TRANSPORTATION LAW

MIDTERM EXAM Q&A 2017

1. Pedro is an overseas contract worker who recently retired. He used

his retirement pay to buy a “KIA Pregnant” passenger van capable
of carrying twenty passengers. He uses his van to transport OCW
applicants only from Baguio City to the different embassies, as well
as to the offices of various overseas placement agencies in Manila.
Instead of collecting fare from these prospective OCWs, Pedro
collects a fixed amount per person from the placement agency under
a pre-arranged agreement with them. Is Pedro considered a common
carrier? (10pts)

-Yes.

The Civil Code defines "common carriers" in the following terms:

Article 1732. Common carriers are persons, corporations, firms or

associations engaged in the business of carrying or transporting
passengers or goods or both, by land, water, or air for compensation,
offering their services to the public.

The above article makes no distinction between one whose principal business
activity is the carrying of persons or goods or both, and one who does such carrying
only as an ancillary activity (in local Idiom as "a sideline"). Article 1732 also carefully
avoids making any distinction between a person or enterprise offering transportation
service on a regular or scheduled basis and one offering such service on an occasional,
episodic or unscheduled basis. Neither does Article 1732 distinguish between a carrier
offering its services to the "general public," i.e., the general community or population,
and one who offers services or solicits business only from a narrow segment of the
general population.

In the case, the fact that Pedro collects a compensation, regardless of who
pays him, he is considered a common carrier. Also, the fact that Pedro has a limited
clientele does not exclude him from the definition of a common carrier.

2. Abe is a law student who lives in a remote barangay some

20km from the University of the Cordilleras. He has four
classmates who are his neighbors. In order to reduce his
gasoline expenses, he and his four friends entered into a
carpooling agreement whereby Pedro is obligated to transport
his classmates to their respective doorsteps every night after
his class. In exchange, he totals his gas bills for the month,
devides it by four and collects from each of his four classmates
 their proportionate share. What degree of diligence must Abe
observe in driving his classmates home Every night? 10pts.
ANSWER
Abe must exercise ordinary diligence of a good father of a family.
In this case, Abe is a private carrier. In Sps. Perena vs Spouses Nicholas (G.R.
No. 157917 ,August 29, 2012) a private carrier is defined as one who, without
making the activity a vocation, or without holding himself or itself out to the
public as ready to act for all who may desire his or its services, undertakes, by
special agreement in a particular instance only, to transport goods or persons
from one place to another either gratuitously or for hire. The provisions on
ordinary contracts of the Civil Code govern the contract of private carriage. The
diligence required of a private carrier is only ordinary, that is, the diligence of a
good father of the family.
The true test for a common carrier is not the quantity or extent of the business
actually transacted, or the number and character of the conveyances used in the
activity, but whether the undertaking is a part of the activity engaged in by the
carrier that he has held out to the general public as his business or occupation. If
the undertaking is a single transaction, not a part of the general business or
occupation engaged in, as advertised and held out to the general public, the
individual or the entity rendering such service is a private, not a common,
carrier. The question must be determined by the character of the business
actually carried on by the carrier, not by any secret intention or mental
reservation it may entertain or assert when charged with the duties and
obligations that the law imposes.
In this case, Abe did not hold himself out as a ready transportation
indiscriminately. He has limited clientele, his four classmates. The carpooling
agreement is a single transaction, not a part of the general business or
occupation engaged in, as advertised and held out to the general public.

3. ABC hardware owns a Toyota Erp cargo truck which it uses to

transport building materials from its suppliers’ warehouse
Manila up to Baguio. XYZ is another hardware in Baguio. One
time, XYZ rented the cargo truck of ABC to be used in
transporting an unusually big volume of materials from manila.
Along the way, the cargo truck was high jacked by armed men
with M-16 Armalites. The truck was subsequently recovered
but not the cargo. XYZ sued ABC for Damages arising from
breach of contract. If you were the lawyer of ABC, what would
be your defense?
ANSWER
If I am the lawyer of ABC I would put up as a defense that ABC is a
private carrier.
 A private carrier is one who, without making the activity a vocation, or
without holding himself or itself out to the public as ready to act for all who
may desire his or its services, undertakes, by special agreement in a
particular instance only, to transport goods or persons from one place to
another either gratuitously or for hire. Since the arrangement between ABC
and XZY is a special contract to transport goods from baguio to manila, ABC
then is considered as a private carrier considering that the transaction is a
single transaction only and not part of the general business or occupation of
ABC.
Therefore, ABC may put up as a defense that it is private carrier.
4. MR. Mario Operates a public utility Jeepney (PUJ) plying the
“BCF-Bakakeng-vice-versa” route. One time the BCF Barristers
Club hired his jeep for a field trip to the Hundred Islands in
Alaminus Pangasinan. Since the Jeepney will travel outside and
beyond its assigned route, Mang Mario had to obtain a
“Special Trip Ticket” from the LTO. During the field trip, one of
the Barristers Officers drowned while swimming just 50m away
from the beach where the jeepney was parked.
a. Is Mang Mario a common carrier at the time of the field trip?
(5pts)
Yes Mario is a common carier at the time of field trip. (Same reason
sa number essay daw hehe)
b. Can Mang Maro be presumed negligent and be held liable
for the death of the barristers club officer? 5pts
No Mang Mario cannot be presumed negligent and be held liable.
A common Carrier’s obligation is to deliver the passengers to their
proper destination safely with the exercise of extraordinary
diligence. In the present case, there is showing that Mang Mario was
negligent in transportation of his passengers, his duty is transport
them to hundred Islands safely. From the moment the BC officer
stepped out from the platform of Mang Mario’s jeep, the obligation
is deemed suspended. Mang Mario is a driver not a baby sitter nor a
life guard

5. Bukang Bulaklak Nite Club and Discotheque is located far from

the town. Its owner, Mr Richard, thought of a gimmick to boost
patronage of his night club. Free shuttle rides are provided
from 7:30 P.M. to 3:30 A.M. for anyone who wants to go to
Bukang Bulaklak from designated pick up point downtown, and
back. However, only persons who actually go inside the club, or
are coming out of it, are entitled to free ride. Mr. Richard
figures that he can just recover the cost of transporting his
patrons for free by a small markup on the price of beer that he
 sells to his patrons. Is Bukang Bulaklak a common carrier?
Explain. 5pts.
ANSWER
Yes Bukang Bulakallak is a common carrier.
Article 1732. Common carriers are persons, corporations, firms or
associations engaged in the business of carrying or transporting passengers
or goods or both, by land, water, or air for compensation, offering their
services to the public. The above article makes no distinction between one
whose principal business activity is the carrying of persons or goods or both,
and one who does such carrying only as an ancillary activity (in local Idiom as
"a sideline"). Article 1732 also carefully avoids making any distinction
between a person or enterprise offering transportation service on a regular or
scheduled basis and one offering such service on an occasional, episodic or
unscheduled basis. Neither does Article 1732 distinguish between a carrier
offering its services to the "general public," i.e., the general community or
population, and one who offers services or solicits business only from a
narrow segment of the general population.
Clearly, Bukang Bulaklak is considered a common carrier.
6. It says on the reservation ticket of the Philippine Rapid Bus Lines;
“The Company shall not be responsible in any way for injury suffered
by any passenger, or any loss of baggage, during the trip” Is this
stipulation Valid? Why or Why Not?
The stipulation is not valid. It is considered unreasonable, unjust and
contrary to public policy. Article (1745) void stipulations: (2) That the
common carrier will not be held liable for any loss, destruction or
deterioration of the goods.
Article 1757 Provides that the duty of the common carrier to carry
passengers with extraordinary diligence cannot be dispensed with or
lessened by stipulation, by posting of notices, statements on tickets, or
otherwise

7. Mang Rrey Owns a minibus that used to ply the Baguio-San Fernando
route until franchise expired last year. Unable to sell the
decommissioned bus, he kept at as his personal service vehicle. One
time, while driving up to Baguio from San Fernando on his “personal
bus”, he noticed that people along the way still recognized his bus
as ame as the same one they have ridden for many years. They still
tried to waved to stop (“pinapara pa din”). Feeling sentimental,
Mang Rey decided to give in to the public persistence and picked up
twenty passengers between Nanguilian and Sablan. When the
passngers tried to pay, Mang Rey just smiled and said he was
offering the ride for free as a sign of his gratitude for past business.
Unfortunately, when they reached the Banangan just 6 kilometers
from Baguio, the right front tire hit the sharp end of an exposed iron
bar sticking out of the pavement. The tire blew up, causing the bus
to skid out of control and to fall into a deep ravine. Man grey
survived but five of the passengers died.
a. Is Mang Rey a common carrier at the time of the accident? 5pts
No. Mang Rey is not a common carrier at the time of the accident.
To be considered as Common Carrier, one must be engaged in the
business of carrying or transporting passengers, goods or both for
compensation.
In the instant case, since Mang Rey offers to transport its passengers for
free, he is considered as a private carrier. As defined, a private carrier is
one who, without making the activity a vocation, or without holding
himself or itself out to the public as ready to act for all who may desire his
or its services, undertakes, by special agreement in a particular instance
only, to transport goods or persons from one place to another either
gratuitously or for hire.
b. Should man grey presumed negligent? 5pts
No. Mang Rey should not be presumed negligent since he is a private
carrier.
As a rule,a private carrier is duty bound to observe ordinary diligence, that
is, the diligence of a good father of the family and is not presumed to be
at fault or to have acted negligently in case of the loss of the effects of
passengers, or the death or injuries to passengers.”
c. Should Mnag Rey be held responsible for the death of the five
passengers, considering that they were being transported for
free? 5pts
No. A private carrier is not presumed to be at fault or to have acted
negligently in case of the loss of the effects of passengers, or the death or
injuries to passengers. Also, the passengers were merely accommodation
passengers who paid nothing for the service. Thus, Mang Rey is only
required to observe ordinary diligence.
To be held responsible, the complainants must first prove that Mang Rey
failed to exercise Ordinary Diligence
d. Should Mang Rey be held responsible if the passengers paid the
FULL FARE? 5pts.
Yes. The SC in the case of De Guzman v. CA held that Article 1732
makes no distinction between one whose principal business activity is the
carrying of persons or goods or both, and one who does such carrying only
as an ancillary activity (in local Idiom as "a sideline"). Article 1732 also
carefully avoids making any distinction between a person or enterprise
offering transportation service on a regular or scheduled basis and one
offering such service on an occasional, episodic or unscheduled basis.
Neither does Article 1732 distinguish between a carrier offering its
services to the "general public," i.e., the general community or population,
and one who offers services or solicits business only from a narrow
segment of the general population.
That liability arises the moment a person or firm acts as a common
carrier, without regard to whether or not such carrier has also complied
with the requirements of the applicable regulatory statute and
 implementing regulations and has been granted a certificate of public
convenience or other franchise
e. What would be the effect on his liability if Mang Rey had collected
50% discount?5pts
The reduction of fare does not justify any limitation of the common
carrier’s liability.
As a rule, a common carrier cannot escape its duty to observe extra-
ordinary diligence just because a passenger did not pay the full fare.
Article 1758 of the Civil Code of the Philippines states: “Article 1758. When
a passenger is carried gratuitously, a stipulation limiting the common
carrier’s liability for negligence is valid, but not for willful acts or gross
negligence.
f. Should Mang Rey be held responsible for the death of the five
passengers if the accident happened because he tried to overtake
a brand-new all-power Isuzu Trooper around a blind corner?
Yes. This is because he is duty bound to carry the passengers safely to
their destination using the required diligence with due regard for all the
circumstances.
8. A, B, C, and D were all confirmed ticket holders on an AIR
ASEAN flight from Manila to Baguio scheduled to depart at
9:00 A.M. from the domestic Airport. A, B, C, and D arrived at
airport at 8:30 A.M. They were told by an airline spokespman
that due to an ongoing labor strike , the runway at the
domestic airport was closed. But they were directed to
walkway right on the tarmac that leads to an alternative
runway normally used for international flights. A, B, C, and D,
were told that there plain was waiting for them there.
Somehow, A,B,C, and D got lost in the tarmac and strayed into
the path of an inbound light plane that was landing at that
moment. The Four were gruesomely shredded by the propeller
of the light plane. Sued for indemnity and other damages by
the heirs of A,B,C and D, the airline denied responsibility
saying that at the time of the accident, A,B,C and D were not
yet passengers because they were not yet aboard the plane. Is
the defense valid? Explain. 5pts

Answer
NO.8 ANSWER: No, the defense is not valid.
A passenger is defined as one who travels in a public conveyance by
virtue of a contract, express or implied, with the carrier as to the payment of
the fare, or that which is accepted as an equivalent thereof. The relation of
carrier and the passenger commences when one puts himself in the care of
the carrier, or directly under its control, with the bona fide intention of
becoming a passenger, and accepted as such by the carrier as where in this
case A,B,C and D present themselves at the proper place and in a proper
 manner to be transported. The carrier is liable for the death of the victims,
the victims are considered passengers. The rule is that the relation of carrier
and passengers continues until the passengers has been landed at the port of
destination.
9. A shipment of fragile ceramics was damaged because the van
carrying it rammed into a concrete barrier while trying to
evade pursuing a highway patrol car. The carrier apologized to
the shipper and said it wasn’t their fault because the van
driver was being ordered by the the highway patrol to pull
over without any apparent reason. Is the carrier correct?
Expalin. 5pts,
Is the carrier correct?

ANSWER
No, the defense of the carrier is incorrect.
Under the law, the carrier is required to faithfully comply with his obligation
to deliver the goods to the point of destination in the sense that the goods
should be delivered in the same condition that they were received without
encountering loss or harm. In the exercise of this obligation, the common
carrier is obligated to exercise extraordinary diligence. Failure to exercise
extraordinary diligence will result in breach of the obligation of the carrier
through negligence.

In the case the contention of the carrier that the damage was caused while
trying to evade the highway patrol is not tenable, he is still considered
negligent the moment he failed to delivered the goods in the same condition
when he accepted it for delivery. Also he should have exercise extraordinary
diligence in transporting the goods. Therefore, the carrier is not correct.
10. A shipment consisting of 1,000 bags of cement solidified
after it got wet while sitting out in the yard of freight
forwarding company in Manila. The shipper sued for recovery
of the value of the cement, plus damages. The freight
forwarding company said that it was not their fault, they could
not send their freight truck to Baguio to make delivery as
scheduled because of the meningoccemia scare. Also, the
carrier said the cement bags were made of porous paper and
not waterproof, which is why the rain got it inside causing it to
harden.
a. Is the meningoccemia scare a valud cause for the delay in
delivery? 5pts
No. Valid causes for delays in deliveries are:
1. Flood, storm, earthquake, lightning, or other natural disaster or
calamity.
2. Acts of Public Enemyat war whether international or civil
3. Act or ommissin of the shipper or owner of the goods
 4. The character of the goods or defectsof the packing or in the
containers
5. Order or act of competent public authority
Hence menigoccemia is not one of the valid defense that a carrier may
raise to escape liability

b. Will the fact that the cement bags were made of paper excuse the
carrier from any responsibility?5pts
No. as a common carrier, extra ordinary diligence over the goods is
required. While a defect in packing can exempt the common carrier from
responsibility, does not excuse the latter not to perform the required
diligence over the goods being shipped. The common carrier's duty to
observe extraordinary diligence over the goods remains in full force and
effect even when they are temporarily unloaded or stored in transit,
unless the shipper or owner has made use of the right of stoppage in
transit.
11. A shipped goods P10,000,000,000.00 packed and sealed
in a container on board the vessel M/V Papalubog owned and
operated by B. The latter inspected the goods and found them
to be in good condition before the same were sealed in
container and was covered by a bill of lading containing a
printed clause at the dorsal portion thereof limiting the
carrier’s liability to Php 10,000.00 in case of loss, destruction,
or deterioration of the shipment which was not signed nor read
by A. The goods totally deteriorated while in transit. Can A
claim for damages beyond the limit stipulated in the bill of
lading?
ANSWER
No, A cannot claim beyond the limit stipulated.
The law provides that, a contract fixing the sum that may be recovered
by the owner or shipper for the loss, destruction or deterioration of the goods
is valid, if it is reasonable and just under the circumstances, and has been
fairly and freely agreed upon. Further, jurisprudence provides that contracts
of adhesion wherein one party imposes a ready-made form of contract on the
other are contracts not entirely prohibited. The one who adheres to the
contract is in reality free to reject it entirely; if he adheres he gives his
consent not even an allegation of ignorance of a party excuses non-
compliance with the contractual stipulations since the responsibility for
ensuring full comprehension of the provisions of a contract of carriage
devolves not on the carrier but on the owner, shipper, or consignee as the
case may be. And this case the fact the A did not read nor sign the printed
clause at the dorsal portion is not an excuse to claim beyond what is
stipulated.
Thus A cannot claim beyond the limit stipulated in the bill of lading.
12. Chinese businessman Haw Shaw shipped 100 crates of dried
salted fish from Palwan to Baguio whereby he consngned the goods
 to Door-To-Door Trucking Inc. owned and operated by Lakwa Chero
which would, as a trade practice, load the full truck of shipment
goods into vessel then proceed to destinations to deliver the good s
to respective consignees. The transport of goods were suspended
for one week because the trucking company prioritized the lipat-
bahay cargo shipped by another client for a higher fee. When the
crates of dried fish were finally transported, the entire ship was lost
due to fortuitous event. Can Haw Shaw claim for damages from the
company?

ANSWER
YES, Haw Shaw can claim for damges from the company.
Art.1733 CC, provides that from the very nature of their business and
by reasons of public policy, common carriers are bound to observe
extraordinary diligence in the vigilance over the goods transported by
them..., in full force and effect when they are temporarily unloaded or stored
in transit (art. 1737).This extraordinary diligence, under art.1736 lasts from
the time the goods are unconditionally placed in possession of and received
by the carrier until they are delivered actually or constructively to the
consignee or person who has the right to receive them. And art. 1735
establishes the presumption that if goods are LOST, destroyed ,or
deteriorated, common carriers are presumed to have been at fault or have
acted negligently, unless they prove that they had observed extraordinary
diligence.
13. What is the Effect of if the character or improper packing
of the gods by the shipper or owner thereof merely contributed
to the loss, destruction or deterioration of the goods, the
proximate cause of the damage being the negligence of the
common carrier?

ANSER
Art. 1742 of Civil Code provides that even if the loss, destruction, or
deterioration of the goods should be caused by the character of the
goods, or the faulty nature of the packing or of the containers, the
common carrier must exercise due diligence to forestall or lessen the
loss.
As a rule, if the loss, destruction, or deterioration of the goods is
caused by the character or improper packaging of the goods by the
shipper or owner, the common carrier is relieved from liability provided
that the common carrier exercised due diligence to forestall or lessen
the loss.
Furthermore, if the carrier accepts the goods knowing the fact of the
improper packaging of the goods upon ordinary observation, it is not
relieved of liability for loss or injury resulting therefrom.
 If the proximate cause of the damage is the negligence of the common
carrier, such common carrier cannot be relieved from liability even if
the character or improper packaging of the goods contributed to the
loss, destruction, or deterioration of the goods.

14. What is nature and extent of the diligence required of

common carriers in connection with passengers?

Answer
ART. 1733. Common carriers, from the nature of their business and for
reasons of public policy, are bound to observe extra ordinary diligence
in the vigilance over the goods and for the safety of the passengers
transported by them according to all the circumstances of each case.
ART. 1755. A common carrier is bound to carry the passengers safely
as far as human care and foresight can provide, using the utmost
diligence of very cautious persons, with a due regard for all the
circumstances.
ART. 1756. In case of death of or injuries to passengers, common
carriers are presumed to have been at fault or to have acted
negligently, unless they prove that they observed extraordinary
diligence as prescribed in articles 1733 and 1755.

15. Passenger A of Caragksy Liner Bus relieved himself

across the concrete fence of the bus company’s stop-over
terminal during the bus stop-over. When the bus resumed trip,
A was left behind, so he ran to the terminal dispatcher, D, who
immediately called for the bus conductor thru cellular phone.
In a few minutes, the bus went back to the terminal for A who,
before boarding, was berated by D telling him that he was “No
better than a dog which would urinate everywhere” causing
him to be humiliated. Can the bus company be held liable for
damages due to the acts of D?

Yes. The Caragsky Liner bus can be held liable for damages due
to the acts of D. Under the principle that it is the carriers implied duty
to transport the passenger safely. It is enough that the insult happened
within the course of the employer’s duty. It is no defense for the carrier
that the acts was done in excess of authority or in disobedience of the
carrier’s orders. The carrier’s liability here is absolute in the sense that
it practically secures the passengers from assaults committed by its
employees.
Longer form
Yes, the bus company is liable.
 Under the law, the basis of the common carrier's liability
under NCC for assaults on passengers committed by its drivers rests
either on (1) the doctrine of respondent superior or (2) the principle
that it is the carrier's implied duty to transport the passenger safely.
Under the first, which is the minority view, the carrier is liable
only when the act of the employee is within the scope of his authority
and duty. It is not sufficient that the act be within the course of
employment only. Under the second view, upheld by the majority and
also by the later cases, it is enough that the assault happens within the
course of the employee's duty. It is no defense for the carrier that the
act was done in excess of authority or in disobedience of the carrier's
orders. The carrier's liability here is absolute in the sense that it
practically secures the passengers from assaults committed by its own
employees. Art. 1759, evidently follows the rule based on the second
view.
As be gleaned from article 1759, the civil code of the
Philippines evidently follows the rule based on the second view. As
explained in Texas Midland R.R, v. Monroe, 110 Tex. 97, 216 S.W.
388,389-390, and Haver v. Central railroad Co., 43 LRA 84, 85: the
special undertaking of the carrier requires that it furnish its passenger
that full measure of protection afforded by the exercise of the high
degree of care prescribed by law, inter alia from violence and insults at
the hands of strangers and other passengers, but above all, from the
acts of the carriers own servants charged with the passengers safety.
Accordingly, it is the carrier's strict obligation to select its drivers
and similar employees with due regard not only to their technical
competence and physical ability, but also, no less important, to their
total personality, including their patterns of behavior, moral fibers, and
social attitude.
In the case at bar, D as terminal dispatcher acted within
the scope of his authority.

True or False
1. False
2. True
3. True
4. False
5. False
6. True
7. True
8. True
9. True
10. True
11. True
12. True
13. True
14. True
15. False
16. True
17. False
18. True
19. True
20. True
21. True
22. True
23. False
24. True
25. True
26. True
27. False
28. True
29. False
30. True
Enumerate, distinguish, or explain
1. Distinguished public utility from a common carrier
Public Utility is business or service which is engaged in regularly
supplying the public with some commonality or service of public
convenience such as electric, gas, water, transportation, telephone or
telegraphic service. On the other hand, common carriers are persons,
corporations, firms or associations engaged in the business of carrying
or transporting passengers or goods or both, by land, water or air for
compensation offering their services to the public.
2. What are the five essential elements of a common carrier
The five (5) essential elements of cc are as follows;
a. Must be persons, corporations, firms or associations
b. Engaged in the business of of carrying or transporting passengers or
goods or both
c. Means of carriage is by land, water or air
d. The carrying of passengers, goods or both is for compensation
e. The service is offered to the public without distinctions
3. What are the four (4) distinctions between CC and PC
The following are the four distinctions between common carriers and
private carriers;
a. As to availability, the CC holds himself out for people (general
public) indiscriminately while PC cotracts with particular individuals
or groups only
 b. As to required diligence, CC is required to observe extraordinary
diligence while it is enough that PC exercises a diligence of a good
father of the family.
c. As to stipulation, CC is subject to state regulation while a PC is not
subject to state regulation
d. As to limiting liability, In CC parties may agree on limiting the
carriers liability except when provided by law while in PC parties
may limit the carriers liability provided it is not contrary to morals or
good custom.
4. What is the doctrine of last clear chance?
Under the doctrine of last clear chance, when both parties involved in
accident were both negligent, the negligence of the other party will not be
considered the proximate cause if the other party has the last clear chance of
avoiding the injury. , Thus if the plaintiff has the last clear chance of avoiding the
injury, the defendant may no longer be liable. In such case, the negligence of the
plaintiff which is not just contributory negligence will be considered an efficient
intervening cause.
Moreover, said doctrine applies only in suit between colliding vehicles. It does
not apply to the passengers. It does not arise where the passengers demands
responsibility from the carrier to enforce its contractual obligation. (Phil. Rabbit bus
lines Inc. Vs IAC)

5. What is the doctrine of Res Ipsa Loquitor?

Latin for “the thing speaks for itself”. - a doctrine of law that one is presumed
to be negligent if he/she/it had exclusive control of whatever caused the injury even
though there is no specific evidence of an act of negligence, and without negligence
the accident would not have happened. Examples: a) a load of bricks on the roof of
a building being constructed by Highrise Construction Co. falls and injures Paul
Pedestrian below, and Highrise is liable for Pedestrian's injury even though no one
saw the load fall. b) While under anesthetic, Isabel Patient's nerve in her arm is
damaged although it was not part of the surgical procedure, and she is unaware of
which of a dozen medical people in the room caused the damage. Under res ipsa
loquitur all those connected with the operation are liable for negligence. Lawyers
often shorten the doctrine to "res ips," and find it a handy shorthand for a complex
doctrine. In this jurisdiction, res ipsa loquitur is not a rule of substantive law, hence,
does not per se create or constitute an independent or separate ground of liability,
being a mere evidentiary rule. In other words, mere invocation and application of
the doctrine does not dispense with the requirement of proof of negligence

6. What is kabit system?

Kabit system is an arrangement whereby a person who has been granted a
certificate of public convenience allows other persons who own motor vehicles to
operate them under his license, sometimes for free or percentage. Although the
law does not out rightly penalize the parties to such agreement, the kabit system is
invariably recognized as being contrary to public policy and therefore void and
inexistent.
7. Enumerate the regulatory agencies under Public Service Act
a. Department of Transportations and Communications
b. Land Transportation Franchising Regulatory Board (LTFRB)
c. Land Transportation Office (LTO)
d. Maritime Industry Authority (MARINA)
e. Philippine Coast Guard
f. National Telecommunications Office
g. Energy Regulatory Commission
h. National Water Resource Council
i. Civil Aeronautics Board
k. Civil Aviation Authority of the Philippines (CAAP)
l. Philippines Ports Authority
l. Local Water Utilities Administration
m. Toll Regulatory Board

Explain the following;

1. Prior Operator Rule:
Before permitting a new operator to operate in the territory of
another operator already established with a certificate of public
convenience, the PRIOR operator must first be given the opportunity to
EXTEND its service in order to meet the public needs. It means that a
Public utility operator must be shielded from ruinous competition by
giving the prior operator the opportunity to IMPROVE his equipment
and services before allowing a new operator to serve in the same
territory he covers. (Mandbusco, Inc. v. Francisco)

or

Provides existing franchise operator preferential right within

authorized territory as long as said operator renders satisfactory and
economical service. This rule subordinates the prior applicant rule
which gives first applicant priority only if things and circumstances are
equal. A prior operator must be given the opportunity to extend its
transportation services before permitting a new operator to operate in
the territory of said prior operator.
 2. Old Operator Rule:
Which is to the effect that a public utility operator should be
shielded from ruinous competition by affording him the opportunity to
improve his equipment and service before allowing a new operator to
serve in the same territory he covers. (Mandbusco, Inc. v. Francisco)

3. Third Operator Rule:

Where two operators are more than serving the public there is no
reason to permit a third operator to engage in competition with them.
The fact that it is only one trip and of little consequence is not
sufficient reason to grant the application. (Yangco v. Esteban, G.R. No.
38586, Aug. 18, 1933)

4. Prior Applicant Rule:

Applies to situations wherein two applicants are applying for a
certificate of public convenience over a given territory. Where both
applicants are similarly situated, the prior applicant shall have the
certificate over the other.

or

Presupposes a situation where two interested persons apply for a

Certificate of Public Convenience in the same community over which
no person has yet been granted a CPC to operate. If both applicants
equal,
then the applicant who applied first will be given the Certificate of
Public Convenience.

8. Registered Owner Rule

The registered owner of a certificate of a public convenience is
liable to the public for the injuries or damages suffered by third
persons caused by the operation of said vehicle, even though the same
had been transferred to a third person. The registered owner is not
allowed to escape responsibility by proving that a third person is the
actual and real owner. The registered owner is the lawful operator
insofar as the public and third persons are concerned; consequently, it
is directly and primarily responsible for the consequences of its
operation. In contemplation of law, the owner/operator of record is the
employer of the driver, the actual operator and employer being
considered as merely its agent. The same principle applies even if the
registered of any vehicle does not use it for public service (Equitable
Leasing Corp. v. Suyom, G. R. No.143360, September 5, 2002), or
otherwise stated, to privately--‐owned vehicles.
A sale, lease or financial lease that is not registered with the LTO
does not bind third persons who are aggrieved in tortuous incidents,
for the latter need only to rely on the public registration of a motor
vehicle as conclusive evidence of ownership. A lease is an
encumbrance in contemplation of law, which needs to be registered in
order for it to bind third parties (PCI Leasing Corp and Finance Inc. v.
UCPB General Insurance Co., Inc. G.R. No. 162267, 4 July 2008).

or

Benedicto vs IAC – Registered owner is liable for the

consequences flowing from the operations of the carrier, even though
the specific vehicle involved may already have been transferred to
another person. It is presumed that registered owner is actual owner.