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DELSAN TRANSPORT LINES, INC., petitioner, vs.


AMERICAN HOME ASSURANCE CORPORATION, Held:
respondent
(1) The cause of the loss in the case at bar was petitioner's
Facts: Delsan is a domestic corporation which owns and negligence in not ensuring that the doors of the baggage
operates the vessel MT Larusan. On the other hand, compartment of its bus were securely fastened. As a result of
respondent American Home Assurance Corporation (AHAC for this lack of care, almost all of the luggage was lost, to the
brevity) is a foreign insurance company duly licensed to do prejudice of the paying passengers.
business in the Philippines through its agent, the American-
International Underwriters, Inc. (Phils.). It is engaged, among (2) There is no dispute that of the three pieces of luggage of
others, in insuring cargoes for transportation within the Fatima, only one was recovered. Respondents had to shuttle
Philippines. between Bicol and Manila in their efforts to be compensated
for the loss. During the trial, Fatima and Marisol had to travel
On August 5, 1984, Delsan received on board MT Larusan a from the United States just to be able to testify. Expenses
shipment consisting of 1,986.627 k/l Automotive Diesel Oil were also incurred in reconstituting their lost documents.
(diesel oil) at the Bataan Refinery Corporation for Under these circumstances, the Court agrees with the Court of
transportation and delivery to the bulk depot in Bacolod City Appeals in awarding P30,000.00 for the lost items and
of Caltex Phils., Inc. (Caltex), pursuant to a Contract of P30,000.00 for the transportation expenses, but disagrees
Afreightment. The shipment was insured by respondent AHAC with the deletion of the award of moral and exemplary
against all risks under Inland Floater Policy No. AH-IF64- damages which, in view of the foregoing proven facts, with
1011549P and Marine Risk Note No. 34-5093-6. negligence and bad faith on the fault of petitioner having
been duly established, should be granted to respondents in
On August 7, 1984, the shipment arrived in Bacolod City. the amount of P20,000.00 and P5,000.00, respectively.
Immediately thereafter, unloading operations commenced.
The discharging of the diesel oil started at about 1:30 PM of TABACALERA INSURANCE CO., PRUDENTIAL GUARANTEE
the same day. However, at about 10:30 PM, the discharging & ASSURANCE, INC., and NEW ZEALAND INSURANCE
had to be stopped on account of the discovery that the port CO., LTD., vs.NORTH FRONT SHIPPING SERVICES, INC.,
bow mooring of the vessel was intentionally cut or stolen by and COURT OF APPEALS,
unknown persons. Because there was nothing holding it, the G.R. No. 119197. May 16, 1997
vessel drifted westward, dragged and stretched the flexible
rubber hose attached to the riser, broke the elbow into pieces, Facts:
severed completely the rubber hose connected to the tanker
from the main delivery line at sea bed level and ultimately Sacks of grains were loaded on board a vessel owned by North
caused the diesel oil to spill into the sea. To avoid further Front Shipping (common carrier); the consignee: Republic
spillage, the vessels crew tried water flushing to clear the line Floor Mills. The vessel was inspected by representatives of the
of the diesel oil but to no avail. In the meantime, the shore shipper prior to the transport and was found fitting to carry
tender, who was waiting for the completion of the water the cargo; it was also issued a Permit to Sail. The goods were
flushing, was surprised when the tanker signaled a red light successfully delivered but it was not immediately unloaded by
which meant stop pumping. Unaware of what happened, the the consignee. There were a shortage of 23.666 metric tons
shore tender, thinking that the vessel would, at any time, and some of the merchandise was already moldy and
resume pumping, did not shut the storage tank gate valve. As deteriorating. Hence, the consignee rejected all the cargo and
all the gate valves remained open, the diesel oil that was demanded payment of damages from the common carrier.
earlier discharged from the vessel into the shore tank Upon refusal, the insurance companies (petitioners) were
backflowed. Due to non-availability of a pump boat, the vessel obliged to pay. Petitioners now allege that there was
could not send somebody ashore to inform the people at the negligence on the part of the carrier. The trial court ruled that
depot about what happened. only ordinary diligence was required since the charter-party
agreement converted North Front Shipping into a private
As a result of spillage and backflow of diesel oil, Caltex sought carrier.
recovery of the loss from Delsan, but the latter refused to pay.
As insurer, AHAC paid Caltex the sum of P479,262.57 for Issues:
spillage, pursuant to Marine Risk Note No. 34-5093-6, and
P1,939,575.37 for backflow of the diesel oil pursuant to Inland WON North Front Shipping is a common carrier. If indeed, did
Floater Policy No. AH-1F64-1011549P. On August 31, 1989, the it fail to exercise the required diligence and thus should be
trial court rendered its decision[2] in favor of AHAC holding held liable?
Delsan liable for the loss of the cargo for its negligence in its
duty as a common carrier. Delsan appealed to the CA whereat Held:
its recourse was docketed as CA-G.R. CV No. 40951. In the
herein challenged decision,[3] the CA affirmed the findings of North Front Shipping is a common carrier. Thus, it has the
the trial court burden of proving that it observed extraordinary diligence in
order to avoid responsibility for the lost cargo.
Issue: The charter-party agreement between North Front Shipping
Services, Inc., and Republic Flour Mills Corporation did not in
SARKIES TOURS v CA any way convert the common carrier into a private carrier. A
“charter-party” is defined as a contract by which an entire
Facts: ship, or some principal part thereof, is let by the owner to
On August 31, 1984, Fatima boarded petitioner’s bus from another person for a specified time or usex x x
Manila to Legazpi. Her belongings consisting of 3 bags were
kept at the baggage compartment of the bus, but during the Having been in the service since 1968, the master of the
stopover in Daet, it was discovered that only one remained. vessel would have known at the outset that corn grains that
The others might have dropped along the way. Other were farm wet and not properly dried would eventually
passengers suggested having the route traced, but the driver deteriorate when stored in sealed and hot compartments as in
ignored it. Fatima immediately told the incident to her mother, hatches of a ship. Equipped with this knowledge, the master
who went to petitioner’s office in Legazpi and later in Manila. of the vessel and his crew should have undertaken
Petitioner offered P1,000 for each bag, but she turned it down. precautionary measures to avoid or lessen the cargo’s
Disapointed, she sought help from Philtranco bus drivers and possible deterioration as they were presumed knowledgeable
radio stations. One of the bags was recovered. She was told about the nature of such cargo.
by petitioner that a team is looking for the lost luggage. After But none of such measures was taken.
nine months of fruitless waiting, respondents filed a case to It did not even endeavor to establish that the loss, destruction
recover the lost items, as well as moral and exemplary or deterioration of the goods was due to the following: (a)
damages, attorney’s fees and expenses of litigation. The trial flood, storm, earthquake, lightning, or other natural disaster
court ruled in favor of respondents, which decision was or calamity; (b) act of the public enemy in war, whether
affirmed with modification by the Court of Appeals, deleting international or civil; © act or omission of the shipper or
moral and exemplary damages. owner of the goods; (d) the character of the goods or defects
in the packing or in the containers; (e) order or act of
Issues: competent public authority. This is a closed list. If the cause of
destruction, loss or deterioration is other than the enumerated
(1) Whether petitioner is liable for the loss of the luggage circumstances, then the carrier is rightly liable therefor.

(2) Whether the damages sought should be recovered


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However, the destruction, loss or deterioration of the cargo


cannot be attributed solely to the carrier. The consignee Facts: Samar Mining imported 1 crate optima welded wire
Republic Flour Mills Corporation is guilty of contributory (amounting to around USD 424 or PhP 1,700) from Germany,
negligence. It was seasonably notified of the arrival of the which was shipped on a vessel owned by Nordeutscher Lloyd
barge but did not immediately start the unloading operations. (M/S Schwabenstein). The shipment was unloaded in Manila
into a barge for transshipment to Davao and temporarily
MACAM vs. COURT OF APPEALS GR No. 125524; August stored in a bonded warehouse owned by AMCYL. The goods
25, 1999 never reached Davao and were never delivered to or received
by the consignee, Samar Mining Co.
Facts: Benito Macam, doing business under name Ben-Mac
Enterprises, shipped on board vessel Nen-Jiang, owned and CFI ruled in favor of Samar Mining holding Nordeutscher Lloyd
operated by respondent China Ocean Shipping Co. through liable. However, defendants may recoup whatever they may
local agent Wallem Philippines Shipping Inc., 3,500 boxes of pay Samar Mining by enforcing the judgment against third
watermelon covered by Bill of Lading No. HKG 99012, and party defendant AMCYL.
1,611 boxes of fresh mangoes covered by Bill of Lading No.
HKG 99013. The shipment was bound for Hongkong with Issue: Whether Nordeustscher Lloyd is liable for the loss of
PAKISTAN BANK as consignee and Great Prospect Company of the goods as common carrier?
Rowloon (GPC) as notify party.
Held: No. At the time of the loss of the goods, the character
Upon arrival in Hongkong, shipment was delivered by of possession of Nordeutscher Lloyd shifted from common
respondent WALLEM directly to GPC, not to PAKISTAN BANK carrier to agent of Samar Mining Co.
and without the required bill of lading having been
surrendered. Subsequently, GPC failed to pay PAKISTAN BANK, The Bill of Lading is serves both as a receipt of goods and is
such that the latter, still in possession of original bill of lading, likewise the contract to transport and deliver the same as
refused to pay petitioner thru SOLIDBANK. Since SOLIDBANK stipulated. It is a contract and is therefore the law between
already pre-paid the value of shipment, it demanded payment the parties. The Bill of Lading in question stipulated that
from respondent WALLEM but was refused. MACAM Nordeutscher Lloyd only undertook to transport the goods in
constrained to return the amount paid by SOLIDBANK and its vessel only up to the port of discharge from ship, which is
demanded payment from WALLEM but to no avail. Manila. The Bill of Lading further stipulated that the goods
were to be transshipped by the carrier from Manila to the port
WALLEM submitted in evidence a telex dated 5 April 1989 as of destination – Davao. By unloading the shipment in Manila
basis for delivering the cargoes to GPC without the bills of and delivering the goods to the warehouse of AMCYL, the
lading and bank guarantee. The telex instructed delivery of appellant was acting within the contractual stipulations
various shipments to the respective consignees without need contained in the Bill of Lading.
of presenting the bill of lading and bank guarantee per the
respective shipper’s request since “for prepaid shipt ofrt Article 1736 of the Civil Code relives the carrier of
charges already fully paid.” MACAM, however, argued that, responsibility over the shipment as soon as the carrier makes
assuming there was such an instruction, the consignee actual or constructive delivery of the goods to the consignee
referred to was PAKISTAN BANK and not GPC. or to the person who has a right to receive them.

The RTC ruled for MACAM and ordered value of shipment. CA Under the Civil Code provisions governing Agency, an agent
reversed RTC’s decision. can only be held liable in cases where his acts are attended by
fraud, negligence, deceit or if there is a conflict of interest
between him and the principal. Under the same law an agent
Issue: Are the respondents liable to the petitioner for is likewise liable if he appoints a substitute when he was not
releasing the goods to GPC without the bills of lading or bank given the power to appoint one or otherwise appoints one that
guarantee? is notoriously incompetent or insolvent. These facts were not
proven in the record.

Held: It is a standard maritime practice when immediate SERVANDO v PHILIPPINE STEAM NAVIGATION
delivery is of the essence, for shipper to request or instruct
the carrier to deliver the goods to the buyer upon arrival at Facts:
the port of destination without requiring presentation of bill of 1. Clara UyBico and AmparoServando loaded on board a
lading as that usually takes time. Thus, taking vessel of Philippine Steam Navigation Co. for carriage from
intoaccount that subject shipment consisted of perishable Manila to Negros Occidental 1,528 cavans of rice and 44
goods and SOLIDBANK pre-paid the full amount of value cartons of colored paper, toys and general merchandise.
thereof, it is not hard to believe the claim of respondent 2. The contract of carriage of cargo was evidenced by a Bill
WALLEM that petitioner indeed requested the release of the of Lading (B/L). There was a stipulation limiting the
goods to GPC without presentation of the bills of lading and responsibility of the carrier for loss or damage that may be
bank guarantee. caused to the shipment
a. “carrier shall not be responsible for loss or damage to
To implement the said telex instruction, the delivery of the shipments billed ‘owner’s risk’ unless such loss or damage is
shipment must be to GPC, the notify party or real due to the negligence of the carrier. Nor shall the carrier be
importer/buyer of the goods and not the PAKISTANI BANK responsible for loss or damage caused by force majeure,
since the latter can very well present the original Bills of dangers or accidents of the sea, war, public enemies, fire”.
Lading in its possession. Likewise, if it were the PAKISTANI 3. Upon arrival of the vessel at its destination, the cargoes
BANK to whom the cargoes were to be strictly delivered, it will were discharged in good condition and placed inside the
no longer be proper to require a bank guarantee as a warehouse of the Bureau of Customs.
substitute for the Bill of Lading. To construe otherwise will 4. UyBico was able to take delivery of 907 cavans of rice.
render meaningless the telex instruction. After all, the cargoes 5. Unfortunately, the warehouse was razed by fire of
consist of perishable fresh fruits and immediate delivery unknown origin later that same day destroying the remaining
thereof the buyer/importer is essentially a factor to reckon cargoes.
with. 6. UyBico and Servando filed a claim for the value of the
goods against the carrier.
We emphasize that the extraordinary responsibility of the 7. The lower court ruled in their favor. It held that the
common carriers lasts until actual or constructive delivery of delivery of the shipment to the warehouse is not the delivery
the cargoes to the consignee or to the person who has a right contemplated by Art. 1736 of the CC. And since the burning of
to receive them. PAKISTAN BANK was indicated in the bills of the warehouse occurred prior to the actual or constructive
lading as consignee whereas GPC was the notify party. delivery of the goods, the loss is chargeable against the
However, in the export invoices GPC was clearly named as vessel.
buyer/importer. Petitioner also referred to GPC as such in
his demand letter to respondent WALLEM and in his complaint
Issue:Whether or not the carrier is liable for the loss of the
before the trial court. This premise draws us to conclude that
goods.
the delivery of the cargoes to GPC as buyer/importer which,
conformably with Art. 1736 had, other than the consignee, the
Held:No.
right to receive them was proper.
1. Article 1736 of the CC imposes upon common carriers the
Samar Mining Co., Inc. vs. Nordeutscher Lloyd
duty to observe extraordinary diligence from the moment the
(132 SCRA 529)
goods are unconditionally placed in their possession "until the
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same are delivered, actually or constructively, by the carrier W/N petitioner was negligent and should be held liable for the
to the consignee or to the person who has a right to receive payment of damages.
them, without prejudice to the provisions of Article 1738.” The HELD:
court a quo held that the delivery of the shipment in question
to the warehouse of the Bureau of Customs is not the delivery YES. Plainly, the heavy seas and rains referred to in
contemplated by Article 1736; and since the burning of the the master's report were notcaso fortuito, but normal
warehouse occurred before actual or constructive delivery of occurrences that an ocean-going vessel, particularly in the
the goods to the appellees, the loss is chargeable against the month of September which, in our area, is a month of rains
appellant. and heavy seas would encounter as a matter of routine. They
are not unforeseen nor unforeseeable. These are conditions
2. It should be pointed out, however, that in the bills of that ocean-going vessels would encounter and provide for, in
lading issued for the cargoes in question, the parties agreed the ordinary course of a voyage. That rain water (not sea
to limit the responsibility of the carrier. The stipulation is valid water) found its way into the holds of the Jupri Venture is a
not being contrary to law, morals or public policy. clear indication that care and foresight did not attend the
3. The petitioners however, contend that the stipulation closing of the ship's hatches so that rainwater would not find
does not bind them since it was printed at the back of the B/L its way into the cargo holds of the ship.
and that they did not sign the same. However, as the Court
held in OngYiu vs. CA, while it may be true that a passenger Moreover, under Article 1733 of the Civil Code,
had not signed the plane ticket, he is nevertheless bound by common carriers are bound to observe "extra-ordinary
the provisions thereof. Such provisions have been held to be a vigilance over goods . . . .according to all circumstances of
part of the contract of carriage, and valid and binding upon each case," and Article 1735 of the same Code states, to wit:
the passenger regardless of the latter's lack of knowledge or
assent to the regulation. Art. 1735. In all cases other than those mentioned in
4. Also, where fortuitous event is the immediate and Nos. 1, 2, 3, 4, and 5 of the preceding article, if the goods are
proximate cause of the loss, the obligor is exempt from lost, destroyed or deteriorated, common carriers are
liability for non-performance.In the case at bar, the burning of presumed to have been at fault or to have acted negligently,
the customs warehouse was an extraordinary event which unless they prove that they observed extraordinary diligence
happened independently of the will of the appellant. The latter as required in article 1733.
could not have foreseen the event.
5. There is nothing in the record to show that the carrier Since the carrier has failed to establish any caso
incurred in delay in the performance of its obligation. It fortuito, the presumption by law of fault or negligence on the
appears that it had not only notified UyBico and Servando of part of the carrier applies; and the carrier must present
the arrival of their shipment, but had demanded that the evidence that it has observed the extraordinary diligence
same be withdrawn. In fact, pursuant to such demand, UyBico required by Article 1733 of the Civil Code in order to escape
had taken delivery of 907 cavans of rice before the burning of liability for damage or destruction to the goods that it had
the warehouse. admittedly carried in this case. No such evidence exists of
6. Nor can the carrier or its employees be charged with record. Thus, the carrier cannot escape liability.
negligence. The storage of the goods in the Customs
warehouse pending withdrawal thereof by UyBico and The presumption, therefore, that the cargo was in
Servando was undoubtedly made with their knowledge and apparent good condition when it was delivered by the vessel
consent. Since the warehouse belonged to and was to the arrastre operator by the clean tally sheets has been
maintained by the government, it would be unfair to impute overturned and traversed. The evidence is clear to the
negligence to the carrier, the latter having no control effect that the damage to the cargo was suffered while aboard
whatsoever over the same. petitioner's vessel

BASCOS vs. COURT OF APPEALS and RODOLFO A.


Eastern Shipping Lines Inc. v. IAC, 150 SCRA 463 CIPRIANO
Doctrine: G.R. No. 101089
When a carrier fails to establish any caso fortuito, the
presumption by law of fault or negligence on the part FACTS: Rodolfo A. Cipriano representing Cipriano Trading
of the carrier applies. Enterprise (CIPTRADE for short) entered into a hauling
FACTS: contract with Jibfair Shipping Agency Corp whereby the former
bound itself to haul the latter’s 2,000 m/tons of soya bean
Carrier – Eastern Shipping Lines Inc meal to the warehouse in Calamba, Laguna. To carry out its
obligation, CIPTRADE, through Cipriano, subcontracted with
Shipper/Consignee –Stresstek Post Tensioning Philippines Inc Bascos to transport and to deliver 400 sacks of soya bean
meal from the Manila Port Area to Calamba, Laguna. Petitioner
Insurer - First Nationwide Assurance Corporation failed to deliver the said cargo. As a consequence of that
failure, Cipriano paid Jibfair Shipping Agency the amount of
Arrastre Operator – E. Razon Inc. (not significant) the lost goods in accordance with their contract.
Cipriano demanded reimbursement from petitioner but the
FACTS: latter refused to pay. Eventually, Cipriano filed a complaint for
Eastern Shipping Lines Inc shipped uncoated 7-wire a sum of money and damages with writ of preliminary
stress relieved wire strand for prestressed concretewere attachment for breach of a contract of carriage. The trial court
shipped on board the vessel "Japri Venture,". Upon arrival granted the writ of preliminary attachment.
at the port of Manila, it discharged thecargo to the custody of In her answer, petitioner interposed the defense that there
the defendant E. Razon, Inc. from whom the consignee's was no contract of carriage since CIPTRADE leased her cargo
customs brokerreceived it for delivery to the consignee's truck to load the cargo from Manila Port Area to Laguna and
warehouse. First Nationwide Assurance, indemnified that the truck carrying the cargo was hijacked and being a
theconsignee in the amount of P171,923.00 for damage and force majeure, exculpated petitioner from any liability
loss to the insured cargo, whereupon theformer was After trial, the trial court rendered a decision in favor of
subrogated for the latter. The insurer now seeks to recover Cipriano and against Bascos ordering the latter to pay the
from the defendants what ithas indemnified the consignee. former for actual damages for attorney’s fees and cost of suit.
The petitioner protested alleging that it should not be held The “Urgent Motion To Dissolve/Lift preliminary Attachment”
liable toanswer for damages for the event that caused the Bascos is DENIED for being moot and academic.
rusting of the goods was due to the “encounteredvery rough Petitioner appealed to the Court of Appeals but respondent
seas and stormy weather” classified as force majeure, hence Court affirmed the trial court’s judgment.
relieving them of any liability. Hence this petition for review on certiorari

Aggrieved, respondent filed a case against petitioner. ISSUE:


(1) WON petitioner a common carrier
RTC– dismissed the case (2) WON the hijacking referred to a force majeure

CA –set aside RTC’s decision and ordered petitioner to pay HELD: The petition is DISMISSED and the decision of the
respondent Court of Appeals is hereby AFFIRMED.
1. YES
ISSUE: In disputing the conclusion of the trial and appellate courts
that petitioner was a common carrier, she alleged in this
petition that the contract between her and Cipriano was lease
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of the truck. She also stated that: she was not catering to the brought to NASSCO compound. Later, the Acting Mayor issued
general public. Thus, in her answer to the amended complaint, a receipt stating that the Municipality had taken custody of
she said that she does business under the same style of A.M. the scrap iron. Respondent instituted an action for damages
Bascos Trucking, offering her trucks for lease to those who against petitioner. Respondent Court found in favor for
have cargo to move, not to the general public but to a few Tumambing.
customers only in view of the fact that it is only a small Issue:
business. Whether or not petitioner Ganzon, a common carrier, can be
We agree with the respondent Court in its finding that exempt from liability by invoking order of competent authority.
petitioner is a common carrier. Ruling: NO.
Article 1732 of the Civil Code defines a common carrier as “(a) The petitioner has failed to show that the loss of the scraps
person, corporation or firm, or association engaged in the was due to any of the following causes enumerated in Article
business of carrying or transporting passengers or goods or 1734 of the Civil Code.
both, by land, water or air, for compensation, offering their Before the appellee Ganzon could be absolved from
services to the public.” The test to determine a common responsibility on the ground that he was ordered by
carrier is “whether the given undertaking is a part of the competent public authority to unload the scrap iron, it must
business engaged in by the carrier which he has held out to be shown that Acting Mayor Basilio Rub had the power to
the general public as his occupation rather than the quantity issue the disputed order, or that it was lawful, or that it was
or extent of the business transacted.” 12 In this case, issued under legal process of authority. The appellee failed to
petitioner herself has made the admission that she was in the establish this. Indeed, no authority or power of the acting
trucking business, offering her trucks to those with cargo to mayor to issue such an order was given in evidence. Neither
move. Judicial admissions are conclusive and no evidence is has it been shown that the cargo of scrap iron belonged to the
required to prove the same. 13 Municipality of Mariveles. The fact remains that the order
But petitioner argues that there was only a contract of lease given by the acting mayor to dump the scrap iron into the sea
because they offer their services only to a select group of was part of the pressure applied by Mayor Jose Advincula to
people. Regarding the first contention, the holding of the shakedown the appellant for P5,000.00. The order of the
Court in De Guzman vs. Court of Appeals 14 is instructive. In acting mayor did not constitute valid authority for appellee
referring to Article 1732 of the Civil Code, it held thus: Mauro Ganzon and his representatives to carry out. The
“The above article makes no distinction between one whose petitioner was not duty bound to obey the illegal order to
principal business activity is the carrying of persons or goods dump into the sea the scrap iron.
or both, and one who does such carrying only as an ancillary
activity (in local idiom, as a “sideline”). Article 1732 also Transportation Case Digest: Phil Am Gen Insurance Co,
carefully avoids making any distinction between a person or Et Al. V. PKS Shipping Co (2003)
enterprise offering transportation service on a regular or
scheduled basis and one offering such service on an FACTS:
occasional, episodic or unscheduled basis. Neither does Article  Davao Union Marketing Corporation (DUMC)
1732 distinguish between a carrier offering its services to the contracted the services of PKS Shipping Company
“general public,” i.e., the general community or population, (PKS Shipping) for the shipment to Tacloban City of
and one who offers services or solicits business only from a 75,000 bags of cement worth P3,375,000.
narrow segment of the general population. We think that  DUMC insured the goods for its full value with
Article 1732 deliberately refrained from making such Philippine American General Insurance Company
distinctions.” (Philamgen).
2. NO  The goods were loaded aboard the dumb
Likewise, We affirm the holding of the respondent court that barge Limar I belonging to PKS Shipping.
the loss of the goods was not due to force majeure.  December 22, 1988 9 pm: While Limar I was being
Common carriers are obliged to observe extraordinary towed by PKS’ tugboat MT Iron Eagle, the barge sank
diligence in the vigilance over the goods transported by them. a couple of miles off the coast of Dumagasa Point, in
Accordingly, they are presumed to have been at fault or to Zamboanga del Sur, bringing down with it the entire
have acted negligently if the goods are lost, destroyed or cargo of 75,000 bags of cement.
deteriorated. There are very few instances when the  DUMC filed a formal claim with Philamgen for the full
presumption of negligence does not attach and these amount of the insurance. Philamgen promptly made
instances are enumerated in Article 1734. 19 In those cases payment; it then sought reimbursement from PKS
where the presumption is applied, the common carrier must Shipping of the sum paid to DUMC but the shipping
prove that it exercised extraordinary diligence in order to company refused to pay so Philamgen to file suit
overcome the presumption. against PKS Shipping
In this case, petitioner alleged that hijacking constituted force  RTC: dismissed the complaint - fortuitous event
majeure which exculpated her from liability for the loss of the  CA:Affirmed - not a common carrier but a casual
cargo. In De Guzman vs. Court of Appeals, the Court held that occupation
hijacking, not being included in the provisions of Article 1734, ISSUE: W/N PKS Shipping is NOT liable since it was NOT a
must be dealt with under the provisions of Article 1735 and common carrier
thus, the common carrier is presumed to have been at fault or
negligent. To exculpate the carrier from liability arising from
hijacking, he must prove that the robbers or the hijackers
HELD: NO. Petition is DENIED
acted with grave or irresistible threat, violence, or force. This
is in accordance with Article 1745 of the Civil Code which
provides:
“Art. 1745. Any of the following or similar stipulations shall be Article 1732. Common carriers are persons, corporations,
considered unreasonable, unjust and contrary to public policy; firms or associations engaged in the business of carrying or
xx transporting passengers or goods or both, by land, water, or
(6) That the common carrier’s liability for acts committed by air for compensation, offering their services to the public
thieves, or of robbers who do not act with grave or irresistible  Complementary is Section 13, paragraph (b), of the
threat, violences or force, is dispensed with or diminished;” xx Public Service Act

public service" to be –
GANZON V. CA (G.R. NO. L-48757) "x x x every person that now or hereafter may own, operate,
manage, or control in the Philippines, for hire or
Facts: compensation, with general or limited clientele, whether
Private respondent Tumambing contracted the services of permanent, occasional or accidental, and done for general
petitioner Ganzon to haul 305 tons of scrap iron from Bataan business purposes, any common carrier, railroad, street
to the port of Manila on board the lighter LCT “Batman.” railway, subway motor vehicle, either for freight or passenger,
Petitioner sent his lighter with its Captain Filomeno to dock at or both, with or without fixed route and whatever may be its
Mariveles, where respondent Tumambing delivered the scrap classification, freight or carrier service of any class, express
irons for loading which also begun on the same day. Mayor service, steamboat, or steamship, or steamship line, pontines,
Advincula arrived at the port and demanded P 5,000 ferries and water craft, engaged in the transportation of
shakedown from respondent. The two ended up in a heated passengers or freight or both, shipyard, marine repair shop,
argument where respondent had to be taken to a hospital to wharf or dock, ice plant, ice refrigeration plant, canal,
be treated of a gunshot wound. After sometime, the loading of irrigation system, gas, electric light, heat and power, water
the scrap iron was resumed. But now, the Acting Mayor supply and power petroleum, sewerage system, wire or
together with 3 policemen ordered Captain Filomeno to dump wireless communication systems, wire or wireless
the scrap iron where the lighter was docked and the rest to be broadcasting stations and other similar public services
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 So understood, the concept of `common carrier’


under Article 1732 may be seen to coincide neatly SMC collected the said amount from respondent UCPB under
with the notion of `public service,’ under the Public its insurance contract. Respondent on the other hand, as a
Service Act subrogee of SMC, brought a suit against petitioner in RTC,
 distinction between: Makati City. On December 20, 1995, the RTC rendered
 common or public carrier judgment finding petitioner liable for the damage to the
 private or special carrier - character of the shipment. The decision was affirmed by the CA.
business, such that if the undertaking is an
isolated transaction , not a part of the Issue: Whether or not Calvo is a common carrier?
business or occupation, and the carrier does
not hold itself out to carry the goods for the Held: In this case the contention of the petitioner, that he is
general public or to a limited clientele, not a common carrier but a private carrier, has no merit.
although involving the carriage of goods for
a fee Article 1732 makes no distinction between one whose
 EX: charter party which includes principal business activity is the carrying of persons or goods
both the vessel and its crew, such or both, and one who does such carrying only as ancillary
as in a bareboat or demise, where activity. Article 1732 also carefully avoids making any
the charterer obtains the use and distinction between a person or enterprise offering
service of all or some part of a ship transportation service on a regular or scheduled basis and one
for a period of time or a voyage or offering such service on an occasional, episodic or
voyages and gets the control of the unscheduled basis. Neither does Article 1732 distinguish
vessel and its crew. between a carrier offering its services to the "general public,"
 The regularity of its activities in this area indicates i.e., the general community or population, and one who offers
more than just a casual activity on its part services or solicits business only from a narrow segment of
 The appellate court ruled, gathered from the the general population. We think that Article 1733 deliberately
testimonies and sworn marine protests of the refrained from making such distinction. (De Guzman v. CA, 68
respective vessel masters ofLimar I and MT Iron SCRA 612)
Eagle, that there was no way by which the barge’s or
the tugboat’s crew could have prevented the sinking Te concept of “common carrier” under Article 1732 coincide
of Limar I. The vessel was suddenly tossed by waves with the notion of “public service”, under the Public Service
of extraordinary height of 6 to 8 feet and buffeted by Act which partially supplements the law on common carrier.
strong winds of 1.5 knots resulting in the entry of Under Section 13, paragraph (b) of the Public Service Act, it
water into the barge’s hatches. The official Certificate includes:
of Inspection of the barge issued by the Philippine
Coastguard and the Coastwise Load Line Certificate “ x x x every person that now or hereafter may own, operate,
would attest to the seaworthiness of Limar I and manage, or control in the Philippines, for hire or
should strengthen the factual findings of the compensation, with general or limited clientele, whether
appellate court. permanent, occasional or accidental, and done for general
 Findings of fact of the Court of Appeals generally business purposes, any common carrier, railroad, street
conclude this Court; none of the recognized railway, traction railway, subway motor vehicle, either for
exceptions from the rule - (1) when the factual freight or passenger, or both, with or without fixed route and
findings of the Court of Appeals and the trial court whatever may be its classification, freight or carrier service of
are contradictory; (2) when the conclusion is a any class, express service, steamboat, or steamship line,
finding grounded entirely on speculation, surmises, pontines, ferries and water craft, engaged in the
or conjectures; (3) when the inference made by the transportation of passengers or freight or both, shipyard,
Court of Appeals from its findings of fact is manifestly marine repair shop, wharf or dock, ice plant, ice-refrigeration
mistaken, absurd, or impossible; (4) when there is a plant, canal, irrigation system, gas, electric light, heat and
grave abuse of discretion in the appreciation of facts; power, water supply and power petroleum, sewerage system,
(5) when the appellate court, in making its findings, wire or wireless communications systems, wire or wireless
went beyond the issues of the case and such findings broadcasting stations and other similar public services. x x x”
are contrary to the admissions of both appellant and
appellee; (6) when the judgment of the Court of
Appeals is premised on a misapprehension of facts;
(7) when the Court of Appeals failed to notice certain [G.R. No. 143133. June 5, 2002]
relevant facts which, if properly considered, would BELGIAN OVERSEAS CHARTERING AND SHIPPING N.V.
justify a different conclusion; (8) when the findings of and JARDINE DAVIES TRANSPORT SERVICES, INC.,
fact are themselves conflicting; (9) when the findings petitioners, vs. PHILIPPINE FIRST INSURANCE CO., INC.,
of fact are conclusions without citation of the specific respondent.
evidence on which they are based; and (10) when the DECISION
findings of fact of the Court of Appeals are premised PANGANIBAN, J.:
on the absence of evidence but such findings are Facts:
contradicted by the evidence on record – would CMC Trading A.G. shipped on board the MN ‘Anangel Sky’ at
appear to be clearly extant in this instance. Hamburg, Germany 242 coils of various Prime Cold Rolled
Steel sheets for transportation to Manila consigned to the
Philippine Steel Trading Corporation. On July 28, 1990, MN
Anangel Sky arrived at the port of Manila and, within the
subsequent days, discharged the subject cargo. Four (4) coils
Calvo v. UCPB General Insurance were found to be in bad order B.O. Tally sheet No. 154974.
G.R. No. 148496 March 19, 2002 Finding the four (4) coils in their damaged state to be unfit for
the intended purpose, the consignee Philippine Steel Trading
Facts: Petitioner Virgines Calvo, owner of Transorient Corporation declared the same as total loss.
Container Terminal Services, Inc. (TCTSI), and a custom Despite receipt of a formal demand, Phil. First insurance
broker, entered into a contract with San Miguel Corporation refused to submit to the consignee’s claim. Consequently,
(SMC) for the transfer of 114 reels of semi-chemical fluting Belgian Overseas paid the consignee P506,086.50, and was
paper and 124 reels of kraft liner board from the port area to subrogated to the latter’s rights and causes of action against
the Tabacalera Compound, Ermita, Manila. The cargo was defendants-appellees. Subsequently, plaintiff-appellant
insured by respondent UCPB General Insurance Co., Inc. instituted this complaint for recovery of the amount paid by
them, to the consignee as insured.
On July 14, 1990, contained in 30 metal vans, arrived in Impugning the propriety of the suit against them, defendants-
Manila on board “M/V Hayakawa Maru”. After 24 hours, they appellees imputed that the damage and/or loss was due to
were unloaded from vessel to the custody of the arrastre pre-shipment damage, to the inherent nature, vice or defect
operator, Manila Port Services, Inc. From July 23 to 25, 1990, of the goods, or to perils, danger and accidents of the sea, or
petitioner, pursuant to her contract with SMC, withdrew the to insufficiency of packing thereof, or to the act or omission of
cargo from the arrastre operator and delivered it to SMC’s the shipper of the goods or their representatives. In addition
warehouse in Manila. On July 25, the goods were inspected by thereto, defendants-appellees argued that their liability, if
Marine Cargo Surveyors, reported that 15 reels of the semi- there be any, should not exceed the limitations of liability
chemical fluting paper were “wet/stained/torn” and 3 reels of provided for in the bill of lading and other pertinent laws.
kraft liner board were also torn. The damages cost Finally, defendants-appellees averred that, in any event, they
P93,112.00.
Page 6 of 6

exercised due diligence and foresight required by law to


prevent any damage/loss to said shipment.”
Issue: Whether or not petitioners have overcome the
presumption of negligence of a common carrier
Held:
No.
Petitioners contend that the presumption of fault imposed on
common carriers should not be applied on the basis of the
lone testimony offered by private respondent. The contention
is untenable.
Well-settled is the rule that common carriers, from the nature
of their business and for reasons of public policy, are bound to
observe extraordinary diligence and vigilance with respect to
the safety of the goods and the passengers they transport.
Thus, common carriers are required to render service with the
greatest skill and foresight and “to use all reasonable means
to ascertain the nature and characteristics of the goods
tendered for shipment, and to exercise due care in the
handling and stowage, including such methods as their nature
requires.” The extraordinary responsibility lasts from the time
the goods are unconditionally placed in the possession of and
received for transportation by the carrier until they are
delivered, actually or constructively, to the consignee or to
the person who has a right to receive them.
Owing to this high degree of diligence required of them,
common carriers, as a general rule, are presumed to have
been at fault or negligent if the goods they transported
deteriorated or got lost or destroyed. That is, unless they
prove that they exercised extraordinary diligence in
transporting the goods. In order to avoid responsibility for any
loss or damage, therefore, they have the burden of proving
that they observed such diligence.
However, the presumption of fault or negligence will not arise
if the loss is due to any of the following causes: (1) flood,
storm, earthquake, lightning, or other natural disaster or
calamity; (2) an act of the public enemy in war, whether
international or civil; (3) an act or omission of the shipper or
owner of the goods; (4) the character of the goods or defects
in the packing or the container; or (5) an order or act of
competent public authority. This is a closed list. If the cause of
destruction, loss or deterioration is other than the enumerated
circumstances, then the carrier is liable therefor.
Corollary to the foregoing, mere proof of delivery of the goods
in good order to a common carrier and of their arrival in bad
order at their destination constitutes a prima facie case of
fault or negligence against the carrier. If no adequate
explanation is given as to how the deterioration, the loss or
the destruction of the goods happened, the transporter shall
be held responsible.
That petitioners failed to rebut the prima facie presumption of
negligence is revealed in the case at bar by a review of the
records and more so by the evidence adduced by respondent

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