G.R. No.

92288 February 9, 1993

BRITISH AIRWAYS, INC., petitioner,

vs.
THE HON. COURT OF APPEALS, Twelfth Division, and FIRST INTERNATIONAL TRADING
AND GENERAL SERVICES, respondents.

Quasha, Asperilla, Ancheta, Peña & Nolasco for petitioner.

Monina P. Lee for private respondent.

NOCON, J.:

This is a petition for review on certiorari to annul and set aside the decision dated November 15,
1989 of the Court of Appeals  affirming the decision of the trial court  in ordering petitioner British
1 2

Airways, Inc. to pay private respondent First International Trading and General Services actual
damages, moral damages, corrective or exemplary damages, attorney's fees and the costs as well
as the Resolution dated February 15, 1990  denying petitioner's Motion for Reconsideration in the
3

appealed decision.

It appears on record that on February 15, 1981, private respondent First International Trading and
General Services Co., a duly licensed domestic recruitment and placement agency, received a telex
message from its principal ROLACO Engineering and Contracting Services in Jeddah, Saudi Arabia
to recruit Filipino contract workers in behalf of said principal.
4

During the early part of March 1981, said principal paid to the Jeddah branch of petitioner British
Airways, Inc. airfare tickets for 93 contract workers with specific instruction to transport said workers
to Jeddah on or before March 30, 1981.

As soon as petitioner received a prepaid ticket advice from its Jeddah branch to transport the 93
workers, private respondent was immediately informed by petitioner that its principal had forwarded
93 prepaid tickets. Thereafter, private respondent instructed its travel agent, ADB Travel and Tours.
Inc., to book the 93 workers with petitioner but the latter failed to fly said workers, thereby compelling
private respondent to borrow money in the amount of P304,416.00 in order to purchase airline
tickets from the other airlines as evidenced by the cash vouchers (Exhibits "B", "C" and "C-1 to C-7")
for the 93 workers it had recruited who must leave immediately since the visas of said workers are
valid only for 45 days and the Bureau of Employment Services mandates that contract workers must
be sent to the job site within a period of 30 days.

Sometime in the first week of June, 1981, private respondent was again informed by the petitioner
that it had received a prepaid ticket advice from its Jeddah branch for the transportation of 27
contract workers. Immediatety, private respondent instructed its travel agent to book the 27 contract
workers with the petitioner but the latter was only able to book and confirm 16 seats on its June 9,
1981 flight. However, on the date of the scheduled flight only 9 workers were able to board said flight
while the remaining 7 workers were rebooked to June 30, 1981 which bookings were again
cancelled by the petitioner without any prior notice to either private respondent or the workers.
Thereafter, the 7 workers were rebooked to the July 4,1981 flight of petitioner with 6 more workers
booked for said flight. Unfortunately, the confirmed bookings of the 13 workers were again cancelled
and rebooked to July 7, 1981.
On July 6, 1981, private respondent paid the travel tax of the said workers as required by the
petitioner but when the receipt of the tax payments was submitted, the latter informed private
respondent that it can only confirm the seats of the 12 workers on its July 7, 1981 flight. However,
the confirmed seats of said workers were again cancelled without any prior notice either to the
private respondent or said workers. The 12 workers were finally able to leave for Jeddah after
private respondent had bought tickets from the other airlines.

As a result of these incidents, private respondent sent a letter to petitioner demanding compensation
for the damages it had incurred by the latter's repeated failure to transport its contract workers
despite confirmed bookings and payment of the corresponding travel taxes.

On July 23, 1981, the counsel of private respondent sent another letter to the petitioner demanding
the latter to pay the amount of P350,000.00 representing damages and unrealized profit or income
which was denied by the petitioner.

On August 8, 1981, private respondent received a telex message from its principal cancelling the
hiring of the remaining recruited workers due to the delay in transporting the workers to Jeddah. 5

On January 27, 1982, private respondent filed a complaint for damages against petitioner with the
Regional Trial Court of Manila, Branch 1 in Civil Case No. 82-4653.

On the other hand, petitioner, alleged in its Answer with counterclaims that it received a telex
message from Jeddah on March 20, 1981 advising that the principal of private respondent had
prepaid the airfares of 100 persons to transport private respondent's contract workers from Manila to
Jeddah on or before March 30, 1981. However, due to the unavailability of space and limited time,
petitioner had to return to its sponsor in Jeddah the prepaid ticket advice consequently not even one
of the alleged 93 contract workers were booked in any of its flights.

On June 5, 1981, petitioner received another prepaid ticket advice to transport 16 contract workers
of private respondent to Jeddah but the travel agent of the private respondent booked only 10
contract workers for petitioner's June 9, 1981 flight. However, only 9 contract workers boarded the
scheduled flight with 1 passenger not showing up as evidenced by the Philippine Airlines' passenger
manifest for Flight BA-020 (Exhibit "7", "7-A", "7-B" and "7-C").
6

Thereafter, private respondent's travel agent booked seats for 5 contract workers on petitioner's July
4, 1981 flight but said travel agent cancelled the booking of 2 passengers while the other 3
passengers did not show up on said flight.

Sometime in July 1981, the travel agent of the private respondent booked 7 more contract workers in
addition to the previous 5 contract workers who were not able to board the July 4, 1981 flight with
the petitioner's July 7, 1981 flight which was accepted by petitioner subject to reconfirmation.

However on July 6, 1981, petitioner's computer system broke down which resulted to petitioner's
failure to get a reconfirmation from Saudi Arabia Airlines causing the automatic cancellation of the
bookings of private respondent's 12 contract workers. In the morning of July 7, 1981, the computer
system of the petitioner was reinstalled and immediately petitioner tried to reinstate the bookings of
the 12 workers with either Gulf Air or Saudi Arabia Airlines but both airlines replied that no seat was
available on that date and had to place the 12 workers on the wait list. Said information was duly
relayed to the private respondent and the 12 workers before the scheduled flight.
After due trial on or on August 27, 1985, the trial court rendered its decision, the dispositive portion
of which reads as follows:

WHEREFORE, in view of all the foregoing, this Court renders judgment:

1. Ordering the defendant to pay the plaintiff actual damages in the sum of
P308,016.00;

2. Ordering defendant to pay moral damages to the plaintiff in the amount of

P20,000.00;

3. Ordering the defendant to pay the plaintiff P10,000.00 by way of corrective or

exemplary damages;

4. Ordering the defendant to pay the plaintiff 30% of its total claim for and as
attorney's fees; and

5. To pay the costs. 7

On March 13, 1986, petitioner appealed said decision to respondent appellate court after the trial
court denied its Motion for Reconsideration on February 28, 1986.

On November 15, 1989, respondent appellate court affirmed the decision of the trial court, the
dispositive portion of which reads:

WHEREFORE, the decision appealed from is hereby AFFIRMED with costs against
the appellant.8

On December 9, 1989, petitioner filed a Motion for Reconsideration which was also denied.

Hence, this petition.

It is the contention of petitioner that

W/Nprivate respondent has no cause of action against it there being no perfected contract of
carriage existing between them as no ticket was ever issued to private respondent's contract
workers and, therefore, the obligation of the petitioner to transport said contract workers did not
arise. Furthermore,

private respondent's failure to attach any ticket in the complaint further proved that it was never a
party to the alleged transaction.

Petitioner's contention is untenable.

1. Private respondent had a valid cause of action for damages against petitioner. A cause of
action is an act or omission of one party in violation of the legal right or rights of the
other.  Petitioner's repeated failures to transport private respondent's workers in its flight
9

despite confirmed booking of said workers clearly constitutes breach of contract and bad
faith on its part. In resolving petitioner's theory that private respondent has no cause of
action in the instant case, the appellate court correctly held that:
In dealing with the contract of common carriage of passengers for purpose of
accuracy, there are two (2) aspects of the same, namely: (a) the contract "to carry (at
some future time)," which contract is consensual and is necessarily perfected by
mere consent (See Article 1356, Civil Code of the Philippines), and (b) the contract
"of carriage" or "of common carriage" itself which should be considered as a real
contract for not until the carrier is actually used can the carrier be said to have
already assumed the obligation of a carrier. (Paras, Civil Code Annotated, Vol. V, p.
429, Eleventh Ed.)

In the instant case, the contract "to carry" is the one involved which is consensual
and is perfected by the mere consent of the parties.

There is no dispute as to the appellee's consent to the said contract "to carry" its
contract workers from Manila to Jeddah. The appellant's consent thereto, on the
other hand, was manifested by its acceptance of the PTA or prepaid ticket advice
that ROLACO Engineering has prepaid the airfares of the appellee's contract
workers advising the appellant that it must transport the contract workers on or
before the end of March, 1981 and the other batch in June, 1981.

Even if a PTA is merely an advice from the sponsors that an airline is authorized to
issue a ticket and thus no ticket was yet issued, the fact remains that the passage
had already been paid for by the principal of the appellee, and the appellant had
accepted such payment. The existence of this payment was never objected to nor
questioned by the appellant in the lower court. Thus, the cause or consideration
which is the fare paid for the passengers exists in this case.

The third essential requisite of a contract is an object certain. In this contract "to
carry", such an object is the transport of the passengers from the place of departure
to the place of destination as stated in the telex.

Accordingly, there could be no more pretensions as to the existence of an oral

contract of carriage imposing reciprocal obligations on both parties.

In the case of appellee, it has fully complied with the obligation, namely, the payment
of the fare and its willingness for its contract workers to leave for their place of
destination.

On the other hand, the facts clearly show that appellant was remiss in its obligation
to transport the contract workers on their flight despite confirmation and bookings
made by appellee's travelling agent.

xxx xxx xxx

Besides, appellant knew very well that time was of the essence as the prepaid ticket
advice had specified the period of compliance therewith, and with emphasis that it
could only be used if the passengers fly on BA. Under the circumstances, the
appellant should have refused acceptance of the PTA from appellee's principal or to
at least inform appellee that it could not accommodate the contract workers.

xxx xxx xxx

 While there is no dispute that ROLACO Engineering advanced the payment for the
airfares of the appellee's contract workers who were recruited for ROLACO
Engineering and the said contract workers were the intended passengers in the
aircraft of the appellant, the said contract "to carry" also involved the appellee for as
recruiter he had to see to it that the contract workers should be transported to
ROLACO Engineering in Jeddah thru the appellant's transportation. For that matter,
the involvement of the appellee in the said contract "to carry" was well demonstrated
when
the appellant upon receiving the PTA immediately advised the appellee thereof.  10

Petitioner also contends that the appellate court erred in awarding actual damages in the amount of
P308,016.00 to private respondent since all expenses had already been subsequently reimbursed
by the latter's principal.

In awarding actual damages to private respondent, the appellate court held that the amount of
P308,016.00 representing actual damages refers to private respondent's second cause of action
involving the expenses incurred by the latter which were not reimbursed by ROLACO Engineering.
However, in the Complaint   filed by private respondent, it was alleged that private respondent
11

suffered actual damages in the amount of P308,016.00 representing the money it borrowed from
friends and financiers which is P304,416.00 for the 93 airline tickets and P3,600.00 for the travel tax
of the 12 workers. It is clear therefore that the actual damages private respondent seeks to recover
are the airline tickets and travel taxes it spent for its workers which were already reimbursed by its
principal and not for any other expenses it had incurred in the process of recruiting said contract
workers. Inasmuch as all expenses including the processing fees incurred by private respondent had
already been paid for by the latter's principal on a staggered basis as admitted in open court by its
managing director, Mrs. Bienvenida Brusellas.   We do not find anymore justification in the appellate
12

court's decision in granting actual damages to private respondent.

Thus, while it may be true that private respondent was compelled to borrow money for the airfare
tickets of its contract workers when petitioner failed to transport said workers, the reimbursements
made by its principal to private respondent failed to support the latter's claim that it suffered actual
damages as a result of petitioner's failure to transport said workers. It is undisputed that private
respondent had consistently admitted that its principal had reimbursed all its expenses.

Article 2199 of the Civil Code provides that:

Except as provided by law or by stipulations, one is entitled to an adequate

compensation only for such pecuniary loss suffered by him as he has duly proved.
Such compensation is referred to as actual or compensatory damages.

Furthermore, actual or compensatory damages cannot be presumed, but must be duly proved, and
proved with reasonable degree of certainty. A court cannot rely on speculation, conjecture or
guesswork as to the fact and amount of damages, but must depend upon competent proof that they
have suffered and on evidence of the actual amount thereof.  13

However, private respondent is entitled to an award of moral and exemplary damages for the injury
suffered as a result of petitioner's failure to transport the former's workers because of the latter's
patent bad faith in the performance of its obligation. As correctly pointed out by the appellate court:

As evidence had proved, there was complete failure on the part of the appellant to
transport the 93 contract workers of the appellee on or before March 30, 1981
despite receipt of the payment for their airfares, and acceptance of the same by the
 appellant, with specific instructions from the appellee's principal to transport the
contract workers on or before March 30, 1981. No previous notice was ever
registered by the appellant that it could not comply with the same. And then followed
the detestable act of appellant in unilaterally cancelling, booking and rebooking
unreasonably the flight of appellee's contract workers in June to July, 1981 without
prior notice. And all of these actuations of the appellant indeed constitute malice and
evident bad faith which had caused damage and besmirched the reputation and
business image of the appellee.  14

As to the alleged damages suffered by the petitioner as stated in its counterclaims, the record shows
that no claim for said damages was ever made by the petitioner immediately after their alleged
occurrence therefore said counterclaims were mere afterthoughts when private respondent filed the
present case.

WHEREFORE, the assailed decision is hereby AFFIRMED with the MODIFICATION that the award
of actual damages be deleted from said decision.

SO ORDERED.
G.R. No. L-48757 May 30, 1988

MAURO GANZON, petitioner,
vs.
COURT OF APPEALS and GELACIO E. TUMAMBING, respondents.

Antonio B. Abinoja for petitioner.

Quijano, Arroyo & Padilla Law Office for respondents.

SARMIENTO, J.:

The private respondent instituted in the Court of First Instance of Manila 1 an action against the
petitioner for damages based on culpa contractual. The antecedent facts, as found by the respondent
Court, 2 are undisputed:

On November 28, 1956, Gelacio Tumambing contracted the services of Mauro B. Ganzon to haul 305
tons of scrap iron from Mariveles, Bataan, to the port of Manila on board the lighter LCT "Batman"
(Exhibit 1, Stipulation of Facts, Amended Record on Appeal, p. 38). Pursuant to that agreement, Mauro
B. Ganzon sent his lighter "Batman" to Mariveles where it docked in three feet of water (t.s.n.,
September 28, 1972, p. 31). On December 1, 1956, Gelacio Tumambing delivered the scrap iron to
defendant Filomeno Niza, captain of the lighter, for loading which was actually begun on the same date
by the crew of the lighter under the captain's supervision. When about half of the scrap iron was already
loaded (t.s.n., December 14, 1972, p. 20), Mayor Jose Advincula of Mariveles, Bataan, arrived and
demanded P5,000.00 from Gelacio Tumambing. The latter resisted the shakedown and after a heated
argument between them, Mayor Jose Advincula drew his gun and fired at Gelacio Tumambing (t.s.n.,
March 19, 1971, p. 9; September 28, 1972, pp. 6-7).<äre||anº•1àw>  The gunshot was not fatal but
Tumambing had to be taken to a hospital in Balanga, Bataan, for treatment (t.s.n., March 19, 1971, p.
13; September 28, 1972, p. 15).

After sometime, the loading of the scrap iron was resumed. But on December 4, 1956, Acting Mayor
Basilio Rub, accompanied by three policemen, ordered captain Filomeno Niza and his crew to dump the
scrap iron (t.s.n., June 16, 1972, pp. 8-9) where the lighter was docked (t.s.n., September 28, 1972, p.
31). The rest was brought to the compound of NASSCO (Record on Appeal, pp. 20-22). Later on Acting
Mayor Rub issued a receipt stating that the Municipality of Mariveles had taken custody of the scrap
iron (Stipulation of Facts, Record on Appeal, p. 40; t.s.n., September 28, 1972, p. 10.)

On the basis of the above findings, the respondent Court rendered a decision, the dispositive portion of
which states:

WHEREFORE, the decision appealed from is hereby reversed and set aside and a new one entered
ordering defendant-appellee Mauro Ganzon to pay plaintiff-appellant Gelacio E. Tumambimg the sum of
P5,895.00 as actual damages, the sum of P5,000.00 as exemplary damages, and the amount of
P2,000.00 as attorney's fees. Costs against defendant-appellee Ganzon. 3
In this petition for review on certiorari, the alleged errors in the decision of the Court of Appeals are:

THE COURT OF APPEALS FINDING THE HEREIN PETITIONER GUILTY OF BREACH OF THE CONTRACT OF
TRANSPORTATION AND IN IMPOSING A LIABILITY AGAINST HIM COMMENCING FROM THE TIME THE
SCRAP WAS PLACED IN HIS CUSTODY AND CONTROL HAVE NO BASIS IN FACT AND IN LAW.

II

THE APPELLATE COURT ERRED IN CONDEMNING THE PETITIONER FOR THE ACTS OF HIS EMPLOYEES IN
DUMPING THE SCRAP INTO THE SEA DESPITE THAT IT WAS ORDERED BY THE LOCAL GOVERNMENT
OFFICIAL WITHOUT HIS PARTICIPATION.

III

THE APPELLATE COURT FAILED TO CONSIDER THAT THE LOSS OF THE SCRAP WAS DUE TO A
FORTUITOUS EVENT AND THE PETITIONER IS THEREFORE NOT LIABLE FOR LOSSES AS A CONSEQUENCE
THEREOF. 4

The petitioner, in his first assignment of error, insists that the scrap iron had not been unconditionally
placed under his custody and control to make him liable. However, he completely agrees with the
respondent Court's finding that on December 1, 1956, the private respondent delivered the scraps to
Captain Filomeno Niza for loading in the lighter "Batman," That the petitioner, thru his employees,
actually received the scraps is freely admitted. Significantly, there is not the slightest allegation or
showing of any condition, qualification, or restriction accompanying the delivery by the private
respondent-shipper of the scraps, or the receipt of the same by the petitioner. On the contrary, soon
after the scraps were delivered to, and received by the petitioner-common carrier, loading was
commenced.

By the said act of delivery, the scraps were unconditionally placed in the possession and control of the
common carrier, and upon their receipt by the carrier for transportation, the contract of carriage was
deemed perfected. Consequently, the petitioner-carrier's extraordinary responsibility for the loss,
destruction or deterioration of the goods commenced. Pursuant to Art. 1736, such extraordinary
responsibility would cease only upon the delivery, actual or constructive, by the carrier to the consignee,
or to the person who has a right to receive them. 5 The fact that part of the shipment had not been
loaded on board the lighter did not impair the said contract of transportation as the goods remained in
the custody and control of the carrier, albeit still unloaded.

The petitioner has failed to show that the loss of the scraps was due to any of the following causes
enumerated in Article 1734 of the Civil Code, namely:

(1) Flood, storm, earthquake, lightning, or other natural disaster or calamity;

(2) Act of the public enemy in war, whether international or civil;

(3) Act or omission of the shipper or owner of the goods;

(4) The character of the goods or defects in the packing or in the containers;

(5) Order or act of competent public authority.

Hence, the petitioner is presumed to have been at fault or to have acted negligently. 6 By reason of this
presumption, the court is not even required to make an express finding of fault or negligence before it
could hold the petitioner answerable for the breach of the contract of carriage. Still, the petitioner could
have been exempted from any liability had he been able to prove that he observed extraordinary
diligence in the vigilance over the goods in his custody, according to all the circumstances of the case, or
that the loss was due to an unforeseen event or to force majeure. As it was, there was hardly any
attempt on the part of the petitioner to prove that he exercised such extraordinary diligence.

It is in the second and third assignments of error where the petitioner maintains that he is exempt from
any liability because the loss of the scraps was due mainly to the intervention of the municipal officials
of Mariveles which constitutes a caso fortuito as defined in Article 1174 of the Civil Code. 7

We cannot sustain the theory of caso fortuito. In the courts below, the petitioner's defense was that the
loss of the scraps was due to an "order or act of competent public authority," and this contention was
correctly passed upon by the Court of Appeals which ruled that:

... In the second place, before the appellee Ganzon could be absolved from responsibility on the ground
that he was ordered by competent public authority to unload the scrap iron, it must be shown that
Acting Mayor Basilio Rub had the power to issue the disputed order, or that it was lawful, or that it was
issued under legal process of authority. The appellee failed to establish this. Indeed, no authority or
power of the acting mayor to issue such an order was given in evidence. Neither has it been shown that
the cargo of scrap iron belonged to the Municipality of Mariveles. What we have in the record is the
stipulation of the parties that the cargo of scrap iron was accilmillated by the appellant through separate
purchases here and there from private individuals (Record on Appeal, pp. 38-39). The fact remains that
the order given by the acting mayor to dump the scrap iron into the sea was part of the pressure applied
by Mayor Jose Advincula to shakedown the appellant for P5,000.00. The order of the acting mayor did
not constitute valid authority for appellee Mauro Ganzon and his representatives to carry out.

Now the petitioner is changing his theory to caso fortuito. Such a change of theory on appeal we cannot,
however, allow. In any case, the intervention of the municipal officials was not In any case, of a
character that would render impossible the fulfillment by the carrier of its obligation. The petitioner was
not duty bound to obey the illegal order to dump into the sea the scrap iron. Moreover, there is absence
of sufficient proof that the issuance of the same order was attended with such force or intimidation as
to completely overpower the will of the petitioner's employees. The mere difficulty in the fullfilment of
the obligation is not considered force majeure. We agree with the private respondent that the scraps
could have been properly unloaded at the shore or at the NASSCO compound, so that after the dispute
with the local officials concerned was settled, the scraps could then be delivered in accordance with the
contract of carriage.

There is no incompatibility between the Civil Code provisions on common carriers and Articles 361 8 and
362 9 of the Code of Commerce which were the basis for this Court's ruling in Government of the
Philippine Islands vs. Ynchausti & Co.10 and which the petitioner invokes in tills petition. For Art. 1735 of
the Civil Code, conversely stated, means that the shipper will suffer the losses and deterioration arising
from the causes enumerated in Art. 1734; and in these instances, the burden of proving that damages
were caused by the fault or negligence of the carrier rests upon him. However, the carrier must first
establish that the loss or deterioration was occasioned by one of the excepted causes or was due to an
unforeseen event or to force majeure. Be that as it may, insofar as Art. 362 appears to require of the
carrier only ordinary diligence, the same is .deemed to have been modified by Art. 1733 of the Civil
Code.

Finding the award of actual and exemplary damages to be proper, the same will not be disturbed by us.
Besides, these were not sufficiently controverted by the petitioner.

WHEREFORE, the petition is DENIED; the assailed decision of the Court of Appeals is hereby AFFIRMED.
Costs against the petitioner.

This decision is IMMEDIATELY EXECUTORY.

Yap, C.J., Paras and Padilla, JJ., concur.

Separate Opinions

MELENCIO-HERRERA, J.,  dissenting:

I am constrained to dissent.

It is my view that petitioner can not be held liable in damages for the loss and destruction of the scrap
iron. The loss of said cargo was due to an excepted cause an 'order or act of competent public authority"
(Article 1734[5], Civil Code).

The loading of the scrap iron on the lighter had to be suspended because of Municipal Mayor Jose
Advincula's intervention, who was a "competent public authority." Petitioner had no control over the
situation as, in fact, Tumambing himself, the owner of the cargo, was impotent to stop the "act' of said
official and even suffered a gunshot wound on the occasion.

When loading was resumed, this time it was Acting Mayor Basilio Rub, accompanied by three policemen,
who ordered the dumping of the scrap iron into the sea right where the lighter was docked in three feet
of water. Again, could the captain of the lighter and his crew have defied said order?

Through the "order" or "act" of "competent public authority," therefore, the performance of a
contractual obligation was rendered impossible. The scrap iron that was dumped into the sea was
"destroyed" while the rest of the cargo was "seized." The seizure is evidenced by the receipt issues by
Acting Mayor Rub stating that the Municipality of Mariveles had taken custody of the scrap iron.
Apparently, therefore, the seizure and destruction of the goods was done under legal process or
authority so that petitioner should be freed from responsibility.

Art. 1743. If through order of public authority the goods are seized or destroyed, the common carrier is
not responsible, provided said public authority had power to issue the order.

 
Separate Opinions

MELENCIO-HERRERA, J.,  dissenting:

I am constrained to dissent.

It is my view that petitioner can not be held liable in damages for the loss and destruction of the scrap
iron. The loss of said cargo was due to an excepted cause an 'order or act of competent public authority"
(Article 1734[5], Civil Code).

The loading of the scrap iron on the lighter had to be suspended because of Municipal Mayor Jose
Advincula's intervention, who was a "competent public authority." Petitioner had no control over the
situation as, in fact, Tumambing himself, the owner of the cargo, was impotent to stop the "act' of said
official and even suffered a gunshot wound on the occasion.

When loading was resumed, this time it was Acting Mayor Basilio Rub, accompanied by three policemen,
who ordered the dumping of the scrap iron into the sea right where the lighter was docked in three feet
of water. Again, could the captain of the lighter and his crew have defied said order?

Through the "order" or "act" of "competent public authority," therefore, the performance of a
contractual obligation was rendered impossible. The scrap iron that was dumped into the sea was
"destroyed" while the rest of the cargo was "seized." The seizure is evidenced by the receipt issues by
Acting Mayor Rub stating that the Municipality of Mariveles had taken custody of the scrap iron.
Apparently, therefore, the seizure and destruction of the goods was done under legal process or
authority so that petitioner should be freed from responsibility.

Art. 1743. If through order of public authority the goods are seized or destroyed, the common carrier is
not responsible, provided said public authority had power to issue the order.

Footnotes

1 Presided by Judge Jesus P. Morfe

2 Pascual, Chairman, ponente; Agrava and Climaco, JJ., concurring.

3 Decision, 9; Rollo 19.

4 Petitioner's Brief, 3, 7, 9; Rollo, 41.

5 Article 1736, Civil Code of the Philippines:

Art. 1736. The extraordinary responsibility of the common carriers 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 a right
to receive them, without prejudice to the provisions of article 1738.

6 Article 1735, supra.

Art. 1735. In all cases other than those mentioned in Nos. 1, 2, 3, 4, and 5 of the preceding article, if the
goods are lost, destroyed or deteriorated, common carriers are presumed to have been at fault or to
have acted negligently, unless they prove that they observed extraordinary diligence as required in
Article 1733.

7 Art. 11 74, supra:

Art. 1174. Except in cases expressly specified by the law, or when it is otherwise declared by stipulation,
or when the nature of the obligation requires the assumption of risk, no person shall be responsible for
those events which could not be foreseen, or which though for foreseen were inevitable.

8 Article 361, Code of Commerce:

Art. 361. The merchandise shall be transported at the risk and venture of the shipper, if the contrary has
not been expressly stipulated.

As a consequence, all the losses and deterioration which the goods may suffer during the transportation
by reason of fortuitous event, force majeure, or the inherent nature and defect of the goods, shall be for
the account and risk of the shipper.

Proof of these accidents is incumbent upon the carrier.

9 Article 362, Code of Commerce:

Art. 362. Nevertheless, the carrier shall be liable for the losses and damages resulting from the causes
mentioned in the preceding article if it is proved, as against him, that they arose through his negligence
or by reason of his having failed to take the precautions which usage has established among careful
persons, unless the shipper has committed fraud in the bill of lading, representing the goods to be of a
kind or quality different from what they really were.

If, notwithstanding the precautions referred to in to article, the goods transported run the risk of being
lost, on account of their nature or by reason of unavoidable accident, there being no time for their
owners to dispose of them, the carrier may proceed to sell them, placing them for this purpose at the
disposal of the judicial authority or of the officials designated by special provisions.