1. Perena vs.

Nicolas Aug 29, 2012;

Doctrine: The operator of a school bus service is a common carrier in the eyes of the law. He is bound to observe extraordinary diligence
in the conduct of his business. He is presumed to be negligent when death occurs to a passenger. His liability may include indemnity for
loss of earning capacity even if the deceased passenger may only be an unemployed high school student at the time of the accident.

Facts: Spouses Perenas were engaged in the business of transporting students from their respective residences in Paranaque to Don
Bosco, Makati; and back. They used a KIA Ceres Van (PYA 896), with a capacity of 14 students at a time; 2 in front, and 12 in the rear
equally balanced on either side. They employed Alfaro as driver.

Spouses Zarate contracted with the Perenas to transport Aaron, an unemployed high school student in Don Bosco. Aaron sat on the left
side of the van near the rear door. To avoid being late to school, Alfaro traversed the narrow part underneath Magallanes Interchange,
which were marked by piles of construction materials and parked passenger jeepneys, and the railroad crossing had no railroad warning
signs, watchmen, or other responsible persons manning the crossing. The bamboo barandilla was up, leaving the railroad crossing open
to traversing motorists. Alfaro, and another passenger bus, traversed the railroad crossing while PNR Commuter No. 302 (train), operated
by Alano, was travelling northbound. The train blew its horn to warn motorists of its approach. Alano even applied emergency brakes
when he saw that a collision was imminent.

Fortunately, the passenger bus successfully crossed the railroad tracks. However, the train hit the rear end of the van, causing 9 of the 12
students in the rear to be thrown out of the van. Aaron’s head was severed. Alano fled the scene, and did not wait for the police
investigator to arrive.

Spouses Zarate commenced an action for damages against Alfaro, Spouses Perenas, PNR and Alano.

Perenas claimed that they exercised the diligence of a good father of the family in the selection and supervision of Alfaro, by making sure
that he has a driver’s license and that he had not been involved in any vehicular accident prior to the collision; that their own son had
taken the van daily; and that Teodoro Perena had sometimes accompanied Alfaro in the van’s trips.

PNR claimed that the proximate cause of the collision was the reckless crossing of the van; and that the narrow path had not been
intended to be a crossing for motorists.
The Court ruled in favor of the plaintiff and against the defendants ordering them to jointly and severally pay the plaintiff. In RTC,
Perenas’ motion for reconsideration was denied, reiterating that the cooperative gross negligence of the Perenas and PNR had caused the
collision, and that the damages were not excessive. CA affirmed the decision of the RTC. Hence, this review on certiorari.

Issue:

W/N Perenas and PNR are jointly and severally liable for damages.

W/N the indemnity for loss of Aaron’s earning capacity was proper.

W/N the amounts of damages were excessive.

Ratio: Yes, they are joint tortfeasors. Perenas operated as a common carrier; and that their standard of care was extraordinary diligence,
not the ordinary diligence of a good father of a family. Although the operator of a school bus service has been usually regarded as a private
carrier, the true test for a common carrier is not the quantity or extent of the business actually transacted, or the number and character of
the conveyances used in the activity, but whether the undertaking is a part of the activity engaged in by the carrier that he has held out to
the general public as his business or occupation. There is no question that the Perenñ as as the operators of a school bus service were: (a)
engaged in transporting passengers generally as a business, not just as a casual occupation; (b) undertaking to carry passengers over
established roads by the method by which the business was conducted; and (c) transporting students for a fee. Despite catering to a
limited clienteè le, the Perenñ as operated as a common carrier because they held themselves out as a ready transportation indiscriminately
to the students of a particular school living within or near where they operated the service and for a fee. Article 1755 of the Civil Code
specifies that the common carrier should "carry the passengers safely as far as human care and foresight can provide, using the utmost
diligence of very cautious persons, with a due regard for all the circumstances." To successfully fend off liability in an action upon the
death or injury to a passenger, the common carrier must prove his or its observance of that extraordinary diligence; otherwise, the legal
presumption that he or it was at fault or acted negligently would stand. Moreover, the fact of death of one of their passenger gives rise to
the presumption of negligence, which they failed to overturn. The Perenas were liable for the death of Aaron despite the fact that their
driver might have acted beyond the scope of his authority or even in violation of the orders of the common carrier for crossing a shortcut
that he knew was risky to his passengers. The loudness of Alfaro’s music may have also reduced his ability to hear the warning horns of
PNR. The omission of care on the part of Alfaro was negligence. PNR is also guilty of negligence because the railroad tracks traversed was
not dedicated by the PNR as a railroad crossing for pedestrians and motorists, and that the PNR did not ensure the safety of others
through the placing of warning signs, and the like.

Yes, the award was proper. While only a high school student, had been enrolled in one of the reputable schools in the Philippines and that
he had been a normal and able-bodied child prior to his death. The basis for the computation of Aaron’s earning capacity was the
minimum wage in effect at the time of his death. Moreover, the RTC’s computation of Aaron’s life expectancy rate was not reckoned from
his age of 15 years at the time of his death, but on 21 years, his age when he would have graduated from college. It is not speculative and
unfounded because the courts premised on Aaron being a lowly minimum wage earner, and not a professional, despite his being then
enrolled at a prestigious school. Our law itself states that the loss of the earning capacity of the deceased shall be the liability of the guilty
party in favor of the heirs of the deceased and shall in every case be assessed and awarded by the court "unless the deceased on account
of permanent physical disability not caused by the defendant, had no earning capacity at the time of his death.”
No. Moral damages were reasonable because of deep mental anguish over their son’s unexpected and violent death.
Exemplary damages were also reasonable since as a common carrier, the Perenñ as needed to be vigorously reminded to observe their
duty to exercise extraordinary diligence to prevent a similarly senseless accident from happening again.

2. HEIRS OF OCHOA vs G&S TRANSPORT CORP.

FACTS: JOSE MARCIAL OCHOA rode a taxicab owned by G&S from MANILA DOMESTIC AIRPORT on his way home in TEACHER’s
VILLAGE, QC. The taxi was cruising at high speed along EDSA going up the fly over in BONI when the taxi driver tried to overtake a 10-
wheeler truck. To avoid colliding with the truck, Padilla turned the wheel to the left causing his taxicab to ram the railing throwing itself
off the fly-over and fell on the middle surface of EDSA below. The forceful drop of the vehicle on the floor of the road broke and split it into
two parts. OCHOA died and the taxi driver survived.

The heirs demanded 15,000,000.00 from G&S for indemnification but the same was unheeded. So they filed a case for breach of contract
of carriage. The heirs alleged that G & S, as a common carrier, is under legal obligation to observe and exercise extraordinary diligence in
transporting its passengers to their destination safely and securely. As an alternative cause of action, they asserted that G & S is likewise
liable for damages based on quasi-delict. The heirs thus prayed for G & S to pay them actual damages, moral damages, exemplary
damages, and attorney’s fees and expenses of litigation.

In their answer with compulsory counterclaim, G&S averred that the cause of the accident was a fortuitous event. Allegedly, a van hit the
rear of the taxi which caused it to ram the railings of the fly-over and fall.

The RTC ruled in favor of the HEIRS. RTC granted ₱50,000.00 as civil indemnity for the death of deceased, ₱6,537,244.96 for the loss of
earning capacity of the deceased, ₱100,00.00 for attorney’s fees, and the cost of litigation. By way of MR, the RTC modified its ruling by
adding ₱300,000.00 as moral damages.

G&S appealed. G&S insisted on their theory that the accident happened due to a fortuitous event. The heirs rebut was that in order for a
fortuitous event to exempt one from liability, it is necessary that he has committed no negligence or conduct that may have occasioned
the loss. Thus, to be exempt from liability for the death on this ground, G & S must clearly show that the proximate cause of the casualty
was entirely independent of human will and that it was impossible to avoid. And since in the case at bar it was the driver’s inexcusable
poor judgment, utter lack of foresight and extreme negligence which were the immediate and proximate causes of the accident, same
cannot be considered to be due to a fortuitous event. This is bolstered by the fact that the court trying the case for criminal negligence
arising from the same incident convicted Padilla for said charge.

However, the CA ruled with respect to the award of

₱6,537,244.96 for Jose Marcial’s loss of earning capacity, the CA declared the same unwarranted. The CA noted that same is unsupported
by competent evidence such as income tax returns or receipts. Hence, the item was removed.

BOTH G&S and HEIRS appealed the case to the SC. G&S’ petition was dismissed for lack of merit. Questions of facts issue.

ISSUE: WON there was a contract of carriage between the victim and G&S.

HELD: There is a contract of carriage between G & S and Jose Marcial

What is clear from the records is that there existed a contract of carriage between G & S, as the owner and operator of the Avis taxicab,
and Jose Marcial, as the passenger of said vehicle. As a common carrier, G & S "is bound to carry [Jose Marcial] 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.

However, Jose Marcial was not able to reach his destination safely as he died during the course of the travel. "In a contract of carriage, it is
presumed that the common carrier is at fault or is negligent when a passenger dies or is injured. In fact, there is even no need for the
court to make an express finding of fault or negligence on the part of the common carrier. This statutory presumption may only be
overcome by evidence that the carrier exercised extraordinary diligence."

Unfortunately, G & S miserably failed to overcome this presumption. Both the trial court and the CA found that the accident which led to
Jose Marcial’s death was due to the reckless driving and gross negligence of G & S’ driver, Padilla, thereby holding G & S liable to the heirs
of Jose Marcial for breach of contract of carriage.

The denial by the CA of the heirs’ claim for lost earnings is unwarranted. Clearly, the CA erred in deleting the award for lost income on the
ground that the USAID Certification supporting such claim is self-serving and unreliable. On the contrary, we find said certification
sufficient basis for the court to make a fair and reasonable estimate of Jose Marcial’s loss of earning capacity just like in Tamayo v. Senñ
ora52where we based the victim’s gross annual income on his pay slip from the Philippine National Police. Hence, we uphold the trial
court’s award for Jose Marcial’s loss of earning capacity.

3. MOF Company, Inc. vs. Shin Yang Brokerage Corporation G.R. No. 172822, December 18, 2009
Facts: On October 25, 2001, Halla Trading Co., a company based in Korea, shipped to Manila second hand cars and other articles on board
the vessel Hanjin Busan (Hanjin). The bill of lading covering the shipment prepared by the carrier Hanjin Shipping Co., Ltd. (Hanjin),
named respondent Shin Yang Brokerage Corp. (Shin Yang) as the consignee and indicated that payment was on a Freight Collect basis, i.e.,
that the consignee/receiver of the goods would be the one to pay for the freight and other charges in the total amount of P57,646.00.
The shipment arrived in Manila on October 29, 2001. Thereafter, petitioner MOF Company, Inc. (MOF), Hanjins exclusive general agent in
the Philippines, repeatedly demanded the payment of freight and other charges from Shin Yang. The latter, however, failed and refused to
pay contending that it did not cause the importation of the goods, that it is only the Consolidator of the said shipment, that the ultimate
consignee did not endorse in its favor the original bill of lading and that the bill of lading was prepared without its consent.
Thus, on March 19, 2003, MOF filed a case for sum of money before the MeTC Pasay. The MeTC ruled in favor of the plaintiff by relying on
the previous business transactions between the plaintiff and defendant. The RTC affirmed the MeTC. The CA however reversed the ruling
of the RTC contending that aside from the bill of lading, respondent has not presented any other evidence to bolster its claim that
petitioner has entered into an agreement of affreightment with respondent, be it verbal or written. It further stated that the Bill of Lading
was prepared by Hanjin Shipping, not the petitioner.

Issue: Whether or not a consignee, who is not a signatory to the bill of lading, is bound by the stipulations thereof.

Held: The bill of lading is oftentimes drawn up by the shipper/consignor and the carrier without the intervention of the consignee.
However, a consignee, although not a signatory to the contract of carriage between the shipper and the carrier, becomes a party to the
contract by reason of either a) the relationship of agency between the consignee and the shipper/ consignor; b) the unequivocal
acceptance of the bill of lading delivered to the consignee, with full knowledge of its contents or c) availment of the stipulation pour
autrui, i.e., when the consignee, a third person, demands before the carrier the fulfillment of the stipulation made by the
consignor/shipper in the consignees favor, specifically the delivery of the goods/cargoes shipped.

In the instant case, Shin Yang consistently denied in all of its pleadings that it authorized Halla Trading, Co. to ship the goods on its behalf;
or that it got hold of the bill of lading covering the shipment or that it demanded the release of the cargo. Thus, MOF has the burden to
controvert all these denials, it being insistent that Shin Yang asserted itself as the consignee and the one that caused the shipment of the
goods to the Philippines.

4. Cruz vs. Sun Holidays, June 29, 2010;

Doctrine: Neither does Article 1732 distinguish between a carrier offering its services to the general public, i.e., the general community
or population, and one who offers services or solicits business only from a narrow segment of the general population. Indeed, respondent
is a common carrier. Its ferry services are so intertwined with its main business as to be properly considered ancillary thereto.

Facts: Spouses Cruz filed a Complaint against Sun Holidays, Inc. with the RTC for damages arising from the death of their son Ruelito and
his wife on board the boat M/B Coco Beach III that capsized en route to Batangas from Puerto Galera, Oriental Mindoro where the couple
had stayed at Coco Beach Island Resort owned and operated by respondent. The stay at the Resort was by virtue of a tour package-
contract with respondent that included transportation to and from the Resort and the point of departure in Batangas.
Matute, a scuba diving instructor, testified that it was windy when Ruelito and his wife trekked to the other side of the Resort mountain,
where they boarded the boat. Shortly after, it began rain, hence, the boat capsized.

At the time of his death, Ruelito was 28 years old and employed as a contractual worker for Mitsui Engineering & Shipbuilding Arabia,
Ltd. in Saudi Arabia, with a basic monthly salary of
$900.

Sun Holidays denied responsibility raising the defense of fortuitous event. Sun Holidays denied being a common carrier, alleging that its
boats are not available to the general public as they only ferry Resort guests and crew members. Nonetheless, it claimed that it exercised
the utmost diligence in ensuring the safety of its passengers, where the Coast Guard cleared the voyage and that there was no storm.
There was also sufficient life jackets and the boat was not filled to capacity. Carlos Bonquin, the captain, averred that they met the four
conditions, to wit: 1) the sea is calm, 2) there is clearance from the Coast Guard, 3) there is clearance from the captain, and 4) there is
clearance from the Resorts assistant manager.

RTC and CA affirmed that the respondent is a private carrier which is only required to observe ordinary diligence, and that the proximate
cause of the incident was a fortuitous event.

Petitioners maintain that the respondent is a common carrier since by its tour package, the transporting of its guests is an integral part of
its resort business.

Issue: W/N Sun Holidays is a common carrier.

Ratio: Yes. Sun Holidays is a common carrier as defined under Article 1732. The above article makes no distinction between one whose
principal business activity is the carrying of persons or goods or both, and one who does such carrying only as an ancillary activity (in
local idiom, as a sideline). Article 1732 also carefully avoids making any distinction between a person or enterprise offering
transportation service on a regular or scheduled basis and one offering such service on an occasional, episodic or unscheduled basis.
Neither does Article 1732 distinguish between a carrier offering its services to the general public, i.e., the general community or
population, and one who offers services or solicits business only from a narrow segment of the general population. Indeed, respondent is
a common carrier. Its ferry services are so intertwined with its main business as to be properly considered ancillary thereto. The Court is
aware of the practice of beach resort operators offering tour packages to factor the transportation fee in arriving at the tour package
price. That guests who opt not to avail of respondents ferry services pay the same amount is likewise inconsequential. These guests may
only be deemed to have overpaid. A very cautious person exercising the utmost diligence would thus not brave such stormy weather and
put other peoples lives at risk. The extraordinary diligence required of common carriers demands that they take care of the goods or lives
entrusted to their hands as if they were their own. This respondent failed to do. To fully free a common carrier from any liability, the
fortuitous event must have been the proximate and only cause of the loss. And it should have exercised due diligence to prevent or
minimize the loss before, during and after the occurrence of the fortuitous event.
 5. Villanueva vs Domingo, Sept 20, 2004;
Petitioner: Nostradamus Villanueva- registered owner of a green Mitsubishi Lancer

Actual owner of green Lancer: Albert Jaucian- business buy and sell under the name Auto Palace Car Exchange

Respondent: Priscilla Domingo- registered owner of a silver Mitsubishi Lancer Car model 1980

Co-respondent: Leandro Domingo- authorized driver of Priscilla

FACTS: On 22 October 1991 at about 9:45 in the evening, following a green traffic light, respondent Priscilla’s car then driven by co-
respondent, Leandro, was cruising along the middle lane of South Superhighway at moderate speed from north to south. Suddenly, a
petitioner’s car driven by Renato Ocfemia darted from Vito Cruz Street towards the South Superhighway directly into the path of
respondent’s car, thereby hitting and bumping its left front portion. And petitioner’s car then hit two (2) parked vehicles at the roadside,
the second hitting another parked car in front of it.

Petitioner claimed that he was no longer the owner of the car at the time of the mishap because it was swapped with a Pajero owned by
Albert Jaucian/Auto Palace Car Exchange. Auto Palace Car Exchange represented by Albert Jaucian claimed that he was not the registered
owner of the car. Moreover, it could not be held subsidiary liable as employer of Ocfemia because the latter was off-duty as utility
employee at the time of the incident. Neither was Ocfemia performing a duty related to his employment. Ocfemia was driving with
expired license and positive for alcoholic breathe- as such information for reckless imprudence resulting to damage to property and
physical injuries was recommended by the assistant prosecutor. The original complaint was amended twice: impleading Auto Palace Car
Exchange and Albert Jaucian as principal defendant doing business under the former.

RTC Manila: Petitioner liable and ordered him to pay respondent actual, moral and exemplary damages plus appearance and attorneys
fees. Albert Jaucian is hereby ordered to indemnify Nostradamus Villanueva for whatever amount the latter is hereby ordered to pay
under the judgment.

CA: Upheld the trial courts decision but deleted the award for appearance and attorneys fees because the justification for the grant was
not stated in the body of the decision.

ISSUE: MAY THE REGISTERED OWNER OF A MOTOR VEHICLE BE HELD LIABLE FOR DAMAGES ARISING FROM A VEHICULAR ACCIDENT
INVOLVING HIS MOTOR VEHICLE WHILE BEING OPERATED BY THE EMPLOYEE OF ITS BUYER WITHOUT THE LATTERS CONSENT AND
KNOWLEDGE?

HELD: Yes. The Revised Motor Vehicle Law provides that no vehicle may be used or operated upon any public highway unless the same is
property registered. It has been stated that the system of licensing and the requirement that each machine must carry a registration
number, conspicuously displayed, is one of the precautions taken to reduce the danger of injury to pedestrians and other travelers from
the careless management of automobiles. And to furnish a means of ascertaining the identity of persons violating the laws and
ordinances, regulating the speed and operation of machines upon the highways (2 R.C.L. 1176). Not only are vehicles to be registered and
that no motor vehicles are to be used or operated without being properly registered for the current year, but that dealers in motor
vehicles shall furnish thee Motor Vehicles Office a report showing the name and address of each purchaser of motor vehicle during the
previous month and the manufacturers serial number and motor number. (Section 5(c), Act No. 3992, as amended.)

Registration is required not to make said registration the operative act by which ownership in vehicles is transferred. The main purpose
of vehicle registration is the easy identification of the owner who can be held responsible for any accident, damage or injury caused by
the vehicle. Easy identification prevents inconvenience and prejudice to a third party injured by one who is unknown or unidentified. To
allow a registered owner to escape liability by claiming that the driver was not authorized by the new (actual) owner results in the public
detriment the law seeks to avoid.

A registered owner who has already sold or transferred a vehicle has the recourse to a third-party complaint, in the same action brought
against him to recover for the damage or injury done, against the vendee or transferee of the vehicle. The inconvenience of the suit is no
justification for relieving him of liability; said inconvenience is the price he pays for failure to comply with the registration that the law
demands and requires.

The registered owner, the defendant-appellant herein, is primarily responsible for the damage caused to the vehicle of the plaintiff-
appellee, but he (defendant-appellant) has a right to be indemnified by the real or actual owner of the amount that he may be required to
pay as damage for the injury caused to the plaintiff-appellant.

Whether the driver is authorized or not by the actual owner is irrelevant to determining the liability of the registered owner who the law
holds primarily and directly responsible for any accident, injury or death caused by the operation of the vehicle in the streets and
highways. It is immaterial whether or not the driver was actually employed by the operator of record. Finally, the issue of whether or not
the driver of the vehicle during the accident was authorized is not at all relevant to determining the liability of the registered owner. This
must be so if we are to comply with the rationale and principle behind the registration requirement under the motor vehicle law.
 6. Sanico vs. Colipano, 841 SCRA 141, G.R. No. 209969 September 27, 2017
Facts: Colipano filed a complaint on January 7, 1997 for breach of contract of carriage and damages against Sanico and Castro. In her
complaint, Colipano claimed that at 4:00 P.M. more or less of December 25, 1993, Christmas Day, she and her daughter were; paying
passengers in the jeepney operated by Sanico, which was driven by Castro. Colipano claimed she was made to sit on an empty beer case at
the edge of the rear entrance/exit of the jeepney with her sleeping child on her lap. And, at an uphill incline in the road to Natimao-an,
Carmen, Cebu, the jeepney slid backwards because it did not have the power to reach the top. 7 Colipano pushed both her feet against the
step board to prevent herself and her child from being thrown out of the exit, but because the step board was wet, her left foot slipped
and got crushed between the step board and a coconut tree which the jeepney bumped, causing the jeepney to stop its backward
movement.8 Colipano's leg was badly injured and was eventually amputated. 9 Colipano prayed for actual damages, loss of income, moral
damages, exemplary damages, and attorney's fees.

In their answer, Sanico and Castro admitted that Colipano's leg was crushed and amputated but claimed that it! was Colipano's fault that
her leg was crushed.11 They admitted that the jeepney slid backwards because the jeepney lost power. The conductor then instructed
everyone not to panic but Colipano tried to disembark and her foot got caught in between the step board and the coconut tree. Sanico
claimed that he paid for all the hospital and medical expenses of Colipano, and that Colipano eventually freely and voluntarily executed an
Affidavit of Desistance and Release of Claim.

After trial, the RTC found that Sanico and Castro breached the contract of carriage between them and Colipano but only awarded actual
and compensatory damages in favor of Colipano.
CA affirmed the RTCs decision.

Issue: Whether or not Sanico and Castro are jointly and severally liable.

Ruling: Only Sanico breached the contract of carriage. Sanico is liable as operator and owner of a common carrier. Specific to a contract of
carriage, the Civil Code requires common carriers to observe extraordinary diligence in safely transporting their passengers. It is beyond
dispute that Colipano was injured while she was a passenger in the jeepney owned and operated by Sanico that was being driven by
Castro.

Since the cause of action is based on a breach of a contract of carriage, the liability of Sanico is direct as the contract is between him and
Colipano. Castro, being merely the driver of Sanico's jeepney, cannot be made liable as he is not a party to the contract of carriage. Since
Castro was not a party to the contract of carriage, Colipano had no cause of action against him and the pomplaint against him should be
dismissed. Although he was driving the jeepney, he was a mere employee of Sanico, who was the operator and owner of the jeepney. The
obligation to carry Colipano safely to her destination was with Sanico. In fact, the elements of a contract of carriage existeid between
Colipano and Sanico: consent, as shown when Castro, as employee of Sanico, accepted Colipano as a passenger when he allowed Colipano
to board the jeepney, and as to Colipano, when she boarded the jeepney; cause or consideration, when Colipano, for her part, paid her fare;
and, object, the transportation of Colipano from the place of departure to the place of destination.
Further, common carriers may also be liable for damages when they contravene the tenor of their obligations. Article 1170 of the Civil
Code states:

ART. 1170. Those who in the performance of their obligations are guilty of fraud, negligence, or delay, and those who in any manner
contravene the tenor thereof, are liable for damages.
In Magat v. Medialdea,28 the Court ruled: "The phrase 'in any manner contravene the tenor' of the obligation includes any illicit act or
omission which impairs the strict and faithful fulfillment of the obligation and every kind of defective performance." 29 There is no
question here that making Colipano sit on the empty beer case was a clear showing of how Sanico contravened the tenor of his obligation
to safely transport Colipano from the place of departure to the place of destination as far as human care and foresight can provide, using
the utmost diligence of very cautious persons, and with due regard for all the circumstances.

7. PCI Leasing and Finance vs UCPB General Insurance, GR 162267

FACTS: On October 19, 1990 at about 10:30 p.m., a Mitsubishi Lancer car with Plate Number PHD-206 owned by United Coconut Planters
Bank was traversing the Laurel Highway, Barangay Balintawak, Lipa City. The car was insured with plantiff-appellee [UCPB General
Insurance Inc.], then driven by Flaviano Isaac with Conrado Geronimo, the Asst. Manager of said bank, was hit and bumped by an 18-
wheeler Fuso Tanker Truck with Plate No. PJE-737 and Trailer Plate No. NVM-133, owned by defendants-appellants PCI Leasing &
Finance, Inc. allegedly leased to and operated by defendant-appellant Superior Gas & Equitable Co., Inc. (SUGECO) and driven by its
employee, defendant appellant Renato Gonzaga.

The impact caused heavy damage to the Mitsubishi Lancer car resulting in an explosion of the rear part of the car. The driver and
passenger suffered physical injuries. However, the driver defendant-appellant Gonzaga continued on its [sic] way to its [sic] destination
and did not bother to bring his victims to the hospital.
Plaintiff-appellee paid the assured UCPB the amount of P244,500.00 representing the insurance coverage of the damaged car.

As the 18-wheeler truck is registered under the name of PCI Leasing, repeated demands were made by plaintiff-appellee for the payment
of the aforesaid amounts. However, no payment was made. Thus, plaintiff-appellee filed the instant case on March 13, 1991.

Petitioner interposed the defense that it could not be held liable for the collision, since the driver of the truck, Gonzaga, was not its
employee, but that of its co-defendant Superior Gas & Equitable Co., Inc. (SUGECO). In fact, it was SUGECO, and not petitioner, that was the
actual operator of the truck, pursuant to a Contract of Lease signed by petitioner and SUGECO. Petitioner, however, admitted that it was
the owner of the truck in question.

RTC Makati: judgment is rendered in favor of plaintiff UCPB General Insurance [respondent], ordering the defendants PCI Leasing and
Finance, Inc., [petitioner] and Renato Gonzaga, to pay jointly and severally the former

CA: Upheld the ruling of RTC. Under the Public Service Act, if the property covered by a franchise is transferred or leased to another
without obtaining the requisite approval, the transfer is not binding on the Public Service Commission and, in contemplation of law, the
grantee continues to be responsible under the franchise in relation to the operation of the vehicle, such as damage or injury to third
parties due to collisions.

ISSUE: Whether petitioner, as registered owner of a motor vehicle that figured in a quasi-delict may be held liable, jointly and severally,
with the driver thereof, for the damages caused to third parties?

HELD: Although the Public Service Act is inapplicable, as correctly argued by petitioner stating that the vehicle’s involved are not
common carriers. However, the registered owner of the vehicle driven by a negligent driver may still be held liable under applicable
jurisprudence involving laws on compulsory motor vehicle registration and the liabilities of employers for quasi-delicts under the Civil
Code.

In case a separate civil action is filed, the long-standing principle is that the registered owner of a motor vehicle is primarily and directly
responsible for the consequences of its operation, including the negligence of the driver, with respect to the public and all third persons.
In contemplation of law, the registered owner of a motor vehicle is the employer of its driver, with the actual operator and employer, such
as a lessee, being considered as merely the owner's agent. This being the case, even if a sale has been executed before a tortious incident,
the sale, if unregistered, has no effect as to the right of the public and third persons to recover from the registered owner.
The public has the right to conclusively presume that the registered owner is the real owner, and may sue accordingly.

In the case now before the Court, there is not even a sale of the vehicle involved, but a mere lease, which remained unregistered up to the
time of the occurrence of the quasi-delict that gave rise to the case. Since a lease, unlike a sale, does not even involve a transfer of title or
ownership, but the mere use or enjoyment of property, there is more reason, therefore, in this instance to uphold the policy behind the
law, which is to protect the unwitting public and provide it with a definite person to make accountable for losses or injuries suffered in
vehicular accidents.

The Court recognizes that the business of financing companies has a legitimate and commendable purpose. In earlier cases, it considered
a financial lease or financing lease a legal contract though subject to the restrictions of the so-called Recto Law or Articles 1484 and 1485
of the Civil Code.

Petitioners argues that the enactment of R.A. No. 8556, especially its addition of the new Sec. 12 to the old law, is deemed to have
absolved petitioner from liability, fails to convince the Court. Sec 12. Reads: Liability of lessors. Financing companies shall not be liable for
loss, damage or injury caused by a motor vehicle, aircraft, vessel, equipment, machinery or other property leased to a third person or
entity except when the motor vehicle, aircraft, vessel, equipment or other property is operated by the financing company, its employees
or agents at the time of the loss, damage or injury.

The new law, R.A. No. 8556, notwithstanding developments in foreign jurisdictions, do not supersede or repeal the law on compulsory
motor vehicle registration. No part of the law expressly repeals Section 5(a) and (e) of R.A. No. 4136, as amended, otherwise known as
the Land Transportation and Traffic Code.

Thus, the rule remains the same: a sale, lease, or financial lease, for that matter, that is not registered with the Land Transportation Office,
still does not bind third persons who are aggrieved in tortious incidents, for the latter need only to rely on the public registration of a
motor vehicle as conclusive evidence of ownership. A lease such as the one involved in the instant case is an encumbrance in
contemplation of law, which needs to be registered in order for it to bind third parties. Under this policy, the evil sought to be avoided is
the exacerbation of the suffering of victims of tragic vehicular accidents in not being able to identify a guilty party. A contrary ruling will
not serve the ends of justice. The failure to register a lease, sale, transfer or encumbrance, should not benefit the parties responsible, to
the prejudice of innocent victims.

The non-registration of the lease contract between petitioner and its lessee precludes the former from enjoying the benefits under
Section 12 of R.A. No. 8556. Petitioner may resort to third-party complaints against their lessees or whoever are the actual operators of
their vehicles.
8. Singapore Airlines vs. Andion Fernandez GR 142305;
FACTS: Respondent is an acclaimed soprano here in the Philippines and abroad. At the time of the incident, she was availing an
educational grant from the Federal Republic of Germany, pursuing a Masters Degree in Music majoring in Voice. She was invited to sing
before the King and Queen of Malaysia on February 3 and 4, 1991. For this singing engagement, an airline passage ticket was purchased
from petitioner Singapore Airlines which would transport her to Manila from Frankfurt, Germany on January 28, 1991. From Manila, she
would proceed to Malaysia on the next day. It was necessary for the respondent to pass by Manila in order to gather her wardrobe; and to
rehearse and coordinate with her pianist her repertoire for the aforesaid performance.

The petitioner issued the respondent a Singapore Airlines ticket leaving Frankfurt, Germany on January 27, 1991 bound for Singapore
with onward connections from Singapore to Manila. Flight No. SQ 27 was scheduled to leave Frankfurt at 1:45 in the afternoon of January
27, 1991, arriving at Singapore at 8:50 in the morning of January 28, 1991. The connecting flight from Singapore to Manila was leaving
Singapore at 11:00 in the morning of January 28, 1991, arriving in Manila at 2:20 in the afternoon of the same day. However, on that date,
from Frankfurt to Singapore, the flight arrive 2 hours late and the aircraft bound for Manila had left as scheduled, leaving the respondent
and about 25 other passengers stranded in the Changi Airport in Singapore.
The respondent approached the transit counter who referred her to the nightstop counter and told the lady employee thereat that it was
important for her to reach Manila on that day, January 28, 1991. The lady employee told her that there were no more flights to Manila for
that day and that respondent had no choice but to stay in Singapore. Upon respondents persistence, she was told that she can actually fly
to Hong Kong going to Manila but since her ticket was non-transferable, she would have to pay for the ticket. The respondent could not
accept the offer because she had no money to pay for it. Her pleas for the respondent to make arrangements to transport her to Manila
were unheeded. The respondent then requested the lady employee to use their phone to make a call to Manila. Over the employees
reluctance, the respondent telephoned her mother to inform the latter that she missed the connecting flight. The respondent was able to
contact a family friend who picked her up from the airport for her overnight stay in Singapore.
The next day, after being brought back to the airport, the respondent proceeded to petitioners counter which says: Immediate Attention
To Passengers with Immediate Booking. There were four or five passengers in line. The respondent approached petitioners male
employee at the counter to make arrangements for immediate booking only to be told: Cant you see I am doing something. She explained
her predicament but the male employee uncaringly retorted: Its your problem, not ours.

The respondent never made it to Manila and was forced to take a direct flight from Singapore to Malaysia on January 29, 1991, through
the efforts of her mother and travel agency in Manila. Her mother also had to travel to Malaysia bringing with her respondents wardrobe
and personal things needed for the performance that caused them to incur an expense of about P50,000.

As a result of this incident, the respondents performance before the Royal Family of Malaysia was below par. Because of the rude and
unkind treatment she received from the petitioners personnel in Singapore, the respondent was engulfed with fear, anxiety, humiliation
and embarrassment causing her to suffer mental fatigue and skin rashes. She was thereby compelled to seek immediate medical attention
upon her return to Manila for acute urticarial.

RTC Pasig: Singapore Airlines is ordered to pay herein plaintiff Fernandez damages (actual, moral, exemplary, attorney’s fees and cost of
suit)

CA: Upheld RTC Ruling

ISSUE: Whether or not damages was correctly awarded by reason of failure to exercise extraordinary diligence and bad faith?

HELD: Yes. When an airline issues a ticket to a passenger, confirmed for a particular flight on a certain date, a contract of carriage arises.
The passenger then has every right to expect that he be transported on that flight and on that date. If he does not, then the carrier opens
itself to a suit for a breach of contract of carriage.

The contract of air carriage is a peculiar one. Imbued with public interest, the law requires common carriers 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. In an action for breach of contract of carriage, the aggrieved party does not have to prove that the common carrier was at
fault or was negligent. All that is necessary to prove is the existence of the contract and the fact of its non-performance by the carrier.
In the case at bar, it is undisputed that the respondent carried a confirmed ticket for the two-legged trip from Frankfurt to Manila: 1)
Frankfurt-Singapore; and 2) Singapore-Manila. In her contract of carriage with the petitioner, the respondent certainly expected that she
would fly to Manila on Flight No. SQ 72 on January 28, 1991. Since the petitioner did not transport the respondent as covenanted by it on
said terms, the petitioner clearly breached its contract of carriage with the respondent. The respondent had every right to sue the
petitioner for this breach. The defense that the delay was due to fortuitous events and beyond petitioners control is unavailing.

In the instant case, petitioner was not without recourse to enable it to fulfill its obligation to transport the respondent safely as scheduled
as far as human care and foresight can provide to her destination. Tagged as a premiere airline as it claims to be and with the complexities
of air travel, it was certainly well-equipped to be able to foresee and deal with such situation. The petitioners indifference and negligence
by its absence and insensitivity was exposed by the trial court. The petitioners diligence in communicating to its passengers the
consequences of the delay in their flights was wanting. The respondent was not remiss in conveying her apprehension about the delay of
the flight when she was still in Frankfurt. Upon the assurance of petitioners personnel in Frankfurt that she will be transported to Manila
on the same date, she had every right to expect that obligation fulfilled.

When a passenger contracts for a specific flight, he has a purpose in making that choice which must be respected. This choice, once
exercised, must not be impaired by a breach on the part of the airline without the latter incurring any liability. For petitioners failure to
bring the respondent to her destination, as scheduled, we find the petitioner clearly liable for the breach of its contract of carriage with
the respondent.

the petitioner acted in bad faith. Bad faith means a breach of known duty through some motive of interest or ill will. Self-enrichment or
fraternal interest, and not personal ill will, may well have been the motive; but it is malice nevertheless. Bad faith was imputed by the trial
court when it found that the petitioners employees at the Singapore airport did not accord the respondent the attention and treatment
allegedly warranted under the circumstances. The trial court concluded that this inattentiveness and rudeness of petitioners personnel to
respondents plight was gross enough amounting to bad faith.

Article 2232 of the Civil Code provides that in a contractual or quasi-contractual relationship, exemplary damages may be awarded only if
the defendant had acted in a wanton, fraudulent, reckless, oppressive or malevolent manner. In this case, petitioners employees acted in a
wanton, oppressive or malevolent manner. The award of exemplary damages is, therefore, warranted in this case.
 9. Japan Airlines vs. Asuncion GR 161730;
FACTS: Michael and Jeanette Asuncion left Manila on board Japan Airlines’ bound for Los Angeles. Their itinerary included a stopover in
Narita. Upon arrival thereat, their applications for shore pass, which is required of a foreigner aboard a vessel or aircraft who desires to
stay in the neighborhood of the port of call for not more than 72 hours, were endorsed to the Japanese immigration official. During their
interview, the immigration official noted that Michael appeared shorter than his height as indicated in his passport. Consequently,
respondents were denied shore pass entries, and were instead taken to the Narita Airport Rest House where they stayed overnight until
their departure the following day for Los Angeles. The immigration official also handed Mrs. Haguchi of JAL a notice stating that
respondents were to be watched so as not to escape. The couple later filed a complaint for damages, claiming that JAL did not fully
apprise them of their travel requirements and that they were rudely and forcibly detained at Narita Airport. JAL, on the other hand,
denied the allegations of respondents, maintaining that the refusal of the Japanese immigration authorities to issue shore passes to
respondents is an act of state, which JAL cannot interfere with or prevail upon. The trial court ruled in favor of respondents, and
dismissed JAL’s counterclaim for litigation expenses, exemplary damages and attorney’s fees, which decision was affirmed in toto by the
Court of Appeals. JAL then proceeded to file a petition for review seeking to reverse and set aside the decision of the Court of Appeals.

ISSUE: Whether JAL is guilty of breach of contract

RULING: No. Under Article 1755 of the Civil Code, a common carrier such as JAL is bound to carry its 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. When an
airline issues a ticket to a passenger, confirmed for a particular flight on a certain date, a contract of carriage arises. The passenger has
every right to expect that he be transported on that flight and on that date and it becomes the carrier’s obligation to carry him and his
luggage safely to the agreed destination. If the passenger is not so transported or if in the process of transporting he dies or is injured, the
carrier may be held liable for a breach of contract of carriage. While it may be true that JAL has the duty to inspect whether its passengers
have the necessary travel documents, however, such duty does not extend to checking the veracity of every entry in these documents. JAL
could not vouch for the authenticity of a passport and the correctness of the entries therein. The power to admit or not an alien into the
country is a sovereign act, which cannot be interfered with even by JAL. This is not within the ambit of the contract of carriage entered
into by JAL and herein respondents. As such, JAL should not be faulted for the denial of respondents’ shore pass applications. The most
that could be expected of JAL is to endorse respondents’ applications, which Mrs. Higuchi did immediately upon their arrival in Narita.

10. Maranan vs. Perez GR 22272;

FACTS: Rogelio Corachea, was a passenger in a taxicab owned and operated by Pascual Perez when he was stabbed and killed by the
driver, Simeon Valenzuela. Valenzuela was prosecuted for homicide in the Court of First Instance of Batangas. Found guilty. On December
6 1961, while appeal was pending in the Court of Appeals, Antonia Maranan, Rogelio's mother, filed an action in the Court of First Instance
of Batangas to recover damages from Perez and Valenzuela for the death of her son. Defendants asserted that the deceased was killed in
self-defense, since he first assaulted the driver by stabbing him from behind. Defendant Perez further claimed that the death was a caso
fortuito for which the carrier was not liable.

Issue: WON the death was caso fortuito for which the carrier was not liable.

Held: YES. Defendant-appellant relies solely on the ruling enunciated in Gillaco v. Manila Railroad, that the carrier is under no absolute
liability for assaults of its employees upon the passengers. The attendant facts and controlling law of that case and the one at bar are very
different however. In the Gillaco case, the passenger was killed outside the scope and the course of duty of the guilty employee. As this
Court there found.

Now here, the killing was perpetrated by the driver of the very cab transporting the passenger, in whose hands the carrier had entrusted
the duty of executing the contract of carriage. In other words, unlike the Gillaco case, the killing of the passenger here took place in the
course of duty of the guilty employee and when the employee was acting within the scope of his duties.
Moreover, the Gillaco case was decided under the provisions of the Civil Code of 1889 which, unlike the present Civil Code, did not impose
upon common carriers absolute liability for the safety of passengers against wilful assaults or negligent acts committed by their
employees. Unlike the old Civil Code, the new Civil Code of the Philippines expressly makes the common carrier liable for intentional
assaults committed by its employees upon its passengers as provided by Art 1759.

The Civil Code provisions on the subject of Common Carriers are new and were taken from Anglo-American Law.There, the basis of the
carrier's liability for assaults on passengers committed by its drivers rests either on (1) the doctrine of respondeat superior or (2) the
principle that it is the carrier's implied duty to transport the passenger safely.

Under the first, which is the minority view, the carrier is liable only when the act of the employee is within the scope of his authority and
duty. It is not sufficient that the act be within the course of employment only. Under the second view, upheld by the majority and also by
the later cases, it is enough that the assault happens within the course of the employee's duty. It is no defense for the carrier that the act
was done in excess of authority or in disobedience of the carrier's orders. The carrier's liability here is absolute in the sense that it
practically secures the passengers from assaults committed by its own employees.

As can be gleaned from Art. 1759, the Civil Code of the Philippines evidently follows the rule based on the second view. At least three very
cogent reasons underlie this rule. As explained in Texas. v. Monroe, , and Haver v. Central Railroad Co.,: (1) the special undertaking of the
carrier requires that it furnish its passenger that full measure of protection afforded by the exercise of the high degree of care prescribed
by the law, inter alia from violence and insults at the hands of strangers and other passengers, but above all, from the acts of the carrier's
own servants charged with the passenger's safety; (2) said liability of the carrier for the servant's violation of duty to passengers, is the
result of the formers confiding in the servant's hands the performance of his contract to safely transport the passenger, delegating
therewith the duty of protecting the passenger with the utmost care prescribed by law; and (3) as between the carrier and the passenger,
the former must bear the risk of wrongful acts or negligence of the carrier's employees against passengers, since it, and not the
passengers, has power to select and remove them.
Accordingly, it is the carrier's strict obligation to select its drivers and similar employees with due regard not only to their technical
competence and physical ability, but also, no less important, to their total personality, including their patterns of behavior, moral fibers,
and social attitude.
Applying this stringent norm to the facts in this case, therefore, the lower court rightly adjudged the defendant carrier liable pursuant to
Art. 1759 of the Civil Code. The dismissal of the claim against the defendant driver was also correct. Plaintiff's action was predicated on
breach of contract of carriage and the cab driver was not a party thereto. His civil liability is covered in the criminal case wherein he was
convicted by final judgment.
11. Compania Maritima vs. CA GR 31379;

FACTS: Private respondent Vicente E. Concepcion, a civil engineer, had a contract with the Civil Aeronautics Administration (CAA)
sometime in 1964 for the construction of the airport in Cagayan de Oro City Misamis Oriental. Being a Manila — based contractor, Vicente
E. Concepcion had to ship his construction equipment to Cagayan de Oro City. Having shipped some of his equipment through petitioner,
Concepcion negotiated anew with petitioner, thru its collector, Pacifico Fernandez, on August 28, 1964 for the shipment to Cagayan de
Oro City of one (1) unit payloader, four (4) units 6x6 Reo trucks and two (2) pieces of water tanks. He was issued Bill of Lading 113 on the
same date upon delivery of the equipment at the Manila North Harbor.

These equipment were loaded aboard the MV Cebu in its Voyage No. 316, which left Manila on August 30, 1964 and arrived at Cagayan de
Oro City in the afternoon of September 1, 1964. The Reo trucks and water tanks were safely unloaded within a few hours after arrival, but
while the payloader was about two (2) meters above the pier in the course of unloading, the swivel pin of the heel block of the port block
of Hatch No. 2 gave way, causing the payloader to fall. 3 The payloader was damaged and was thereafter taken to petitioner's compound in
Cagayan de Oro City.

Petitioner shipped the payloader to Manila where it was weighed at the San Miguel Corporation. Finding that the payloader weighed 7.5
tons and not 2.5 tons as declared in the B-111 of Lading, petitioner denied the claim for damages, contending that had Vicente E.
Concepcion declared the actual weight of the payloader, damage to their ship as well as to his payloader could have been prevented.

ISSUE: Whether or not the act of private respondent Vicente E. Concepcion in furnishing petitioner Companñ ia Maritima with an
inaccurate weight of 2.5 tons instead of the payloader's actual weight of 7.5 tons was the proximate and only cause of the damage on the
Oliver Payloader OC-12 when it fell while being unloaded by petitioner's crew, as would absolutely exempt petitioner from liability for
damages under paragraph 3 of Article 1734 of the Civil Code

HELD: NO, petitioner in not exempt from liability because it seems to have overlooked the extraordinary diligence required of common
carriers in the vigilance over the goods transported by them. The Court of Appeals is not persuaded by the proffered explanation of
petitioner alleged to be the proximate cause of the fall of the payloader while it was being unloaded at the Cagayan de Oro City pier.
Petitioner seems to have overlooked the extraordinary diligence required of common carriers in the vigilance over the goods transported
by them by virtue of the nature of their business, which is impressed with a special public duty.
Petitioner, upon the testimonies of its own crew, failed to take the necessary and adequate precautions for avoiding damage to, or
destruction of, the payloader entrusted to it for safe carriage and delivery to Cagayan de Oro City, it cannot be reasonably concluded that
the damage caused to the payloader was due to the alleged misrepresentation of private respondent Concepcion as to the correct and
accurate weight of the payloader. As found by the respondent Court of Appeals, the fact is that petitioner used a 5-ton capacity lifting
apparatus to lift and unload a visibly heavy cargo like a payloader. Private respondent has, likewise, sufficiently established the laxity and
carelessness of petitioner's crew in their methods of ascertaining the weight of heavy cargoes offered for shipment before loading and
unloading them, as is customary among careful persons.

While the act of private respondent in furnishing petitioner with an inaccurate weight of the payloader cannot successfully be used as an
excuse by petitioner to avoid liability to the damage thus caused, said act constitutes a contributory circumstance to the damage caused
on the payloader, which mitigates the liability for damages of petitioner in accordance with Article 1741 of the Civil Code.

DOCTRINES: The general rule under Articles 1735 and 1752 of the Civil Code is that common carriers are presumed to have been at fault
or to have acted negligently in case the goods transported by them are lost, destroyed or had deteriorated. To overcome the presumption
of liability for the loss, destruction or deterioration of the goods under Article 1735, the common carriers must prove that they observed
extraordinary diligence as required in Article 1733 of the Civil Code. The responsibility of observing extraordinary diligence in the
vigilance over the goods is further expressed in Article 1734 of the same Code, the article invoked by petitioner to avoid liability for
damages.

Corollary is the rule that mere proof of delivery of the goods in good order to a common carrier, and of their arrival at the place of
destination in bad order, makes out prima facie case against the common carrier, so that if no explanation is given as to how the loss,
deterioration or destruction of the goods occurred, the common carrier must be held responsible. 10 Otherwise stated, it is incumbent
upon the common carrier to prove that the loss, deterioration or destruction was due to accident or some other circumstances
inconsistent with its liability.
Under 1736 of the Civil Code, the responsibility to observe extraordinary diligence commences and lasts from the time the goods are
unconditionally placed in the possession of, and received by the carrier for transportation until the same are delivered, actually or
constructively, by the carrier to the consignee, or to the person who has the right to receive them without prejudice to the provisions of
Article 1738.

12. Sulpicio Lines vs. Curso 615 SCRA 575

Facts: Dr. Curso boarded a vessel operated by petitioner w/c was bound for Tacloban City. Unfortunately, due to inclement sea and
weather conditions caused by Typhoon Unsang, the vessel sank. This resulted in the deaths of many passengers including Dr. Curso.
Respondents in this case are the surviving brothers and sisters of Dr. Curso who filed an action for damages against petitioner for breach
of contract of carriage by sea, averring that the latter had acted negligently thus making them liable even though there was force majeure.
The RTC dismissed the complaint but this was reversed by the CA w/c said that due to weather reports before the voyage, the crew of the
vessel should have had the foresight to know that the typhoon was affecting their intended route and should have acted accordingly.
There was also an issue of the ship’s hydraulic system w/c broke down mid-voyage that negated the ship’s seaworthiness. The CA
awarded moral damages to the respondents.

Issue: WON the respondents are entitled to moral damages.

Held: No. The SC held that moral damages may be recovered in an action upon breach of contract of carriage only when: (a) where death
of a passenger results, or (b) it is proved that the carrier was guilty of fraud and bad faith, even if death does not result. Article 2206 of
the Civil Code entitles the descendants, ascendants, illegitimate children, and surviving spouse of the deceased passenger to demand
moral damages for mental anguish by reason of the death of the deceased. Since the respondents are the siblings of the deceased, they are
not entitled to moral damages. The petitioner has correctly relied on the holding in Receiver for North Negros Sugar Company, Inc. v.
Ybaez, to the effect that in case of death caused by quasi-delict, the brother of the deceased was not entitled to the award of moral
damages based on Article 2206 of the Civil Code.
Essentially, the purpose of moral damages is indemnity or reparation, that is, to enable the injured party to obtain the means, diversions,
or amusements that will serve to alleviate the moral suffering he has undergone by reason of the tragic event. According to Villanueva v.
Salvador, the conditions for awarding moral damages are: (a) there must be an injury, whether physical, mental, or psychological, clearly
substantiated by the claimant; (b) there must be a culpable act or omission factually established; (c) the wrongful act or omission of the
defendant must be the proximate cause of the injury sustained by the claimant; and (d) the award of damages is predicated on any of the
cases stated in Article 2219 of the Civil Code.

13. Edna Diago Lhuillier vs. british airways G.R. No. 171092; March 15, 2010
FACTS: On April 28, 2005, petitioner Edna Diago Lhuillier filed a Complaint[2] for damages against respondent British Airways before the
Regional Trial Court (RTC) of Makati City. She alleged that on February 28, 2005, she took respondent's flight 548 from London, United
Kingdom to Rome, Italy. Once on board, she allegedly requested Julian Halliday (Halliday), one of the respondent's flight attendants, to
assist her in placing her hand-carried luggage in the overhead bin. However, Halliday allegedly refused to help and assist her, and even
sarcastically remarked that If I were to help all 300 passengers in this flight, I would have a broken back.

Petitioner further alleged that when the plane was about to land in Rome, Italy, another flight attendant, Nickolas Kerrigan (Kerrigan),
singled her out from among all the passengers in the business class section to lecture on plane safety. Allegedly, Kerrigan made her appear
to the other passengers to be ignorant, uneducated, stupid, and in need of lecturing on the safety rules and regulations of the plane.

Upon arrival in Rome, petitioner complained to respondents ground manager and demanded an apology.However, the latter declared that
the flight stewards were only doing their job. Thus, she filed an action for damages.
ANTONIA MARANAN, plaintiff-appellant

Respondent alleged that only the courts of London, United Kingdom or Rome, Italy, have jurisdiction over the complaint for damages
pursuant to the Warsaw Convention, Article 28(1) of which provides: An action for damages must be brought at the option of the plaintiff,
either before the court of domicile of the carrier or his principal place of business, or where he has a place of business through which the
contract has been made, or before the court of the place of destination.

ISSUE: Whether or not Philippines, a signatory to the Warsaw Convention, should adhere to the provision of the Warsaw Convention in
the determination of its jurisdiction with respect to a case for damages involving a tortuous conduct committed by an airline personnel
while in an international carrier against a Filipino citizen.

HELD: Yes. It is settled that the Warsaw Convention has the force and effect of law in this country. In Santos III v. Northwest Orient
Airlines, 210 SCRA 256 (1992), we held that: The Republic of the Philippines is a party to the Convention for the Unification of Certain
Rules Relating to International Transportation by Air, otherwise known as the Warsaw Convention. It took effect on February 13, 1933.
The Convention was concurred in by the Senate, through its Resolution No. 19, on May 16, 1950. The Philippine instrument of accession
was signed by President Elpidio Quirino on October 13, 1950, and was deposited with the Polish government on November 9, 1950. The
Convention became applicable to the Philippines on February 9, 1951. On September 23, 1955, President Ramon Magsaysay issued
Proclamation No. 201, declaring our formal adherence thereto, to the end that the same and every article and clause thereof may be
observed and fulfilled in good faith by the Republic of the Philippines and the citizens thereof. The Convention is thus a treaty
commitment voluntarily assumed by the Philippine government and, as such, has the force and effect of law in this country. Also, although
her alleged claim is based on a tortious act and not on contract of carriage, it does not mean that it is outside the ambit of The Warsaw
Convention.

14. Ramos vs. China Southern Airlines Co., Ltd., G.R. No. 213418, September 21, 2016

FACTS: The Ramoses purchased 5 China Southern Airlines roundtrip plane tickets from Active Travel Agency for Manila-Xiamen-Manila
trip. On their way back to Manila, however, petitioners were prevented from taking their designated flight despite the fact that earlier that
day an agent from Active Tours informed them that their bookings for China Southern Airlines 1920H flight are confirmed. 8 The refusal
came after petitioners already checked in all their baggages and were given the corresponding claim stubs and after they had paid the
terminal fees. According to the airlines' agent with whom they spoke at the airport, petitioners were merely chance passengers but they
may be allowed to join the flight if they are willing to pay an additional 500 Renminbi per person. When petitioners refused to defray the
additional cost, their baggages were offloaded from the plane, which left Xiamen International Airport without them.9 Because they have
business commitments waiting for them in Manila, petitioners were constrained to rent a car, board a train to Hongkong, and purchase
new plane tickets from PAL that flew them back to Manila.

ISSUE: WON bumping the petitioners off their return flight was in violation of a contract of carriage, and attended by bad faith and malice

HELD: Yes.
When an airline issues a ticket to a passenger confirmed on a particular flight, on a certain date, a contract of carriage arises, and the
passenger has every right to expect that he would fly on that flight and on that date. If that does not happen, then the carrier opens itself
to a suit for breach of contract of carriage. 24 In an action based on a breach of contract of carriage, the aggrieved party does not have to
prove that the common carrier was at fault or was negligent. All he has to prove is the existence of the contract and the fact of its non-
performance by the carrier, through the latter's failure to carry the passenger to its destination.
It is beyond question in the case at bar that petitioners had an existing contract of air carriage with China Southern Airlines as evidenced
by the airline tickets issued by Active Travel. The airlines' claim that petitioners do not have confirmed reservations cannot be given
credence by the Court. The petitioners were issued two-way tickets with itineraries indicating the date and time of their return flight to
Manila. These are binding contracts of carriage. It was only after petitioners went through all the required check-in procedures that they
were informed by the airlines that they were merely chance passengers. Airlines companies do not, as a practice, accept pieces of luggage
from passengers without confirmed reservations. Quite tellingly, all the foregoing circumstances lead us to the inevitable conclusion that
petitioners indeed were bumped off from the flight. We cannot from the records of this case deduce the true reason why the airlines
refused to board petitioners back to Manila. What we can be sure of is the unacceptability of the proffered reason that rightfully gives rise
to the claim for damages

15. Sulpicio Lines, Inc. vs. Sesante, 798 SCRA 459, G.R. No. 172682 July 27, 2016
Facts: On September 18, 1998, at around 12:55 p.m., the M/V Princess of the Orient, a passenger vessel owned and operated by the
petitioner, sank near Fortune Island in Batangas. Of the 388 recorded passengers, 150 were lost. 3 Napoleon Sesante, then a member of
the Philippine National Police (PNP) and a lawyer, was one of the passengers who survived the sinking. He sued the petitioner for breach
of contract and damages.

Sesante alleged in his complaint that the M/V Princess of the Orient left the Port of Manila while Metro Manila was experiencing stormy
weather; that at around 11:00 p.m., he had noticed the vessel listing starboard, so he had gone to the uppermost deck where he
witnessed the strong winds and big waves pounding the vessel; that at the same time, he had seen how the passengers had been
panicking, crying for help and frantically scrambling for life jackets in the absence of the vessel's officers and crew; that sensing danger,
he had called a certain Vency Ceballos through his cellphone to request him to inform the proper authorities of the situation; that
thereafter, big waves had rocked the vessel, tossing him to the floor where he was pinned by a long steel bar; that he had freed himself
only after another wave had hit the vessel; that he had managed to stay afloat after the vessel had sunk, and had been carried by the
waves to the coastline of Cavite and Batangas until he had been rescued; that he had suffered tremendous hunger, thirst, pain, fear, shock,
serious anxiety and mental anguish; that he had sustained injuries, and had lost money, jewelry, important documents, police uniforms
and the .45 caliber pistol issued to him by the PNP; and that because it had committed bad faith in allowing the vessel to sail despite the
storm signal, the petitioner should pay him actual and moral damages of P500,000.00 and P1,000,000.00, respectively.

In its defense, the petitioner insisted on the seaworthiness of the M/V Princess of the Orient due to its having been cleared to sail from
the Port of Manila by the proper authorities; that the sinking had been due to force majeure; that it had not been negligent; and that its
officers and crew had also not been negligent because they had made preparations to abandon the vessel because they had launched life
rafts and had provided the passengers assistance in that regard.

Issue: Whether or not petitioner is exempted from liability due to force majeure.
Held: No. A common carrier may be relieved of any liability arising from a fortuitous event pursuant to Article 1174 25 of the Civil Code.
But while it may free a common carrier from liability, the provision still requires exclusion of human agency from the cause of injury or
loss.26 Else stated, for a common carrier to be absolved from liability in case of force majeure, it is not enough that the accident was
caused by a fortuitous event. The common carrier must still prove that it did not contribute to the occurrence of the incident due to its
own or its employees' negligence.

The petitioner could not escape liability considering that, as borne out by the aforequoted findings of the BMI, the immediate and
proximate cause of the sinking of the vessel had been the gross negligence of its captain in maneuvering the vessel.
The Court also notes that Metro Manila was experiencing Storm Signal No. 1 during the time of the sinking. The BMI observed that a
vessel like the M/V Princess of the Orient, which had a volume of 13.734 gross tons, should have been capable of withstanding a Storm
Signal No. 1 considering that the responding fishing boats of less than 500 gross tons had been able to weather through the same waves
and winds to go to the succor of the sinking vessel and had actually rescued several of the latter's distressed passengers.
The liability of common carriers under Article 1759 is demanded by the duty of extraordinary diligence required of common carriers in
safely carrying their passengers.
On the other hand, Article 1756 of the Civil Code lays down the presumption of negligence against the common carrier in the event of
death or injury of its passenger, viz.:
Article 1756. In case of death of or injuries to passengers, common carriers are presumed to have been at fault or to have acted
negligently, unless they prove that they observed extraordinary diligence as prescribed in Articles 1733 and 1755.
Clearly, the trial court is not required to make an express finding of the common carrier's fault or negligence. Even the mere proof of
injury relieves the passengers from establishing the fault or negligence of the carrier or its employees. The presumption of negligence
applies so long as there is evidence showing that:
(a) a contract exists between the passenger and the common carrier; and (b) the injury or death took place during the existence of such
contract. In such event, the burden shifts to the common carrier to prove its observance of extraordinary diligence, and that an
unforeseen event or force majeure had caused the injury.

16. Torres-Madrid Brokerage v. FEB Mitsu Marine Insurance & Manalastas, G.R. No. 194121, July 11, 2016

Facts: Sony contracted petitioner TMBI to deliver a shipment of various electronic goods from the Port of Manila to Binan, Laguna. Since
TMBI did not own any trucks, it subcontracted the work to BMT. Sony was notified of the arrangements and did not have any objections.
4 trucks were loaded in Manila but only 3 arrived in Laguna. The missing truck was found in Muntinlupa without its driver and cargo.
Sony demanded from TMBI to reimburse them for the lost equipment but TMBI relented claiming that it was not a common carrier and
thus was not liable for the loss.

Issue: WON TMBI may be considered a common carrier.

Held: Yes, the SC held that a customs broker – whose principal business is the preparation of the correct customs declaration and the
proper shipping documents – is still considered a common carrier if it also undertakes to deliver the goods for its customers. The law
does not distinguish between one whose principal business activity is the carrying of goods and one who undertakes this task only as an
ancillary activity. despite TMBI’s present denials, the SC found that the delivery of the goods is an integral, albeit ancillary, part of its
brokerage services. TMBI admitted that it was contracted to facilitate, process, and clear the shipments from the customs authorities,
withdraw them from the pier, then transport and deliver them to Sony’s warehouse in Laguna.

That TMBI does not own trucks and has to subcontract the delivery of its clients’ goods, is immaterial. As long as an entity holds itself to
the public for the transport of goods as a business, it is considered a common carrier regardless of whether it owns the vehicle used or
has to actually hire one.

Lastly, TMBI’s customs brokerage services – including the transport/delivery of the cargo – are available to anyone willing to pay its fees.
Given these circumstances, we find it undeniable that TMBI is a common carrier.
However, TMBI may also proceed against BMT for failure to comply with their contract of carriage.

17. LTFRB vs. G.V. Florida Transport, G.R. No. 213088, June 28, 2017
FACTS: A vehicular accident occurred at Bontoc, Mountain Province involving a public utility bus coming from Sampaloc, Manila, bound
for Poblacion Bontoc and bearing a "G.V. Florida" body mark. The mishap claimed the lives of fifteen (15) passengers and injured thirty-
two (32) others. An initial investigation report, which came from the Department of Transportation and Communications of the Cordillera
Administrative Region (DOTC-CAR), showed that based on the records of the Land Transportation Office (LTO) and herein petitioner,
LTFRB, the bus License Plate actually belongs to a different bus owned by and registered under the name of a certain Norberto Cue, Sr.
(Cue) under a Certificate of Public Convenience (CPC); and that the bus involved in the accident is not duly authorized to operate as a
public transportation.

Thus, LTFRB, pursuant to its regulatory powers, immediately issued an Order preventively suspending, for a period not exceeding thirty
(30) days, the operations of ten (10) buses of Cue under its CPC, as well as respondent's entire fleet of buses, consisting of two hundred
and twenty-eight (228) units, under its twenty-eight (28) CPCs.
ISSUE: WHETHER OR NOT THE LTFRB HAVE THE POWER TO SUSPEND THE FLEET OF A PUBLIC UTILITY THAT VIOLATES THE LAW, TO
THE DAMAGE OF THE PUBLIC

HELD: Yes. The Court rules in favor of petitioner. Section 16(n) of Commonwealth Act. No. 146, otherwise known as the Public Service
Act, provides that “The Commission shall have power to suspend or revoke any certificate issued under the provisions of such Act
whenever the holder thereof has violated or willfully and contumaciously refused to comply with any order rule or regulation of
the Commission or any provision of this Act: Provided, that the Commission, for good cause, may prior to the hearing suspend
for a period not to exceed thirty days any certificate or the exercise of any right or authority issued or granted under this Act by
order of the Commission, whenever such step shall in the judgment of the Commission be necessary to avoid serious and irreparable
damage or inconvenience to the public or to private interests.

Also, Section 5(b) of E.O. 202 states the Powers and Functions of the Land Transportation Franchising and Regulatory Board. The
Board shall have the powers and functions to issue, amend, revise, suspend or cancel Certificates of Public Convenience or
permits authorizing the operation of public land transportation services provided by motorized vehicles, and to prescribe the
appropriate terms and conditions.

In the present case, respondent is guilty of several violations of the law. The Court agrees with petitioner that its power to suspend the
CPCs issued to public utility vehicles depends on its assessment of the gravity of the violation, the potential and actual harm to the public,
and the policy impact of its own actions. In this regard, the Court gives due deference to petitioner's exercise of its sound administrative
discretion in applying its special knowledge, experience and expertise to resolve respondent's case.

Indeed, the law gives to the LTFRB (previously known, among others, as Public Service Commission or Board of Transportation) ample
power and discretion to decree or refuse the cancellation of a certificate of public convenience issued to an operator as long as
there is evidence to support its action.

18. Phil-Nippon Kyoei, Corp. vs. Gudelosao, 796 SCRA 508, G.R. No. 181375 July 13, 2016
Facts: Petitioner, a domestic shipping corporation, purchased a "Ro-Ro" passenger/cargo vessel "MV Mahlia" in Japan in February 2003.
For the vessel's one month conduction voyage from Japan to the Philippines, Edwin C. Gudelosao, Virgilio A. Tancontian, and six other
crewmembers were hired by petitioner, as local principal and Top Ever Marine Management Maritime Co., Ltd., as foreign principal,
through the local manning agency of TMCL, Top Ever Marine Management Philippine Corporation (TEMMPC). TEMMPC, through their
president and general manager, Capt. Oscar Orbeta, and the eight crewmembers signed separate contracts of employment. Petitioner
secured a Marine Insurance from SSSICI over the vessel for P10,800,000.00 against loss, damage, and third party liability or expense,
arising from the occurrence of the perils of the sea for the voyage of the vessel from Onomichi, Japan to Batangas, Philippines. This Marine
Insurance Policy included Personal Accident Policies for the eight crewmembers for P3,240,000.00 each in case of accidental death or
injury.
On February 24, 2003, while still within Japanese waters, the vessel sank due to extreme bad weather condition. Only Chief Engineer Nilo
Macasling survived the incident while the rest of the crewmembers, including Gudelosao and Tancontian, perished.
Separate complaints for death benefits and other damages were filed against petitioner by the heirs and beneficiaries of Gudelosao and
Tancontian.

Issue Whether the doctrine of real and hypothecary nature of maritime law (also known as the limited liability rule) applies in favor of
petitioner.

HELD: Doctrine of limited liability is not applicable to claims under POEA-SEC.

In this jurisdiction, the limited liability rule is embodied in Articles 587, 590 and 837 under Book III of the Code of Commerce. Article 837
applies the limited liability rule in cases of collision. Meanwhile, Articles 587 and 590 embody the universal principle of limited liability in
all cases wherein the shipowner or agent may be properly held liable for the negligent or illicit acts of the captain. These articles precisely
intend to limit the liability of the shipowner or agent to the value of the vessel, its appurtenances and freightage earned in the voyage,
provided that the owner or agent abandons the vessel. When the vessel is totally lost, in which case abandonment is not required because
there is no vessel to abandon, the liability of the shipowner or agent for damages is extinguished. Nonetheless, the limited liability rule is
not absolute and is without exceptions. It does not apply in cases: (1) where the injury or death to a passenger is due either to the fault of the
shipowner, or to the concurring negligence of the shipowner and the captain; (2) where the vessel is insured; and (3) in workmen's
compensation claims.

19. Pioneer Insurance and Surety vs. APL Co, G.R. No. 226345 August 2, 2017

FACTS: January 13, 2012, the shipper, Chillies Export House Limited, turned over to respondent APL Co. Pte. Ltd. (APL) 250 bags of chili
pepper for transport from the port of Chennai, India, to Manila. The shipment, with a total declared value of $12,272.50, was loaded on
board MN Wan Hai 262. In tum, BSFIL Technologies, Inc. (BSFIL), as consignee, insured the cargo with petitioner Pioneer Insurance and
Surety Corporation (Pioneer Insurance).

RULING: The cardinal rule in the interpretation of contracts is embodied in the first paragraph of Article 1370 of the Civil Code: 11 [i]f the
terms of a contract are clear and leave no doubt upon the intention of the contracting parties, the literal meaning of its stipulations shall
control. 11 This provision is akin to the "plain meaning rule" applied by Pennsylvania courts, which assumes that the intent of the parties
to an instrument is "embodied in the writing itself, and when the words are clear and unambiguous the intent is to be discovered only
from the express language of the agreement". It also resembles the "four corners" rule, a principle which allows courts in some cases to
search beneath the semantic surface for clues to meaning. A court's purpose in examining a contract is to interpret the intent of the
contracting parties, as objectively manifested by them. The process of interpreting a contract requires the court to make a preliminary
inquiry as to whether the contract before it is ambiguous. A contract provision is ambiguous if it is susceptible of two reasonable
alternative interpretations. Where the written terms of the contract are not ambiguous and can only be read one way, the court will
interpret the contract as a matter of law. If the contract is determined to be ambiguous, then the interpretation of the contract is left to
the court, to resolve the ambiguity in the light of the intrinsic evidence.

In the Bill of Lading, it was categorically stated that the carrier shall in any event be discharged from all liability whatsoever in respect of
the goods, unless suit is brought in the proper forum within nine (9) months after delivery of the goods or the date when they should
have been delivered. The same, however, is qualified in that when the said nine-month period is contrary to any law compulsory
applicable, the period prescribed by the said law shall apply. The present case involves lost or damaged cargo. It has long been settled
that in case of loss or damage of cargoes, the one-year prescriptive period under the COGSA applies. It is at this juncture where the parties
are at odds, with Pioneer Insurance claiming that the one-year prescriptive period under the COGSA governs; whereas APL insists that
the nine-month prescriptive period under the Bill of Lading applies.

20. Ace Navigation vs. FGU, G.R. No. 171591

This is an appeal under Rule 45 of the Rules of Court seeking to reverse the June 22, 2004 Decision [1] and February 17, 2006
Resolution[2] of the Court of Appeals (CA) ordering petitioner Ace Navigation Co., Inc., jointly and severally with Cardia Limited, to pay
respondents FGU Insurance Corp. and Pioneer Insurance and Surety Corp. the sum of P213,518.20 plus interest at the rate of six per
centum (6%) from the filing of the complaint until paid.

The Facts

On July 19, 1990, Cardia Limited (CARDIA) shipped on board the vessel M/V Pakarti Tiga at Shanghai Port China, 8,260 metric tons or
165,200 bags of Grey Portland Cement to be discharged at the Port of Manila and delivered to its consignee, Heindrich Trading Corp.
(HEINDRICH). The subject shipment was insured with respondents, FGU Insurance Corp. (FGU) and Pioneer Insurance and Surety Corp.
(PIONEER), against all risks under Marine Open Policy No. 062890275 for the amount of P18,048,421.00. [3]

The subject vessel is owned by P.T. Pakarti Tata (PAKARTI) which it chartered to Shinwa Kaiun Kaisha Ltd. (SHINWA). [4] Representing
itself as owner of the vessel, SHINWA entered into a charter party contract with Sky International, Inc. (SKY), an agent of Kee Yeh
Maritime Co. (KEE YEH),[5] which further chartered it to Regency Express Lines S.A. (REGENCY). Thus, it was REGENCY that directly dealt
with consignee HEINDRICH, and accordingly, issued Clean Bill of Lading No. SM-1. [6]

On July 23, 1990, the vessel arrived at the Port of Manila and the shipment was discharged. However, upon inspection of HEINDRICH and
petitioner Ace Navigation Co., Inc. (ACENAV), agent of CARDIA, it was found that out of the 165,200 bags of cement, 43,905 bags were in
bad order and condition. Unable to collect the sustained damages in the amount of P1,423,454.60 from the shipper, CARDIA, and the
charterer, REGENCY, the respondents, as co-insurers of the cargo, each paid the consignee, HEINDRICH, the amounts of P427,036.40 and
P284,690.94, respectively,[7] and consequently became subrogated to all the rights and causes of action accruing to HEINDRICH.

Thus, on August 8, 1991, respondents filed a complaint for damages against the following defendants: "REGENCY EXPRESS LINES, S.A./
UNKNOWN CHARTERER OF THE VESSEL 'PAKARTI TIGA'/ UNKNOWN OWNER and/or DEMIFE (sic) CHARTERER OF THE VESSEL
'PAKARTI TIGA', SKY INTERNATIONAL, INC. and/or ACE NAVIGATION COMPANY, INC." [8] which was docketed as Civil Case No. 90-2016.

In their answer with counterclaim and cross-claim, PAKARTI and SHINWA alleged that the suits against them cannot prosper because
they were not named as parties in the bill of lading.[9]

Similarly, ACENAV claimed that, not being privy to the bill of lading, it was not a real party-in-interest from whom the respondents can
demand compensation. It further denied being the local ship agent of the vessel or REGENCY and claimed to be the agent of the shipper,
CARDIA.[10]

For its part, SKY denied having acted as agent of the charterer, KEE YEH, which chartered the vessel1 from SHINWA, which originally
chartered the vessel from PAKARTI. SKY also averred that it cannot be sued as an agent without impleading its alleged principal, KEE
YEH.[11]

On September 30, 1991, HEINDRICH filed a similar complaint against the same parties and Commercial Union Assurance Co.
(COMMERCIAL), docketed as Civil Case No. 91-2415, which was later consolidated with Civil Case No. 91-2016. However, the suit against
COMMERCIAL was subsequently dismissed on joint motion by the respondents and COMMERCIAL. [12]

Proceedings Before the RTC and the CA

In its November 26, 2001 Decision,[13] the RTC dismissed the complaint, the fallo of which reads:

WHEREFORE, premises considered, plaintiffs' complaint is DISMISSED. Defendants' counter-claim against the plaintiffs are likewise
dismissed, it appearing that plaintiff[s] did not act in evident bad faith in filing the present complaint against them.
Defendant Pakarti and Shinwa's cross-claims against their co-defendants are likewise dismissed for lack of sufficient evidence. No costs.
SO ORDERED.

Dissatisfied, the respondents appealed to the CA which, in its assailed June 22, 2004 Decision, [14] found PAKARTI, SHINWA, KEE YEH and
its agent, SKY, solidarity liable for 70% of the respondents' claim, with the remaining 30% to be shouldered solidarity by CARDIA and its
agent, ACENAV, thus:

WHEREFORE, premises considered, the Decision dated November 26, 2001 is hereby MODIFIED in the sense that:

a) defendant-appellees P.T. Pakarti Tata, Shinwa Kaiun Kaisha, Ltd., Kee Yeh Maritime Co., Ltd. and the latter's agent Sky International, Inc.
are hereby declared jointly and severally liable, and are DIRECTED to pay FGU Insurance Corporation the amount of Two Hundred Ninety
Eight Thousand Nine Hundred Twenty Five and 45/100 (P298,925.45) Pesos and Pioneer Insurance and Surety Corp. the sum of One
Hundred Ninety Nine Thousand Two Hundred Eighty Three and 66/100 (P199,283.66) Pesos representing Seventy (70%) per centum of
their respective claims as actual damages plus interest at the rate of six (6%) per centum from the date of the filing of the complaint; and

b) defendant Cardia Ltd. and defendant-appellee Ace Navigation Co., Inc. are DECLARED jointly and severally liable and are hereby
DIRECTED to pay FGU Insurance Corporation One Hundred Twenty Eight Thousand One Hundred Ten and 92/100 (P128,110.92) Pesos
and Pioneer Insurance and Surety Corp. Eighty Five Thousand Four Hundred Seven and 28/100 (P85,407.28) Pesos representing thirty
(30%) per centum of their respective claims as actual damages, plus interest at the rate of six (6%) per centum from the date of the filing
of the complaint. SO ORDERED.

Finding that the parties entered into a time charter party, not a demise or bareboat charter where the owner completely and exclusively
relinquishes possession, command and navigation to the charterer, the CA held PAKARTI, SHINWA, KEE YEH and its agent, SKY, solidarity
liable for 70% of the damages sustained by the cargo. This solidarity liability was borne by their failure to prove that they exercised
extraordinary diligence in the vigilance over the bags of cement entrusted to them for transport. On the other hand, the CA passed on the
remaining 30% of the amount claimed to the shipper, CARDIA, and its agent, ACENAV, upon a finding that the damage was partly due to
the cargo's inferior packing.

With respect to REGENCY, the CA affirmed the findings of the RTC that it did not acquire jurisdiction over its person for defective service
of summons. PAKARTI's, SHTNWA's, SKY's and ACENAV's respective motions for reconsideration were subsequently denied in the CA's
assailed February 17, 2006 Resolution.

Issues Before the Court

PAKARTI, SHINWA, SKY and ACENAV filed separate petitions for review on certiorari before the Court, docketed as G.R. Nos. 171591,
171614, and 171663, which were ordered consolidated in the Court's Resolution dated July 31, 2006. [15]

On April 21, 2006, SKY manifested[16] that it will no longer pursue its petition in G.R. No. 171614 and has preferred to await the resolution
in G.R. No. 171663 filed by PAKARTI and SHINWA. Accordingly, an entry of judgment [17] against it was made on August 18, 2006. Likewise,
on November 29, 2007, PAKARTI and SHINWA moved[18] for the withdrawal of their petitions for lack of interest, which the Court granted
in its January 21, 2008 Resolution.19 The corresponding entry of judgment20 against them was made on March 17, 2008.

Thus, only the petition of ACENAV remained for the Court's resolution, with the lone issue of whether or not it may be held liable to the
respondents for 30% of their claim.

Maintaining that it was not a party to the bill of lading, ACENAV asserts that it cannot be held liable for the damages sought to be collected
by the respondents. It also alleged that since its principal, CARDIA, was not impleaded as a party-defendant/respondent in the instant
suit, no liability can therefore attach to it as a mere agent. Moreover, there is dearth of evidence showing that it was responsible for the
supposed defective packing of the goods upon which the award was based.

The Court's Ruling

A bill of lading is defined as "an instrument in writing, signed by a carrier or his agent, describing the freight so as to identify it, stating
the name of the consignor, the terms of the contract for carriage, and agreeing or directing that the freight to be delivered to the order or
assigns of a specified person at a specified place."[21] It operates both as a receipt and as a contract. As a receipt, it recites the date and
place of shipment, describes the goods as to quantity, weight, dimensions, identification marks and condition, quality, and value. As a
contract, it names the contracting parties, which include the consignee, fixes the route, destination, and freight rates or charges, and
stipulates the rights and obligations assumed by the parties. As such, it shall only be binding upon the parties who make them, their
assigns and heirs.[23]

In this case, the original parties to the bill of lading are: (a) the shipper CARDIA; (b) the carrier PAKARTI; and (c) the consignee
HEINDRICH. However, by virtue of their relationship with PAKARTI under separate charter arrangements, SHINWA, KEE YEH and its
agent SKY likewise became parties .to the bill of lading. In the same vein, ACENAV, as admitted agent of CARDIA, also became a party to
the said contract of carriage.
The respondents, however, maintain 4 that ACENAV is a ship agent and not a mere agent of CARDIA, as found by both the CA25 and the
RTC.26 The Court disagrees.

Article 586 of the Code of Commerce provides: ART. 586. The shipowner and the ship agent shall be civilly liable for the acts of the captain
and for the obligations contracted by the latter to repair, equip, and provision the vessel, provided the creditor proves that the amount
claimed was invested therein.

By ship agent is understood the person entrusted with the provisioning of a vessel, or who represents her in the port in which she may be
found. (Emphasis supplied)

Records show that the obligation of ACENAV was limited to informing the consignee HEINDRICH of the arrival of the vessel in order for
the latter to immediately take possession of the goods. No evidence was offered to establish that ACENAV had a hand in the provisioning
of the vessel or that it represented the carrier, its charterers, or the vessel at any time during the unloading of the goods. Clearly,
ACENAV's participation was simply to assume responsibility over the cargo when they were unloaded from the vessel. Hence, no
reversible error was committed by the courts a quo in holding that ACENAV was not a ship agent within the meaning and context of
Article 586 of the Code of Commerce, but a mere agent of CARDIA, the shipper.

On this score, Article 1868 of the Civil Code states:

ART. 1868. By the contract of agency, a person binds himself to render some service or to do something in representation or on behalf of
another, with the consent or authority of the latter.

Corollarily, Article 1897 of the same Code provides that an agent is not personally liable to the party with whom he contracts, unless he
expressly binds himself or exceeds the limits of his authority without giving such party sufficient notice of his powers.

Both exceptions do not obtain in this case. Records are bereft of any showing that ACENAV exceeded its authority in the discharge of its
duties as a mere agent of CARDIA. Neither was it alleged, much less proved, that ACENAV's limited obligation as agent of the shipper,
CARDIA, was not known to HEINDRICH.

Furthermore, since CARDIA was not impleaded as a party in the instant suit, the liability attributed upon it by the CA [27] on the basis of its
finding that the damage sustained by the cargo was due to improper packing cannot be borne by ACENAV. As mere agent, ACENAV cannot
be made responsible or held accountable for the damage supposedly caused by its principal.

Accordingly, the Court finds that the CA erred in ordering ACENAV jointly and severally liable with CARDIA to pay 30% of the
respondents' claim.

WHEREFORE, the assailed Decision and Resolution of the Court of Appeals are hereby REVERSED. The complaint against petitioner Ace
Navigation Co., Inc. is hereby DISMISSED. SO ORDERED.

21. Manay, Jr. vs. Cebu Air, Inc., 788 SCRA 155, G.R. No. 210621 April 4, 2016
FACTS: On June 13, 2008, Carlos S. Jose (Jose) purchased 20 Cebu Pacific round-trip tickets from Manila to Palawan for himself and on
behalf of his relatives and friends. Jose alleged that he specified to “Alou,” the Cebu Pacific ticketing agent that his preferred date and time
of departure from Manila to Palawan should be on July 20, 2008 at 8:20 a.m. and that his preferred date and time for their flight back to
Manila should be on July 22, 2008 at 4:15 p.m. After paying for the tickets, Alou printed the tickets, which consisted of three (3) pages,
and recapped only the first page to him. Since the first page contained the details he specified to Alou, he no longer read the other pages
of the flight information.

After their trip or on the afternoon of July 22, 2008, the group proceeded to the airport for their flight back to Manila. During the
processing of their boarding passes, they were informed by Cebu Pacific personnel that nine (9) of them could not be admitted because
their tickets were for the 10:05 a.m. flight earlier that day. Jose informed the ground personnel that he personally purchased the tickets
and specifically instructed the ticketing agent that all 20 of them should be on the 4:15 p.m. flight to Manila. Upon checking the tickets,
they learned that only the first two (2) pages had the schedule Jose specified. They were left with no other option but to rebook their
tickets. They then learned that their return tickets had been purchased as part of the promo sales of the airline, and the cost to rebook the
flight would be ₱7,000.00 more expensive than the promo tickets. The sum of the new tickets amounted to ₱65,000.00.

They offered to pay the amount by credit card but were informed by the ground personnel that they only accepted cash. They then offered
to pay in dollars, since most of them were balikbayans and had the amount on hand, but the airline personnel still refused. Eventually,
they pooled enough cash to be able to buy tickets for five (5) of their companions. The other four (4) were left behind in Palawan and had
to spend the night at an inn, incurring additional expenses. Upon his arrival in Manila, Jose immediately purchased four (4) tickets for the
companions they left behind, which amounted to ₱5,205.

Later in July 2008, Jose went to Cebu Pacific’s ticketing office in Robinsons Galleria to complain about the allegedly erroneous booking
and the rude treatment that his group encountered from the ground personnel in Palawan. Jose and his companions were unsatisfied
with Cebu Pacific’s response so they filed a Complaint for Damages against Cebu Pacific before Branch 59 of the Metropolitan Trial Court
of Mandaluyong. The Complaint prayed for actual damages in the amount of ₱42,955.00, moral damages in the amount of ₱45,000.00,
exemplary damages in the amount of ₱50,000.00, and attorney’s fees.

The Metropolitan TC rendered its Decision ordering Cebu Pacific to pay Jose and his companions ₱41,044.50 in actual damages and
₱20,000.00 in attorney’s fees with costs of suit. Cebu Pacific appealed to the RTC, which was subsequently dismissed. Cebu Pacific
appealed to the CA, arguing that it was not at fault for the damages caused to the passengers.

On December 13, 2013, the CA rendered the Decision granting the appeal and reversing the Decisions of the MeTC and the RTC. According
to it, the extraordinary diligence expected of common carriers only applies to the carriage of passengers and not to the act of encoding
the requested flight schedule. It was incumbent upon the passenger to exercise ordinary care in reviewing flight details and checking
schedules. Cebu Pacific’s counterclaim, however, was denied since there was no evidence that Jose and his companions filed their
Complaint in bad faith and with malice.

ISSUE: Whether respondent Cebu Air, Inc. is liable for damages for the issuance of a plane ticket with an allegedly erroneous flight
schedule

HELD: NO. Common carriers are required to exercise extraordinary diligence in the performance of its obligations under the contract of
carriage. This extraordinary diligence must be observed not only in the transportation of goods and services but also in the issuance of
the contract of carriage, including its ticketing operations. The obligation of the airline to exercise extraordinary diligence commences
upon the issuance of the contract of carriage. Ticketing, as the act of issuing the contract of carriage, is necessarily included in the exercise
of extraordinary diligence. Once a plane ticket is issued, the common carrier binds itself to deliver the passenger safely on the date and
time stated in the ticket. The contractual obligation of the common carrier to the passenger is governed principally by what is written on
the contract of carriage.

The common carrier’s obligation to exercise extraordinary diligence in the issuance of the contract of carriage is fulfilled by requiring a
full review of the flight schedules to be given to a prospective passenger before payment. Based on the information stated on the contract
of carriage, all three (3) pages were recapped to petitioner Jose. The only evidence petitioners have in order to prove their true intent of
having the entire group on the 4:15 p.m. flight is petitioner Jose’s self-serving testimony that the airline failed to recap the last page of the
tickets to him. They have neither shown nor introduced any other evidence before the Metropolitan Trial Court, Regional Trial Court,
Court of Appeals, or this Court.

Even assuming that the ticketing agent encoded the incorrect flight information, it is incumbent upon the purchaser of the tickets to at
least check if all the information is correct before making the purchase. Once the ticket is paid for and printed, the purchaser is presumed
to have agreed to all its terms and conditions. Considering that respondent was entitled to deny check-in to passengers whose names do
not match their photo identification, it would have been prudent for petitioner Jose to check if all the names of his companions were
encoded correctly. Since the tickets were for 20 passengers, he was expected to have checked each name on each page of the tickets in
order to see if all the passengers’ names were encoded and correctly spelled. Had he done this, he would have noticed that there was a
different flight schedule encoded on the third page of the tickets since the flight schedule was stated directly above the passengers’
names. Moreover, the tickets were issued 37 days before their departure from Manila and 39 days from their departure from Palawan.
There was more than enough time to correct any alleged mistake in the flight schedule.

Petitioners, in failing to exercise the necessary care in the conduct of their affairs, were without a doubt negligent. Thus, they are not
entitled to damages.

Final note: The Air Passenger Bill of Rights recognizes that a contract of carriage is a contract of adhesion, and thus, all conditions and
restrictions must be fully explained to the passenger before the purchase of the ticket. It acknowledges that “while a passenger has the
option to buy or not to buy the service, the decision of the passenger to buy the ticket binds such passenger[.]” Thus, the airline is mandated
to place in writing all the conditions it will impose on the passenger. However, the duty of an airline to disclose all the necessary
information in the contract of carriage does not remove the correlative obligation of the passenger to exercise ordinary diligence in the
conduct of his or her affairs. The passenger is still expected to read through the flight information in the contract of carriage before
making his or her purchase. If he or she fails to exercise the ordinary diligence expected of passengers, any resulting damage should be
borne by the passenger.

22. Spouses Fernando vs. Northwest Airlines, G.R. No. 212038 and G.R. No. 212043, February 8, 2017
FACTS: Spouses Jesus and Elizabeth S. Fernando are frequent flyers of Northwest Airlines, Inc. and are holders of Elite Platinum World
Perks Card, the highest category given to frequent flyers of the carrier. The Fernandos initiated the filing of the instant case which arose
from two separate incidents: first, when Jesus Fernando arrived at Los Angeles Airport on December 20, 2001; second, when the
Fernandos were to depart from the LA Airport on January 29, 2002. Jesus Fernando arrived at the LA Airport via Northwest Airlines
Flight No. NW02 to join his family for Christmas, however upon arrival at the airport it was found out that his documents reflect his
return ticket as August 2001. So he approached Northwest personnel who was later identified as Linda Puntawongdaycha, but the latter
merely glanced at his ticket without checking its status with the computer and peremptorily said that the ticket has been used and could
not be considered as valid. The Immigration Officer brought Jesus Fernando to the interrogation room of the Immigration and
Naturalization Services where he was asked humiliating questions for more than two (2) hours. When he was finally cleared by the
Immigration Officer, he was granted only a twelve-day stay in the United States, instead of the usual six months.
When the Fernandos reached the gate area where boarding passes need to be presented, Northwest supervisor Linda Tang stopped them
and demanded for the presentation of their paper tickets (coupon type). They failed to present the same since, according to them,
Northwest issued electronic tickets (attached to the boarding passes) which they showed to the supervisor. In the presence of the other
passengers, Linda Tang rudely pulled them out of the queue. Elizabeth Fernando explained to Linda Tang that the matter could be sorted
out by simply verifying their electronic tickets in her computer and all she had to do was click and punch in their Elite Platinum World
Perks Card number. But when the Fernandos reached the boarding gate, the plane had already departed. They were able to depart,
instead, the day after, or on January 30, 2002, and arrived in the Philippines on January 31, 2002.
Northwest airlines employees on the other hand claim that they were “courteous” and “was very kind enough” to assist them. Northwest
also offered them free hotel accommodations but they, again, rejected the offer Northwest then made arrangements for the
transportation of the Fernandos from the airport to their house in LA, and booked the Fernandos on a Northwest flight that would leave
the next day, January 30, 2002. On January 30, 2002, the Fernandos flew to Manila on business class seats.
ISSUES: (1) Whether or not there was breach of contract of carriage and whether it was done In a wanton, malevolent or reckless manner
amounting to bad faith.
(2) Whether or not Northwest is liable for the payment of moral damages and attorney’s fees and whether it is liable to pay more than
that awarded by the RTC.
HELD: (1). Yes. The Fernandos’ cause of action against Northwest stemmed from a breach of contract of carriage. A contract is a meeting
of minds between two persons whereby one agrees to give something or render some service to another for a consideration. There is no
contract unless the following requisites concur:
 consent of the contracting parties;
 an object certain which is the subject of the contract; and
 the cause of the obligation which is established.
A contract of carriage is defined as one whereby a certain person or association of persons obligate themselves to transport persons,
things, or goods from one place to another for a fixed price.
Under Article 1732 of the Civil Code, this “persons, corporations, firms, or associations engaged in the business of carrying or
transporting passengers or goods or both, by land, water, or air, for compensation, offering their services to the public” is called a
common carrier. Undoubtedly, a contract of carriage existed between Northwest and the Fernandos. They voluntarily and freely gave their
consent to an agreement whose object was the transportation of the Fernandos from LA to Manila, and whose cause or consideration was
the fare paid by the Fernandos to Northwest.
(2) Yes. Northwest is in bad faith. While We agree that the discrepancy between the date of actual travel and the date appearing on the
tickets of the Fernandos called for some verification, however, the Northwest personnel failed to exercise the utmost diligence in assisting
the Fernandos. The actuations of Northwest personnel in both subject incidents are constitutive of bad faith.
On the first incident, Jesus Fernando even gave the Northwest personnel the number of his Elite Platinum World Perks Card for the latter
to access the ticket control record with the airline’s computer for her to see that the ticket is still valid. But Linda Puntawongdaycha
refused to check the validity of the ticket in the computer. As a result, the Immigration Officer brought Jesus Fernando to the interrogation
room of the INS where he was interrogated for more than two (2) hours. When he was finally cleared by the Immigration Officer, he was
granted only a twelve (12)-day stay in the United States (US), instead of the usual six (6) months.

23. A.F. Sanchez Brokerage Inc. vs. Court of Appeals and FGU Insurance Corporation, G.R. No. 147079, December 21, 2004
Article 1732 does not distinguish between one whose principal business activity is the carrying of goods and one who does such carrying
only as an ancillary activity. The contention, therefore, of petitioner that it is not a common carrier but a customs broker whose principal
function is to prepare the correct customs declaration and proper shipping documents as required by law is bereft of merit. It suffices
that petitioner undertakes to deliver the goods for pecuniary consideration. In this light, petitioner as a common carrier is mandated to
observe, under Article 1733 of the Civil Code, extraordinary diligence in the vigilance over the goods it transports according to all the
circumstances of each case. In the event that the goods are lost, destroyed or deteriorated, it is presumed to have been at fault or to have
acted negligently, unless it proves that it observed extraordinary diligence.

FACTS On July 8, 1992, Wyeth-Pharma GMBH shipped on board an aircraft of KLM Royal Dutch Airlines at Dusseldorf, Germany oral
contraceptives consisting of 86,800 Blisters Femenal tablets, 14,000 Blisters Nordiol tablets and 42,000 Blisters Trinordiol tablets for
delivery to Manila in favor of the consignee, Wyeth-Suaco Laboratories, Inc. Wyeth-Suaco insured the shipment against all risks with FGU
Insurance. Upon arrival of the shipment, it was discharged "without exception" and delivered to the warehouse of the Philippine
Skylanders, Inc. (PSI) located also at the NAIA for safekeeping. In order to secure the release of the cargoes, Wyeth-Suaco engaged the
services of Sanchez Brokerage. Wyeth-Suaco being a regular importer, the customs examiner did not inspect the cargoes which were
thereupon stripped from the aluminum containers and loaded inside two transport vehicles hired by Sanchez Brokerage. Upon
instructions of Wyeth-Suaco, the cargoes were delivered to Hizon Laboratories Inc. in Antipolo City for quality control check. Upon
inspection, it was discovered that 44 cartons containing Femenal and Nordiol tablets were in bad order. The remaining 160 cartons of
oral contraceptives were accepted as complete and in good order. Wyeth-Suaco later demanded, by letter from Sanchez Brokerage the
payment of P191,384.25 representing the value of its loss arising from the damaged tablets. As the Sanchez Brokerage refused to heed
the demand, Wyeth-Suaco filed an insurance claim against FGU Insurance which paid Wyeth-Suaco the amount of P181,431.49 in
settlement of its claim. Wyeth-Suaco thus issued Subrogation Receipt30 in favor of FGU Insurance. On demand by FGU Insurance for
payment of the amount of P181,431.49 it paid Wyeth-Suaco, Sanchez Brokerage, by letter of January 7, 1993, disclaimed liability for the
damaged goods, positing that the damage was due to improper and insufficient export packaging; that when the sealed containers were
opened outside the PSI warehouse. Hence, FGU Insurance of a complaint for damages before the Regional Trial Court of Makati City
against the Sanchez Brokerage. The trial court dismissed the complaint. On appeal, the appellate court reversed the decision of the trial
court, it holding that the Sanchez Brokerage engaged not only in the business of customs brokerage but also in the transportation and
delivery of the cargo of its clients, hence, a common carrier within the context of Article 1732 of the New Civil Code.

ISSUE Whether petitioner is a "common carrier" within the context of Article 1732 of the New Civil Code. (YES)

RULING The appellate court did not err in finding petitioner, a customs broker, to be also a common carrier, as defined under Article 1732
of the Civil Code, to wit: Art. 1732. Common carriers are persons, corporations, firms or associations engaged in the business of carrying
or transporting passengers or goods or both, by land, water, or air, for compensation, offering their services to the public. Anacleto F.
Sanchez, Jr., the Manager and Principal Broker of Sanchez Brokerage himself testified that the services the firm offers include the delivery
of goods to the warehouse of the consignee or importer, stating: “As customs broker, we calculate the taxes that has to be paid in cargos,
and those upon approval of the importer, we prepare the entry together for processing and claims from customs and finally deliver the
goods to the warehouse of the importer.” Article 1732 does not distinguish between one whose principal business activity is the carrying
of goods and one who does such carrying only as an ancillary activity. The contention, therefore, of petitioner that it is not a common
carrier but a customs broker whose principal function is to prepare the correct customs declaration and proper shipping documents as
required by law is bereft of merit. It suffices that petitioner undertakes to deliver the goods for pecuniary consideration. In this light,
petitioner as a common carrier is mandated to observe, under Article 1733 of the Civil Code, extraordinary diligence in the vigilance over
the goods it transports according to all the circumstances of each case. In the event that the goods are lost, destroyed or deteriorated, it is
presumed to have been at fault or to have acted negligently, unless it proves that it observed extraordinary diligence. The concept of
"extra-ordinary diligence" was explained in Compania Maritima v. Court of Appeals: The extraordinary diligence in the vigilance over the
goods tendered for shipment requires the common carrier to know and to follow the required precaution for avoiding damage to, or
destruction of the goods entrusted to it for sale, carriage and delivery. It requires common carriers to render service with the greatest
skill and foresight and "to use all reasonable means to ascertain the nature and characteristics of goods tendered for shipment, and to
exercise due care in the handling and stowage, including such methods as their nature requires." In the case at bar, it was established that
petitioner received the cargoes from the PSI warehouse in NAIA in good order and condition; and that upon delivery by petitioner to
Hizon Laboratories Inc., some of the cargoes were found to be in bad order, as noted in the Delivery Receipt issued by petitioner, and as
indicated in the Survey Report of Elite Surveyors and the Destruction Report of Hizon Laboratories, Inc.

In an attempt to free itself from responsibility for the damage to the goods, petitioner posits that they were damaged due to the fault or
negligence of the shipper for failing to properly pack them and to the inherent characteristics of the goods; and that it should not be
faulted for following the instructions of Calicdan of Wyeth-Suaco to proceed with the delivery despite information conveyed to the latter
that some of the cartons, on examination outside the PSI warehouse, were found to be wet. While paragraph No. 4 of Article 1734 of the
Civil Code exempts a common carrier from liability if the loss or damage is due to the character of the goods or defects in the packing or
in the containers, the rule is that if the improper packing is known to the carrier or his employees or is apparent upon ordinary
observation, but he nevertheless accepts the same without protest or exception notwithstanding such condition, he is not relieved of
liability for the resulting damage. Since petitioner received all the cargoes in good order and condition at the time they were turned over
by the PSI warehouseman, and upon their delivery to Hizon Laboratories, Inc. a portion thereof was found to be in bad order, it was
incumbent on petitioner to prove that it exercised extraordinary diligence in the carriage of the goods. It did not, however. Hence, its
presumed negligence under Article 1735 of the Civil Code remains unrebutted.

24. Nostradamus Villanueva vs. Priscilla R. Domingo and Leandro Luis R. Domingo, G.R. No. 144274, September 20, 2004
Under the same principle the registered owner of any vehicle, even if not used for a public service, should primarily be responsible to the
public or to third persons for injuries caused the latter while the vehicle is being driven on the highways or streets. The members of the
Court are in agreement that the defendant-appellant should be held liable to plaintiff-appellee for the injuries occasioned to the latter
because of the negligence of the driver, even if the defendant-appellant was no longer the owner of the vehicle at the time of the damage
because he had previously sold it to another.

FACTS Priscilla Domingo is the registered owner of a silver Mitsubishi Lancer Car model 1980 with Plate No. NDW 781 with co-
respondent Leandro Luis Domingo as authorized driver. Petitioner Nostradamus Villanueva was then the registered “owner” of a green
Mitsubishi Lancer bearing Plate No. PHK 201.
On Oct. 22, 1991, 9:45 PM, following a green traffic light, Priscilla Domingo silver Lancer then driven by Leandro Domingo was cruising
the middle lane of South Superhighway at moderate speed when suddenly, a green Mitsubishi Lancer with Plate No. PHK 201 driven by
Renato Dela Cruz Ocfemia darted from Vito Cruz St. towards the South Superhighway directly into the path of Domingo’s car thereby
hitting and bumping its left front portion. As a result of the impact, NDW 781 hit two parked vehicles at the roadside, the second hitting
another car parked in front of it. Traffic accident report found Ocfemia driving with expired license and positive for alcoholic breath.
Manila Asst. Prosecutor Pascua recommended filing of information for reckless imprudence resulting to damage to property and physical
injuries. The original complaint was amended twice: first impleading Auto Palace Car Exchange as commercial agent and/or buyer-seller
and second, impleading Albert Jaucian as principal defendant doing business under the name and style of Auto Palace Car Exchange.
Except Ocfemia, all defendants filed separate answers to the complaint. Petitioner Nostradamus Villanueva claimed that he was no longer
the owner of the car at the time of the mishap because it was swapped with a Pajero owned by Albert Jaucian/Auto Palace Car Exchange.
Linda Gonzales declared that her presence at the scene of the accident was upon the request of the actual owner of the Mitsubishi Lancer
PHK 201, Albert Jaucian for whom she had been working as agent/seller. Auto Palace Car Exchange represented by Albert Jaucian claimed
that he was not the registered owner of the car. Moreover, it could not be held subsidiarily liable as employer of Ocfemia because the
latter was off-duty as utility employee at the time of the incident. Neither was Ocfemia performing a duty related to his employment. RTC
found petitioner Villanueva liable and ordered him to pay respondent actual, moral and exemplary damages plus appearance and
attorney’s fees. In conformity with equity and the ruling in First Malayan Lending and Finance Corp. vs CA, Albert Jaucian is hereby
ordered to indemnify Villanueva for whatever amount the latter is hereby ordered to pay under the judgment.

ISSUE May the registered owner of a motor vehicle be held liable for damages arising from a vehicular accident involving his motor
vehicle while being operated by the employee of its buyer without the latter’s consent and knowledge?

RULING YES, the registered owner of any vehicle is directly and primarily responsible for the public and third persons while it is being
operated. The rationale behind such doctrine was explained way back in 1957 in Erezo vs. Jepte. The principle upon which this doctrine is
based is that in dealing with vehicles registered under the Public Service Law, the public has the right to assume or presume that the
registered owner is the actual owner thereof, for it would be difficult for the public to enforce the actions that they may have for injuries
caused to them by the vehicles being negligently operated if the public should be required to prove who the actual owner is. How would
the public or third persons know against whom to enforce their rights in case of subsequent transfers of the vehicles? We do not imply by
his doctrine, however, that the registered owner may not recover whatever amount he had paid by virtue of his liability to third persons
from the person to whom he had actually sold, assigned or conveyed the vehicle.

25. Crisostomo vs. Court of Appeals, G.R. No. 138334, August 25, 2003

FACTS: Petitioner Estela L. Crisostomo contracted the services of respondent Caravan Travel and Tours International, Inc. to arrange and
facilitate her booking, ticketing and accommodation in a tour dubbed Jewels of Europe (England, Holland, Germany, Austria,
Liechstenstein, Switzerland and France) at a total cost of P74,322.70. Petitioners niece, Meriam Menor, was respondent companys
ticketing manager.

Without checking her travel documents, and by relying to Meriam’s statement that her flight is on June 15, 1991, petitioner went to NAIA
on that date. To her surprise her plane ticket was for the flight scheduled on June 14, 1991
Thus she called Meriam menor to complain, who was able to convince her to take another tour the British Pageant which included
England, Scotland and Wales in its itinerary. For this package she was asked to pay anew P20,881.00. Partial payment was allowed

Upon her return from Europe, she demanded from respondent the reimbursement of P61,421.70, representing the difference between
the sum she paid for Jewels of Europe and the amount she owed respondent for the British Pageant tour. Respondent refused.

Respondent insisted that petitioner had only herself to blame for missing the flight, as she did not bother to read or confirm her flight
schedule as printed on the ticket. respondent maintained that the British Pageant was not a substitute for the package tour that
petitioner missed. This tour was independently procured by petitioner after realizing that she made a mistake in missing her flight for
Jewels of Europe.

RTC - Respondent was negligent in erroneously advising petitioner of her departure date through its employee, Menor. However, petitioner
was guilty of contributory negligence and accordingly, deducted 10% from the amount being claimed as refund.

CA - Set aside the decision of RTC, but appellate court held that petitioner is more negligent than respondent because as a lawyer and
well-traveled person thus not entitled to any form of damages

Thus, this present petition; Petitioner contends that respondent did not observe the standard of care required of a common carrier when
it informed her wrongly of the flight schedule.

ISSUE Whether or not respondent is a common carrier, thus requiring it to exercise utmost diligence

HELD: No A common carrier is defined under Article 1732 of the Civil Code as persons, corporations, firms or associations engaged in the
business of carrying or transporting passengers or goods or both, by land, water or air, for compensation, offering their services to the
public. It is obvious from the above definition that respondent is not an entity engaged in the business of transporting either passengers
or goods and is therefore, neither a private nor a common carrier. Respondent did not undertake to transport petitioner from one place to
another since its covenant with its customers is simply to make travel arrangements in their behalf.

The object of petitioners contractual relation with respondent is the latters service of arranging and facilitating petitioners booking,
ticketing and accommodation in the package tour. In contrast, the object of a contract of carriage is the transportation of passengers or
goods. It is in this sense that the contract between the parties in this case was an ordinary one for services and not one of carriage. Since
the contract between the parties is an ordinary one for services, the standard of care required of respondent is that of a good father of a
family under Article 1173 of the Civil Code