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G.R. No. L-30309 November 25, 1983
CLEMENTE BRIÑAS, petitioner, 
 vs.
 THE PEOPLE
OF THE PHILIPPINES and HONORABLE COURT
OF APPEALS, respondents.
Mariano R. Abad for petitioner.
The Solicitor General for respondents.

GUTIERREZ, JR., J .:
This is a petition to review the decision of respondent
Court of Appeals, now Intermediate Appellate Court,
affirming the decision of the Court of First Instance of
Quezon, Ninth Judicial District, Branch 1, which found
the accused Clemente Briñas guilty of the crime of
DOUBLE HOMICIDE THRU RECKLESS
IMPRUDENCE prior the deaths of Martina Bool and
Emelita Gesmundo.
The information charged the accused-appellant. and
others as follows:
That on or about the 6th day of January, 1957, in the
Municipality of Tiaong, Province of Quezon,
Philippines, and within the jurisdiction of this Hon.
Court, the said accused Victor Milan, Clemente Briñas
and Hermogenes Buencamino, being then persons in
charge of passenger Train No. 522-6 of the Manila
Railroad Company, then running from Tagkawayan to
San Pablo City, as engine driver, conductor and
assistant conductor, respectively, wilfully and
unlawfully drove and operated the same in a
negligent, careless and imprudent manner, without
due regard to existing laws, regulations and
ordinances, that although there were passengers on
board the passenger coach, they failed to provide
lamps or lights therein, and failed to take the
necessary precautions for the safety of passengers
and to prevent accident to persons and damage to
property, causing by such negligence, carelessness
and imprudence, that when said passenger Train No.
522-6 was passing the railroad tracks in the
Municipality of Tiaong, Quezon, two of its passengers,
Martina Bool, an old woman, and Emelita Gesmundo,
a child about three years of age, fell from the
passenger coach of the said train, as a result of
which, they were over run, causing their
instantaneous death. "
The facts established by the prosecution and
accepted by the respondent court as basis for the
decision are summarized as follows:
The evidence of the prosecution tends to show that in
the afternoon of January 6, 1957, Juanito Gesmundo
bought a train ticket at the railroad station in
Tagkawayan, Quezon for his 55-year old mother
Martina Bool and his 3-year old daughter Emelita
Gesmundo, who were bound for Barrio Lusacan,
Tiaong, same province. At about 2:00 p.m., Train No.
522 left Tagkawayan with the old woman and her
granddaughter among the passengers. At Hondagua
the train's complement were relieved, with Victor
Millan taking over as engineman, Clemente Briñas as
conductor, and Hermogenes Buencamino as assistant
conductor. Upon approaching Barrio Lagalag in
Tiaong at about 8:00 p.m. of that same night, the train
slowed down and the conductor shouted 'Lusacan',
'Lusacan'. Thereupon, the old woman walked towards
the left front door facing the direction of Tiaong,
carrying the child with one hand and holding her
baggage with the other. When Martina and Emelita
were near the door, the train suddenly picked up
speed. As a result the old woman and the child
stumbled and they were seen no more. It took three
minutes more before the train stopped at the next
barrio, Lusacan, and the victims were not among the
passengers who disembarked thereat .têñ.£îhqwâ£
Next morning, the Tiaong police received a report that
two corpses were found along the railroad tracks at
Barrio Lagalag. Repairing to the scene to investigate,
they found the lifeless body of a female child, about 2
feet from the railroad tracks, sprawled to the ground
with her belly down, the hand resting on the forehead,
and with the back portion of the head crushed. The
investigators also found the corpse of an old woman
about 2 feet away from the railroad tracks with the
head and both legs severed and the left hand missing.
The head was located farther west between the rails.
An arm was found midway from the body of the child
to the body of the old woman. Blood, pieces of
scattered brain and pieces of clothes were at the
scene. Later, the bodies were Identified as those of
Martina Bool and Emelita Gesmundo. Among the
personal effects found on Martina was a train ticket
(Exhibits "B").
On January 7, 1957, the bodies of the deceased were
autopsied by Dr. Pastor Huertas, the Municipal Health
Officer of Tiaong. Dr. Huertas testified on the cause of
death of the victims as follows: têñ.£îhqwâ£
FISCAL YNGENTE:
Q What could have caused the death of those
women?
A Shock.
Q What could have caused that shock?
A Traumatic injury.
Q What could have caused traumatic injury?
A The running over by the wheel of the train.
Q With those injuries, has a person a chance to
survive?
A No chance to survive.
Q What would you say death would come?
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A Instantaneous.
Q How about the girl, the young girl about four years
old, what could have caused the death?
A Shock too.
Q What could have caused the shock?
A Compound fracture of the skull and going out of the
brain.
Q What could have caused the fracture of the skull
and the going out of the brain?
A That is the impact against a steel object. (TSN., pp.
81-82, July 1, 1959)
The Court of First Instance of Quezon convicted
defendant-appellant Clemente Briñas for double
homicide thru reckless imprudence but acquitted
Hermogenes Buencamino and Victor Millan The
dispositive portion of the decision reads: têñ.£îhqwâ£
WHEREFORE, the court finds the defendant
Clemente Briñas guilty beyond doubt of the crime of
double homicide thru reckless imprudence, defined
and punished under Article 305 in connection with
Article 249 of the Revised Penal Code, and sentences
him to suffer six (6) months and one (1) day of prision
correccional to indemnify the heirs of the deceased
Martina Bool and Emelita Gesmundo in the amounts
of P6,000 and P3,000, respectively, with subsidiary
imprisonment in case of insolvency not to exceed
one-third of the principal penalty, and to pay the costs.
For lack of sufficient evidence against the defendant
Hermogenes Buencamino and on the ground of
reasonable doubt in the case of defendant Victor
Millan the court hereby acquits them of the crime
charged in the information and their bail bonds
declared cancelled.
As to the responsibility of the Manila Railroad
Company in this case, this will be the subject of court
determination in another proceeding.
On appeal, the respondent Court of Appeals affirmed
the judgment of the lower court.
During the pendency of the criminal prosecution in the
Court of First Instance of Quezon, the heirs of the
deceased victims filed with the same court, a separate
civil action for damages against the Manila Railroad
Company entitled "Civil Case No. 5978, Manaleyo
Gesmundo, et al., v. Manila Railroad Company". The
separate civil action was filed for the recovery of
P30,350.00 from the Manila Railroad Company as
damages resulting from the accident.
The accused-appellant alleges that the Court of
Appeals made the following errors in its decision:
I têñ.£îhqwâ£
THE HONORABLE COURT OF APPEALS ERRED IN
CONVICTING PETITIONER-APPELLANT UNDER
THE FACTS AS FOUND BY SAID COURT; and
II têñ.£îhqwâ£
THE HONORABLE COURT OF APPEALS ERRED IN
INCLUDING THE PAYMENT OF DEATH INDEMNITY
BY THE PETITIONER- APPELLANT, WITH
SUBSIDIARY IMPRISONMENT IN CASE OF
INSOLVENCY, AFTER THE HEIRS OF THE
DECEASED HAVE ALREADY COMMENCED A
SEPARATE CIVIL ACTION FOR DAMAGES
AGAINST THE RAILROAD COMPANY ARISING
FROM THE SAME MISHAP.
We see no error in the factual findings of the
respondent court and in the conclusion drawn from
those findings.
It is undisputed that the victims were on board the
second coach where the petitioner-appellant was
assigned as conductor and that when the train
slackened its speed and the conductor shouted
"Lusacan, Lusacan", they stood up and proceeded to
the nearest exit. It is also undisputed that the train
unexpectedly resumed its regular speed and as a
result "the old woman and the child stumbled and they
were seen no more.
In finding petitioner-appellant negligent, respondent
Court têñ.£îhqwâ£
xxx xxx xxx
The appellant's announcement was premature and
erroneous, for it took a full three minutes more before
the next barrio of Lusacan was reached. In making
the erroneous and premature announcement,
appellant was negligent. He ought to have known that
train passengers invariably prepare to alight upon
notice from the conductor that the destination was
reached and that the train was about to stop. Upon
the facts, it was the appellant's negligent act which led
the victims to the door. Said acts virtually exposed the
victims to peril, for had not the appellant mistakenly
made the announcement, the victims would be safely
ensconced in their seats when the train jerked while
picking up speed, Although it might be argued that the
negligent act of the appellant was not the immediate
cause of, or the cause nearest in time to, the injury,
for the train jerked before the victims stumbled, yet in
legal contemplation appellant's negligent act was the
proximate cause of the injury. As this Court held in
Tucker v. Milan, CA G.R. No. 7059-R, June 3, 1953:
'The proximate cause of the injury is not necessarily
the immediate cause of, or the cause nearest in time
to, the injury. It is only when the causes are
independent of each other that the nearest is to be
charged with the disaster. So long as there is a
natural, direct and continuous sequence between the
negligent act the injury (sic) that it can reasonably be
said that but for the act the injury could not have
occurred, such negligent act is the proximate cause of
the injury, and whoever is responsible therefore is
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liable for damages resulting therefrom. One who
negligently creates a dangerous condition cannot
escape liability for the natural and probable
consequences thereof, although the act of a third
person, or an act of God for which he is not
responsible intervenes to precipitate the loss.
xxx xxx xxx
It is a matter of common knowledge and experience
about common carriers like trains and buses that
before reaching a station or flagstop they slow down
and the conductor announces the name of the place.
It is also a matter of common experience that as the
train or bus slackens its speed, some passengers
usually stand and proceed to the nearest exit, ready
to disembark as the train or bus comes to a full stop.
This is especially true of a train because passengers
feel that if the train resumes its run before they are
able to disembark, there is no way to stop it as a bus
may be stopped.
It was negligence on the conductor's part to announce
the next flag stop when said stop was still a full three
minutes ahead. As the respondent Court of Appeals
correctly observed, "the appellant's announcement
was premature and erroneous.
That the announcement was premature and
erroneous is shown by the fact that immediately after
the train slowed down, it unexpectedly accelerated to
full speed. Petitioner-appellant failed to show any
reason why the train suddenly resumed its regular
speed. The announcement was made while the train
was still in Barrio Lagalag.
The proximate cause of the death of the victims was
the premature and erroneous announcement of
petitioner' appelant Briñas. This announcement
prompted the victims to stand and proceed to the
nearest exit. Without said announcement, the victims
would have been safely seated in their respective
seats when the train jerked as it picked up speed. The
connection between the premature and erroneous
announcement of petitioner-appellant and the deaths
of the victims is direct and natural, unbroken by any
intervening efficient causes.
Petitioner-appellant also argues that it was negligence
per se for Martina Bool to go to the door of the coach
while the train was still in motion and that it was this
negligence that was the proximate cause of their
deaths.
We have carefully examined the records and we
agree with the respondent court that the negligence of
petitioner-appellant in prematurely and erroneously
announcing the next flag stop was the proximate
cause of the deaths of Martina Bool and Emelita
Gesmundo. Any negligence of the victims was at most
contributory and does not exculpate the accused from
criminal liability.
With respect to the second assignment of error, the
petitioner argues that after the heirs of Martina Bool
and Emelita Gesmundo had actually commenced the
separate civil action for damages in the same trial
court during the pendency of the criminal action, the
said court had no more power to include any civil
liability in its judgment of conviction.
The source of the obligation sought to be enforced in
Civil Case No. 5978 is culpa contractual, not an act or
omission punishable by law. We also note from the
appellant's arguments and from the title of the civil
case that the party defendant is the Manila Railroad
Company and not petitioner-appellant Briñas Culpa
contractual and an act or omission punishable by law
are two distinct sources of obligation.
The petitioner-appellant argues that since the
information did not allege the existence of any kind of
damages whatsoever coupled by the fact that no
private prosecutors appeared and the prosecution
witnesses were not interrogated on the issue of
damages, the trial court erred in awarding death
indemnity in its judgment of conviction.
A perusal of the records clearly shows that the
complainants in the criminal action for double
homicide thru reckless imprudence did not only
reserve their right to file an independent civil action
but in fact filed a separate civil action against the
Manila Railroad Company.
The trial court acted within its jurisdiction when,
despite the filing with it of the separate civil action
against the Manila Railroad Company, it still awarded
death indemnity in the judgment of conviction against
the petitioner-appellant.
It is well-settled that when death occurs as a result of
the commission of a crime, the following items of
damages may be recovered: (1) an indemnity for the
death of the victim; (2) an indemnity for loss of
earning capacity of the deceased; (3) moral damages;
(4) exemplary damages; (5) attorney's fees and
expenses of litigation, and (6) interest in proper cases.
The indemnity for loss of earning capacity, moral
damages, exemplary damages, attorney's fees, and
interests are recoverable separately from and in
addition to the fixed slim of P12,000.00 corresponding
to the indemnity for the sole fact of death. This
indemnity arising from the fact of death due to a crime
is fixed whereas the others are still subject to the
determination of the court based on the evidence
presented. The fact that the witnesses were not
interrogated on the issue of damages is of no moment
because the death indemnity fixed for death is
separate and distinct from the other forms of
indemnity for damages.
WHEREFORE, the judgment appealed from is
modified in that the award for death indemnity is
increased to P12,000.00 for the death of Martina Bool
instead of P6,000.00 and P12,000.00 for the death of
Emelita Gesmundo instead of P3,000.00, but deleting
the subsidiary imprisonment in case of insolvency
imposed by the lower court. The judgment is
AFFIRMED in all other respects. So ordered.
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G.R. Nos. 74387-90 November 14, 1988
BATANGAS LAGUNA TAYABAS BUS COMPANY
& ARMANDO PON, petitioners,

 vs.
 INTERMEDIATE APPELLATE COURT, THE
HEIRS OF PAZ VDA. DE PAMFILO, THE HEIRS OF
NORMA NERI, and BAYLON SALES and NENA
VDA. DE ROSALES, respondents.
Sibal, Custodia, Santos & Nofuente for petitioners.
Restituto L. Opis for respondents Pamfilos and
Rosaleses.
Citizens Legal Assistance Office for N. Neri and
Baylon Sales.

PARAS, J .:
Before Us is a Petition to Review by Certiorari, the
decision
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of the respondent appellate court which
affirmed with modification the joint decision of the trial
court in four (4) cases involving similar facts and
issues, finding favorably for the plaintiffs (private
respondents herein), the dispositive portion of said
appellate judgment reading as follows:
WHEREFORE, with the modification that the death
indemnity is raised to P30,000.00 to each set of the
victims' heirs, the rest of the judgment appealed from
is hereby affirmed in toto. Costs against the
defendants-appellants.
SO ORDERED. (p. 20, Rollo)
From the records of the case We have gathered the
following antecedent facts:
The collision between Bus No. 1046 of the Batangas
Laguna Tayabas Bus Company (BLTB, for brevity)
driven by Armando Pon and Bus No. 404 of
Superlines Transportation Company (Superlines, for
brevity) driven by Ruben Dasco took place at the
highway traversing Barangay Isabong, Tayabas,
Quezon in the afternoon of August 11, 1978, which
collision resulted in the death of Aniceto Rosales,
Francisco Pamfilo and Romeo Neri and in several
injuries to Nena Rosales (wife of Anecito) and Baylon
Sales, all passengers of the BLTB Bus No. 1046. The
evidence shows that as BLTB Bus No. 1046 was
negotiating the bend of the highway, it tried to
overtake a Ford Fiera car just as Bus No. 404 of
Superlines was coming from the opposite direction.
Seeing thus, Armando Pon (driver of the BLTB Bus)
made a belated attempt to slacken the speed of his
bus and tried to return to his proper lane. It was an
unsuccessful try as the two (2) buses collided with
each other.
Nena Vda. de Rosales and Baylon Sales and the
surviving heirs of the deceased Francisco Pamfilo,
Aniceto Rosales and Romeo Neri instituted separate
cases in the Court of First Instance of Marinduque
against BLTB and Superlines together with their
respective drivers praying for damages, attorney's
fees and litigation expenses plus costs. Criminal
cases against the drivers of the two buses were filed
in the Court of First Instance of Quezon.
Defendants BLTB and Superlines, together with their
drivers Pon and Dasco, denied liability by claiming
that they exercised due care and diligence and shifted
the fault, against each other. They all interposed
counterclaims against the plaintiffs and crossclaims
against each other.
After trial on the merits, the lower court exonerated
defendants Superlines and its driver Dasco from
liability and attributed sole responsibility to defendants
BLTB and its driver Pon, and ordered them jointly and
severally to pay damages to the plaintiffs. Defendants
BLTB and Armando Pon appealed from the decision
of the lower court to respondent appellate court which
affirmed with modification the judgment of the lower
court as earlier stated.
Hence, this petition to review by certiorari of
defendant BLTB assigning a lone error, to wit:
THE INTERMEDIATE APPELLATE COURT ERRED
IN ADJUDGING THAT THE ACTIONS OF PRIVATE
RESPONDENTS ARE BASED ON CULPA
CONTRACTUAL. (p. 12, Rollo)
It is argued by petitioners that if the intention of private
respondents were to file an action based on culpa
contractual or breach of contract of carriage, they
could have done so by merely impleading BLTB and
its driver Pon. As it was in the trial court, private
respondents filed an action against all the defendants
basing their action on culpa aquiliana or tort.
Petitioners' contentions deserve no merit. A reading of
the respondent court's decision shows that it
anchored petitioners' liability both on culpa contractual
and culpa aquiliana, to wit:
The proximate cause of the collision resulting in the
death of three and injuries to two of the passengers of
BLTB was the negligence of the driver of the BLTB
bus, who recklessly operated and drove said bus by
overtaking a Ford Fiera car as he was negotiating the
ascending bend of the highway (tsn, October 4, 1979,
pp. 9-10, 35, 36, 61; Exhibit 6 Superlines, p. 47) which
was divided into two lanes by a continuous yellow
strip (tsn, October 4, 1979, p. 36). The driver of the
BLTB bus admitted in his cross-examination that the
continuous yellow line on the ascending bend of the
highway signifies a no-overtaking zone (tsn, October
4, 1979, p. 36). It is no surprise then that the driver of
the Superlines bus was exonerated by the lower
court. He had a valid reason to presuppose that no
one would overtake in such a dangerous situation.
These facts show that patient imprudence of the
BLTB driver.
It is well settled that a driver abandoning his proper
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lane for the purpose of overtaking another vehicle in
ordinary situation has the duty to see that the road is
clear and not to proceed if he can not do so in safety
(People v. Enriquez, 40 O.G. No. 5, 984).
... Before attempting to pass the vehicle ahead, the
rear driver must see that the road is clear and if there
is no sufficient room for a safe passage, or the driver
ahead does not turn out so as to afford opportunity to
pass, or if, after attempting to pass, the driver of the
overtaking vehicle finds that he cannot make the
passage in safety, the latter must slacken his speed
so as to avoid the danger of a collision, even bringing
his car to a stop if necessary. (3-4 Huddy
Encyclopedia of Automobile Law, Sec. 212, p. 195).
The above rule becomes more particularly applicable
in this case when the overtaking took place on an
ascending curved highway divided into two lanes by a
continuous yellow line. Appellant Pon should have
remembered that:
When a motor vehicle is approaching or rounding a
curve there is special necessity for keeping to the
right side of the road and the driver has not the right
to drive on the left hand side relying upon having time
to turn to the right if a car is approaching from the
opposite direction comes into view. (42 C.J. 42 906).
Unless there is proof to the contrary, it is presumed
that a person driving a motor vehicle has been
negligent if at the time of the mishap, he was violating
any traffic regulation. (Art. 2165, Civil Code).
In failing to observe these simple precautions, BLTB's
driver undoubtedly failed to act with the diligence
demanded by the circumstances.
We now come to the subject of liability of the
appellants.
For his own negligence in recklessly driving the truck
owned by his employer, appellant Armando Pon is
primarily liable (Article 2176, Civil
Code).<äre||anº•1àw>
On the other hand the liability of Pon's employer,
appellant BLTB, is also primary, direct and immediate
in view of the fact that the death of or injuries to its
passengers was through the negligence of its
employee (Marahan v. Mendoza, 24 SCRA 888, 894),
and such liability does not cease even upon proof that
BLTB had exercised all the diligence of a good father
of a family in the selection and supervision of its
employees (Article 1759, Civil Code).
The common carrier's liability for the death of or
injuries to its passengers is based on its contractual
obligation to carry its passengers safely to their
destination. That obligation is so serious that the Civil
Code requires "utmost diligence of very cautious
person (Article 1755, Civil Code). They are presumed
to have been at fault or to have acted negligently
unless they prove that they have observed
extraordinary diligence" (Article 1756, Civil Code). In
the present case, the appellants have failed to prove
extraordinary diligence. Indeed, this legal presumption
was confirmed by the fact that the bus driver of BLTB
was negligent. It must follow that both the driver and
the owner must answer for injuries or death to its
passengers.
The liability of BLTB is also solidarily with its driver
(Viluan v. Court of Appeals, 16 SCRA 742, 747) even
though the liability of the driver springs from quasi
delict while that of the bus company from contract.
(pp. 17-19, Rollo)
Conclusively therefore in consideration of the
foregoing findings of the respondent appellate court it
is settled that the proximate cause of the collision
resulting in the death of three and injuries to two of
the passengers of BLTB was the sole negligence of
the driver of the BLTB Bus, who recklessly operated
and drove said bus in a lane where overtaking is not
allowed by Traffic Rules and Regulations. Such
negligence and recklessness is binding against
petitioner BLTB, more so when We consider the fact
that in an action based on a contract of carriage, the
court need not make an express finding of fault or
negligence on the part of the carrier in order to hold it
responsible for the payment of the damages sought
by the passenger. By the contract of carriage, the
carrier BLTB assumed the express obligation to
transport the passengers to their destination safely
and to observe extraordinary diligence with a due
regard for all the circumstances, and any injury that
might be suffered by its passengers is right away
attributable to the fault or negligence of the carrier
(Art. 1756, New Civil Code).
Petitioners also contend that "a common carrier is not
an absolute insurer against all risks of travel and are
not liable for acts or accidents which cannot be
foreseen or inevitable and that responsibility of a
common carrier for the safety of its passenger
prescribed in Articles 1733 and 1755 of the New Civil
Code is not susceptible of a precise and definite
formulation." (p. 13, Rollo) Petitioners' contention
holds no water because they had totally failed to point
out any factual basis for their defense of force
majeure in the light of the undisputed fact that the
cause of the collision was the sole negligence and
recklessness of petitioner Armando Pon. For the
defense of force majeure or act of God to prosper the
accident must be due to natural causes and
exclusively without human intervention.
WHEREFORE, premises considered, the appealed
decision is hereby AFFIRMED.
SO ORDERED.








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G.R. No. L-22985 January 24, 1968
BATANGAS TRANSPORTATION COMPANY,
petitioner, 
 vs.
 GREGORIO CAGUIMBAL,
PANCRACIO CAGUIMBAL, MARIA MARANAN DE
CAGUIMBAL, BIÑAN TRANSPORTATION
COMPANY and MARCIANO ILAGAN, respondents.
Ozaeta, Gibbs and Ozaeta and Domingo E. de Lara
for petitioner. 
 Victoriano H. Endaya for respondents.
CONCEPCION, C.J .:
Appeal by certiorari from a decision of the Court
of Appeals.
The main facts are set forth in said decision
from which we quote:
There is no dispute at all that the deceased
Pedro Caguimbal, Barrio Lieutenant of Barrio
Calansayan, San Jose, Batangas, was a paying
passenger of BTCO bus, with plate TPU-507, going
south on its regular route from Calamba, Laguna, to
Batangas, Batangas, driven by Tomas Perez, its
regular driver, at about 5:30 o'clock on the early
morning of April 25, 1954. The deceased's destination
was his residence at Calansayan, San Jose,
Batangas. The bus of the Biñan Transportation
Company, bearing plate TPU-820, driven by Marciano
Ilagan, was coming from the opposite direction (north-
bound). Along the national highway at Barrio Daraza,
Tanauan, Batangas, on the date and hour above
indicated, a horse-driven rig (calesa) managed by
Benito Makahiya, which was then ahead of the Biñan
bus, was also coming from the opposite direction,
meaning proceeding towards the north. As to what
transpired thereafter, the lower court chose to give
more credence to defendant Batangas Transportation
Company's version which, in the words of the Court a
quo, is as follows: "As the BTCO bus was nearing a
house, a passenger requested the conductor to stop
as he was going to alight, and when he heard the
signal of the conductor, the driver Tomas Perez
slowed down his bus swerving it farther to the right in
order to stop; at this juncture, a calesa, then driven by
Benito Makahiya was at a distance of several meters
facing the BTCO bus coming from the opposite
direction; that at the same time the Biñan bus was
about 100 meters away likewise going northward and
following the direction of the calesa; that upon seeing
the Biñan bus the driver of the BTCO bus dimmed his
light as established by Magno Ilaw, the very conductor
of the Biñan bus at the time of the accident; that as
the calesa and the BTCO bus were passing each
other from the opposite directions, the Biñan bus
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following the calesa swerved to its left in an attempt to
pass between the BTCO bus and the calesa; that
without diminishing its speed of about seventy (70)
kilometers an hour, the Biñan bus passed through the
space between the BTCO bus and the calesa hitting
first the left side of the BTCO bus with the left front
corner of its body and then bumped and struck the
calesa which was completely wrecked; that the driver
was seriously injured and the horse was killed; that
the second and all other posts supporting the top of
the left side of the BTCO bus were completely
smashed and half of the back wall to the left was
ripped open. (Exhibits 1 and 2). The BTCO bus
suffered damages for the repair of its damaged
portion.
As a consequence of this occurrence, two (2)
passengers of BTCO died, namely, Pedro Caguimbal
and Guillermo Tolentino, apart from others who were
injured. The widow and children of Caguimbal
instituted the present action, which was tried jointly
with a similar action of the Tolentinos, to recover
damages from the Batangas Transportation
Company, hereinafter referred to as BTCO. The latter,
in turn, filed a third-party complaint against the Biñan
Transportation Company — hereinafter referred to as
Biñan — and its driver, Marciano Ilagan.
Subsequently, the Caguimbals amended their
complaint, to include therein, as defendants, said
Biñan and Ilagan.
After appropriate proceedings, the Court of First
Instance of Batangas rendered a decision dismissing
the complaint insofar as the BTCO is concerned,
without prejudice to plaintiff's right to sue Biñan —
which had stopped participating in the proceedings
herein, owing apparently, to a case in the Court of
First Instance of Laguna for the insolvency of said
enterprise — and Ilagan, and without pronouncement
as to costs.
On appeal taken by the Caguimbals, the Court
of Appeals reversed said decision and rendered
judgment for them, sentencing the BTCO, Biñan and
Ilagan to, jointly and severally, pay to the plaintiffs the
aggregate sum of P10,500.00
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and the costs in both
instances. Hence, this appeal by BTCO, upon the
ground that the Court of Appeals erred: 1) in finding
said appellant liable for damages; and 2) in awarding
attorney's fees.
In connection with the first assignment of error,
we note that the recklessness of defendant was,
manifestly, a major factor in the occurrence of the
accident which resulted, inter alia, in the death of
Pedro Caguimbal. Indeed, as driver of the Biñan bus,
he overtook Benito Makahiya's horse-driven rig or
calesa and passed between the same and the BTCO
bus despite the fact that the space available was not
big enough therefor, in view of which the Biñan bus hit
the left side of the BTCO bus and then the calesa.
This notwithstanding, the Court of Appeals rendered
judgment against the BTCO upon the ground that its
driver, Tomas Perez, had failed to exercise the
"extraordinary diligence," required in Article 1733 of
the new Civil Code, "in the vigilance for the safety" of
his passengers.
2

The record shows that, in order to permit one of
them to disembark, Perez drove his BTCO bus partly
to the right shoulder of the road and partly on the
asphalted portion thereof. Yet, he could have and
should have seen to it — had he exercised
"extraordinary diligence" — that his bus was
completely outside the asphalted portion of the road,
and fully within the shoulder thereof, the width of
which being more than sufficient to accommodate the
bus. He could have and should have done this,
because, when the aforementioned passenger
expressed his wish to alight from the bus, Ilagan had
seen the aforementioned "calesa", driven by
Makahiya, a few meters away, coming from the
opposite direction, with the Biñan bus about 100
meters behind the rig cruising at a good speed.
3
When Perez slowed down his BTCO bus to permit
said passenger to disembark, he must have known,
therefore, that the Biñan bus would overtake the
calesa at about the time when the latter and BTCO
bus would probably be on the same line, on opposite
sides of the asphalted portions of the road, and that
the space between the BTCO bus and the "calesa"
would not be enough to allow the Biñan bus to go
through. It is true that the driver of the Biñan bus
should have slowed down or stopped, and, hence,
was reckless in not doing so; but, he had no especial
obligations toward the passengers of the BTCO unlike
Perez whose duty was to exercise "utmost" or
"extraordinary" diligence for their safety. Perez was
thus under obligation to avoid a situation which would
be hazardous for his passengers, and, make their
safety dependent upon the diligence of the Biñan
driver. Such obligation becomes more patent when
we considered the fact — of which the Court may take
judicial cognizance — that our motor vehicle drivers,
particularly those of public service utilities, have not
distinguished themselves for their concern over the
safety, the comfort or the convenience of others.
Besides, as correctly stated in the syllabus to Brito Sy
vs. Malate Taxicab & Garage, Inc.,
4

In an action based on a contract of carriage, the
court need not make an express finding of fault or
negligence on the part of the carrier in order to hold it
responsible to pay the damages sought for by the
passenger. By the contract of carriage, the carrier
assumes the express obligation to transport the
passenger to his destination safely and to observe
extraordinary diligence with a due regard for all the
circumstances, and any injury that might be suffered
by the passenger is right away attributable to the fault
or negligence of the carrier (Article 1756, new Civil
Code). This is an exception to the general rule that
negligence must be proved, and it is therefore
incumbent upon the carrier to prove that it has
exercised extraordinary diligence as prescribed in
Articles 1733 and 1755 of the new Civil Code.
In the case at bar, BTCO has not proven the
exercise of extraordinary diligence on its part. For this
reason, the case of Isaac vs. A. L. Ammen Trans. Co.,
Inc.
5
relied upon by BTCO, is not in point, for, in said
case, the public utility driver had done everything he
could to avoid the accident, and could not have
possibly avoided it, for he "swerved the bus to the
very extreme right of the road," which the driver, in the
8
present case, had failed to do.
As regards the second assignment of error,
appellant argues that the award of attorney's fees is
not authorized by law, because, of the eleven (11)
cases specified in Article 1208 of the new Civil Code,
only the fifth and the last are relevant to the one under
consideration; but the fifth case requires bad faith,
which does not exist in the case at bar. As regards the
last case, which permits the award, "where the court
deems it just and equitable that attorney's fees . . .
should be recovered," it is urged that the evidence on
record does not show the existence of such just and
equitable grounds.
We, however, believe otherwise, for: (1) the
accident in question took place on April 25, 1954, and
the Caguimbals have been constrained to litigate for
over thirteen (13) years to vindicate their rights; and
(2) it is high time to impress effectively upon public
utility operators the nature and extent of their
responsibility in respect of the safety of their
passengers and their duty to exercise greater care in
the selection of drivers and conductor and in
supervising the performance of their duties, in
accordance, not only with Article 1733 of the Civil
Code of the Philippines, but, also, with Articles 1755
and 1756 thereof
6
and the spirit of these provisions,
as disclosed by the letter thereof, and elucidated by
the Commission that drafted the same.
7

WHEREFORE, the decision appealed from,
should be, as it is hereby, affirmed, with the costs of
this instance against appellant Batangas
Transportation Company.

























11Z<¨
SECOND DIVISION
[G.R. No. 128607. January 31, 2000]
ALFREDO MALLARI SR. and ALFREDO MALLARI
JR., petitioners, vs. COURT OF APPEALS and
BULLETIN PUBLISHING CORPORATION,
respondents.
D E C I S I O N
BELLOSILLO, J .:
ALFREDO MALLARI SR. and ALFREDO MALLARI
JR. in this petition for review on certiorari seek to set aside
the Decision of the Court of Appeals[1] which reversed the
court a quo and adjudged petitioners to be liable for
damages due to negligence as a common carrier resulting in
the death of a passenger.
On 14 October 1987, at about 5:00 o'clock in the morning,
the passenger jeepney driven by petitioner Alfredo Mallari
Jr. and owned by his co-petitioner Alfredo Mallari Sr.
collided with the delivery van of respondent Bulletin
Publishing Corp. (BULLETIN, for brevity) along the
National Highway in Barangay San Pablo, Dinalupihan,
Bataan. Petitioner Mallari Jr. testified that he went to the
left lane of the highway and overtook a Fiera which had
stopped on the right lane. Before he passed by the Fiera, he
saw the van of respondent BULLETIN coming from the
opposite direction. It was driven by one Felix Angeles. The
sketch of the accident showed that the collision occurred
after Mallari Jr. overtook the Fiera while negotiating a
curve in the highway. The points of collision were the left
rear portion of the passenger jeepney and the left front side
of the delivery van of BULLETIN. The two (2) right
wheels of the delivery van were on the right shoulder of the
road and pieces of debris from the accident were found
scattered along the shoulder of the road up to a certain
portion of the lane travelled by the passenger jeepney. The
impact caused the jeepney to turn around and fall on its left
side resulting in injuries to its passengers one of whom was
Israel Reyes who eventually died due to the gravity of his
injuries. U=÷1¨=÷
On 16 December 1987 Claudia G. Reyes, the widow of
Israel M. Reyes, filed a complaint for damages with the
Regional Trial Court of Olongapo City against Alfredo
Mallari Sr. and Alfredo Mallari Jr., and also against
BULLETIN, its driver Felix Angeles, and the N.V.
Netherlands Insurance Company. The complaint alleged
that the collision which resulted in the death of Israel Reyes
was caused by the fault and negligence of both drivers of
the passenger jeepney and the Bulletin Isuzu delivery van.
The complaint also prayed that the defendants be ordered
jointly and severally to pay plaintiff P1,006,777.40 in
compensatory damages, P40,000.00 for hospital and
medical expenses, P18,270.00 for burial expenses plus such
amounts as may be fixed by the trial court for exemplary
damages and attorney’s fees.
The trial court found that the proximate cause of the
collision was the negligence of Felix Angeles, driver of the
Bulletin delivery van, considering the fact that the left front
portion of the delivery truck driven by Felix Angeles hit
and bumped the left rear portion of the passenger jeepney
driven by Alfredo Mallari Jr. Hence, the trial court ordered
9
BULLETIN and Felix Angeles to pay jointly and severally
Claudia G. Reyes, widow of the deceased victim, the sums
of P42,106.93 for medical expenses; P8,600.00 for funeral
and burial expenses; P1,006,777.40 for loss of earning
capacity; P5,000.00 for moral damages and P10,000.00 for
attorney’s fees. The trial court also ordered N.V.
Netherlands Insurance Company to indemnify Claudia G.
Reyes P12,000.00 as death indemnity and P2,500.00 for
funeral expenses which when paid should be deducted from
the liabilities of respondent BULLETIN and its driver Felix
Angeles to the plaintiff. It also dismissed the complaint
against the other defendants Alfredo Mallari Sr. and
Alfredo Mallari Jr.
On appeal the Court of Appeals modified the decision of
the trial court and found no negligence on the part of
Angeles and consequently of his employer, respondent
BULLETIN. Instead, the appellate court ruled that the
collision was caused by the sole negligence of petitioner
Alfredo Mallari Jr. who admitted that immediately before
the collision and after 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 by Angeles before overtaking
the Fiera. The Court of Appeals ordered petitioners Mallari
Jr. and Mallari Sr. to compensate Claudia G. Reyes
P1,006,777.50 for loss of earning capacity, P50,000.00 as
indemnity for death and P10,000.00 for attorney’s fees. It
absolved from any liability respondent BULLETIN, Felix
Angeles and N.V. Netherlands Insurance Company. Hence
this petition. ¨=´·1¯ 1
Petitioners contend that there is no evidence to show that
petitioner Mallari Jr. overtook a vehicle at a curve on the
road at the time of the accident and that the testimony of
Angeles on the overtaking made by Mallari Jr. was not
credible and unreliable. Petitioner also submits that the trial
court was in a better position than the Court of Appeals to
assess the evidence and observe the witnesses as well as
determine their credibility; hence, its finding that the
proximate cause of the collision was the negligence of
respondent Angeles, driver of the delivery van owned by
respondent BULLETIN, should be given more weight and
consideration.
We cannot sustain petitioners. Contrary to their allegation
that there was no evidence whatsoever that petitioner
Mallari Jr. overtook a vehicle at a curve on the road at the
time of or before the accident, the same petitioner himself
testified that such fact indeed did occur -
Q:.......And what was that
accident all about?
A:.......Well, what happened,
sir, is that at about that time
5:00 o’clock in that morning
of October 14 while I was
negotiating on the highway at
San Pablo, Dinalupihan,
Bataan, I was then following
a blue Ford Fierra and my
distance behind was about
twenty (20) feet and then I
passed that blue Ford Fierra. I
overtook and when I was
almost on the right lane of the
highway towards Olongapo
City there was an oncoming
delivery van of the Bulletin
Publishing Corporation
which bumped the left rear
portion of the jeepney which
I was driving and as a result
of which the jeepney x x x
turned around and fell on its
left side and as a result of
which some of my passengers
including me were injured, sir
x x x x
Q:.......Before you overtook
the Ford Fierra jeepney did
you look x x x whether there
was any vehicle coming
towards you?
A:.......Yes, sir.
Q:.......Did you see the
Bulletin van or the Press van
coming towards you?
A:.......Yes, sir.
Q:.......At the moment the
Ford Fierra xxx stop(ped) and
in overtaking the Fierra, did
you not have an option to
stop and not to overtake the
Ford Fierra?
A:.......Well, at the time when
the Ford Fierra stopped in
front of me I slowed down
with the intention of applying
the brake, however, when I
saw the oncoming vehicle
which is the Press van is very
far x x x which is 100 feet
distance, x x x it is sufficient
to overtake the Ford Fierra so
I overt(ook) it x x x x
Q:.......You said that you took
into consideration the speed
of the oncoming Press van
but you also could not
estimate the speed of the
press van because it was dark
at that time, which of these
statements are
true? ´-·
A:.......What I wanted to say,
I took into consideration the
speed of the oncoming
vehicle, the Press van,
although at the moment I
could not estimate the speed
of the oncoming vehicle x x x
x[2]
10
The Court of Appeals correctly found, based on the sketch
and spot report of the police authorities which were not
disputed by petitioners, that the collision occurred
immediately after petitioner Mallari Jr. overtook a vehicle
in front of it while traversing a curve on the highway.[3]
This act of overtaking was in clear violation of Sec. 41,
pars. (a) and (b), of RA 4136 as amended, otherwise known
as The Land Transportation and Traffic Code which
provides:
Sec. 41. Restrictions on
overtaking and passing. - (a)
The driver of a vehicle shall
not drive to the left side of
the center line of a highway
in overtaking or passing
another vehicle proceeding in
the same direction, unless
such left side is clearly
visible and is free of
oncoming traffic for a
sufficient distance ahead to
permit such overtaking or
passing to be made in safety.
(b) The driver of a vehicle
shall not overtake or pass
another vehicle proceeding in
the same direction when
approaching the crest of a
grade, nor upon a curve in the
highway, where the driver’s
view along the highway is
obstructed within a distance
of five hundred feet ahead
except on a highway having
two or more lanes for
movement of traffic in one
direction where the driver of
a vehicle may overtake or
pass another vehicle:
Provided That on a highway,
within a business or
residential district, having
two or more lanes for
movement of traffic in one
direction, the driver of a
vehicle may overtake or pass
another vehicle on the right.
The rule is settled that a driver abandoning his proper lane
for the purpose of overtaking another vehicle in an ordinary
situation has the duty to see to it that the road is clear and
not to proceed if he cannot do so in safety.[4] When a
motor vehicle is approaching or rounding a curve, there is
special necessity for keeping to the right side of the road
and the driver does not have the right to drive on the left
hand side relying upon having time to turn to the right if a
car approaching from the opposite direction comes into
view.[5] ´-··1¯
In the instant case, by his own admission, petitioner Mallari
Jr. already saw that the BULLETIN delivery van was
coming from the opposite direction and failing to consider
the speed thereof since it was still dark at 5:00 o'clock in
the morning mindlessly occupied the left lane and overtook
two (2) vehicles in front of it at a curve in the highway.
Clearly, the proximate cause of the collision resulting in the
death of Israel Reyes, a passenger of the jeepney, was the
sole negligence of the driver of the passenger jeepney,
petitioner Alfredo Mallari Jr., who recklessly operated and
drove his jeepney in a lane where overtaking was not
allowed by traffic rules. Under Art. 2185 of the Civil Code,
unless there is proof to the contrary, it is presumed that a
person driving a motor vehicle has been negligent if at the
time of the mishap he was violating a traffic regulation. As
found by the appellate court, petitioners failed to present
satisfactory evidence to overcome this legal presumption.
The negligence and recklessness of the driver of the
passenger jeepney is binding against petitioner Mallari Sr.,
who admittedly was the owner of the passenger jeepney
engaged as a common carrier, considering the fact that in
an action based on contract of carriage, the court need not
make an express finding of fault or negligence on the part
of the carrier in order to hold it responsible for the payment
of damages sought by the passenger. Under Art. 1755 of the
Civil Code, 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 due regard for all the circumstances. Moreover, under
Art. 1756 of the Civil Code, in case of death or injuries to
passengers, a common carrier is presumed to have been at
fault or to have acted negligently, unless it proves that it
observed extraordinary diligence. Further, pursuant to Art.
1759 of the same Code, it is liable for the death of or
injuries to passengers through the negligence or willful acts
of the former’s employees. This liability of the common
carrier does not cease upon proof that it exercised all the
diligence of a good father of a family in the selection of its
employees. Clearly, by the contract of carriage, the carrier
jeepney owned by Mallari Sr. assumed the express
obligation to transport the passengers to their destination
safely and to observe extraordinary diligence with due
regard for all the circumstances, and any injury or death
that might be suffered by its passengers is right away
attributable to the fault or negligence of the
carrier. ¯-÷- ·
The monetary award ordered by the appellate court to be
paid by petitioners to the widow of the deceased passenger
Israel M. Reyes of P1,006,777.50 for loss of earning
capacity, P50,000.00 as civil indemnity for death, and
P10,000.00 for attorney’s fees, all of which were not
disputed by petitioners, is a factual matter binding and
conclusive upon this Court.
WHEREFORE, the Petition is DENIED and the Decision
of the Court of Appeals dated 20 September 1995 reversing
the decision of the trial court being in accord with law and
evidence is AFFIRMED. Consequently, petitioners are
ordered jointly and severally to pay Claudia G. Reyes
P1,006,777.50 for loss of earning capacity, P50,000.00 as
civil indemnity for death, and P10,000.00 for attorney’s
fees. Costs against petitioners.
SO ORDERED.




11
G.R. No. 75118 August 31,
1987
SEA-LAND SERVICE, INC.,
petitioner,

 vs.
 INTERMEDIATE
APPELLATE COURT and
PAULINO CUE, doing
business under the name
and style of "SEN HIAP
HING," respondents.

NARVASA, J .:
The main issue here is
whether or not the consignee
of seaborne freight is bound by
stipulations in the covering bill
of lading limiting to a fixed
amount the liability of the
carrier for loss or damage to
the cargo where its value is
not declared in the bill.
The factual antecedents, for
the most part, are not in
dispute.
On or about January 8, 1981,
Sea-Land Service, Inc. (Sea-
Land for brevity), a foreign
shipping and forwarding
company licensed to do
business in the Philippines,
received from Seaborne
Trading Company in Oakland,
California a shipment
consigned to Sen Hiap Hing
the business name used by
Paulino Cue in the wholesale
and retail trade which he
operated out of an
establishment located on
Borromeo and Plaridel Streets,
Cebu City.
The shipper not having
declared the value of the
shipment, no value was
indicated in the bill of lading.
The bill described the
shipment only as "8 CTNS on
2 SKIDS-FILES. 1 Based on
volume measurements Sea-
land charged the shipper the
total amount of US$209.28
2

for freight age and other
charges. The shipment was
loaded on board the MS
Patriot, a vessel owned and
operated by Sea-Land, for
discharge at the Port Of Cebu.
The shipment arrived in Manila
on February 12, 1981, and
there discharged in Container
No. 310996 into the custody of
the arrastre contractor and the
customs and port authorities.
3

Sometime between February
13 and 16, 1981, after the
shipment had been
transferred, along with other
cargoes to Container No.
40158 near Warehouse 3 at
Pier 3 in South Harbor, Manila,
awaiting trans-shipment to
Cebu, it was stolen by pilferers
12
and has never been
recovered.
4

On March 10, 1981, Paulino
Cue, the consignee, made
formal claim upon Sea-Land
for the value of the lost
shipment allegedly amounting
to P179,643.48.
5
Sea-Land
offered to settle for
US$4,000.00, or its then
Philippine peso equivalent of
P30,600.00. asserting that
said amount represented its
maximum liability for the loss
of the shipment under the
package limitation clause in
the covering bill of lading.
6

Cue rejected the offer and
thereafter brought suit for
damages against Sea-Land in
the then Court of First Instance
of Cebu, Branch X.
7
Said
Court, after trial, rendered
judgment in favor of Cue,
sentencing Sea-Land to pay
him P186,048.00 representing
the Philippine currency value
of the lost cargo, P55,814.00
for unrealized profit with one
(1%) percent monthly interest
from the filing of the complaint
until fully paid, P25,000.00 for
attorney's fees and P2,000.00
as litigation expenses.
8

Sea-Land appealed to the
Intermediate Appellate Court.
9

That Court however affirmed
the decision of the Trial Court
xxx in all its parts ... . 10 Sea-
Land thereupon filed the
present petition for review
which, as already stated,
poses the question of whether,
upon the facts above set forth,
it can be held liable for the loss
of the shipment in any amount
beyond the limit of US$600.00
per package stipulated in the
bill of lading.
To begin with, there is no
question of the right, in
principle, of a consignee in a
bill of lading to recover from
the carrier or shipper for loss
of, or damage to, goods being
transported under said bill
,although that document may
have been — as in practice it
oftentimes is — drawn up only
by the consignor and the
carrier without the intervention
of the consignee. In Mendoza
vs. Philippine Air Lines, Inc. 11
the Court delved at some
length into the reasons behind
this when, upon a claim made
by the consignee of a motion
picture film shipped by air that
he was never a party to the
contract of transportation and
was a complete stranger
thereto, it said:
But appellant now contends
that he is not suing on a
breach of contract but on a tort
13
as provided for in Art. 1902 of
the Civil Code. We are a little
perplexed as to this new
theory of the appellant. First,
he insists that the articles of
the Code of Commerce should
be applied: that he invokes the
provisions of aid Code
governing the obligations of a
common carrier to make
prompt delivery of goods given
to it under a contract of
transportation. Later, as
already said, he says that he
was never a party to the
contract of transportation and
was a complete stranger to it,
and that he is now suing on a
tort or a violation of his rights
as a stranger (culpa aquiliana)
If he does not invoke the
contract of carriage entered
into with the defendant
company, then he would
hardly have any leg to stand
on. His right to prompt delivery
of the can of film at the Phil.
Air Port stems and is derived
from the contract of carriage
under which contract, the PAL
undertook to carry the can of
film safely and to deliver it to
him promptly. Take away or
ignore that contract and the
obligation to carry and to
deliver and right to prompt
delivery disappear. Common
carriers are not obligated by
law to carry and to deliver
merchandise, and persons are
not vested with the right to
prompt delivery, unless such
common carriers previously
assume the obligation. Said
rights and obligations are
created by a specific contract
entered into by the parties. In
the present case, the findings
of the trial court which as
already stated, are accepted
by the parties and which we
must accept are to the effect
that the LVN Pictures Inc. and
Jose Mendoza on one side,
and the defendant company
on the other, entered into a
contract of transportation (p.
29, Rec. on Appeal). One
interpretation of said finding is
that the LVN Pictures Inc.
through previous agreement
with Mendoza acted as the
latter's agent. When he
negotiated with the LVN
Pictures Inc. to rent the film
"Himala ng Birhen" and show it
during the Naga town fiesta,
he most probably authorized
and enjoined the Picture
Company to ship the film for
him on the PAL on September
17th. Another interpretation is
that even if the LVN Pictures
Inc. as consignor of its own
initiative, and acting
independently of Mendoza for
the time being, made Mendoza
as consignee, a stranger to the
14
contract if that is possible,
nevertheless when he,
Mendoza appeared at the Phil
Air Port armed with the copy of
the Air Way Bill (Exh. 1)
demanding the delivery of the
shipment to him, he thereby
made himself a party to the
contract of transportation. The
very citation made by
appellant in his memorandum
supports this view. Speaking
of the possibility of a conflict
between the order of the
shipper on the one hand and
the order of the consignee on
the other, as when the shipper
orders the shipping company
to return or retain the goods
shipped while the consignee
demands their delivery,
Malagarriga in his book
Codigo de Comercio
Comentado, Vol. 1, p. 400,
citing a decision of the
Argentina Court of Appeals on
commercial matters, cited by
Tolentino in Vol. II of his book
entitled "Commentaries and
Jurisprudence on the
Commercial Laws of the
Philippines" p. 209, says that
the right of the shipper to
countermand the shipment
terminates when the
consignee or legitimate holder
of the bill of lading appears
with such big of lading before
the carrier and makes himself
a party to the contract. Prior to
that time he is a stranger to
the contract.
Still another view of this phase
of the case is that
contemplated in Art. 1257,
paragraph 2, of the old Civil
Code (now Art, 1311, second
paragraph) which reads thus:
Should the contract contain
any stipulation in favor of a
third person, he may demand
its fulfillment provided he has
given notice of his acceptance
to the person bound before the
stipulation has been revoked.
Here, the contract of carriage
between the LVN Pictures Inc.
and the defendant carrier
contains the stipulations of
delivery to Mendoza as
consignee. His demand for the
delivery of the can of film to
him at the Phil Air Port may be
regarded as a notice of his
acceptance of the stipulation
of the delivery in his favor
contained in the contract of
carriage and delivery. In this
case he also made himself a
party to the contract, or at
least has come to court to
enforce it. His cause of action
must necessarily be founded
on its breach.
Since the liability of a common
carrier for loss of or damage to
15
goods transported by it under
a contract of carriage is
governed by the laws of the
country of destination 12 and
the goods in question were
shipped from the United States
to the Philippines, the liability
of petitioner Sea-Land to the
respondent consignee is
governed primarily by the Civil
Code, and as ordained by the
said Code, suppletorily, in all
matters not determined
thereby, by the Code of
Commerce and special laws.
13 One of these suppletory
special laws is the Carriage of
Goods by Sea Act, U.S. Public
Act No. 521 which was made
applicable to all contracts for
the carriage of goods by sea to
and from Philippine ports in
foreign trade by
Commonwealth Act No. 65,
approved on October 22,
1936. Sec. 4(5) of said Act in
part reads:
(5) Neither the carrier nor the
ship shall in any event be or
become liable for any loss or
damage to or in connection
with the transportation of
goods in an amount exceeding
$500 per package lawful
money of the United States, or
in case of goods not shipped
in packages, per customary
freight unit, or the equivalent of
that sum in other currency,
unless the nature and value of
such goods have been
declared by the shipper before
shipment and inserted in the
bill of lading. This declaration,
if embodied in the bill of lading,
shall be prima facie evidence,
but shall not be conclusive on
the carrier.
By agreement between the
carrier, master, or agent of the
carrier, and the shipper
another maximum amount
than that mentioned in this
paragraph may be fixed:
Provided, That such maximum
shall not be less than the
figure above named. In no
event shall the carrier be liable
for more than the amount of
damage actually sustained.
xxx xxx xxx
Clause 22, first paragraph, of
the long form bill of lading
customarily issued by Sea-
Land to its shipping clients 14
is a virtual copy of the first
paragraph of the foregoing
provision. It says:
22. VALUATION. In the event
of any loss, damage or delay
to or in connection with goods
exceeding in actual value $500
per package, lawful money of
the United States, or in case of
goods not shipped in
16
packages, per customary
freight unit, the value of the
goods shall be deemed to be
$500 per package or per
customary freight unit, as the
case may be, and the carrier's
liability, if any, shall be
determined on the basis of a
value of $500 per package or
customary freight unit, unless
the nature and a higher value
shall be declared by the
shipper in writing before
shipment and inserted in this
Bill of Lading.
And in its second paragraph,
the bill states:
If a value higher than $500
shag have been declared in
writing by the shipper upon
delivery to the carrier and
inserted in this bill of lading
and extra freight paid, if
required and in such case if
the actual value of the goods
per package or per customary
freight unit shall exceed such
declared value, the value shall
nevertheless be deemed to be
declared value and the
carrier's liability, if any, shall
not exceed the declared value
and any partial loss or damage
shall be adjusted pro rata on
the basis of such declared
value.
Since, as already pointed out,
Article 1766 of the Civil Code
expressly subjects the rights
and obligations of common
carriers to the provisions of the
Code of Commerce and of
special laws in matters not
regulated by said (Civil) Code,
the Court fails to fathom the
reason or justification for the
Appellate Court's
pronouncement in its appealed
Decision that the Carriage of
Goods by Sea Act " ... has no
application whatsoever in this
case. 15 Not only is there
nothing in the Civil Code which
absolutely prohibits
agreements between shipper
and carrier limiting the latter's
liability for loss of or damage
to cargo shipped under
contracts of carriage; it is also
quite clear that said Code in
fact has agreements of such
character in contemplation in
providing, in its Articles 1749
and 1750, that:
ART. 1749 A stipulation that
the common carrier's liability is
limited to the value of the
goods appearing in the bill of
lading, unless the shipper or
owner declares a greater
value, is binding.
ART. 1750. A contract fixing
the sum that may be
recovered by the owner or
shipper for the loss,
17
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.
Nothing contained in section
4(5) of the Carriage of Goods
by Sea Act already quoted is
repugnant to or inconsistent
with any of the just-cited
provisions of the Civil Code.
Said section merely gives
more flesh and greater
specificity to the rather general
terms of Article 1749 (without
doing any violence to the plain
intent thereof) and of Article
1750, to give effect to just
agreements limiting carriers'
liability for loss or damage
which are freely and fairly
entered into.
It seems clear that even if said
section 4(5) of the Carriage of
Goods by Sea Act did not
exist, the validity and binding
effect of the liability limitation
clause in the bill of lading here
are nevertheless fully
sustainable on the basis alone
of the cited Civil Code
provisions. That said
stipulation is just and
reasonable is arguable from
the fact that it echoes Art.
1750 itself in providing a limit
to liability only if a greater
value is not declared for the
shipment in the bill of lading.
To hold otherwise would
amount to questioning the
justice and fairness of that law
itself, and this the private
respondent does not pretend
to do. But over and above that
consideration, the lust and
reasonable character of such
stipulation is implicit in it giving
the shipper or owner the
option of avoiding acrrual of
liability limitation by the simple
and surely far from onerous
expedient of declaring the
nature and value of the
shipment in the bill of lading.
And since the shipper here
has not been heard to
complaint of having been
"rushed," imposed upon or
deceived in any significant way
into agreeing to ship the cargo
under a bill of lading carrying
such a stipulation — in fact, it
does not appear that said
party has been heard from at
all insofar as this dispute is
concerned — there is simply
no ground for assuming that its
agreement thereto was not as
the law would require, freely
and fairly sought and given.
The private respondent had no
direct part or intervention in
the execution of the contract of
carriage between the shipper
and the carrier as set forth in
18
the bill of lading in question.
As pointed out in Mendoza vs.
PAL, supra, the right of a party
in the same situation as
respondent here, to recover for
loss of a shipment consigned
to him under a bill of lading
drawn up only by and between
the shipper and the carrier,
springs from either a relation
of agency that may exist
between him and the shipper
or consignor, or his status as a
stranger in whose favor some
stipulation is made in said
contract, and who becomes a
party thereto when he
demands fulfillment of that
stipulation, in this case the
delivery of the goods or cargo
shipped. In neither capacity
can he assert personally, in
bar to any provision of the bill
of lading, the alleged
circumstance that fair and free
agreement to such provision
was vitiated by its being in
such fine print as to be hardly
readable. Parenthetically, it
may be observed that in one
comparatively recent case 16
where this Court found that a
similar package limitation
clause was "(printed in the
smallest type on the back of
the bill of lading, it nonetheless
ruled that the consignee was
bound thereby on the strength
of authority holding that such
provisions on liability limitation
are as much a part of a bill of
lading as though physically in
it and as though placed therein
by agreement of the parties.
There can, therefore, be no
doubt or equivocation about
the validity and enforceability
of freely-agreed-upon
stipulations in a contract of
carriage or bill of lading limiting
the liability of the carrier to an
agreed valuation unless the
shipper declares a higher
value and inserts it into said
contract or bill. This pro
position, moreover, rests upon
an almost uniform weight of
authority. 17
The issue of alleged deviation
is also settled by Clause 13 of
the bill of lading which
expressly authorizes trans-
shipment of the goods at any
point in the voyage in these
terms:
13. THROUGH CARGO AND
TRANSSHIPMENT. The
carrier or master, in the
exercise of its or his discretion
and although transshipment or
forwarding of the goods may
not have been contemplated
or provided for herein, may at
port of discharge or any other
place whatsoever transship or
forward the goods or any part
19
thereof by any means at the
risk and expense of the goods
and at any time, whether
before or after loading on the
ship named herein and by any
route, whether within or
outside the scope of the
voyage or beyond the port of
discharge or destination of the
goods and without notice to
the shipper or consignee. The
carrier or master may delay
such transshipping or
forwarding for any reason,
including but not limited to
awaiting a vessel or other
means of transportation
whether by the carrier or
others.
Said provision obviates the
necessity to offer any other
justification for offloading the
shipment in question in Manila
for transshipment to Cebu
City, the port of destination
stipulated in the bill of lading.
Nonetheless, the Court takes
note of Sea-Land's
explanation that it only directly
serves the Port of Manila from
abroad in the usual course of
voyage of its carriers, hence
its maintenance of
arrangements with a local
forwarder. Aboitiz and
Company, for delivery of its
imported cargo to the agreed
final point of destination within
the Philippines, such
arrangements not being
prohibited, but in fact
recognized, by law. 18
Furthermore, this Court has
also ruled 19 that the Carriage
of Goods by Sea Act is
applicable up to the final port
of destination and that the fact
that transshipment was made
on an interisland vessel did not
remove the contract of
carriage of goods from the
operation of said Act.
Private respondent also
contends that the aforecited
Clauses 22 and 13 of the bill of
lading relied upon by petitioner
Sea Land form no part of the
short-form bill of lading
attached to his complaint
before the Trial Court and
appear only in the long form of
that document which, he
claims. SeaLand offered (as its
Exhibit 2) as an unused blank
form with no entries or
signatures therein. He,
however, admitted in the Trial
Court that several times in the
past shipments had been
delivered to him through Sea-
Land,
20
from which the
assumption may fairly follow
that by the time of the
consignment now in question,
he was already reasonably
20
apprised of the usual terms
covering contracts of carriage
with said petitioner.
At any rate, as observed
earlier, it has already been
held that the provisions of the
Carriage of Goods by Sea Act
on package limitation [sec 4(5)
of the Act hereinabove
referred to] are as much a part
of a bill of lading as though
actually placed therein by
agreement of the parties.
21

Private respondent, by making
claim for loss on the basis of
the bill of lading, to all intents
and purposes accepted said
bill. Having done so, he —
... becomes bound by all
stipulations contained therein
whether on the front or the back
thereof. Respondent cannot
elude its provisions simply
because they prejudice him and
take advantage of those that are
beneficial. Secondly, the fact that
respondent shipped his goods on
board the ship of petitioner and
paid the corresponding freight
thereon shows that he impliedly
accepted the bill of lading which
was issued in connection with
the shipment in question, and so
it may be said that the same is
finding upon him as if it had been
actually signed by him or by any
other person in his behalf. ...
22
.
There is one final
consideration. The private
respondent admits
23
that as
early as on April 22, 1981,
Sea-Land had offered to settle
his claim for US$4,000.00, the
limit of said carrier's liability for
loss of the shipment under the
bill of lading. This Court having
reached the conclusion that
said sum is all that is justly due
said respondent, it does not
appear just or equitable that
Sea-Land, which offered that
amount in good faith as early
as six years ago, should, by
being made to pay at the
current conversion rate of the
dollar to the peso, bear for its
own account all of the increase
in said rate since the time of
the offer of settlement. The
decision of the Regional Trial
Court awarding the private
respondent P186,048.00 as
the peso value of the lost
shipment is clearly based on a
conversion rate of P8.00 to
US$1.00, said respondent
having claimed a dollar value
of $23,256.00 for said
shipment.
24
All circumstances
considered, it is just and fair
that Sea-Land's dollar
obligation be convertible at the
same rate.
WHEREFORE, the Decision of
the Intermediate Appellate
21
Court complained of is
reversed and set aside. The
stipulation in the questioned
bill of lading limiting Sea-
Land's liability for loss of or
damage to the shipment
covered by said bill to
US$500.00 per package is
held valid and binding on
private respondent. There
being no question of the fact
that said shipment consisted of
eight (8) cartons or packages,
for the loss of which Sea-Land
is therefore liable in the
aggregate amount of
US$4,000.00, it is the
judgment of the Court that said
petitioner discharge that
obligation by paying private
respondent the sum of
P32,000.00, the equivalent in
Philippine currency of
US$4,000.00 at the conversion
rate of P8.00 to $1.00. Costs
against private respondent.
SO ORDERED.