
pose, its lia!ility as ship agent continued and remained until the
cargo was delivered to the consignee' The status o" the appellant
as ship agent su!sisted and its lia!ility as a ship agent was co-
terminous with and su!sisted as long as the cargo was not
delivered to the consignee under the terms o" the +ill o" *ading'
ISSUE: @o% petitioner should !e held lia!le "or the loss o" the
cargo due to a "ire'
RULING: Mes' Fire is not one o" those enumerated under 5rt'
3<=> which e$empts a carrier "rom lia!ility "or loss or destruction
o" the cargo' 6n 2astern Shipping *ines, 6nc' vs' 6ntermediate
5ppellate Court, we ruled that since the peril o" "ire is not
comprehended within the e$ceptions in 5rticle 3<=>, then the
common carrier shall !e presumed to have !een at "ault or to
have acted negligently, unless it proves that it has o!served the
e$traordinary diligence re0uired !y law' Common carriers are
o!liged to o!serve e$traordinary diligence in the vigilance over the
goods transported !y them' 5ccordingly, they are presumed to
have !een at "ault or to have acted negligently i" the goods are
lost, destroyed or deteriorated' There are very "ew instances when
the presumption o" negligence does not attach and these
instances are enumerated in 5rticle 3<=>' 6n those cases where
the presumption is applied, the common carrier must prove that it
e$ercised e$traordinary diligence in order to overcome the
presumption' espondent Federal Phoeni$ 5ssurance raised the
presumption o" negligence against petitioners' /owever, they
"ailed to overcome it !y su""icient proo" o" e$traordinary diligence'
D LOADSTAR SHIPPING CO., INC., .&(!(!n&', /%.
COURT OF APPEALS and THE MANILA INSURANCE CO.,
INC., '&%.nd&n(%.
Characters:
*oadstar Shipping Co' > owner o" vessel Cherokee
Manila 6nsurance Comp'> insurer o" goods, plainti"" sa
TC
Prudential Duarantee and 5ssurance 6nc> insurer o" the
vessel
FACTS:
*oadstar received on !oard its M4B OCherokeeO various
goods "or shipment
The goods were insured with M6C against various risks
including OT7T5* *7SS +M T7T5* 7F T/2 *7SS T/2
B2SS2*'O
The vessel, in turn, was insured !y Prudential Duarantee 9
5ssurance, 6nc'
its way to Manila the vessel, along with its cargo, sank o""
*imasawa 6sland
5s a result o" the total loss o" its shipment, the consignee
made a claim with *oadstar which, however, ignored the same
5s the insurer, M6C paid the insured in "ull settlement o" its
claim, and the latter e$ecuted a su!rogation receipt
M6C "iled a complaint against *oadstar and Prudential,
alleging that the sinking o" the vessel was due to the "ault and
negligence o" *oadstar and its employees
*oadstar contention: denied any lia!ility "or the loss o" the
shipperTs goods and claimed that sinking o" its vessel was due
to force majeure'
*oadstar &e"ense:
6t is a private carrier !ecause it was not issued a certi"icate
o" pu!lic convenience# it did not have a regular trip or
schedule nor a "i$ed route, and there was only Oone
shipper, one consignee "or a special cargo'
5s a private carrier, it cannot !e presumed to have !een
negligent, and the !urden o" proving otherwise devolved
upon M6C'
5s a private carrier, any agreement limiting its lia!ility,
such as what transpired in this case, is valid' )Cargo
shipped at the owner(s risk'-
6t is not lia!le !ecause the sinking o" the ship was due to
"orce ma?eure' 6t maintained that its vessel was seaworthy'
PD56 contention: averred that M6C had no cause o" action
against it, *oadstar !eing the party insured# was later dropped
as a party de"endant a"ter it paid the insurance proceeds to
*75&ST5
TC: ruled in "avor o" M6C
7n appeal C5: a""irmed the TC in toto
*oadstar cannot !e considered a private carrier on the
sole ground that there was a single shipper on that
"ate"ul voyage' The court noted that the charter o" the
vessel was limited to the ship, !ut *oadstar retained
control over its crew
*oadstar was not a private carrier' The charter o" the
vessel was limited to the ship, *oadstar maintaining
control over its crew'
The vessel was not seaworthy'
There was a !reach o" contract when the goods "ailed
to reach its destination and the de"ense o" diligence o"
a good "ather o" a "amily is unavailing in culpa
contractual'
ISSUES: 10N
a' 6s the petitioner a private or common carrier'
!' 6s the limited lia!ility rule applica!le in the case'
HELD:
a'-
Common carrier )as de"ined !y 5rt 3<=G and &e Du.man v
Ca-'
6t is not necessary that the carrier !e issued a
certi"icate o" pu!lic convenience, and this pu!lic
character is not altered !y the "act that the carriage
o" the goods in 0uestion was periodic, occasional,
episodic or unscheduled'
5 certi"icate o" pu!lic convenience is not a re0uisite
"or the incurring o" lia!ility under the Civil Code
provisions governing common carriers' That lia!ility
arises the moment a person or "irm acts as a
common carrier, without regard to whether or not
such carrier has also complied with the
re0uirements o" the applica!le regulatory statute
and implementing regulations and has !een
granted a certi"icate o" pu!lic convenience or other
"ranchise' To e$empt private respondent "rom the
lia!ilities o" a common carrier !ecause he has not
secured the necessary certi"icate o" pu!lic
convenience, would !e o""ensive to sound pu!lic
policy# that would !e to reward private respondent
precisely "or "ailing to comply with applica!le
statutory re0uirements
There was no charter party'
!'-
%o' The doctrine o" limited lia!ility does not apply
where there was negligence on the part o" the vessel
owner or agent' *75&ST5 was at "ault or negligent in
not maintaining a seaworthy vessel and in having
allowed its vessel to sail despite knowledge o" an
approaching typhoon' 6n any event, it did not sink
!ecause o" any storm that may !e deemed as force
majeure, inasmuch as the wind condition in the
per"ormance o" its duties, *75&ST5 cannot hide
!ehind the Olimited lia!ilityO doctrine to escape
responsi!ility "or the loss o" the vessel and its cargo'
Three kinds o" stipulations have o"ten !een made in a
!ill o" lading' The first one e$empting the carrier "rom
any and all lia!ility "or loss or damage occasioned !y
its own negligence' The second is one providing "or an
un0uali"ied limitation o" such lia!ility to an agreed
valuation' 5nd the third is one limiting the lia!ility o" the
carrier to an agreed valuation unless the shipper
declares a higher value and pays a higher rate o"'
"reight' 5ccording to an almost uni"orm weight o"
authority, the "irst and second kinds o" stipulations are
invalid as !eing contrary to pu!lic policy, !ut the third is
valid and en"orcea!le' )5rts 3<>>->,# 5rts 3<>E-,F-'
a stipulation reducing the one-year period is null and
void# it must, accordingly, !e struck down
DISPOSITIVE: Petition denied' C5 a""irmed'
G S1EET LINES, INC., .&(!(!n&', /%.
HON. BERNARDO TEVES, P'&%!d!n" E$d"&, CFI 3 M!%a*!% O'!&n(a,
B'an9) VII, LEOVIGILDO TANDOG, ER., and ROGELIO
TIRO, '&%.nd&n(%.
1F PAN AMERICAN 1ORLD AIR1A6S, INC., .&(!(!n&', /%.
EOSE K. RAPADAS and THE COURT OF APPEALS, '&%.nd&n(%.
11 PHILIPPINE AIRLINES, INC., .&(!(!n&', /%.
HON. ADRIANO SAVILLO, P'&%!d!n" E$d"& 3 RTC B'an9) 2F , I,!,
C!(+, and SIMPLICIO GRIIO,'&%.nd&n(%.
Characters:
Simplicio Drino > plainti"" sa TC, private respondent sa
SC
P5* and Singapore 5irlines> respondents sa TC civil
case
P5*> petitioner SC
Ludge 5driano Savillo> pu!lic respondent, presiding ?udge
TC 6loilo
%ature o" the Case: Complaint "or &amages, seeking
compensation "or moral damages'
FACTS:
Drino was invited to participate in the 3EE= 5S25%
Seniors 5nnual Dol" Tournament held in Lakarta, 6ndonesia
/e and several companions decided to purchase their
respective passenger tickets "rom P5* with the "ollowing
points o" passage: M5%6*5-S6%D5P72-L5I5T5-
S6%D5P72-M5%6*5
Private respondent and his companions were made to
understand !y P5* that its plane would take them "rom Manila
to Singapore, while Singapore 5irlines would take them "rom
Singapore to Lakarta
private respondent and his companions took the P5* "light
to Singapore, 1pon their arrival, they proceeded to the
Singapore 5irlines to check-in "or their "light to Lakarta
Singapore 5irlines re?ected the tickets o" private
respondent and his group !ecause they were not endorsed !y
P5*' 6t was e$plained to private respondent and his group that
i" Singapore 5irlines honored the tickets without P5*(s
endorsement, P5* would not pay Singapore 5irlines "or their
passage
P5*(s o""ice at the airport was closed, Stranded at the
airport in Singapore and le"t with no recourse, private
respondent was in panic and at a loss where to go# and was
su!?ected to humiliation, em!arrassment, mental anguish,
serious an$iety, "ear and distress
private respondent and his companions were "orced
to purchase tickets "rom Daruda 5irlines "or Lakarta, arrived
late, party supposed to "etch them had already le"t, Drino
!ecame ill and was una!le to participate in the tournament
1pon his return to the Philippines, private respondent, sent
a demand letter to P5* on GF &ecem!er 3EE= and another to
Singapore 5irlines on G3 March 3EE>, !oth airlines disowned
lia!ility and !lamed each other "or the "iasco
3EE<, private respondent "iled a Complaint "or &amages
!e"ore the TC
6nstead o" "iling an answer to private respondent(s
Complaint, P5* "iled a Motion to &ismiss
K
dated 3K Septem!er
3EEK on the ground that the said complaint was !arred on the
ground o" prescription under Section 3)"- o" ule 3C o" the
ules o" Court'
P5*(s Contention: that the @arsaw Convention,

particularly
5rticle GE thereo", governed this case, as it provides that any
claim "or damages in connection with the international
transportation o" persons is su!?ect to the prescription period
o" two years' Since the Complaint was "iled on 3, 5ugust
3EE<, more than three years a"ter P5* received the demand
letter on G, Lanuary 3EE>, it was already !arred !y
prescription
Trial Court: denied the Motion to &ismiss, maintained that the
provisions o" the Civil Code and other pertinent laws o" the
Philippines, not the @arsaw Convention, were applica!le to
the present case'
C5 likewise dismissed the Petition "or Certiorari "iled !y P5*
and a""irmed 7rder o" the TC' 6t pronounced that the
application o" the @arsaw Convention must not !e construed
to preclude the application o" the Civil Code and other
pertinent laws' +y applying 5rticle 33>> o" the Civil Code,
which allowed "or a ten-year prescription period, the appellate
court declared that the Complaint "iled !y private respondent
should not !e dismissed
ISSUE:
@hether it is the provisions o" the %CC or the @arsaw
Convention that should apply "or the !reach o" contract "or
international air transport
HELD:
Petition without merit
this Court notes that ?urisprudence in the Philippines and
the 1nited States also recogni.es that the @arsaw Convention
does not Oe$clusively regulateO the relationship !etween
passenger and carrier on an international "light' This Court
"inds that the present case is su!stantially similar to cases in
which the damages sought were considered to !e outside the
coverage o" the @arsaw Convention'
6nstant case is compara!le to the case o" Lathigra v.
British Airways' 6n Lathigra, it was held that the airlines(
negligent act o" recon"irming the passenger(s reservation days
!e"ore departure and "ailing to in"orm the latter that the "light
had already !een discontinued is not among the acts covered
!y the @arsaw Convention, since the alleged negligence did
not occur during the per"ormance o" the contract o" carriage
!ut, rather, days !e"ore the scheduled "light'
6n the case at hand, Singapore 5irlines !arred private
respondent "rom !oarding the Singapore 5irlines "light
!ecause P5* allegedly "ailed to endorse the tickets o" private
respondent and his companions, despite P5*(s assurances to
respondent that Singapore 5irlines had already con"irmed their
passage' @hile this "act still needs to !e heard and
esta!lished !y ade0uate proo" !e"ore the TC, an action
!ased on these allegations will not "all under the @arsaw
Convention, since the purported negligence on the part o" P5*
did not occur during the per"ormance o" the contract o"
carriage !ut days !e"ore the scheduled "light' Thus, the
present action cannot !e dismissed !ased on the statute o"
limitations provided under 5rticle GE o" the @arsaw
Convention'
/ad the present case merely consisted o" claims incidental
to the airlines( delay in transporting their passengers, the
private respondent(s Complaint would have !een time-!arred
under 5rticle GE o" the @arsaw Convention' /owever, the
present case involves a special species o" in?ury resulting "rom
the "ailure o" P5* and4or Singapore 5irlines to transport private
respondent "rom Singapore to Lakarta J the pro"ound distress,
"ear, an$iety and humiliation that private respondent
e$perienced when, despite P5*(s earlier assurance that
Singapore 5irlines con"irmed his passage, he was prevented
"rom !oarding the plane and he "aced the daunting possi!ility
that he would !e stranded in Singapore 5irport !ecause the
P5* o""ice was already closed
These claims are covered !y the Civil Code provisions on
tort, and not within the purview o" the @arsaw Convention'
/ence, the applica!le prescription period is that provided
under A'(!9,& 114B 3 ()& C!/!, Cd&:
5rt' 33>C' The "ollowing actions must !e instituted within
"our years:
)3- 1pon an in?ury to the rights o" the plainti""#
)G- 1pon a 0uasi-delict'
Private respondent(s Complaint was "iled with the TC on
3, 5ugust 3EE<, which was less than "our years since P5*
received his e$tra?udicial demand on G, Lanuary 3EE>' Thus,
private respondent(s claims have not yet prescri!ed and P5*(s
Motion to &ismiss must !e denied
Should there !e any dou!t as to the prescription o" private
respondent(s Complaint, the more prudent action is "or the
TC to continue hearing the same and deny the Motion to
&ismiss' @here it cannot !e determined with certainty whether
the action has already prescri!ed or not, the de"ense o"
prescription cannot !e sustained on a mere motion to dismiss
!ased on what appears to !e on the "ace o" the complaint
12 PHILTRANCO SERVICE ENTERPRISES, INC. and ROGACIONES
MANILHIG, .&(!(!n&', /%. COURT OF APPEALS and HEIRS OF THE
LATE RAMON ACUESTA, '&%.nd&n(%.
P)!,('an9 S&'/!9& En(&'.'!%&%, In9. /%. CA, 2C2 SCRA =B2
(1GGC)
)Pang T7TS yata ung case na ito' Uuasi-delict ang involved at
payment o" &amages' @alang application ng Transpo *aw'
+ahala na si +atman sa matatawag dito' #>-
FACTS: Bictim amon 5' 5cuesta was riding in his easy rider
!icycle along the Dome. Street o" Cal!ayog City' 7n the
Magsaysay +lvd', also in Cal!ayog City, de"endant Philtranco !us
driven !y de"endant Manilhig was !eing pushed !y some persons
in order to start its engine' The Magsaysay +lvd' runs
perpendicular to Dome. St' and the said !us was heading in the
general direction o" the said Dome. Street' 5s the !us was
pushed, its engine started there!y the !us continued on its
running motion and it occurred at the time when amon 5'
5cuesta who was still riding on his !icycle was directly in "ront o"
the said !us' 5s the engine o" the Philtranco !us started a!ruptly
and suddenly, its running motion was also enhanced !y the said
"unctioning engine, there!y the su!?ect !us !umped on the victim
amon 5' 5cuesta who, as a result thereo" "ell and, therea"ter,
was run over !y the said !us' The !us did not stop although it had
already !umped and ran over the victim# instead, it proceeded
running towards the direction o" the osales +ridge which is
located at one side o" the %i?aga Park and towards one end o" the
Dome. St', to which direction the victim was then heading when
he was riding on his !icycle' The accident was witnessed !y
P4Sgt' Ma!ao who ordered the !us to stop and !rought the driver
o" the said !us to the Police /U' From the place where the victim
was actually !umped !y the !us, the said vehicle still had run to a
distance o" a!out 3, meters away' The case was instituted !y the
heirs o" amon 5' 5cuesta alleging that petitioners were guilty o"
gross negligence, recklessness, violation o" tra""ic rules and
regulations, a!andonment o" victim, and attempt to escape "rom a
crime' Petitioners "iled an 5nswer wherein they alleged that
petitioner Philtranco e$ercised the diligence o" a good "ather o" a
"amily in the selection and supervision o" its employees, including
petitioner Manilhig who had e$cellent record as a driver and had
undergone months o" rigid training !e"ore he was hired' Petitioner
Manilhig had always !een a prudent pro"essional driver,
religiously o!serving tra""ic rules and regulations' 6n driving
PhiltrancoTs !uses, he e$ercised the diligence o" a very cautious
person' The petitioners "urther claimed that it was the negligence
o" the victim in overtaking two tricycles, without taking precautions
such as seeing "irst that the road was clear, which caused the
death o" the victim' The latter did not even give any signal o" his
intention to overtake'
RTC: The trial court handed down a decision ordering the
petitioners to ?ointly and severally pay the private respondents'
CA: The Court o" 5ppeals a""irmed the decision o" the trial court'
@e cannot help !ut accord with the lower courtTs "inding on
appellant ManilhigTs "ault' The doctrine o" last clear chance
theori.ed upon !y appellants, is inapplica!le under the premises
!ecause the victim, who was !umped "rom !ehind, o!viously, did
not o" course anticipate a Philtranco !us !eing pushed "rom a
perpendicular street'
ISSUE: @o% Philtranco can !e held lia!le "or the death o" the
victim'
RULING: Civil Case %o' =<= is an action "or damages !ased on
0uasi-delict under 5rticle G3<C )U-&- and G3KF)Bicarious- o" the
Civil Code against petitioner Manilhig and his employer, petitioner
Philtranco, respectively' @e have consistently held that the lia!ility
o" the registered owner o" a pu!lic service vehicle, like petitioner
Philtranco, "or damages arising "rom the tortious acts o" the driver
is primary, direct, and ?oint and several or solidary with the driver'
5s to solidarity, 5rticle G3E> e$pressly provides: 5rt' G3E>' The
responsi!ility o" two or more persons who are lia!le "or a 0uasi-
delict is solidary'
Since the employerTs lia!ility is primary, direct and solidary, its
only recourse i" the ?udgment "or damages is satis"ied !y it is to
recover what it has paid "rom its employee who committed the
"ault or negligence which gave rise to the action !ased on 0uasi-
delict' 5rticle G3K3 o" the Civil Code provides: 5rt' G3K3' @hoever
pays "or the damage caused !y his dependents or employees
may recover "rom the latter what he has paid or delivered in
satis"action o" the claim'
12 TEEA MARKETING AND0OR ANGEL EAUCIAN, .&(!(!n&', /%.
HONORABLE INTERMEDIATE APPELLATE COURT J AND PEDRO
N. NALE, '&%.nd&n(%.
PARTIES:
3' Te?a Marketing J sold the motorcycle herein
G' Pedro %ale J !ought a motorcycle "rom Te?a Marketing
=' 5ngel Laucian J mortgaged the motorcycle to Te?a Marketing
FACTS:
3' Pedro %ale !ought a motorcycle with complete accessories
and a sidecar "or Kk, to which he gave a downpayment o" 3,<FF'
G' /e did not pay the !alance within CF days as promised# it was
e$tended to 3 year in monthly installments until Lanuary when he
stopped paying' &emands were to no avail' Te?a says Pedro is
hiding the motorcycle'
=' Te?a Marketing consulted a lawyer and "iled an action "or
damages'
>' 6t turned out in the records that the motorcycle was mortgaged
!y 5ngel to Te?a Marketing, who happened to !e one and the
same'
,' 5ngel has a "ranchise, Pedro does not'
C' @hat persuaded Pedro to !uy was the agreement that Te?a
Marketing45ngel would !e the one to register with the *and
Transportation Commission'
<' /owever, despite Pedro giving Php EF "or registration,
Te?a45ngel "ailed to register the mortgage and the motorcycle, and
"ailed to insure the same, there!y causing Pedro to su""er
damages'
C!(+ C$'(: 7rdering %ale to pay the unpaid !alance plus interest'
CFI: 5""irmed in toto' Thus a petition "or review'
IAC: &ismissed' as the purchase o" the motorcycle "or operation
as a trimo!ile under the "ranchise o" the private respondent
Laucian, pursuant to what is commonly known as the Oka!it
systemO, without the prior approval o" the +oard o" Transportation
)"ormerly the Pu!lic Service Commission- was an illegal
transaction involving the "ictitious registration o" the motor vehicle
in the name o" the private respondent so that he may tra""ic with
the privileges o" his "ranchise, or certi"icate o" pu!lic convenience,
to operate a tricycle service, the parties !eing in pari delicto,
neither o" them may !ring an action against the other to en"orce
their illegal contract V5rt' 3>3G )a-, Civil CodeW
SC: 5""irmed 65C' Case dismissed'
ISSUE: @7% respondent court erred in applying the doctrine o"
Opari delicto'O
RULING: Mes' Ia!it system occurred in this case'
6t was "ound that Pedro purchased it "or the purpose o" engaging
and using the same in the transportation !usiness and "or this
purpose said trimo!ile unit was attached to the plainti""s
transportation line who had the "ranchise, so much so that in the
registration certi"icate, the plainti"" appears to !e the owner o" the
unit'
1n0uestiona!ly, the parties herein operated under an
arrangement, commonly known as the Oka!it systemO where!y a
person who has !een granted a certi"icate o" pu!lic convenience
allows another person who owns motor vehicles to operate under
such "ranchise "or a "ee' 5 certi"icate o" pu!lic convenience is a
special privilege con"erred !y the government' 5!use o" this
privilege !y the grantees thereo" cannot !e countenanced'
D9('!n&%:
OT2$ pacto illicitoT non oritur actioO )%o action arises out o" illicit
!argain- is the time-honored ma$im that must !e applied to the
parties in the case at !ar' /aving entered into an illegal contract,
neither can seek relie" "rom the courts, and each must !ear the
conse0uences o" his acts'O
6t is a "undamental principle that the court will not aid either party
to en"orce an illegal contract, !ut will leave !oth where it "inds
then' The de"ect o" in e$istence o" a contract is permanent and
cannot !e cured !y rati"ication or !y prescription' The mere lapse
o" time cannot give e""icacy to contracts that are null and void'
14 URBANO MAGBOO and EMILIA C. MAGBOO, .,a!n(!33%-
a..&,,&&%, /%.
DELFIN BERNARDO, d&3&ndan(-a..&,,an(.
C)a'a9(&'%:
3' Sps' Mag!oo - parents o" Cesar Mag!oo
G' Ceasar Mag!oo J the child o" Sps' Mag!ooA )wag
maasar- a child o" K years old, when he was killed in a
motor vehicle accident
=' &el"in +ernardo J employer o" the ?eepney driver who#
!eing sued "or "or en"orcement o" his su!sidiary lia!ility as
employer in accordance with 5rticle 3F=, evised Penal
Code
Fa9(%: 3' That plainti""s are the parents o" Cesar Mag!oo, a child
o" K years old, who lived with them and was under their custody
until his death on 7cto!er G>,3E,C when he was killed in a motor
vehicle accident, the "atal vehicle !eing a passenger ?eepney with
Plate %o, 5C-3EC= ),C- owned !y the de"endant#
G' That at the time o" the accident, said passenger ?eepney was
driven !y Conrado o0ue#
=' That the contract !etween Conrado o0ue and de"endant
&el"in +ernardo was that o0ue was to pay to de"endant the sum
o" PK'FF, which he paid to said de"endant, "or privilege o" driving
the ?eepney on 7cto!er G>, 3E,C, it !eing their agreement that
whatever earnings o0ue could make out o" the use o" the
?eepney in transporting passengers "rom one point to another in
the City o" Manila would !elong entirely to Conrado o0ue#
>' That as a conse0uence o" the accident and as a result o" the
death o" Cesar Mag!oo in said accident, Conrado o0ue was
prosecuted "or homicide thru reckless imprudence !e"ore the
Court o" First 6nstance o" Manila, the in"ormation having !een
docketed as Criminal Case %o' =<<=C, and that upon arraignment
Conrado o0ue pleaded guilty to the in"ormation and was
sentenced to si$ )C- months o" arresto mayor, with the accessory
penalties o" the law# to indemni"y the heirs o" the deceased in the
sum o" P=,FFF'FF, with su!sidiary imprisonment in case o"
insolvency, and to pay the costs#
,' That pursuant to said ?udgment Conrado o0ue served his
sentence !ut he was not a!le to pay the indemnity !ecause he
was insolvent'O
RTC R$,!n": T)& ('!a, 9$'( 'd&'&d d&3&ndan( ( .a+
.,a!n(!33% P2,FFF.FF and 9%(%. CA 9&'(!3!&% ()& 9a%& ( SC.
I%%$&: 1)&()&' ' n( an &*.,+&'-&*.,+&& '&,a(!n%)!.
&A!%(% #&(?&&n a <&&.n&+-?n&' and a d'!/&' $nd&' a
K#$nda'+ %+%(&*K a''an"&*&n(. A..&,,an( 9n(&nd% ()a( ()&
'&,a(!n%)!. !% &%%&n(!a,,+ ()a( 3 ,&%%' and ,&%%&&.
B&'na'd D&3&n%&: H& 9ann( #& )&,d %$#%!d!a'!,+ ,!a#,&
#&9a$%& ()&'& !% n &*.,+&'-&*.,+&& '&,a(!n%)!..
SC R$,!n": 5 similar contention has !een re?ected !y this Court
in several cases' 6t was held that the "eatures which characteri.e
the O!oundary systemO X namely, the "act that the driver does not
receive a "i$ed wage !ut gets only the e$cess o" the receipt o"
"ares collected !y him over the amount he pays to the ?eep-owner
and that the gasoline consumed !y the ?eep is "or the account o"
the driver X are not su""icient to withdraw the relationship
!etween them "rom that o" employer and employee'
The same principle applies with greater reason in negligence
cases concerning the right o" third parties to recover damages "or
in?uries sustained' 6n Montoya v' 6gnacio, *-,KCK, &ecem!er GE,
3E,=, the owner and operator o" a passenger ?eepney leased it to
another, !ut without the approval o" the Pu!lic Service
Commission' 6n a su!se0uent collision a passenger died' @e
ruled that since the lease was made without such approval, which
was re0uired !y law, the owner continued to !e the operator o" the
vehicle in legal contemplation and as such was responsi!le "or the
conse0uences incident to its operation' The same responsi!ility
was held to attach in a case where the in?ured party was not a
passenger !ut a third person, who sued on the theory o" culpa
a0uiliana )Tim!ol vs' 7sias, *-<,><, 5pril =F, 3E,,-' There is no
reason why a di""erent rule should !e applied in a su!sidiary
lia!ility case under 5rticle 3F= o" the evised Penal Code' 5s in
the e$istence o" an employer-employee relationship !etween the
owner o" the vehicle and the driver' 6ndeed to e$empt "rom lia!ility
the owner o" a pu!lic vehicle who operates it under the O!oundary
systemO on the ground that he is a mere lessor would !e not only
to a!et "lagrant violations o" the Pu!lic Service law !ut also to
place the riding pu!lic at the mercy o" reckless and irresponsi!le
drivers - reckless !ecause the measure o" their earnings depends
largely upon the num!er o" trips they make and, hence, the speed
at which they drive# and irresponsi!le !ecause most i" not all o"
them are in no position to pay the damages they might cause'
1= HERMINIO L. NOCUM, .,a!n(!33-a..&,,&&, /%.
LAGUNA TA6ABAS BUS COMPAN6, d&3&ndan(-a..&,,an(.
Characters,
-erminio Nocum- passenger in9ured as conse1uence of e)plosion
'aguna +ayabas Company- common carrier
Severino &ndaya"-a witness for the plaintiff
Sancho MendoDa- bus conductor
about 66,8B in the morning and when the e)plosion occurred
%8;( passengers were in9ured
FACTS
-erminio '$ Nocum" a passenger in 'aguna +ayabas Bus Co$5s Bus 67B" which
was then ma.ing a trip wi thi n the barri o of 2i t a" Muni ci pal i ty of Bay"
'aguna" was i n9 ured as a conse1uence of t he e)pl osi on of
firecrac.ers" contained in a bo)" loaded in said bus and declared to its conductor
as containing clothes and miscellaneous items by a co-passenger$
Nocum filed a case against 'aguna +ayabas Bus for damages$
4+C Batangas, #n favor of Nocum" sentenced 'aguna +ayabas to pay
#f proper and rigid inspection were observed by the defendant" the
contents of the bo) could have been discovered and the accident
avoided$
4efusal by the passenger to have the pac.age opened was no e)cuse
because" as stated by 2ispatcher Cornista" employees should call the
police if there were pac.ages containing articles against company
regulations$
Neither was failure by employees of defendant company to detect the
contents of the pac.ages of passengers because li.e the rationale in
the Necesito vs$ !aras case %supra(" a passenger has neither choice
nor control in the e)ercise of their discretion in determining what are
inside the pac.age of co-passengers which may eventually prove fatal
+he appeal is purely on legal 1uestions
SC, reversed the appealed 9udgment of the trial court
ISSUE:
ON +ayabas is liable for the e)plosion occurred brought by a passenger
HELD:
NO
Cairness demands that in measuring a common carrierEs duty towards
its passengers" allowance must be given to the reliance that should be reposed
on the sense of responsibility of all the passengers in regard to their common
safety$ #t is to be presumed that a passenger will not ta.e with him anything
dangerous to the lives and limbs of his co-passengers" not to spea. of his own$
Not to be lightly considered must be the right to privacy to which each passenger
is entitled$ -e cannot be sub9ected to any unusual search" when he protests the
innocuousness of his baggage and nothing appears to indicate the contrary" as
in the case at bar$ #n other words" in1uiry may be verbally made as to the nature
of a passengerEs baggage 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 invo.ed by
the trial 9udge" in compelling the passenger to submit to more rigid inspection"
after the passenger had already declared that the bo) contained mere clothes
and other miscellaneous" could not have 9ustified invasion of a constitutionally
protected domain$
E)plosive or 2angerous Contents$ F & carrier is ordinarily not liable for in9uries
to passengers from fires or e)plosions caused by articles brought into its
conveyances by other passengers" in the absence of any evidence that the
carrier" through its employees" was aware of the nature of the article or had any
reason to anticipate danger therefrom$ %Bogard v$ #llinois C$ 4 Co$ 6GG *y$ <G>"
68> S$ $ ?33" 8< '$ 4$ &$HN$ S$I 88;J Clar.e v$ 'ouisville K N$ 4$ Co$ 6B6 *y$ 8G"
8> S$ $ ?GB" 8< '$ 4$ &$ 678 He)plosion of can of gasolineIJ East #ndian 4$ Co$ v$
Mu.er9ee H6>B6I &$ C$ HEng$I 8><" 8 B$ 4$ C$ G7B F !$ C$ He)plosion of firewor.sIJ
&nnotation, 8; '$ 4$ &$ HN$ S$I ;73$(
8
&ppellant further invo.es &rticle 66;G of the Civil Code which relieves all
obligors" including" of course" common carriers li.e appellant" from the
conse1uence of fortuitous events$ +he court a +uo held that Lthe breach of
contract %in this case( was not due to fortuitous event and that" therefore" the
defendant is liable in damages$L Since e hold that appellant has succeeded in
rebutting the presumption of negligence by showing that it has e)ercised
e)traordinary diligence for the safety of its passengers" Laccording to the
circumstances of the %each( caseL" e deem it unnecessary to rule whether or
not there was any fortuitous event in this case$
1B PHILIPPINE RABBIT BUS LINES, INC., .&(!(!n&', /%.
THE HONORABLE INTERMEDIATE APPELLATE COURT AND
CASIANO PASCUA, ET AL., '&%.nd&n(%.
Characters:
Phil a!!it +us *ines > petitioner-common carrier
Tomas delos eyes>!us driver
Spouses 6sidro Mangune and Duillerma Carreon> owner o"
the ?eepney
Tran0uilino Manalo J driver o" the ?eepney
Catalina Pascua> ?eep passenger# na-dead.
2rlindaMeriales> ?eeppassenger# na-dead.
Florida 2stomo> ?eeppassenger# na-dead. )aka
5delaida4Florida 2stomo, di ko ma-gets
!akitandaminyapangalan-
Caridad Pascua >?eep passenger# in?ured
7ther ?eep passengers: Mercedes *oren.o, 5le?andro
Morales, NenaidaPare?as
Filriters Duaranty 6nsurance Co' >contracted to ensure and
answer "or the o!ligations o" spouses Mangune and Carreon
"or damages due their passengers
%ature o" the Case: Complaints "or recovery o" damages )= civil
cases and in all three cases, spouses Mangune and Carreon,
Manalo, a!!it and delos eyes were all impleaded as
de"endants in the trial court' Filriters Duaranty 5ssurance
Corporation, 6nc' was also impleaded as additional de"endant in
Civil Case %o' 33=C only-
FACTS:
Passengers !oarded ?eep at Pampanga !ound "or
Pangasinan to spend Christmas at their respective homes'
They had to take the ?eep !ecause !uses were "ull'
Contract w4 Manalo was to pay PG> each "or the trip'
1pon reaching Tarlac, the right rear wheel o" the ?eepney
was detached, so it was running in an un!alanced position'
Manalo stepped on the !rake, as a result o" which, the ?eepney
which was then running on the eastern lane )its right o" way-
made a 1-turn, invading and eventually stopping on the
western lane o" the road in such a manner that the ?eepneyTs
"ront "aced the south )"rom where it came- and its rear "aced
the north )towards where it was going-'
The ?eepney practically occupied and !locked the greater
portion o" the western lane, which is the right o" way o"
vehicles coming "rom the north, among which was petitioner(s
!us driven !y delos eyes'
5lmost at the time when the ?eepney made a sudden 1-
turn and encroached on the western lane o" the highway as
claimed !y a!!it and delos eyes, or a"ter stopping "or a
couple o" minutes as claimed !y Mangune, Carreon and
Manalo, the !us !umped "rom !ehind the right rear portion o"
the ?eepney' 5s a result o" the collision, three passengers o"
the ?eepney died while the other ?eepney passengers
sustained physical in?uries'
Causes o" death: Pakitignannalangsa case
mgatipong"racture o" the upper third o" the right ti!ia and
"illnea J anoyun:: Parte !a ng katawan ng taoyun'
Police investigation'
5t the time and in the vicinity o" the accident, there were
no vehicles "ollowing the ?eepney, neither were there
oncoming vehicles e$cept the !us' The weather condition o"
that day was "air'
5"ter conducting the investigation, the police "iled with the
Municipal Court o" San Manuel, Tarlac, a criminal complaint
against the two drivers "or Multiple /omicide' )&elos eyes(
case was dismissed# Manalo convicted-
Complaints were then "iled w4 the Pangasinan trial court'
Cross claim:
Phil a!!it v Spouses
Spouses v Phil a!!it
Trial Court "ound Manalo negligent and ordered Spouses 9
Manalo to pay de"endants in solidum !ased on unre!utted
testimonies:
- The ?eepney was Orunning "astO that his passengers
cautioned driver Manalo to slow down !ut did not heed the
warning'
- Police investigators
- Conviction o" Manalo "or the crimes o" Multiple /omicide
and Multiple Serious Physical 6n?uries with &amage to
Property thru eckless 6mprudence# and
- The application o" the doctrine o" res-ipsa lo0uitur attesting
to the circumstance that the collision occurred on the right
o" way o" the Phil' a!!it +us'
65C reversed trial court applying primarily )3- the doctrine o" last
clear chance, )G- the presumption that drivers who !ump the rear
o" another vehicle guilty and the cause o" the accident unless
contradicted !y other evidence, and )=- the su!stantial "actor test
and concluded that delos eyes was negligent'
ISSUE: @ho is lia!le "or the death and physical in?uries su""ered
!y the passengers o" the ?eepney:
HELD: Spouses 6sidro Mangune, Duillerma Carreon and Filriters
Duaranty 5ssurance Corporation, 6nc' are lia!le to the victims or
their heirs'
Reason? The pro$imate cause o" the accident was the negligence
o" Manalo and spouses Mangune and Carreon' They all "ailed to
e$ercise the precautions that are needed precisely pro hac vice.
)@ag kakalimutanang term na pro hac vice dahil "avorite term
koyan-
Basis?
6n culpa contractual, the moment a passenger dies or is
in?ured, the carrier is presumed to have !een at "ault or to
have acted negligently, and this disputa!le presumption may
only !e overcome !y evidence that he had o!served e$tra-
ordinary diligence as prescri!ed in A'(!9,&% 1C22, 1C== and
1C=B o" the %ew Civil Code or that the death or in?ury o" the
passenger was due to a "ortuitous event'
river !analo cannot "e held jointly and severally lia"le w# the
Spouses $remem"er trial court%s ruling&. 'hy?
The driver cannot !e held ?ointly and severally lia!le with
the carrier in case o" !reach o" the contract o" carriage'
F!'%(,+, the contract o" carriage is !etween the carrier and the
passenger, and in the event o" contractual lia!ility, the carrier
is e$clusively responsi!le there"ore to the passenger, even i"
such !reach !e due to the negligence o" his driver' S&9nd,+,
i" @e make the driver ?ointly and severally lia!le with the
carrier, that would make the carrierTs lia!ility personal instead
o" merely vicarious and conse0uently, entitled to recover only
the share which corresponds to the driver, contradictory to the
e$plicit provision o" 5rticle G3K3 o" the %ew Civil Code'
(ote that mag)ai"aang findings of facts ng trial at appellate courts
at findings ng trial court ang in-adopt ng SC.Bali)anang findings
ng trial court a"ove.
&6SP7S6T6B2: Petition D5%T2&' 65C decision S2T 5S6&2'
Trial court 26%ST5T2& w4 modi"ication that only the Spouses
and 6nsurer are lia!le'
7T/2S:
I. On IAC@% *!%a..,!9a(!n 3 ()& ,a?%:)see again 65C(s ruling-
&octrine o" *ast Clear Chance: The principle a!out Othe
last clearO chance, would call "or application in a suit !etween
the owners and drivers o" the two colliding vehicles' 6t does not
arise where a passenger demands responsi!ility "rom the
carrier to en"orce its contractual o!ligations' For it would !e
ine0uita!le to e$empt the negligent driver o" the ?eepney and
its owners on the ground that the other driver was likewise
guilty o" negligence'
7n the presumption that drivers who !ump the rear o"
another vehicle guilty and the cause o" the accident, unless
contradicted !y other evidence: @ould have !een correct were
it not "or the undisputed "act that the 1-turn made !y the
?eepney was a!rupt' delos eyes could not have anticipated
the sudden 1-turn e$ecuted !y Manalo' The respondent court
did not reali.e that the presumption was re!utted !y this piece
o" evidence'
Su!stantial Factor Test: 5ccording to the 65C, ;6t is the rule
under the su!stantial "actor test that i" the actorTs conduct is a
su!stantial "actor in !ringing a!out harm to another, the "act
that the actor neither "oresaw nor should have "oreseen the
e$tent o" the harm or the manner in which it occurred does not
prevent him "rom !eing lia!le )estatement, Torts, Gd-' /ere,
@e "ind de"endant !us running at a "ast speed when the
accident occurred and did not even make the slightest e""ort to
avoid the accident, ' ' ' ' The !us driverTs conduct is thus a
su!stantial "actor in !ringing a!out harm to the passengers o"
the ?eepney, not only !ecause he was driving "ast and did not
even attempt to avoid the mishap !ut also !ecause it was the
!us which was the physical "orce which !rought a!out the
in?ury and death to the passengers o" the ?eepney'8 +1T the
Supreme Court was not convinced stating that the !us was
running w4in the speed limit and that delos eyes had little
time to react to the situation' To re0uire delos eyes to avoid
the collision is to ask too much "rom him' 5side "rom the time
element involved, there were no options availa!le to him'
II. Ind&*n!(+ 3' L%% 3 L!3&: 1nder 5rticle 3<C> in relation to
5rticle GGFC o" the %CC, the amount o" damages "or the death o" a
passenger is at least three thousand pesos )P=,FFF'FF-' The
prevailing ?urisprudence has increased the amount o" P=,FFF'FF to
P=F,FFF'FF'
1C LOURDES E. LARA, ET AL., .,a!n(!33%-a..&,,an(%, /%.
BRIGIDO R. VALENCIA, d&3&ndan(-a..&,,an(.
Characters:
g. *ourdes *ara J plainti"", wi"e o" the deceased )&emetrio *ara,
Sr'-
h. +rigido Balencia J de"endant, owner and driver o" the vehicle
)pick up- were &emetrio is a passenger# engaged in the
!usiness o" 2YP7T6%D *7DS "rom Cota!ato
i. &emetrio *ara J accommodated passenger, an inspector o"
the +ureau o" Forestry
&emetrio *ara, an inspector o" +ureau o" Forestry, was assigned in
Cota!ato upon instructions o" his chie" to classi"y the logs o" the
de"endant !e"ore it will !e loaded in a ship located in the port o"
Parang' /is work lasted "or )C- si$ days on which he contracted
Malaria "ever' /e asked the de"endant i" he can ride his pick up
!ound "or &avao since there were no means o" transportation that
could take him, on which the latter agreed'
The pick up has )E- nine passengers including the de"endant as a
driver' The passengers were not asked to pay' The de"endant even
invited the &emetrio to sit with him !ut the latter declined since it
would !e convenient "or him to sit on a !ag and travel in a reclining
position considering his "everish condition' 1n"ortunately, &emetrio
*ara 3&,, while he was hal" asleep upon reaching Im' EC, +arrio
Catidtuan and su""ered serious physical in?uries' /e was !rought to
the nearest hospital with a doctor, !ut to no avail, until they reached
St' Loseph(s Clinic o" Iidapawan were he is considered dead on
arrival'
Case was "iled in the CF6 J &avao "or damages "rom the
negligence o" the de"endant'
CFI 7 Da/a D&9!%!n:
Favored *55 and ordered the de"endant to pay
damages'
BOTH a..&a,&d ( ()& SC:
*55 J court a 0uo erred "or disregarding actual and
compensatory damages
B5*2%C65 )&e"endant-
3' The accident was due to the negligence o" &emetrio
*ara'
G' The accident was due to an unavoida!le accident'
6SS12:
>' @4% the de"endant is lia!le "or the death o" the deceased,
&emetrio *ara Sr':
,' @4% the de"endant should have e$ercised e$traordinary
diligence to his passengers:
SC HELD:
The Court held in "avor o" B5*2%C65, the de"endant' The accident
occurred not due to the negligence o" the de"endant !ut to
circumstances !eyond his control and so he should !e e$empt "rom
lia!ility'
3' %o' The de"endant is not lia!le "or the death o" the de"endant'
The deceased was invited to sit !eside the de"endant during their
ride going to &avao !ut an un"ortunate happening was only due to an
un"oreseen accident caused !y the "act that &emetrio was hal"
asleep and must have "allen "rom the pick-up when it run into stones'
The >F kms4hr was not considered an unreasona!le speed
considering they travelled in a national road and tra""ic was not heavy
!y then'
;The deceased desire to !e at the !ack so that he could
sit on a !ag and travel in a reclining position !ecause
such was more convenient "or him due to his "everish
condition' 5ll the circumstances there"ore clearly indicate
that de"endant had done what a reasona!le prudent man
would have done under the circumstances'8
Such accident was rather attri!uted to the lack o" care on the part o"
the deceased' The law even provides that ;5 passenger must
o!serve the diligence o" a good "ather o" a "amily to avoid in?ury to
himsel"8: )5rt 3<C3-, which means that the pro$imate cause o" death
was caused !y his own negligence'
G' %o' The de"endant merely accommodated the passengers
and did no charge them any "ee "or the service' They are
considered invited guests within the meaning o" the law'
7rdinary care is only re0uired as the de"endant is not duty
!ound to e$ercise e$traordinary diligence as re0uired !y o" a
common carrier'
;5s accommodation passengers or invited guests, the
de"endant as owner and driver o" the pick-up owes to
them merely the duty to e$ercise reasona!le care so that
they may !e transported sa"ely to their destination' Thus,
;The rule is esta!lished !y the weight o" authority that the
owner or operator o" an automo!ile owes the duty to an
invited guest to e$ercise reasona!le care in its operation,
and not unreasona!ly to e$pose him to danger and in?ury
!y increasing the ha.ard o" travel' This rule, as "re0uently
stated !y the courts, is that an owner o" an automo!ile
owes a guest the duty to e$ercise ordinary or reasona!le
care to avoid in?uring him' Since one riding in an
automo!ile is no less a guest !ecause he was asked "or
the privilege o" doing so, the same o!ligation o" care is
imposed upon the driver as in the case o" one e$pressly
invited to ride8'
1DEAPAN AIRLINES, .&(!(!n&', /%.
THE COURT OF APPEALS, ENRILUE AGANA., MARIA ANGELA
NINA AGANA, ADALIA B. FRANCISCO and EOSE
MIRANDA, '&%.nd&n(%.
!omero, J )+aka itanong kung sinong ponente Zinsurance-
Lapan 5irlines J Carrier
Passengers:
2nri0ue 5gana J L5* Flight %o' FC3
Maria 5ngela %ina 5gana J L5* Flight %o' FC3
5dalia +' Francisco J L5* Flight %o' FC3
Lose Miranda J L5* Flight %o' L*FF3
F5CTS:
- The passengers !oarded Lapan 5irlines in San Francisco,
Cali"ornia !ound "or Manila on Lune 3=, 3EE3 and as
incentive "or travelling with L5*, they were to make an
overnight stop over at %arita, Lapan at the airlines(
e$pense !e"ore proceeding to Manila the ne$t day'
- /owever, on the "inal leg o" their ?ourney to Manila their trip
was cancelled due to Mt' Pinatu!o eruption that
unrelenting ash"all !lanketed %565 rendering it
inaccessi!le to airline tra""ic'
- To accommodate the needs o" the stranded passengers o"
L5* they re!ooked all the Manila-!ound passengers to
Lune 3C "light and paid "or their hotel e$penses "or their
une$pected overnight stay'
- 5gain, the Lune 3C "light was cancelled due to %565(s
inde"inite closure and L5* in"ormed the passengers that it
would no longer de"ray their hotel and accommodation
e$penses during their stay in %arita' @ith that, the
passengers "orced to pay "or their e$penses "rom their
personal "unds until Lune G3'
- Still reeling "rom the e$perience, private respondents on
Lune G, commenced an action "or damages against L5*
!e"ore the TC o" UC +ranch alleging that L5* "ailed to
live up to its duty to provide care and com"ort to its
stranded passengers when it re"used to pay "or their
e$penses "rom Lune 3C to G3 at %arita, Lapan'

L5* &2F2%S2:
- 5irline passengers have no vested right to these amenities
in case a "light is cancelled due to "orce ma?eure'
TC 1*6%D:
- uled in "avor o" the passengers and ordered L5* to pay
actual, moral and e$emplary damages:
2nri0ue 5gana, 5dalia +' Francisco and Maria 5ngela
%ina 5gana JPhp 3,G>C,E=C
Lose Miranda J Php=GF,C3C'=3
5ttorney(s Fees J PhpGFF,FFF

C5 1*6%D:
- 5""irmed the TC ruling with e$ception o" lowering the
damages awarded:
Moral damages J PhpGFF,FFF per plainti""
2$emplary damages J Php=FF,FFF
5ttorney(s Fees J Php3FF,FFF
6SS12:
@hether L5* as common carrier has the o!ligation to
shoulder the hotel and meal e$penses o" its stranded passengers
until they have reached their "inal destination even i" delay were
caused !y "orce ma?eure'
SC 1*6%D:
- %o, the SC ruled that though we sympathi.e with the
private respondents( plight we are una!le to accept their
contention'
- @e are not unmind"ul o" the "act that in plethora o" cases
we have consistently ruled that a contract to transport
passengers is "uite dierent in kind and degree rom
any other contractual relation. It is sae to conclude
that it is a relationship imbued with public interest.
Failure on the part o" the common carrier to live up to the
e$acting standards o" care and diligence renders it lia!le
"or any damages that may !e sustained !y its passengers'
/owever, this is not to say that common carriers are
a!solutely responsi!le "or all the in?uries or damages even
i" the same were caused !y a "ortuitous event' To rule
otherwise would render the de"ense o" ;"orce ma?eure8 as
an e$ception "rom any lia!ility, illusory and ine""ective'
- There is no 0uestion that when a party is una!le to "ul"ill
his o!ligation !ecause o" ;"orce ma?eure8 the general rule
is that he cannot !e held lia!le "or damages "or non-
per"ormance' /ence, when L5* was prevented "rom
resuming its "light to Manila due to the e""ects o" Mt'
Pinatu!o eruption, whatever losses or damages in the "orm
o" hotel and meal e$penses the stranded passengers
incurred, cannot !e charged to L5*' Met it is undenia!le
that L5* assumed the hotel e$penses o" respondents "or
their une$pected stay on Lune 3,''
- 5dmittedly, to !e stranded "or almost one week in a "oreign
land was an e$asperating e$perience "or the private
respondents' To !e sure, they underwent distress and
an$iety during their unanticipated stay in %arita, !ut their
predicament was not due to the "ault or negligence o" L5*
!ut the closure o" %565 to international "lights' 6ndeed, to
hold L5*, in the a!sence o" !ad "aith or negligence, lia!le
"or the amenities o" its stranded passengers !y reason o"
"ortuitous event is too much o" a !urden to assume'
- /owever, L5* is not completely a!solved "rom any lia!ility'
6t must !e noted that private respondents !ought tickets
"rom the 1nited States with Manila as their "inal
destination' @hile L5* was no longer re0uired to de"ray
private respondents( living e$penses during their stay in
%arita on account o" "ortuitous event, L5* had the duty to
make the necessary arrangements to transport private
respondents on the "irst availa!le connecting "light to
Manila' L5* reneged on its o!ligation to look a"ter the
com"ort and convenience o" its passengers when it
declassi"ied private respondents "rom ;transit passengers8
to ;new passengers8 as a result o" which private
respondents were o!liged to make the necessary
arrangements themselves "or the ne$t "light to Manila'
- C5 ruling is here!y modi"ied' L5* is ordered to pay each
o" the private respondents nominal damages in the sum o"
Php3FF,FFF each including attorney(s "ees o" Php,F,FFF'
1G ABELARDO LIM and ESMADITO GUNNABAN, .&(!(!n&'%, /%.
COURT OF APPEALS and DONATO H. GON5ALES, '&%.nd&n(%.
2F FGU INSURANCE CORPORATION, .&(!(!n&', /%.
G.P. SARMIENTO TRUCKING CORPORATION and LAMBERT M.
EROLES, '&%.nd&n(%.
21 PEDRO T. LA6UGAN, .&(!(!n&', /%.
INTERMEDIATE APPELLATE COURT, GODOFREDO ISIDRO, and
TRAVELLERS MULTI-INDEMNIT6 CORPORATION, '&%.nd&n(%.
C)a'a9(&'%:
3' P&d' T. La+$"an 7 a truck helper who sustained in?uries
during such occupation a"ter his truck was hit !y another
G' Gd3'&d I%!d' 7 the owner o" the truck that caused the
accident
=' Dan!&, S&''an 7 the accused driver o" the truck'
>' T'a/&,,&'% M$,(!-Ind&*n!(+ C'.'a(!n 7 the insurer "or
Dodo"redo 6sdiro
Fa9(%: Pedro T' *ayugan "iled an action "or damages against
Dodo"redo 6sidro, alleging that on May 3,, 3E<E while at +aret!et,
+aga!ag, %ueva Bi.caya, the Plainti"" and a companion were
repairing the tire o" their cargo truck with Plate %o' S1-<=F which
was parked along the right side o" the %ational /ighway# that
de"endantTs truck !earing Plate %o' P@-,K=, driven recklessly !y
&aniel Serrano !umped the plainti"", that as a result, plainti"" was
in?ured and hospitali.ed' Plainti""(s le"t leg was later amputated
and thus lost his earning capacity' &e"endant admitted his
ownership o" the vehicle involved in the accident driven !y &aniel
Serrano' &e"endant countered that the plainti"" was merely a
!ystander, not a truck helper !eing a !rother-in-law law o" the
driver o" said truck# that the truck allegedly !eing repaired was
parked, occupying almost hal" o" the right lane towards Solano,
%ueva Bi.caya, right a"ter the curve# that the pro$imate cause o"
the incident was the "ailure o" the driver o" the parked truck in
installing the early warning device, hence the driver o" the parked
car should !e lia!le "or damages sustained !y the truck o" the
herein de"endant in the amount o" more than PGF,FFF'FF# that
plainti"" !eing a mere !ystander and hitchhiker must su""er all the
damages he incurred' Third party insurer claims no lia!ility "or the
in?ury su""ered !y plainti""'
RTC R$,!n": &e"endants were "ound lia!le to the plainti"" !y way
o" actual, attorney(s "ees and moral damages while the third party
insurer is ordered to indemni"y the de"endant'
CA R$,!n": eversed TC ruling'
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22 LA MALLORCA, .&(!(!n&', /%.
HONORABLE COURT OF APPEALS, MARIANO BELTRAN, ET
AL., '&%.nd&n(%.
22 ABOITI5 SHIPPING CORPORATION, .&(!(!n&', /%.
HON. COURT OF APPEALS, ELEVENTH DIVISION, LUCILA C.
VIANA, SPS. ANTONIO VIANA and GORGONIA VIANA, and
PIONEER STEVEDORING CORPORATION, '&%.nd&n(%.
A#!(!U S)!..!n" C. /%. C$'( 3 A..&a,%, 1CG SCRA G=
(1GDG) )Same eto nung sa 3
st
Set ng assignment' 1ng timaan ng
crane pagkatapos sumampa uli sa !arko para kunin ung naiwang
!agahe'-
C)a'a9(&'%: 5nacleto Biana J passenger o" MB 5ntiona who
died a"ter having !een hit !y a crane while pointing
to the crew o" said vessel the place where his
cargoes were loaded'
5!oiti. Shipping *ines J owner o" MB 5ntonia
where 5nacleto dies' Sued !y the respondents "or
damages'
Pioneer Stevedoring J the company with which
5!oiti. had contracted with to take care o" the
ship(s cargoes' 7wner o" the crane used in the
vessel'
Private espondents J parents and wi"e o"
5nacleto'
PLOT: 5nacleto !oarded MB 5ntonia in Mindoro, !ound "or
Manila' The vessel arrived in Manila and the passengers therein
disem!arked' 5"ter said vessel has landed, Pioneer took control
over its cargoes' 5n hour a"ter the passengers had disem!arked,
a crane started to unload the vessel(s cargoes' &uring the
operation, 5nacleto, a"ter remem!ering that his cargoes were still
on!oard returned to the vessel and pointed out to the vessel(s
crew the place where his cargoes were loaded when the crane hit
him' /e was !rought to the hospital where he later e$pired = days
therea"ter' Private respondents "iled a complaint "or damages
against 5!oiti. "or !reach o" contract o" carriage'
D&3&n%&: 5!oiti. denied responsi!ility contending that at the time
o" the accident, the vessel was completely under the control o"
Pioneer' 6t also averred that since the crane operator was not their
employee, they cannot !e held vicariously lia!le'
2'd Pa'(+ C*.: 5 third party complaint was "iled !y 5!oiti.
against Pioneer imputing lia!ility "or 5nacleto(s death as having
!een allegedly caused !y the crane(s operator, Pioneer(s
employee'
P!n&&'@% D&3: 5!oiti. had no cause o" action since it is !eing
sued "or !reach o" contract o" carriage to which Pioneer is not a
party and that it o!served diligence !oth in the selection and
supervision o" their employees and that it was 5nacleto(s gross
negligence which was the pro$imate cause o" his death'
RTC: 7rdered 5!oiti. to pay respondents "or damages incurred
and Pioneer was ordered to reim!urse 5!oiti.' 7n M, Pioneer
was a!solved "or "ailure o" the respondents and 5!oiti. to
preponderantly esta!lish a case o" negligence against the crane
operator in which the TC ruled that it was never presumed'
CA: 5""irmed with modi"ication as to the amount o" damages
awarded'
ISSUE: @o% 5nacleto was still a passenger at the time o" the
accident to make 5!oiti. lia!le'
RULING: 6t has !een recogni.ed as a rule that the relation o"
carrier and passenger does not cease at the moment the
passenger alights "rom the carrierTs vehicle at a place selected !y
the carrier at the point o" destination, !ut continues until the
passenger has had a reasona!le time or a reasona!le opportunity
to leave the carrierTs premises' 5nd, what is a reasona!le time or
a reasona!le delay within this rule is to !e determined "rom all the
circumstances' Berily, petitioner cannot categorically claim,
through the !are e$pedient o" comparing the period o" time
entailed in getting the passengerTs cargoes, that the ruling in *a
Mallorca is inapplica!le to the case at !ar' 7n the contrary, i" we
are to apply the doctrine enunciated therein to the instant petition,
we cannot in reason dou!t that the victim 5nacleto Biana was still
a passenger at the time o" the incident' @hen the accident
occurred, the victim was in the act o" unloading his cargoes, which
he had every right to do, "rom petitionerTs vessel' 5s earlier stated,
a carrier is duty !ound not only to !ring its passengers sa"ely to
their destination !ut also to a""ord them a reasona!le time to claim
their !aggage' 6n consonance with common shipping procedure
as to the minimum time o" one )3- hour allowed "or the passengers
to disem!ark, it may !e presumed that the victim had ?ust gotten
o"" the vessel when he went to retrieve his !aggage' Met, even i"
he had already disem!arked an hour earlier, his presence in
petitionerTs premises was not without cause' The victim had to
claim his !aggage which was possi!le only one )3- hour a"ter the
vessel arrived since it was admittedly standard procedure in the
case o" petitionerTs vessels that the unloading operations shall
start only a"ter that time' Conse0uently, under the "oregoing
circumstances, the victim 5nacleto Biana is still deemed a
passenger o" said carrier at the time o" his tragic death' The
presumption is, there"ore, esta!lished !y law that in case o" a
passengerTs death or in?ury the operator o" the vessel was at "ault
or negligent, having "ailed to e$ercise e$traordinary diligence, and
it is incum!ent upon it to re!ut the same' This is in consonance
with the avowed policy o" the State to a""ord "ull protection to the
passengers o" common carriers which can !e carried out only !y
imposing a stringent statutory o!ligation upon the latter'
Concomitantly, this Court has likewise adopted a rigid posture in
the application o" the law !y e$acting the highest degree o" care
and diligence "rom common carriers, !earing utmost in mind the
wel"are o" the passengers who o"ten !ecome hapless victims o"
indi""erent and pro"it-oriented carriers' @e cannot in reason deny
that petitioner "ailed to re!ut the presumption against it' 1nder the
"acts o!taining in the present case, it cannot !e gainsaid that
petitioner had inade0uately complied with the re0uired degree o"
diligence to prevent the accident "rom happening'
24 ALFREDO MALLARI, SR. and ALFREDO MALLARI,
ER., .&(!(!n&'%, /%.
COURT OF APPEALS and BULLETIN PUBLISHING
CORPORATION, '&%.nd&n(%.
Characters:
5l"redo Mallari Sr> owner o" ?eepney, petitioner
5l"redo Mallari Lr > driver o" ?eepney, petitioner
+ulletin Pu!lishing Corp'> owner o" delivery van
Feli$ 5ngeles > driver o" +ulletin delivery van
%B %etherlands 6nsurance Comp'> co-respondent ni
5ngeles at +ulletin sa TC
6srael eyes> ?eepney passenger, deceased
Claudia eyes> widow o" 6srael, plainti"" sa TC
%ature o" the case: Complaint "or &amages
FACTS:
at a!out ,:FF oTclock in the morning, the passenger
?eepney driven !y petitioner 5l"redo Mallari Lr' and owned !y
his co-petitioner 5l"redo Mallari Sr' collided with the delivery
van o" respondent +ulletin Pu!lishing Corp' along the %ational
/ighway in &inalupihan, +ataan'
Petitioner Mallari Lr' testi"ied that he went to the le"t lane o"
the highway and overtook a Fiera which had stopped on the
right lane'
+e"ore he passed !y the Fiera, he saw the van o"
respondent +1**2T6% coming "rom the opposite direction' 6t
was driven !y one Feli$ 5ngeles'
The points o" collision were at the le"t rear portion o" the
passenger ?eepney and the le"t "ront side o" the delivery van o"
+ulletin'
The impact caused the ?eepney to turn around and "all on
its le"t side resulting in in?uries to its passengers one o" whom
was 6srael eyes who eventually died due to the gravity o" his
in?uries
Claudia eyes, the widow o" 6srael eyes "iled complaint
"or damages TC 7longapo against Mallari Sr and Mallari Lr
and also against +ulletin, its driver Feli$ 5ngeles and the %B
%etherlands 6nsurance
eyes contention: alleged that the collision which resulted
in the death o" 6srael eyes was caused !y the "ault and
negligence o" !oth drivers o" the passenger ?eepney and the
+ulletin 6su.u delivery van
TC:
"ound that the pro$imate cause o" the collision was the
negligence o" Feli$ 5ngeles, driver o" the +ulletin van,
considering the "act that the le"t "ront portion o" the delivery
truck driven !y 5ngeles hit and !umped the le"t rear
portion o" the passenger ?eepney driven !y Mallari Lr
ordered +ulletin and 5ngeles to pay ?ointly and severally
Claudia eyes
ordered %B %etherlands to indemni"y Claudia eyes
dismissed the complaint against Mallari Lr and Sr
on appeal C5:
modi"ied the decision o" the trial court and "ound no
negligence on the part o" 5ngeles and conse0uently o" his
employer, +ulletin
ruled that the collision was caused !y the sole negligence
o" petitioner Mallari Lr' who admitted that immediately
!e"ore the collision and a"ter he rounded a curve on the
highway, he overtook a Fiera which had stopped on his
lane and that he had seen the van driven !y 5ngeles
!e"ore overtaking
ordered petitioners Mallari Lr' and Mallari Sr' to
compensate eyes
a!solved "rom any lia!ility respondent +ulletin, Feli$
5ngeles and %'B' %etherlands 6nsurance Company
Petitioners contention: no evidence to show that petitioner
Mallari Lr' overtook a vehicle at a curve on the road at the
time o" the accident, that the testimony o" 5ngeles was not
credi!le and unrelia!le and the trial court was in a !etter
position than the Court o" 5ppeals to assess the evidence
and o!serve the witnesses as well as determine their
credi!ility
C5 "ound, !ased on the sketch and spot report o" the
police authorities which were not disputed !y petitioners,
that the collision occurred immediately a"ter petitioner
Mallari Lr' overtook a vehicle in "ront o" it while traversing a
curve on the highway, in clear violation o" Sec' >3, pars'
)a- and )!-, o" 5 >3=C as amended, otherwise known as
The *and Transportation and Tra""ic Code* Restrictions on
overta)ing and passing.
5 settled rule that a driver a!andoning his proper lane "or
the purpose o" overtaking another vehicle in an ordinary
situation has the duty to see to it that the road is clear and
not to proceed i" he cannot do so in sa"ety
/ence this petition
ISSUE: @hether petitioners are lia!le "or the death4in?uries o"
passengers due to recklessness and negligence in an action
!ased on contract o" carriage
HELD:
SC cannot sustain petitioners
Contrary to their allegation that there was no evidence
whatsoever that petitioner Mallari Lr' overtook a vehicle at
a curve on the road at the time o" or !e"ore the accident,
the same petitioner himsel" testi"ied that such "act indeed
did occurred
petitioner Mallari Lr' already saw that the +ulletin delivery
van was coming "rom the opposite direction and "ailing to
consider the speed thereo" since it was still dark at ,:FF
oTclock in the morning mindlessly occupied the le"t lane
and overtook two )G- vehicles in "ront o" it at a curve in the
highway'
the pro$imate cause o" the collision resulting in the death
o" eyes, was the sole negligence o" the driver Mallari Lr',
who recklessly operated and drove his ?eepney in a lane
where overtaking was not allowed !y tra""ic rules
The negligence and recklessness o" the driver o" the
passenger ?eepney is !inding against petitioner Mallari Sr',
who admittedly was the owner o" the passenger ?eepney
engaged as a common carrier, considering the "act that in
an action !ased on contract o" carriage, the court need not
make an e$press "inding o" "ault or negligence on the part
o" the carrier in order to hold it responsi!le "or the payment
o" damages sought !y the passenger
5pplica!le provisions stated in the case:
A'(. 1C== o" the Civil Code, a common carrier is !ound to
carry the passengers sa"ely as "ar as human care and
"oresight can provide using the utmost diligence o" very
cautious persons with due regard "or all the circumstances'
A'(. 1C=B o" the Civil Code, in case o" death or in?uries to
passengers, a common carrier is presumed to have !een
at "ault or to have acted negligently, unless it proves that it
o!served e$traordinary diligence'
A'(. 1C=G o" the same Code, it is lia!le "or the death o" or
in?uries to passengers through the negligence or will"ul acts
o" the "ormerTs employees' This lia!ility o" the common
carrier does not cease upon proo" that it e$ercised all the
diligence o" a good "ather o" a "amily in the selection o" its
employees'
Clearly, !y the contract o" carriage, the carrier ?eepney
owned !y Mallari Sr' assumed the e$press o!ligation to
transport the passengers to their destination sa"ely and to
o!serve e$traordinary diligence with due regard "or all the
circumstances, and any in?ury or death that might !e
su""ered !y its passengers is right away attri!uta!le to the
"ault or negligence o" the carrier'
DISPOSITIVE: Petition is &2%62& and the &ecision o" the Court
o" 5ppeals reversing the decision o" the trial court !eing in accord
with law and evidence is 5FF6M2&' Petitioners are ordered
?ointly and severally to pay Claudia eyes
2= CORNELIA A. DE GILLACO, ET AL., .,a!n(!33%-a..&,,&&%, /%.
MANILA RAILROAD COMPAN6, d&3&ndan(-a..&,,an(.
2B ANTONIA MARANAN, .,a!n(!33-a..&,,an(, /%.
PASCUAL PERE5, ET AL., d&3&ndan(%.
PASCUAL PERE5, d&3&ndan( a..&,,an(.
Characters:
5ntonia Maranan> mother o" deceased ogelio Corachea
Pascual Pere. > ta$i owner and operator
Simeon Balen.uela > ta$i driver
ogelio > ta$i passenger# deceased
FACTS:
ogelio was sta!!ed and killed !y Balen.uela'
Balen.uela was prosecuted and "ound guilty "or homicide
in +atangas TC' 5ppeal o" this ?udgment was taken to the
C5, w4c su!se0uently a""irmed trial court(s ?udgment o"
conviction'
@hile appeal was pending, Maranan "iled action in
+atangas TC to recover damagegs "rom Pere. and
Balen.uela "or the death o" her son'
&e"endants asserted that the deceased was killed in sel"-
de"ense, since he "irst assaulted the driver !y sta!!ing him
"rom !ehind' &e"endant Pere. "urther claimed that the death
was a casofortuito "or which the carrier was not lia!le'
Trial court "ound "or the plainti"" Maranan and awarded her
P=k as damages against de"endant Pere. while the claim
against Balen.uela was dismissed' +oth parties appealed to
the SC )SC talaga to hindi C5-'
Pere. &e"ense: ruling in Dillaco v Manila ailroad Co'
6SS12S:
a' @hether the Dillaco case is applica!le in the instant case'
!' @4% Pere. can !e held lia!le to the heir o" a passenger killed
!y its driver'
/2*&:
a' %o' The killing here was perpetrated !y the driver o" the very
ca! transporting the passenger, in whose hands the carrier
had entrusted the duty o" e$ecuting the contract o" carriage' 6n
other words, unlike the +illaco case, the killing o" the
passenger here took place in the course o" duty o" the guilty
employee and when the employee was acting within the scope
o" his duties'
Moreover, the +illaco case was decided under the provisions
o" the Civil Code o" 3KKE which, unlike the present Civil Code,
did not impose upon common carriers a!solute lia!ility "or the
sa"ety o" passengers against wil"ul assaults or negligent acts
committed !y their employees' The death o" the passenger in
the +illaco case was truly a "ortuitous event which e$empted
the carrier "rom lia!ility'
1nlike the old Civil Code, the new Civil Code o" the Philippines
e$pressly makes the common carrier lia!le "or intentional
assaults committed !y its employees upon its passengers, !y
the wording o" A'(. 1C=G'
!' Mes' it is the carrierTs strict o!ligation to select its drivers and
similar employees with due regard not only to their technical
competence and physical a!ility, !ut also, no less important, to
their total personality, including their patterns o" !ehavior,
moral "i!ers, and social attitude'
The Civil Code provisions on the su!?ect o" Common Carriers3
are new and were taken "rom 5nglo-5merican *aw' There, the
!asis o" the carrierTs lia!ility "or assaults on passengers
committed !y its drivers rests either on (1) the doctrine o"
respondeat superior or (2) the principle that it is the carrierTs
implied duty to transport the passenger sa"ely'
1nder the "irst, which is the minority view, the carrier is lia!le
only when the act o" the employee is within the scope o" his
authority and duty' 6t is not su""icient that the act !e within the
course o" employment only'
1nder the second view, upheld !y the ma?ority and also !y the
later cases, it is enough that the assault happens within the
course o" the employeeTs duty' 6t is no de"ense "or the carrier
that the act was done in e$cess o" authority or in diso!edience
o" the carrierTs orders' The carrierTs lia!ility here is a!solute in
the sense that it practically secures the passengers "rom
assaults committed !y its own employees'
5rt 3<,E, %CC "ollows the rules !ased on the second view' 5t
least three very cogent reasons underlie this rule'
3' The special undertaking o" the carrier re0uires that it
"urnish its passenger that "ull measure o" protection
a""orded !y the e$ercise o" the high degree o" care
prescri!ed !y the law, inter alia "rom violence and insults at
the hands o" strangers and other passengers, !ut a!ove
all, "rom the acts o" the carrier(s own servants charged with
the passenger(s sa"ety#
G' Said lia!ility o" the carrier "or the servant(s violation o" duty
to passengers, is the result o" the "ormer(s con"iding in the
servant(s hands the per"ormance o" his contract to sa"ely
transport the passenger, delegating therewith the duty o"
protecting the passenger with the utmost care prescri!ed
!y law# and
=' 5s !etween the carrier and the passenger, the "ormer must
!ear the risk o" wrong"ul acts or negligence o" the carrier(s
employees against passengers, since, it and not the
passengers, has the power to select and remove them'
2C PHILIPPINE NATIONAL RAIL1A6S, .&(!(!n&', /%.
THE HONORABLE COURT OF APPEALS and ROSARIO
TUPANG, '&%.nd&n(%.
Characters
inifredo+upang -a paying passenger who fell off a train operated by the
petitioner$
4osario +upang- respondentJ widowed of the deceased +upang
FACTS
On September 6B" 6>;7" at about >,BB oEcloc. in the evening"
inifredo+upang" husband of plaintiff 4osario +upang" boarded E+rain
of appellant at 'ibmanan" Camarines Sur" as a paying passenger bound
for Manila$
2ue to some mechanical defect" the train stopped at Sipocot"
Camarines Sur" for repairs" ta.ing some two hours before the train
could resume its trip to Manila$
0nfortunately" upon passing #yam Bridge at 'ucena" MueDon"
inifredo+upang fell off the train resulting in his death$
+he train did not stop despite the alarm raised by the other passengers
that somebody fell from the train$ #nstead" the train conductor !erfecto
&braDado" called the station agent at Candelaria" MueDon" and
re1uested for verification of the information$
!olice authorities of 'ucena City were dispatched to the #yam Bridge
where they found the lifeless body of inifredo+upang$
inifredo+upang died of cardio-respiratory failure due to massive
cerebral hemorrhage due to traumatic in9ury
0pon complaint filed by the deceasedEs widow" 4osario +upang" the
then Court of Cirst #nstance of 4iDal
4+C, held the petitioner !N4 liable for damages for breach of contract of
carriage and ordered to pay the plaintiff
C&, &CC#4ME2
!N45s defense
+he doctrine of state immunity from suit"it alleged that it is a mere
agency of the !hilippine government without distinct or separate
personality of its own" and that its funds are governmental in character
and" therefore" not sub9ect to garnishment or e)ecution$
ISSUE
ON !N4 is liable
HELD
NES
!N4 has the obligation to transport its passengers to their destinations and to
observe e)traordinary diligence in doing so$ 2eath or any in9ury suffered by any
of its passengers gives rise to the presumption that it was negligent in the
performance of its obligation under the contract of carriage$ !N4 failed to
overthrow such presumption of negligence with clear and convincing evidence"
inasmuch as !N4 does not deny" %6( that the train boarded by the deceased
inifredo +upang was so overcrowded that he and many other passengers had
no choice but to sit on the open platforms between the coaches of the train" %7(
that the train did not even slow down when it approached the #yam Bridge which
was under repair at the time" and %8( that neither didt he trai n stop" despi t e
t he al arm rai sed by other passengers that a person had f al l en off
t he trai n at # yamBridge$
But while petitioner failed to e)ercise e)traordinary diligence as re1uired by
law"
8
it appears that the deceased was chargeable with contributory negligence$
Since he opted to sit on the open platform between the coaches of the train" he
should have held tightly and tenaciously on the upright metal bar found at the
side of said platform to avoid falling off from the speeding train$ Such contributory
negligence" while not e)empting the !N4 from liability" nevertheless 9ustified the
deletion of the amount ad9udicated as moral damages
&s to immunity from suit,
+he !N4 was c r eat ed under & G63<" as amended$ Sec t i on G
of t he s ai d &c t pr ov i des t hat @ t he !hilippine National 4ailways shall
have the following powers, %a( +o do all such other things and to transact all such
business directly or indirectly necessary" incidental or conducive to the
attainment of the purpose of the corporationJ and %b( /enerally" to e)ercise all
powers of a corporation under the Corporation 'aw$A 0nder the foregoing
section" the !N4 has all the powers" the characteristics and attributes of a
corporation under the Corporat i on 'aw$ !N4 may sue and be sued and
may be sub9 ected to court processes 9 ust l i .e any ot her corporation'
2D CESAR L. ISAAC, .,a!n(!33-a..&,,an(, /%.
A. L. AMMEN TRANSPORTATION CO., INC., d&3&ndan(-a..&,,&&.
Bautista, #ngelo J
+us =3, 5'*' 5mmen Transportation Co', 6nc J Carrier
Cesar 6saac J passenger
F5CTS:
- 7n May =3, 3E,3, Cesar 6saac !oarded +us =3 "rom
*igao, 5l!ay !ound "or Pili, Camarines Sur and seated
himsel" on the le"t side resting his le"t arm on the window
sill !ut with his el!ow protruding to the window'
- +e"ore reaching his destination, a pick-up car at "ull speed
and was running outside o" its proper lane came "rom the
opposite direction'
- The driver o" the !us swerved to the e$treme right o" the
road until its "ront and rear wheels have gone over the pile
o" stones or gravel !ut could not move "arther without
endangering the lives o" the passengers'
- &espite e""orts, the rear le"t side o" the !us was hit !y the
pick-up car and 6saac(s le"t arm was completely damaged
and the severed portion "ell inside the !us'
- /e was rushed to the hospital in 6riga, Camarines Sur
where he was given !lood trans"usion to save his li"e and
a"terwards moved to Ta!aco hospital where he underwent
treatment "or = months and later to 7rthopedic hospital
where he stayed "or another G months'
P5SS2%D2(s claim:
- 5lleging that the collision which resulted in the loss o" his
arm was mainly due to the gross incompetence and
recklessness o" the driver o" the !us and "or that the
de"endant operator incurred in culpa contractual arising
"rom its non-compliance with its o!ligation to transport
6saac sa"ely to his destination'
- @hen an action is !ased on a contract o" carriage all that
is necessary to sustain recovery is proo" o" the e$istence o"
the contract which is !reached !y act or omission'
&2F2%S2 o" the 7P25T7:
- The in?ury su""ered !y 6saac was due entirely to the "ault or
negligence o" the driver o" the pick-up car and to the
contri!utory negligence o" the plainti"" himsel"'
- *ia!ility o" the carrier was predicated not upon mere
!reach o" its contract o" carriage !ut upon the "inding that
its negligence was "ound to !e the direct or pro$imate
cause o" the in?ury complained' Thus, ;i" there is no
negligence on the part o" the carrier !ut that the accident
resulting in?uries is due to causes which are inevita!le and
which could not have !een avoided or anticipated
notwithstanding the e$ercise o" that high degree o" care
and skill which the carrier is !ound to e$ercise "or the
sa"ety o" the passengers8, neither the common carrier nor
the driver is lia!le there"ore'

TC 1*6%D:
&ismissed the case' The TC ruled that the collision was
occurred due to the negligence o" the driver o" the pick-up and not
to that o" the driver o" the !us !ecause the latter did everything he
could do to avoid the accident !ut notwithstanding his e""orts, he
was not a!le to avoid it'
6SS12:
6" there is no negligence on the part o" the common carrier
!ut that the accident resulting in in?uries is due to causes which
are inevita!le and which could not have !een avoided or
anticipated notwithstanding the e$ercise o" that high degree o"
care and skill which the carrier is !ound to e$ercise "or the sa"ety
o" his passengers neither the driver nor the common carrier is
lia!le there"ore'
SC 1*6%D:
- Mes' The appealed decision is a""irmed'
- Take note o" 5rticles 3<==, 3<,, and 3<,C o" the %CC'
- From the given legal provisions the "ollowing are the
principles governing the lia!ility o" the common carrier:
3' The lia!ility o" a carrier is contractual and arises upon
!reach o" its o!ligation' There is !reach i" it "ails to
e$ert e$traordinary diligence according to all
circumstances o" each case'
G' 5 carrier is o!liged to carry its passenger with the
utmost diligence o" a very cautious person, having due
regard "or all the circumstances'
=' 5 carrier is presumed to !e at "ault o" to have acted
negligently in case o" death o", or in?ury to, passengers,
it !eing its duty to prove that it e$ercised e$traordinary
diligence'
>' The carrier is not an insurer against all risk'
- @hen a carrier(s employee is con"ronted with a sudden
emergency, the "act that he is o!liged to act 0uickly and
without a chance "or deli!eration must !e taken into
account, and he is held to the some degree o" care that he
would otherwise !e re0uired to e$ercise in the a!sence o"
such emergency !ut must e$ercise only such care as any
ordinary prudent person would e$ercise under like
circumstances and conditions, and the "ailure on his part to
e$ercise the !est ?udgment the case renders possi!le does
not esta!lish lack o" care and skill on his part' Considering
all the circumstances, we are persuaded that the driver o"
the !us has done what a prudent man could have done to
avoid the collision and in our opinion this relieves the
appellee "rom legi!ility under our law'
- 5 circumstance which militates against the stand o" 6saac
is the "act !orne out !y the evidence that when he !oarded
the !us, he seated himsel" on the le"t side resting his le"t
arm on the sill !ut with his le"t el!ow outside the window,
this !eing his position in the !us when the collision took
place' 6t is "or the reason that the collision resulted in the
severance o" said arm' 6s there"ore apparent that 6saac is
guilty o" contri!utory negligence' /ad he not placed his
le"t arm o" the window sill with a portion protruding outside,
perhaps the in?ury would have !een avoided as is the case
with the other passengers' 6t is to !e noted that he was
the only victim o" the collision' 6t is true that such
contri!utory negligence cannot relieve appellee o" its
lia!ility !ut will only entitle it to a reduction o" the amount o"
damages caused )5rt 3<CG %CC-, !ut this is a
circumstance which "urther militates against the position
taken !y appellant in the case'
2G VICENTE CALALAS, .&(!(!n&',/%.
COURT OF APPEALS, ELI5A EUEEURCHE SUNGA and FRANCISCO
SALVA, '&%.nd&n(%.
PARTIES:
3' Francisco Salva J owner o" the 6su.u truck that !umped the
?eepney 2li.a is riding
G' 6glecerio Berena J driver o" the 6su.u tryck
=' 2li.a Sunga J college "reshman ma?oring in P2 at Siliman
1niversity
>' Bicente Calalas J owner and operator o" the ?eepney herein
FACTS:
3' 2li.a took a ?eepney which was already "illed to capacity o" G>
passengers'
G' The conductor gave 2li.a an e$tension seat, a wooden stool at
the !ack o" the door at the rear end o" the vehicle'
=' 2li.a gave way to an alighting passenger, and in the course, an
6su.u truck !umped the le"t rear portion o" the ?eepney, causing
"racture to 2li.a(s le"t leg# with casting, con"ined'
>' +ecause o" the in?ury, she was not a!le to enroll in the second
semester o" that school year and said she had no more intention
o" continuing with her schooling, !ecause she could not walk and
decided not to pursue her degree, ma?or in Physical 2ducation
O!ecause o" my leg which has a de"ect already'O
,' Sunga "iled "or damages in violation o" Contract o" carriage#
Calalas "iled a third party complaint against Salva and Berena'
C' 5dditionally, Calalas "iled a complaint "or 0uasi-delict against
Salva and Berena )ung decision dun, lia!le sila "or damages sa
?eep-
RTC: 5!solved Calalas# ruled against Salva
CA: eversed# SungaTs cause o" action was !ased on a contract
o" carriage, not 0uasi-delict, and that the common carrier "ailed to
e$ercise the diligence re0uired
Ca,a,a%: The !umping o" the ?eepney was a "ortuitous event'
ISSUE:
3'whether petitioner is lia!le on his contract o" carriage'
G' @7% moral damages may !e awarded'
1*6%D:
3' Mes' Presumption o" negligence'
- Calalas did not carry Sunga Osa"ely as "ar as human care and
"oresight could provide, using the utmost diligence o" very
cautious persons, with due regard "or all the circumstancesO'
- Leepney was not properly parked, its rear portion !eing e$posed
a!out two meters "rom the !road shoulders o" the highway, and
"acing the middle o" the highway in a diagonal angle# against 5
>3=C )7!struction o" Tra""ic'-
- PetitionerTs driver took in more passengers than the allowed
seating capacity o" the ?eepney
- 6t is immaterial that the pro$imate cause o" the collision !etween
the ?eepney and the truck was the negligence o" the truck driver'
The doctrine o" pro$imate cause is applica!le only in actions "or
0uasi-delict, not in actions involving !reach o" contract'
- 5 caso"ortuito is an event which could not !e "oreseen, or which,
though "oreseen, was inevita!le' This re0uires that the "ollowing
re0uirements !e present: )a- the cause o" the !reach is
independent o" the de!torTs will# )!- the event is un"oreseea!le or
unavoida!le# )c- the event is such as to render it impossi!le "or the
de!tor to "ul"ill his o!ligation in a normal manner, and )d- the
de!tor did not take part in causing the in?ury to the
creditor'> Petitioner should have "oreseen the danger o" parking
his ?eepney with its !ody protruding two meters into the highway'
Mentioned articles: 3<==, 3<,,, 3<,C
G' %o'
D: Moral damages are not recovera!le in actions "or damages
predicated on a !reach o" contract "or it is not one o" the items
enumerated under 5rt' GG3E o" the Civil Code'
2$c': )3- in cases in which the mishap results in the death o" a
passenger, as provided in 5rt' 3<C>, in relation to 5rt'GGFC)=- o"
the Civil Code# and
)G- in the cases in which the carrier is guilty o" "raud or !ad "aith,
as provided in 5rt' GGGF'
- 6n this case, there is no legal !asis "or awarding moral damages
since there was no "actual "inding !y the appellate court that
petitioner acted in !ad "aith in the per"ormance o" the contract o"
carriage' SungaTs contention that petitionerTs admission in open
court that the driver o" the ?eepney "ailed to assist her in going to a
near!y hospital cannot !e construed as an admission o" !ad "aith'
O()&' D9('!n&%:
The "irst, 0uasi-delict, also known as culpa a0uiliana or culpa e$tra
contractual, has as its source the negligence o" the tort"easor' The
second, !reach o" contract or culpa contractual, is premised upon
the negligence in the per"ormance o" a contractual o!ligation'
Conse0uently, in 0uasi-delict, the negligence or "ault should !e
clearly esta!lished !ecause it is the !asis o" the action, whereas
in !reach o" contract, the action can !e prosecuted merely !y
proving the e$istence o" the contract and the "act that the o!ligor,
in this case the common carrier, "ailed to transport his passenger
sa"ely to his destination'
2F FORTUNE EHPRESS, INC., .&(!(!n&', /%.
COURT OF APPEALS, PAULIE U.CAORONG, and *!n'
9)!,d'&n6ASSER KING CAORONG, ROSE HEINNI and PRINCE
ALEHANDER, a,, %$'na*&d CAORONG, and '&.'&%&n(&d #+ ()&!'
*()&' PAULIE U. CAORONG, '&%.nd&n(%.
Characters:
5tty' Tali! Caorong> !us passenger, deceased
Paulie Caorong> widow o" 5tty' Caorong, plainti"" sa TC
Masser, ose, Prince> minor children o" the Caorongs
Fortune 2$press > !us company, petitioner
%ature o" the case: Suit o" !reach o" contract o" carriage'
FACTS:
Fortune 2$press !us "igured in an accident with a ?eepney
in *anao del %orte, resulting in the death o" several
passengers o" the ?eepney, including two Maranaos
Crisanto Deneralao, a volunteer "ield agent o" the
Consta!ulary egional Security 1nit, conducted an
investigation o" the accident, and "ound out that the owner o"
the ?eepney was a Maranao
Deneralao rendered a report on his "indings to Sgt'
eynaldo +astasa o" the Philippine Consta!ulary egional
/ead0uarters at Cagayan de 7ro that certain Maranaos were
planning to take revenge on the petitioner !y !urning some o"
its !uses
+astasa instructed Deneralao to see &iosdado
+ravo, operations manager o" petitioner in its main o""ice in
Cagayan de 7ro City' +ravo assured him that the necessary
precautions to insure the sa"ety o" lives and property would !e
taken'

> days later, = armed Maranaos who pretended to !e
passengers, sei.ed a !us o" petitioner while on its way
to 6ligan City' 5mong the passengers o" the !us was 5tty'
Caorong' The leader o" the Maranaos, identi"ied as one
+ashier Mananggolo, ordered the driver, Dodo"redo Ca!atuan,
to stop the !us on the side o" the highway
Mananggolo shot Ca!atuan on the arm' 7ne o" the
companions o" Mananggolo started pouring gasoline inside the
!us including the driver Ca!atuan' Mananggolo then ordered
the passenger to get o"" the !us'
5tty' Caorong returned to the !us to retrieve something
"rom the overhead rack' Ca!atuan, who had regained
consciousness, heard 5tty' Caorong pleading with the armed
men to spare the driver as he was innocent o" any wrong
doing The armed men were, however, adamant as they
repeated the warning that they were going to !urn the !us
along with its driver'
Ca!atuan clim!ed out o" the le"t window o" the !us /e
heard shots "rom inside the !us' *arry de la Cru., one o" the
passengers, saw that 5tty' Caorong was hit' Then the !us was
set on "ire' Some o" the passengers were a!le to pull 5tty'
Caorong out o" the !urning !us and rush him to the Mercy
Community /ospital in 6ligan City, !ut he died while
undergoing operation
Paulie Caorong !rought suit "or each o" contract TC
6ligan'
TC:
&ismissed complaint "or lack o" merit
the "ailure o" de"endant to accord "aith and credit to the
report o" Deneralao and the "act that it did not provide
security to its !uses cannot, in the light o" the
circumstances, !e characteri.ed as negligence
evidence clearly shows that the assalants did not have the
least intention o" the harming any o" the passengers' They
ordered all the passengers to alight and set "ire on the !us
only a"ter all the passengers were out o" danger' The
death o" 5tty' Caorong was an une$pected and un"orseen
occurrense over which de"endant had no control
5tty' Caorong per"ormed an act o" charity and heroism
+ut neither should any !lame !e laid on the doorstep o"
de"endant' /is death was solely due to the will"ull acts o"
the lawless which de"endant could neither prevent nor to
stop
7n appeal C5:
eversed decision o" the TC
given the circumstances o!taining in the case at !ench
that:
)a- two Maranaos died !ecause o" a vehicular collision
involving one o" appelleeTs vehicles#
)!- appellee received a written report "rom a mem!er o" the
egional Security 1nit, Consta!ulary Security Droup, that
the tri!al4ethnic group o" the two deceased were planning
to !urn "ive !uses o" appellee out o" revenge#
)c- appelle did nothing "or the sa"ety o" its passengers
travelling in the area o" in"luence o" the victims,
appellee has "ailed to e$ercise the degree o" dilegence
re0uired o" common carrier' appellee must !e ad?udge
lia!le
/ence this appeal'
ISSUES: @4%
a' petitioner is lia!le "or !reach o" contract o" carriage
!' sei.ure o" !us was a case o" "orce ma?eure
c' there was contri!utory negligence on the part o" the
deceased
HELD:
Petition has no merit'
a'-
Mes lia!le "or !reach o" contract o" carriage
A'(. 1CB2 3 ()& C!/!, Cd& provides that a common
carrier is responsi!le "or in?uries su""ered !y a passenger
on account o" wil"ull acts o" other passengers, i" the
employees o" the common carrier could have prevented
the act through the e$ercise o" the diligence o" a good
"ather o" a "amily'
6n the present case, it is clear that !ecause o" the
negligence o" petitionerTs employees, the sei.ure o" the
!us !y Mananggolo and his men was made possi!le
&espite warning !y the Philippine Consta!ulary at
Cagayan de 7ro that the Maranaos were planning to take
revenge on the petitioner !y !urning some o" its !uses and
the assurance o" petitionerTs operation manager, &iosdado
+ravo, that the necessary precautions would !e taken,
petitioner did nothing to protect the sa"ety o" its
passengers'
From the "oregoing, it is evident that petitionerTs employees
"ailed to prevent the attack on one o" petitionerTs !uses
!ecause they did not e$ercise the diligence o" a good
"ather o" a "amily'
/ence, petitioner should !e held lia!le "or the death o"
5tty' Caorong
!'-
Sei.ure o" PetitionerTs +us not a Case o" Force Ma?eure
A'(. 11C4 3 ()& C!/!, Cd& de"ines a "ortuitous event as
an occurence which could not !e "oreseen, is inevita!le'
6n ,o"ido v. Court of Appeals, we held that to considered
as "orce ma?eure, it is necessary that
o )3- the cause o" the !reach o" the o!ligation must
!e independent o" the human will#
o )G- the event must !e either un"oreseea!le or
unavoida!le#
o )=- the occurence must !e render it impossi!le "or
the de!tor to "ul"ill the o!ligation in a normal
manner
o )>- the o!ligor must !e "ree o" participation in, or
aggravation o", the in?ury to the creditor'
The a!sence o" any o" the re0uisites mentioned a!ove
would prevent the o!ligor "rom !eing e$cused "rom lia!ility'
6n the present case, this "actor o" un"oreseea!ility )the
second re0uisite "or an event to !e considered "orce
ma?eure- is lacking' 5s already stated, despite the report o"
PC agent Deneralao that the Maranaos were planning to
!urn some o" petitionerTs !uses and the assurance o"
petitionerTs operation manager )&iosdado +ravo- that the
necessary precautions would !e taken, nothing was really
done !y petitioner to protect the sa"ety o" passengers
c'-
&eceased not Duilty o" Contri!utory %egligence
Fortune contention: 5tty' Caorong was guilty o"
contri!utory negligence in returning to the !us to retrieve
something' +ut 5tty' Caorong did not act recklessly' 6t
should !e pointed out that the intended targets o" the
violence were petitioners and its employees, not its
passengers' The assailantTs motive was to retaliate "or the
loss o" li"e o" two Maranaos as a result o" the collision
!etween petitionerTs !us and the ?eepney in which the two
Maranaos were riding' Mananggolo, the leader o" the
group which had hi?acked the !us, ordered the passengers
to get o"" the !us as they intended to !urn it and its driver'
The armed men actually allowed 5tty' Caorong to retrieve
something "rom the !us' @hat apparently angered them
was his attempt to help the driver o" the !us !y pleading
"or his li"e' /e was playing the role o" the good Samaritan'
Certainly, this act cannot considered an act o" negligence,
let alone recklessness'
&amages awarded:
-ndemnity for eath' A'(. 1CB4 3 ()& C!/!, Cd&, !n
'&,a(!n ( A'(. 22FB thereo", provides "or the payment o"
indemnity "or the death o" passengers caused !y the
!reach o" contract o" carriage !y a common carrier' 6nitially
"i$ed in 5rt' GGFC at P=,FFF'FF, the amount o" the said
indemnity "or death has through the years !een gradually
increased in view o" the declining value o" the peso' 6t is
presently "i$ed at P,F,FFF'FF' Private respondents are
entitled to this amount'
Compensation for Loss of .arning Capacity' A'(. 1CB4 3
()& C!/!, Cd&, !n '&,a(!n ( A'(. 22FB thereo", provides
that in addition to the indemnity "or death arising "rom the
!reach o" contrtact o" carriage !y a common carrier, the
Ode"endant shall !e lia!le "or the loss o" the earning
capacity o" the deceased, and the indemnity shall !e paid
to the heirs o" the latter'O
Actual amages. Art' G3EE provides that Oe$cept as
provided !y law or !y stipulation, one is entitled to an
ade0uate compensation only "or such pecuniary loss
su""ered !y him as has duly proved'O
!oral amages' 1nder 5rt' GGFC, the Ospouse, legitimate
and illegitimate descendants and ascendants o" the
deceased may demand moral damages "or mental anguish
!y reason o" the death o" the deceased'O
./emplary amages' 5rt' GG=G provides that Oin contracts
and 0uasi-contracts, the court may award e$emplary
damages i" the de"endant acted in a wanton, "raudulent,
reckless, oppressive, or malevolent reckless manner'O 6n
the present case, the petitioner acted in a wanton and
reckless manner'
Attorney0s 1ees' Pursuant to 5rt' GGFK, attorneyTs "ees may
!e recovered when, as in the instant case, e$emplary
damages are awarded'
Compensation for Loss of .arning Capacity' A'(. 1CB4 3
()& C!/!, Cd&, !n '&,a(!n ( A'(. 22FB ()&'&3, provides
that in addition to the indemnity "or death arising "rom the
!reach o" contrtact o" carriage !y a common carrier, the
Ode"endant shall !e lia!le "or the loss o" the earning
capacity o" the deceased, and the indemnity shall !e paid
to the heirs o" the latter'O
DISPOSITIVE: the decision o" the Court o" 5ppeals is here!y
5FF6M2& with the M7&6F6C5T67% that petitioner Fortune
2$press, 6nc' is ordered to pay private respondents Paulie, Masser
Iing, ose /einni, and Prince 5le$ander Caorong'