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Asia Lighterage Shipping Inc vs CA

Facts: Wheat in bulk, was shipped by Marubeni American Corporation of Portland, Oregon on
board the vessel M/V NEO for delivery to the consignee, General Milling Corporation in Manila.
The shipment was insured by the private respondent Prudential Guarantee and Assurance, Inc.
against loss or damage. The carrying vessel arrived in Manila and the cargo was transferred to
the custody of the petitioner Asia Lighterage and Shipping, Inc. The petitioner was contracted by
the consignee as carrier to deliver the cargo to consignee's warehouse. On, 900 metric tons of the
shipment was loaded on barge PSTSI III for delivery to consignee. The cargo did not reach its

It appears that the transport of said cargo was suspended due to a warning of an incoming
typhoon. The petitioner proceeded to pull the barge to Engineering Island off Baseco to seek
shelter from the approaching typhoon. A few days after, the barge developed a list because of a
hole it sustained after hitting an unseen protuberance underneath the water. The barge was then
towed to ISLOFF terminal before it finally headed towards the consignee's wharf. Upon reaching
the Sta. Mesa spillways, the barge again ran aground due to strong current. To avoid the
complete sinking of the barge, a portion of the goods was transferred to three other barges.

The next day, the towing bits of the barge broke. It sank completely, resulting in the total loss of
the remaining cargo. Private respondent indemnified the consignee.15Thereafter, as subrogee, it
sought recovery of said amount from the petitioner, but to no avail.

The private respondent filed a complaint against the petitioner for recovery of the amount of
indemnity, attorney's fees and cost of suit.

The Regional Trial Court ruled in favor of the private respondent.

Petitioner appealed to the Court of Appeals insisting that it is not a common carrier.

Issue: Whether the petitioner is a common carrier

Held: Common Carrier. Petitioner is a common carrier whether its carrying of goods is done on
an irregular rather than scheduled manner, and with an only limited clientele. A common carrier
need not have fixed and publicly known routes. Neither does it have to maintain terminals or
issue tickets. To be sure, petitioner fits the test of a common carrier as laid down in Bascos vs.
Court of Appeals. The test to determine a common carrier is "whether the given undertaking is a
part of the business engaged in by the carrier which he has held out to the general public as his
occupation rather than the quantity or extent of the business transacted." In the case at bar, the
petitioner admitted that it is engaged in the business of shipping and lighterage, offering its
barges to the public, despite its limited clientele for carrying or transporting goods by water for
Home Assurance Co. v. American Steamship Agencies, Inc.

G.R. No. L-25599, 4 April 1968, 23 SCRA 24


“Consorcio Pesquero del Peru of South America” shipped freight pre-paid at Peru, jute bags of
Peruvian fish meal through SS Crowborough, covered by clean bills of lading. The cargo,
consigned to San Miguel Corporation, and insured by Home Insurance Company arrived in
Manila and was discharged into the lighters of Luzon Stevedoring Company. When the cargo
was delivered to consignee San Miguel Brewery Inc., there were shortages amounting to
P12,033.85, causing the latter to lay claims against Luzon Stevedoring Corporation, Home
Insurance Company and the American Steamship Agencies (shipowner), owner and operator of
SS Crowborough.

Because the others denied liability, Home Insurance Company paid SMBI the insurance value of
the loss. Having been refused reimbursement, Home Insurance Company, as subrogee to the
consignee, filed against them before the CFI of Manila a complaint for recovery of the payment
paid . In its answer, Luzon Stevedoring Corporation alleged that it delivered with due diligence
the goods.The CFI, after trial, absolved Luzon Stevedoring Corporation, and ordered American
Steamship Agencies to pay Home Insurance Company the amount demanded with legal interest
plus attorney’s fees.
Section 2, paragraph 2 of the charter party, provides that the owner is liable for loss or damage to
the goods caused by personal want of due diligence on its part or its manager to make the vessel
in all respects seaworthy and to secure that she be properly manned, equipped and supplied or by
the personal act or default of the owner or its manager. Said paragraph, however, exempts the
owner of the vessel from any loss or damage or delay arising from any other source, even from
the neglect or fault of the captain or crew or some other person employed by the owner on board,
for whose acts the owner would ordinarily be liable except for said paragraph.

ISSUE: WON the stipulation in the charter party of the owner’s non-liability is valid so as to
absolve the American Steamship Agencies from liability for loss

HELD: Yes. A common carrier undertaking to carry a special cargo or chartered to a special
person only, becomes a private carrier. As a private carrier, a stipulation exempting the owner
from liability for the negligence of its agent is not against public policy, and is deemed valid.


GR No. 141910, 2002-08-06
G.P. Sarmiento Trucking Corporation (GPS) undertook to deliver thirty units of Condura white
refrigerators aboard one of its Isuzu truck, driven by Lambert Eroles, from the plant site of
Concepcion Industries, Inc., to the Central Luzon Appliances in Dagupan City. While the truck
was traversing the north diversion road along McArthur highway, it collided with an unidentified
truck, causing it to fall into a deep canal, resulting in damage to the cargoes.
FGU Insurance Corporation (FGU), an insurer of the shipment, paid to Concepcion Industries,
Inc., the value of the covered cargoes. FGU, in turn, being the subrogee of the rights and interests
of Concepcion Industries, Inc., sought reimbursement of the amount it had paid to the latter from
GPS. Since the trucking company failed to heed the claim, FGU filed a complaint for damages
and breach of contract of carriage against GPS and its driver Lambert Eroles with the Regional
Trial Court, which dismissed the case on the basis that GPS is not a common carrier . Thus, the
laws governing the contract between the owner of the cargo to whom the plaintiff was
subrogated and the owner of the vehicle which transports the cargo are the laws on obligation
and contract of the Civil Code as well as the law on quasi delicts.
"Thus, the laws governing the contract between the owner of the cargo to whom the plaintiff was
subrogated and the owner of the vehicle which transports the cargo are the laws on obligation
and contract of the Civil Code as well as the law on quasi delicts.
"Considering that plaintiff failed to adduce evidence that defendant is a common carrier and
defendant's driver was the one negligent, defendant cannot be made liable for the damages of the
subject cargoes."
Defendant GPS is not a common Carrie. GPS, being an exclusive contractor and hauler of
Concepcion Industries, Inc., rendering or offering its services to no other individual or entity,
cannot be considered a common carrier. Common carriers are persons, corporations, firms or
associations engaged in the business of carrying or transporting passengers or goods or both, by
land, water, or air, for hire or compensation, offering their services to the public whether to the
public in general or to a limited clientele in particular, but never on an exclusive basis. The true
test of a common carrier is the carriage of passengers or goods, providing space for those who
opt to avail themselves of its transportation service for a fee. Given accepted standards, GPS
scarcely falls within the term common carrier.
The above conclusion nothwithstanding, GPS cannot escape from liability.


Facts: Davao Union Marketing Corporation (DUMC) contracted the services of respondent PKS
Shipping Company (PKS Shipping) for the shipment to Tacloban City of seventy-five thousand
bags of cement worth. DUMC insured the goods for its full value with petitioner Philippine
American General Insurance Company (Philamgen). The goods were loaded aboard the dumb
barge Limar I belonging to PKS Shipping. While Limar I was being towed by respondent’s
tugboat, MT Iron Eagle, the barge sank, bringing down with it the entire cargo of 75,000 bags of

DUMC filed a formal claim with Philamgen for the full amount of the insurance. Philamgen
promptly made payment; it then sought reimbursement from PKS Shipping of the sum paid to
DUMC but the shipping company refused to pay, prompting Philamgen to file suit against PKS.

The RTC dismissed the complaint after finding that the total loss of the cargo could have been
caused either by a fortuitous event, in which case the ship owner was not liable.

Philamgen interposed an appeal to the Court of Appeals which affirmed in toto the decision of
the trial court. The appellate court ruled that evidence to establish that PKS Shipping was a
common carrier at the time it undertook to transport the bags of cement was wanting because the
peculiar method of the shipping company’s carrying goods for others was not generally held out
as a business but as a casual occupation


Whether PKS Shipping is a common carrier or a private carrier; and


PKS Shipping is a common carrier.

PKS Shipping has engaged itself in the business of carrying goods for others, although
for a limited clientele, undertaking to carry such goods for a fee. The regularity of its activities in
this area indicates more than just a casual activity on its part. Neither can the concept of a
common carrier change merely because individual contracts are executed or entered into with
patrons of the carrier.

PKS Shipping is not liable such, under Art. 1733, NCC, common carriers are exempt from
liability for loss, destruction, or deterioration of the goods due to any of the following causes,
among others:

Flood, storm, earthquake, lightning, or other natural disaster or calamity