CHAPTER 1 GENERAL CONSIDERATION

== Characteristics:
1. Undertakes to carry for all people indifferently
and thus is liable for refusal without sufficient
1. DEFINITION OF CONTRACT OF reason (Lastimoso vs. Doliente, October 20,
TRANSPORTATION 1961);
2. Cannot lawfully decline to accept a particular
class of goods for carriage to the prejudice of the
is when a person obligates himself to transport traffic in these goods;
persons or property from one place to another 3. No monopoly is favored (Batangas Trans. vs.
for a consideration. The contract may involve Orlanes, 52 PHIL 455);
carriage of passengers or carriage of goods. The 4. Provides public convenience.
person who obligates himself to transport the
goods or passengers may be a common carrier or PRIVATE CARRIER
a private carrier.
One which, without being engaged in the
{memaid: A contract whereby a person, natural business of carrying as a public employment,
or juridical, obligates to transport persons, undertakes to deliver goods or passengers for
goods, or both, from one place to another, by compensation.(Home Insurance Co. vs. American
land, air or water, for a price or compensation. Steamship Agency, 23 SCRA 24)

Classifications:
2. The passenger
1.Common or Private
2.Goods or Passengers
is one who travels in a public conveyance by
3.For a fee (for hire) or Gratuitous
4.Land, Water/maritime, or Air virtue of contract, express or implied, with the
carrier subject to payment of fare or an
5.Domestic/inter-island/coastwise or
International/foreign equivalent thereof.

It is a relationship which is imbued with thepublic a. Gratuitous or reduced fare.

interest.}
• Passenger is still considered as such
(passenger) even if he is being carried
2. PARTIES gratuitously or under a reduced fare.
[Subject to the rule in Article 1758 of the Civil
The parties to a contract of transportation would Code]
depend on whether it is for:
ARTICLE 1758 OF THE CIVIL CODE - when a
A. carriage of passengers or passenger is carried gratuitously, a stipulation
B. carriage of goods. limiting the common carrier's liablity for
negligence is valid.

A. CARRIAGE OF PASSENGERS Article 1758. When a passenger is carried

gratuitously, a stipulation limiting the common
The parties in contract of passengers are: carrier's liability for negligence is valid, but not
for wilful acts or gross negligence.
1. common carrier and
b. Baliwag Transit Corporation v. CA

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. [Crisostomo
vs CA]
• Only real party in interest (injured party) is the
contracting party.
Facts:
> Injured Party (of legal age) and his parents filed
a complaint against the bus company for the
injury he sustained from vehicular accident.
>The complaint was dismissed for the ground
that the injured party received payment from the
petitioner's insurer and executed a Release of
Claim.
>Parents of the injured party appeal - SC
sustained the dismissal.
• His parents cannot maintain an action because
they are not real parties-in-interest in an action
for breach of contract of carriage. It is the person
whose contractual right has been invaded who
must bring every action based on contract.
c. Cases where party who contracted with carrier
is not the passenger.
i.e.
1. When the employer will hire the service of a
bus company to ferry its employees
2. When the school will hire the service of a bus
company to provide transportation for its
students.
• These are often covered by written
agreements that bind the employer or school and
the bus service provider. Breach of the provisions
of the agreement will entitle one party to file an
action against the other. However, whether or
not there is a written agreement, the carrier
owes a duty of extraordinary diligence directly to
the passengers.
B. CARRIAGE OF GOODS
Parties:
1. Shipper
2. Carrier
b. When consignee is bound by the contract -
Instances when the 3rdparty consignee is bound
by the agreement between the shipper and the
carrier even of the consignee is not a contracting
party.
i.e.
1. Consignee is bound by the terms and
conditions of the bill of lading where it was
established that he accepted the same and is
trying to enforce the agreement. -While the bill
of lading is oftentimes drawn up by the
shipper/consignor and the carrier without the
intervention of the consignee, however, the
latter can be bound by the stipulations of the bill
of lading.
• 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
c. availment of the stipulation pour atrui
3. PERFECTION
2 types of Contracts of carriage of passengers
1. Contract to carry - an agreement to carry the
passengers at some future date.
• Consensual - perfected by mere consent

1. Shipper - the person who delivers the goods to 2. Contract of Carriage or of common carriage
the carrier for transportation. The shipper is the itself - that should be considered a real contract
person who pays the consideration or on whose for not until the facilities of the carrier are
behalf payment is made. actually used can the carrier be said to have
already assumed the obligation of the carrier.
2. Carrier -
CARRIAGE OF GOODS PERFECTION
a. Consignee - is the person to whom the goods
are to be delivered. a. Perfection of Contract of Carriage of Goods

The Consignee may be the shipper himself as in

the case where the goods will be delivered to
one of the branch officer of the shipper.
However, the consignee may be a third person
who is not actually a party to the contract of
carriage.
1. CONTRACT TO CARRY GOODS
- There may be a consensual contract to carry
goods whereby the carrier agrees to accept and
transport goods at some future date.
CONSENSUAL = MEETING OF THE MINDS
 CARRIAGE OF PASSENGERS PERFECTION

2. CONTRACT TO DELIVER GOODS

c. Carriage of Passengers

-However, by the act of delivery of the goods,

that us, "when the goods are unconditionally
place in the possession and control of the
carrier, and upon their receipt by the carrier for
transportation, the contract of carriage is
perfected."

POSSESSION & CONTROL OF CARRIER

=
PERFECTION

3. CONTRACT TO CARRY & DELIVER

NO GOODS RECEIVED = NO CONTRACT

RECEIPTS OF GOODS = FOUNDATION OF

Liability & Responsibility of Carrier

- Contract of Carriage of Goods =
commence on actual delivery or
receipt (acceptance) by carrier or
authorized agent
- Vessel = delivery to lighter in charge
of vessel

Liability of Carrier as Common Carrier

- Actual Delivery of Goods for
transportation not mere execution of
bill of lading even provided by the
statute.
- Issuance of bill of lading is not
necessary to complete delivery and
acceptance.
- Actual Delivery & Acceptance are
sufficient to bind the carrier.

Test to determine whether the

relationship of Shipper & Carrier has
been established.
- Control and Possession has been
totally surrendered to the carrier
and nothing to be done by the
shipper.

b.Compania Maritima v. ICNA

- Complete contract of carriage

The consummation of the contract has already

begun from the time the shipper delivered the
cargo to the carrier and the latter taking
possession thereof by placing it on lighter
manned by its authorized employees.