Transportation Digest Proper 2

Transportation Law Case Digests
A.Y. 2014 – 2015, 2nd Semester
ABOITIZ SHIPPING CORPORATION V. COURT OF APPEALS

G.R. No. 84458 , November 6, 1989
Second Division, Regalado, J.
Digested by: Ace Aries Solda
Facts:
Anacleto Viana boarded the vessel M/V Antonia owned by defendant. After the ship
reached its destination, Pioneer Stevedoring Corporation took over the exclusive control of
the cargoes on board the ship. During the unloading, a crane operated by one of the
employees of Pioneer Stevedoring Corporation smashed into Anacleto while she was
alighting from the vessel which caused her untimely death.
Private respondents filed a complaint for damages against petitioner Aboitiz for
breach of contract of carriage. Petitioner denies responsibility contending that at the time of
the accident, the vessel was already under the complete control of Pioneer Stevedoring
Corporation. Pioneer in its answer to the Third-Party Complaint raised the defense that
Aboitiz has no cause of action since Aboitiz is being sued by the Private Respondents for
breach of contract of carriage.
Issue:
Whether or not petitioner is liable for breach of contract of carriage.
Ruling:
Yes. The rule is that the relation of carrier and passenger continues until the
passenger has been landed at the port of destination and has left the vessel owner’s dock or
premises. It is common knowledge that the very nature of petitioner’s business as a shipper,
the passenger of vessels are allotted a longer period of time to disembark from the ship that
other common carriers such as a passenger bus.
In the case at bar, the victim is still deemed a passenger of said carrier at the time of
his tragic death. A passenger who dies or is injured, the common carrier is presumed to have
been at fault or to have acted negligently. Since the petitioner was not able to overcome
this burden they are liable to pay for the damages to the victim.
1|Page| TRANSPORTATION LAW

DANGWA TRANSPORTATION CO, INC v. COURT OF APPEALS

G.R. No. 95582, October 7, 1991
Digested by: Ace Aries Solda
Facts:
Pedrito Cudiamat figured in to a vehicular accident while on board the bus of
Petitioner Corporation. He was ran over by the bus as the bus accelerated while he was
alighting, however, instead of bringing Pedrito immediately to the nearest hospital, the said
driver, first brought this other passengers and cargo to the destination before banging said
victim to the Lepanto Hospital.
Petitioners alleged that they had observed and continued to observe the
extraordinary diligence required in the operation of the transportation company and the
supervision of the employees, even as they add that they are not absolute insurers of the
safety of the public at large.
Issue:
Whether or not petitioner was negligent in performing its obligation as a common
carrier.
Ruling:
Yes. A public utility bus, once it stops, is in effect making a continuous offer to bus
riders. Hence, it becomes the duty of the driver and the conductor, every time the bus stops,
to do no act that would have the effect of increasing the peril to a passenger while he was
attempting to board the same. The premature acceleration of the bus in this case was a
breach of such duty.
It is the duty of common carriers of passengers, to stop their conveyances a

reasonable length of time in order to afford passengers an opportunity to board and enter,
and they are liable for injuries suffered by boarding passengers resulting from the sudden
starting up or jerking of their conveyance while they are doing so.
In the case at bar, the victim, by stepping and standing on the platform of the bus, is
already considered a passenger and is entitiled all the rights and protection pertaining to
such a contractual relation. Hence, it has been held that the duty which the carrier
passengers owes to its patrons extends to person boarding cars aw well as to those
alighting therefrom.

LRTA v. Natividad
G.R. No. 145804, February 6, 2003
First Division, Justice Vitug
Digested by: Cathrine Lagodgod
Facts:
On 14 October 1993, about half an hour past 7:00 p.m., Nicanor Navidad, then drunk,
entered the EDSA LRT station after purchasing a “token” (representing payment of the
fare). While Navidad was standing on the platform near the LRT tracks, Junelito Escartin, the
security guard assigned to the area approached Navidad. A misunderstanding or an
altercation between the two apparently ensued that led to a fist fight. No evidence,
however, was adduced to indicate how the fight started or who, between the two, delivered
the firstblow or how Navidad later fell on the LRT tracks. At the exact moment that Navidad
fell, an LRT train, operated by Rodolfo Roman, was coming in. Navidad was struck by the
moving train, and he was killed instantaneously. On 8 December 1994, the widow of Nicanor,
Marjorie Navidad, along with her children, filed a complaint for damages against Junelito
Escartin, Rodolfo Roman, the LRTA, the Metro Transit Organization, Inc. (Metro Transit),
and Prudent for the death of her husband. LRTA and Roman filed a counterclaim against
Navidad and a cross-claim against Escartin and Prudent. Prudent, in its answer, denied
liability and averred that it had exercised due diligence in the selection and supervision of its
security guards. The LRTA and Roman presented their evidence while Prudent and Escartin,
instead of presenting evidence, filed a demurrer contending that Navidad had failed to
prove thatEscartin was negligent in his assigned task. On 11 August 1998, the trial court
rendered its decision, ordering Prudent Security and Escartin to jointly and severally pay
Navidad (a) (1) Actual damages of P44,830.00; (2) Compensatory damages of P443,520.00;
(3) Indemnity for the death of Nicanor Navidad in the sum of P50,000.00; (b) Moral damages
of P50,000.00; (c) Attorney’s fees of P20,000; and (d) Costs of suit. The court also dismissed
the complaint against LRTA and Rodolfo Roman for lack of merit, and the compulsory
counterclaim of LRTA and Roman. Prudent appealed to the Court of Appeals. On 27 August
2000, the appellate court promulgated its decision exonerating Prudent from any liability for
the death of Nicanor Navidad and, instead, holding the LRTA and Roman jointly and
severally liable. The appellate court modified the judgment ordering Roman and the LRTA
solidarily liable to pay Navidad (a) P44,830.00 as actual damages; (b) P50,000.00 as nominal
damages; (c) P50,000.00 as moral damages; (d) P50,000.00 as indemnity for the death of
the deceased; and (e) P20,000.00 as and for attorney’s fees. The appellate court denied
LRTA’s and Roman’s motion for reconsideration in its resolution of 10 October 2000. Hence,
this appeal.

Issue:
W/N LRTA liable for tort arising from contract
Ruling:
YES. As discussed in the Aquino book, once one has a token, he is deemed a
passenger on a train. The contract is perfected. The foundation of LRTA’s liability is the
contract of carriage and its obligation to indemnify the victim arises from the breach of that
contract by reason of its failure to exercise the high diligence required of the common
carrier. In the discharge of its commitment to ensure the safety of passengers, a carrier may
choose to hire its own employees or avail itself of the services of an outsider or an
independent firm to undertake the task. In either case, the common carrier is not relieved of
its responsibilities under the contract of carriage.

LA Mallorca v. CA
G.R. No. L-20761, July 27, 1966
En Banc, Justice Barrera
Digested by: Cathrine Lagodgod
Facts:
BELTRAN spouses together with their minor daughters, MILAGROS (13), RAQUEL (41⁄2)
and FE (2), boarded the bus owned and operated by the LA MALLORCA, at San Fernando,
Pampanga, bound for Anao, Mexico, Pampanga. They were carrying with them four pieces
of baggages containing their personal belonging. The conductor of the bus, who happened
to be a half-brother of plaintiff Mariano, issued three tickets covering the full fares of the
plaintiff and their eldest child, MILAGROS. No fare was charged on RAQUEL and FE, since
both were below the height at which fare is charged in accordance with the appellant's rules
and regulations. When the bus reached Anao, it stopped to allow the passengers bound
therefor to get off. MARIANO, then carrying some of their baggages followed by his wife
and his children got off the bus. MARIANO led his companions to a shaded spot on the left
pedestrian side of the road about four or five meters away from the vehicle. He returned to
the bus in controversy to get his other bayong, which he had left behind, but in so doing,
Raquel followed him, unnoticed by her father. While said Mariano was on the running board
of the bus waiting for the conductor to hand him his bayong which he left under one of its
seats near the door, the bus, whose motor was not shut off while unloading, suddenly
started moving forward, evidently to resume its trip, notwithstanding the fact that the
conductor has not given the driver the customary signal to start, since said conductor was
still attending to the baggage left behind by Mariano. Incidentally, when the bus was again
placed into a complete stop, it had travelled about ten meters from the point where the
plaintiffs had gotten off. Sensing that the bus was again in motion, Mariano
immediately jumped from the running board without getting his bayong from
the conductor. He landed on the side of the road almost in front of the shaded place where
he left his wife and children. At that precise time, he saw people beginning to gather around
the body of a child lying prostrate on the ground, her skull crushed, and without life. The
child was Raquel, who was run over by the bus in which she rode earlier together with her
parents.For the death of their said child, BELTRAN spouses commenced the present suit
against the LA MALLORCA seeking to recover from the latter an aggregate amount of
P16,000 to cover moral damages and actual damages sustained as a result thereof and
attorney's fees.The trial court found defendant liable for breach of contract of carriage and
sentenced it to pay P3,000.00 for the death of the child and P400.00 as compensatory
damages representing burial expenses and costs. On appeal, LA MALLORCA claimed that
there could not be a breach of contract in the case, for the reason that when the child met

her death, she was no longer a passenger of the bus involved in the incident and, therefore,
the contract of carriage had already terminated. CA sustained this theory, but still found the
LA MALLORCA guilty of quasi-delict and held the latter liable for damages, for the
negligence of its driver, in accordance with Article 2180 of the Civil Code. CA did not only find
the petitioner liable, but increased the damages awarded the plaintiffs-appellees to
P6,000.00, instead of P3,000.00 granted by the trial court.Under the facts as found by the
CA, we have to sustain the judgment holding petitioner liable for damages for the death of
the child, RAQUEL. It may be pointed out that although it is true that the BELTRAN family
had alighted from the bus at a place designated for disembarking or unloading of
passengers, it was also established that the father had to return to the vehicle to get one of
his bags or bayong that was left under one of the seats of the bus. There can be no
controversy that as far as the father is concerned, when he returned to the bus for his
bayong which was not unloaded, the relation of passenger and carrier between him and the
petitioner remained subsisting. For, the relation of carrier and passenger does not
necessarily cease where the latter, after alighting from the car,aids the carrier's servant or
employee in removing his baggage from the car.
Issue:
W/N the child, who was already led by the father to a place about 5 meters away
from the bus, the liability of the carrier for her safety under the contract of carriage also
persisted
Ruling:
YES. The relation of carrier and passenger does not cease at the moment the
passenger alights from the carrier's vehicle at a place selected by the carrier at the point of
destination, but continues until the passenger has had a reasonable time or a reasonable
opportunity to leave the carrier's premises. And, what is a reasonable time or a reasonable
delay within this rule is to be determined from all the circumstances. In the circumstances of
the case, it cannot be claimed that the carrier's agent had exercised the "utmost diligence"
of a "very cautions person" required by Article 1755 of the Civil Code to be observed by
a common carrier in the discharge of its obligation to transport safely its passengers. In the
first place, the driver, although stopping the bus, nevertheless did not put off the engine.
Secondly, he started to run the bus even before the bus conductor gave him the signal to go
and while the latter was still unloading part of the baggages of the BELTRAN family. The
presence of said passengers near the bus was not unreasonable and they are, therefore, to

be considered STILL AS PASSENGERS OF THE CARRIER, ENTITLED TO THE PROTECTION

UNDER THEIR CONTRACT OF CARRIAGE. But even assuming arguendo that the contract of
carriage has already terminated, herein petitioner can be held liable for the negligence of its
driver, as ruled by the CA, pursuant to Article 2180 of the Civil Code.

JAPAN AIRLINES v. COURT OF APPEALS

G.R. No. 118664. August 7, 1998
Romero, J., Third Division
Digested by: Janzeri Labiaga
Facts:
Miranda, the Agana’s, and Francisco (Respondents) boarded JAL in California bound
for Manila. As an incentive for travelling on the said airline, their flights were to make an
overnight stopover at Japan, at the airlines’ expense. Upon arrival at Japan respondents
were booked at Hotel Nikko. The next day, respondents went to the airport to take their
flight to Manila. However, due to the Mt. Pinatubo eruption, ash fall blanketed Ninoy
Aquino International Airport (NAIA), making it inaccessible. The trip to Manila was cancelled
indefinitely. JAL rebooked all the Manila-bound passengers on flight No. 741 and paid for the
hotel expenses for their unexpected overnight stay. Respondent’s flight to Manila was
again cancelled. JAL informed the respondents that it would no longer pay their hotel and
accommodation expense. NAIA was reopened six days later and respondents were forced to
pay for their accommodations and meal expenses from their personal funds. The RTC
rendered its judgment in favor of respondents. The Court of Appeals lowered the damages
and affirmed the trial court’s judgment.
Issue:
Whether JAL has the obligation to shoulder the expenses of its stranded passenger’s
even if the delay was caused by force majeure?
Ruling:
A party cannot be held liable for damages for non-performance of an obligation due
to force majeure. The failure to fly to Manila was not due to the fault or negligence of JAL
but the closure of NAIA to international flights. Thus JAL, is not liable for respondents’
expenses. However, respondents bought tickets from the United States with Manila as their
final destination. JAL had the duty to make the necessary arrangements to transport
respondents on the first available connecting flight to Manila. JAL failed on its obligation to
look after the comfort and convenience of its passengers when it declassified private
respondents from “transit passengers” to “new passengers” as a result, respondents were
burdened with making the necessary arrangements for their next flight to Manila.
Respondents were placed on the waiting list and to assure a seat on an available flight, they
were compelled to stay in the airport the whole day. JAL has the obligation to make the
arrangements to transport respondents to Manila. JAL had a contract to transport
respondents from the United States to Manila as their final destination.

Philippine Airlines v. Court Of Appeals

G.R. No. L-82619. September 15, 1993
First Division, Justice Bellosillo
Digested by: Alfred H. Campañano
Facts:
Zapatos purchased a ticket from Philippine Air Lines (PAL) to transport him to Ozamiz
City. The route was from Cebu-Ozamiz-Cotabato. Due to bad weather conditions, the pilot of
PAL did received radio instructions to proceed to Cotabato Airport. PAL then informed
Zapatos of his options, to return to Cebu, or take the next flight to Cebu the following day,
or to take the next available flight to Ozamiz City. Zapatos chose to return to Ozamiz City on
the same day. However, there were only six seats available and, the seats were given to the
passengers according to their check-in sequence at Cebu. Zapatos was stranded in Cotabato
City, where a battle between the government and rebels was ongoing. PAL also failed to
provide accommodations for Zapatos and also refused Zapatos a hitch ride with its
employees on a ford truck. It also failed to return Zapatos’ luggage.
Issue:
Whether PAL can invoke the defense of fortuitous event to exempt itself from paying
damages.
Ruling:
PAL failed in its duty of extending utmost care to Zapatos while being stranded in
Cotabato City. The flight diversion due to bad weather is a fortuitous event. Howeaver, such
event did not terminate PAL’s contract with Zapatos. Being in the business of air carriage
and the sole one to operate in the country, PAL is deemed equipped to deal with such
situations. The relation of carrier and passenger continues until the passenger has landed at
the port of destination and has left the carrier’s premises. Thus, PAL still have to exercise
extraordinary diligence in safeguarding the comfort, convenience and safety of its stranded
passengers until they have reached their final destination. PAL failed considering the then
ongoing battle between government forces and rebels in Cotabato City and the fact that
Zapatos was a stranger to the place. PAL’s failure to comply with the obligation of common
carrier to deliver its passengers safely to their destination and PAL’s duty to provide comfort
and convenience to its stranded passengers using extra-ordinary diligence, is not solely due
to fortuitous event, but due to something which PAL could have prevented, PAL is liable to
Zapatos.

Gacal vs PAL
G.R. No. L-55300, March 15, 1990
Second Division, Justice Paras
Digested by: Claris Langngag
Facts:
Plaintiffs Franklin G. Gacal and his wife, Corazon M. Gacal along with three others
were then passengers boarding defendant’s BAC 1-11 at Davao Airport for a flight to Manila,
not knowing that on the same flight were members of the MNLF armed with grenades and
pistols. Ten minutes after takeoff, the MNLF announced the hijacking of the aircraft and
directed its pilot to fly to Libya. With the pilot explaining to them of the fuel limitations of
the plane, the hijackers directed the pilot to fly to Sabah. So they landed in Zamboanga
Airport to refuel. At the Zamboanga Airport, there ensued hostilities between the military
and the hijackers. As a result of such faceoff, the wives of Gacal and Anislag suffered injuries.
Now, plaintiffs are claiming for damages averring that PAL exercised negligence, finding
basis on its breach of contract of carriage. There was a failure to frisk the passengers
adequately in order to discover hidden weapons in the bodies of the hijackers. Despite the
prevalence of skyjacking, PAL did not use a metal detector which is the most effective means
of discovering potential skyjackers among the passengers.
Issue:
Whether or not hijacking or air piracy during martial law and under the
circumstances obtaining herein, is a caso fortuitous or force majeure which would exempt
an aircraft from payment of damages to its passengers whose lives were put in jeopardy and
whose personal belongings were lost during the incident.
Ruling:
Caso fortuitous or force majeure, by definition, are extraordinary events not
foreseeable or avoidable, events that could not be foreseen, or which, though foreseen, are
inevitable. It is, therefore, not enough that the event should not have been foreseen or
anticipated, as is commonly believed, but it must be one impossible to foresee or to avoid.
The mere difficulty to foresee the happening is not impossibility to foresee the same. The
failure to transport petitioners safely from Davao to Manila was due to the skyjacking
incident staged by six passengers of the same plane, all members of the Moro National
Liberation Front (MNLF), without any connection with private respondent, hence,
independent of the will of either the PAL or of its passengers. Under normal circumstances,
PAL might have foreseen the skyjacking incident which could have been avoided had there
been a more thorough frisking of passengers and inspection of baggages as authorized by
R.A. No. 6235. But the incident in question occurred during Martial Law where there was a
military take-over of airport security including the frisking of passengers and the inspection
of their luggage preparatory to boarding domestic and international flight.
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Fortune Express , Inc. vs CA

G.R. No. 119756, March 18, 1999
Second Division,Justice Mendoza
Digested by: Claris Langngag
FACTS:
A bus of petitioner figured in an accident with a jeepney in Kauswagan, Lanao del
Norte, resulting in the death of several passengers of the jeepney, including two Maranaos.
The passengers found that the owner of the jeepney was a Maranao and that certain
Maranaos were planning to take revenge on the petitioner by burning some of its buses.
Three armed Maranaos who pretended to be passengers, seized a bus of petitioner at
Linamon, Lanao del Norte while on its way to Iligan City. Among the passengers of the bus
was Atty. Caorong. The leader of the Maranaos, identified as one Bashier Mananggolo shot
the driver and started pouring gasoline inside the bus, and then ordered the passengers to
get off the bus. However, Atty. Caorong returned to the bus to retrieve something from the
overhead rack. At that time he saw that one of the armed men was pouring gasoline on the
head of the driver. Atty. Caorong then pleading with the armed men to spare the driver.
There was shots from inside the bus and Larry de la Cruz, one of the passengers, saw that
Atty. Caorong was hit. Then the bus was set on fire. Some of the passengers were able to
pull Atty. Caorong out of the burning bus and rush him to the Mercy Community Hospital in
Iligan City, but he died while undergoing operation.The private respondents brought this
suit for breach of contract of carriage.
ISSUES:
1. Whether or not the seizure of petitioner’s bus is a case of force majeure.
2. Whether or not Atty. Caorong was guilty of contributory negligence in returning to
the bus to retrieve something.
HELD:
1. NO. Art. 1755 of the Civil Code provides that “a common carrier is bound to carry the
passengers as far as human care and foresight can provide, using the utmost
diligence of very cautious person, with due regard for all the circumstances.” Thus,
we held in Pilapil and De Guzman that the respondents therein were not negligent in
failing to take special precautions against threats to the safety of passengers which
could not be foreseen, such as tortious or criminal acts of third persons. In the
present case, this factor of unforeseeablility the second requisite for an event to be
considered force majeure is lacking. As already stated, despite the report of PC agent
Generalao that the Maranaos were planning to burn some of petitioner’s buses and
the assurance of petitioner’s operations manager Diosdado Bravo that the necessary
precautions would be taken, nothing was really done by petitioner to protect the
safety of passengers.
2. NO. Atty. Caorong did not act recklessly. It should be pointed out that the intended
targets of the violence were petitioner and its employees, not its passengers. The
assailant’s motive was to retaliate for the loss of life of two Maranaos as a result of
the collision between petitioner’s bus and the jeepney in which the two Maranaos
were riding. Mananggolo, the leader of the group which had hijacked the bus,
ordered the passengers to get off the bus as they intended to burn it and its driver.
The armed men actually allowed Atty. Caorong to retrieve something from the bus.
What apparently angered them was his attempt to help the driver of the bus by
pleading for his life. He was playing the role of the good Samaritan. Certainly, this
act cannot be considered an act of negligence, let alone recklessness.
PILAPIL v. COURT OF APPEALS

G.R. No. 52159, December 22, 1989
SECOND DIVISION, Padilla
Digested by: Victoria Dines
FACTS
Jose Pilapil, a paying passenger, boarded Alatco Transportation Company’s bus No.
409 in Iriga City. While said bus was negotiating the distance between Iriga City and Naga
City, upon reaching the vicinity of the cemetery in Camarines Sur, an unidentified man, a
bystander along said national highway, hurled a stone at the left side of the bus, which hit
petitioner above his left eye. Private respondent's personnel lost no time in bringing the
petitioner to the provincial hospital in Naga City where he was confined and treated. As a
result, Pilapil lost partially his left eye's vision and sustained a permanent scar above the left
eye.
Petitioner instituted before the CFI of Camarines Sur an action for recovery of
damages sustained as a result of the stone-throwing incident. After trial, the court a quo
rendered judgment in favour of Pilapil. The CA reversed and set aside the decision.
ISSUE
Whether Alatco Transpotation Company is liable
RULING
NO. Under Article 1755: "A common carrier is bound to carry the passengers safely as
far as human care and foresight can provide, using the utmost diligence of very cautious
persons, with due regard for all the circumstances." Further, in case of death of or injuries to
passengers, the law presumes said common carriers to be at fault or to have acted
negligently.
While the law requires the highest degree of diligence from common carriers in the
safe transport of their passengers and creates a presumption of negligence against them, it
does not, however, make the carrier an insurer of the absolute safety of its passengers.
While as a general rule, common carriers are bound to exercise extraordinary
diligence in the safe transport of their passengers, it would seem that this is not the
standard by which its liability is to be determined when intervening acts of strangers is to be
determined directly cause the injury.
Under Article 1763, it is to be noted that when the violation of the contract is due to
the wilful acts of strangers, as in the instant case, the degree of care essential to be
exercised by the common carrier for the protection of its passenger is only that of a good
father of a family. The rule of ordinary care and prudence is not so exacting as to require one
charged with its exercise to take doubtful or unreasonable precautions to guard against
unlawful acts of strangers. The carrier is not charged with the duty of providing or
maintaining vehicles as to absolutely prevent any and all injuries to passengers.
MARANAN v. PEREZ
G.R. No. L-22272, June 26, 1967
EN BANC, Bengzon
Digested by: Victoria Dines
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 CFI of Batangas. He was found guilty. Pending in the CA,
Antonia Maranan, Rogelio's mother, filed an action to recover damages from Perez and
Valenzuela for the death of her son. Perez claimed that the death was a caso fortuito for
which the carrier was not liable.
ISSUE
Whether Perez is liable
RULING
YES. Under Article 1759 of the New Civil Code, common carriers are liable for the
death of or injuries to passengers through the negligence or wilful acts of the former's
employees, although such employees may have acted beyond the scope of their authority or
in violation of the orders of the common carriers. 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, 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, 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.
Art. 1759, the Civil Code of the Philippines evidently follows the rule based on the
second view.
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.
Singapore Airlines Limited vs. Andion Fernandez

G.R. 142305, December 10, 2003
Second Division, Justice Callejo, Sr.
Digested by: Joseph Harvey M. Vehemente
Facts:
Andion Fernandez, respondent, is a singer who was, at the time of the incident, in
Germany. She was invited before the King and Queen of Malaysia. Before going to Malaysia,
she needed to go to Manila first in order to secure her wardrobe and practice for the
occasion. Thus, an airline passage ticket was issued by Singapore Airlines which would
transport her from Germany to Manila via a connecting flight from Germany to Singapore,
and eventually, from Singapore to Manila.
Respondent arrived in Singapore 2 hours late of its schedule to which the plane which
she was intended to board from Singapore to Manila already left as scheduled. Respondent
informed the lady employee at the transit counter that it was important for her to arrive in
Manila for that same day. However, the latter said that there were no available flights bound
to Manila for that day. Upon respondent’s persistence, she was informed that she can fly to
Hong Kong going to Manila but since her ticket was non-transferable, she would pay for her
ticket. Respondent refused because she had no money to pay for it.
On the next day, she was forced to take a direct flight from Singapore to Malaysia.
Petitioner alleged that, among others, it exercised extraordinary diligence required by law
under the given circumstances and that the delay of the flight from Germany to Singapore
was due to a fortuitous event.
Issue:
1. Whether or not petitioner should be liable for breach of contract of carriage.
2. Whether or not the defense of the petitioner that the delay was caused by
fortuitous event is valid.
Ruling:
1. Petitioner is liable for a breach of contract because when an airline issues a ticket to a
passenger, confirmed for a particular flight on a certain date, a contract of carriage
arises and that the passenger then has every right to expect that he be transported
on that flight on that date.
In an action for a breach of contract of carriage, passenger only needs to prove the
existence of the contract and the fact of its non-performance by the carrier. In this
case, respondent carried a confirmed ticket and that Singapore Airlines failed to
transport respondent to her destination.
2. The defense of the petitioner is not valid because it 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. Petitioner, being a
premiere airline, is certainly equipped to be able to foresee and deal with such
situation. Petitioner did not exercise due diligence in communicating to its

passengers the consequences of delay in their flights. Also, the respondent was not
remiss in conveying her apprehension about the delay of the flight when she was still
in Germany.
Fortune Express, Inc. vs. CA

G.R. No. 119756, March 18, 1999
Second Division, Justice Mendoza
Digested by: Joseph Harvey M. Vehemente
Facts:
A bus owned by the petitioner figured in an accident with a jeepney causing the the
death of two Maranaos. An investigation was made and it was discovered that certain
Maranaos were planning to take revenge on the petitioner by burning some of its buses.
Such discovery was communicated to the operations manager of the petitioner and he
assured that the bus company will take necessary precautions to insure the safety of the
lives and property of its passengers. Four days after, three armed Marinaos who pretended
to be passengers, seized a bus of the petitioner which resulted to the death of one Atty.
Caorong.
Private respondents, wife and children of the deceased, filed a case for breach of
contract of carriage.
Issue:
Whether or not Fortune Express is liable for the death of Atty. Caorong.
Ruling:
Fortune Express is liable for the death of Atty. Caorong because it did not exercise
required diligence in ensuring the safety of its passengers even though a report was already
made that certain group of Maranaos will have revenge against the petitioner.
Art. 1763 of the Civil Code provides that a common carrier is responsible for injuries
suffered by a passenger on account of the willful acts of other passengers, if the employees
of the common carrier could have prevented the act the exercise of the diligence of a good
father of a family. In the present case, it is clear that because of the negligence of
petitioner’s employees, the seizure of the bus was made possible.
Despite warning by authorities that the Maranaos were planning to take revenge on
the petitioner by burning some of its buses and the assurance of petitioner’s operation
manager that the necessary precautions would be taken, petitioner did nothing to protect
the safety of its passengers.
Had petitioner and its employees been vigilant they would not have failed to see that
the malefactors had a large quantity of gasoline with them. Under the circumstances, simple
precautionary measures to protect the safety of passengers, such as frisking passengers and
inspecting their baggages, preferably with non-intrusive gadgets such as metal detectors,
before allowing them on board could have been employed without violating the passenger’s
constitutional rights. It was held by SC that a common carrier can be held liable for failing to
prevent a hijacking by frisking passengers and inspecting their baggage.
Thus, it is evident that petitioner’s employees failed to prevent the attack on one of
petitioner’s buses because they did not exercise the diligence of a good father of a family.
Hence, petitioner should be held liable for the death of Atty. Caorong.
Also, petitoners cannot invoke force majeure. Art. 1755 of the Civil Code provides that
“a common carrier is bound to carry the passengers as far as human care and foresight can
provide, using the utmost diligence of very cautious person, with due regard for all the
circumstances.” In the present case, this factor of unforeseeablility (the second requisite for
an event to be considered force majeure) is lacking. As already stated, despite the report of
PC agent Generalao that the Maranaos were planning to burn some of petitioner’s buses
and the assurance of petitioner’s operations manager that the necessary precautions would
be taken, nothing was really done by petitioner to protect the safety of passengers.
Bachelor Express, Inc. v. CA

G.R. No. 85691, July 31, 1990
Third Division, Justice Gutierrez, Jr.
Digested by: Sol Joanna Frany
Facts:
The bus owned by Bachelor Express, Inc. and driven by Cresencio Rivera came from
Davao City on its way to Cagayan de Oro City passing Butuan City. While at Tabon-Tabon,
Butuan City, the bus picked up a passenger. About fifteen minutes later, a passenger at the
rear portion suddenly stabbed a PC soldier which caused commotion and panic among the
passengers. When the bus stopped, passengers Ornominio Beter and Narcisa Rautraut were
found lying down the road, the former already dead as a result of head injuries and the latter
also suffering from severe injuries which caused her death later. The passenger assailant
alighted from the bus and ran toward the bushes but was killed by the police. Thereafter,
the heirs of Ornominio Beter and Narcisa Rautraut, filed a complaint for "sum of money"
against Bachelor Express, Inc. The petitioners denied liability. After due trial, the trial court
dismissed the complaint. Upon appeal however, the trial court's decision was reversed and
set aside. Hence, the instant petition.
Issue:
Whether extraordinary diligence was exercised by the petitioner therefore
exempting it from liability for the death of its passengers.
Ruling:
No. Article 1174 of the present Civil Code states: Except in cases expressly specified by
law, or when it is otherwise declared by stipulations, 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 foreseen, were inevitable. However, in the case at bar, the
bus driver did not immediately stop the bus at the height of the commotion; the bus was
speeding from a full stop; the victims fell from the bus door when it was opened or gave way
while the bus was still running; the conductor panicked and blew his whistle after people
had already fallen off the bus; and the bus was not properly equipped with doors in
accordance with law-it is clear that the petitioners have failed to overcome the presumption
of fault and negligence found in the law governing common carriers. Therefore, the
petitioner must be liable for not exercising extraordinary diligence.
De Gillaco v. Manila Railroad Company

G.R. No. L – 8034, November 18, 1955
En Banc, Justice Reyes, J.B.L
Digested by: Mageryl Shay De Guzman
Facts:
In the morning, Lieutant De Gillaco boarded the train of the petitioner bound for
Manila. Subsequently, Emilio Devesa boarded the same train who was a guard for the Manila
Railroad Company. It appears that Emilio Devesa had a long standing grudge against
Lieutant De Gillaco beginning even up to the time of the Japanese Occupation. This caused
Devesa shooting De Gillaco upon seeing the latter inside one of the train coaches with the
carbine furnished to him by the Manila Railroad Company. Thus, Lt. De Gillaco died. The
former was convicted with homicide by final judgement in the CA.
Respondent Manilaa Railroad Company contends that there is no subsidiary liability
on its part as employer over the crime of Devesa as stated in Article 103 of the Revised Penal
Code since it was committed not in the performance of Devesa’s duties as a train guard. It
also disputes that the no liability can arise ex contractu since the complaint did not aver
sufficient facts to establish such liability, and no negligence on appellant's party was shown.
The trial court held the Railroad Company liable for the death of De Gillaco reasoning
that a contract of transportation implies protection of passengers against personal violence
by the agents or employees of the carrier.
ISSUE:
Is the carrier liable?
Ruling:
No, it is not liable.
Although the carrier has the obligation to transport passengers safely and entitles
such passengers to the protection against personal violence of its agents or employees such
protection only extends up to what it could foresee or avoid through the exercise of the
degree of care and diligence required from it. Ctiting the case of Lasam v. Smith, the court
reiterated the point that "No one shall be liable for events which could not be foreseen or
which, even if foreseen, were inevitable, with the exception of the cases in which the law
expressly provides otherwise and those in which the obligation itself imposes such liability”
From the facts, the act of the guard shooting Lt. De Gillaco because of the personal
grudge of the former against the latter was totally unforeeable by the Manila Railroad
Company. The company had no means to ascertain that the two would meet especially that
there are thousands of passengers engaging its services everyday. Thus, the event falls
under the concept of Caso Fortuito being both unforeseeable and inevitable under the given
circumstances; and pursuant to established doctrine, the resulting breach of appellant's
contract of safe carriage with the late Tomas Gillaco was excused thereby.
a common carrier is held to a very high degree of care and diligence in the protection
of its passengers; but, given the complexity of rail transportation, to require of that the
carrier should absolutely guard against misunderstandings between its employees and every
passenger is too demanding.
It is also noted that at the time of the commission of the crime, Devesa was still on
the way to his assigned station. So his character at the time was not an employee of Manila
Railroad Company but as another passenger, a stranger entering the train. Devesa was
therefore under no obligation to safeguard the passenger of the Calamba-Manila train,
where the deceased was riding; and the killing of Gillaco was not done in line of duty.
Cathay Pacific Airways Ltd. V CA

G.R. No. 60501, March 5, 1993
First Division, Justice Bellosillo
Digested by: Zhafrulah Tacio
Facts
1. Private respondent Alcantara was to attend a conference with the Director General
of Trade of Indonesia.
2. He boarded as a first class passenger with petitioner on a flight bound from Manila
to Hongkong and then to Jakarta.
3. Upon arrival in Jakarta, he discovered that his luggage, containing not only his
clothing but also documents needed for the conference, was missing.
4. It was explained to him that his luggage was left in Hongkong. He was offered $20
as an “inconvenience money” for payment of his necessities until his luggage was delivered
to him.
5. After 24 hours, his luggage was finally delivered but not to his hotel as it was
required by the petitioner to be picked up by him and an official of the Philippine embassy.
5. Respondent instituted a complaint before the CFI of Lanao del Norte for damages -
temperate and exemplary, and attorney’s fees.
6. CFI - ordered the payment of P20,000.00 moral damages, P5,000.00 temperate
damages, P10,000.00 exemplary damages and attorney’s fees of P25,000.00.
7. CA - Petitioner asserted the application of the Warsaw Convention, however, CA
affirmed the decision of CFI and increased the amount of damages, P80,000.00 oral
damages, P10,000.00 temperate damages, P20,000.00 exemplary damages and attorney’s
fees of P25,000.00.
Issues
1. Is the petitioner liable for damages?
2. Is the Warsaw Convention applicable?
Ruling
1. Yes. Moral and exemplary damages are justified because of the bad faith of the
petitioner when its officers rudely dealt with the respondent during his inquiry with the
management of the airway. CATHAY's employees should have been more solicitous to a
passenger in distress and assuaged his anxieties and apprehensions. However, it offered the
meager amount of $20 to a first class passenger and required him to personally get his
luggage. He is not entitled to temperate damages as there was no showing that he suffered
pecuniary loss. Moral damages reduced to P30, 000.00.
2. No. Although the Convention has force and effect of a law in the country, it does
not preclude the application of the Civil Code and other pertinent laws. It does not regulate,
much less exempt, the carrier from liability for damages for violating the rights of its
passengers under the contract of carriage. The Convention provides that its provisions
cannot be invoked when the damage was caused by an agent of the carrier acting within the
scope of his employment, such as in the case at bar.
Mapa v CA
G.R. No. 122308, July 8, 1997
Third Division, Justice Davide, Jr.
Digested by: Zhafrulah Tacio
Facts
1. Plaintiffs, respectable members of the society, have entered into a contract of air
transportation with private respondent, Trans-world Airlines, Inc. (TWA).
2. The tickets were purchased in Bangkok and were bound for Chicago, USA.
3. Plaintiffs boarded a PAL flight in Manila for Los Angeles and from L.A. to New York.
From New York, they boarded for Boston where they checked in 7 pieces of luggage at the
TWA counter in the JFK airport.
4. They missed their plane as they were in the wrong gate where they were
instructed to proceed. They subsequently boarded another plane and were able to arrive in
Boston but only 3 of their baggages where in the carousel.
5. They filed a complaint for indemnification ($11, 283.79) before the TWA office in
Manila where they were given partial payment.
6. For failure to indemnify the full amount, the plaintiffs instituted the instant
complaint.
7. As special and affirmative defense, TWA invoked lack of jurisdiction of Philippine
courts over the action for damages in that pursuant to Article 28(1) of the Warsaw
Convention, the action could only be brought either in Bangkok where the contract was
entered into, or in Boston which was the place of destination, or in Kansas City which is the
carrier's domicile and principal place of business.
8. RTC dismissed the complaint for lack of jurisdiction.
9. CA affirmed. The case involves international transportation which the Warsaw
Convention deals with. Under it, when the cause of damage is due to loss of baggage, a
complaint may only be brought with the courts of the places specified.
10. The Civil Code also provides that the law of the country to which the goods are to
be transported shall govern the liability of the common carrier for their loss, destruction, or
deterioration. In the case at bar, the place of destination is Chicago.
Issue
Is the Warsaw Convention applicable?
Ruling
No. The contract between the parties is not one of international transportation
falling under the purview of the Warsaw Convention. There are two classes of international
transportation: (1) that where the place of departure and the place of destination are
situated within the territories of two High Contracting Parties regardless of whether or not
there be a break in the transportation or a transshipment; and (2) that where the place of
departure and the place of destination are within the territory of a single High Contracting
Party if there is an agreed stopping place within a territory subject to the sovereignty,
mandate, or authority of another power, even though the power is not a party to the
Convention.
In the case at bar, the contract cannot fall under the first class because both the
place of departure and destination are found in one High Contracting Party nor can it fall
under the second class because there was no agreed stopping place within a territory
subject to the sovereignty, mandate, or authority of another power.
The Manila-L.A. flight cannot be considered as part of the TWA contract which could
have placed the case at bar under “international transportation” because this was never
presented as part of the contract nor was it expressly claimed by TWA that the same fell
under their contract with the petitioners. Its invocation of a provision of the Convention
which provides that where a carriage shall be performed by successive carriers, should the
passengers regard the series of the transportation as an undivided carriage, their
transportation shall be vested with international character. However, in the case at bar, the
petitioners did not regard the series of their flights as an undivided carriage.
CESAR L. ISAAC vs. A. L. AMMEN TRANSPORTATION CO., INC.

G.R. No. L-9671, August 23, 1957
En Banc, Justice Bautista
Digested by: Jsa Noble Gironella
Facts:
Plaintiff boarded said bus, owned by respondent, as a passenger paying the required
fare, but before reaching his destination, the bus collided with a motor vehicle of the pick-up
type coming from the opposite direction, as a result of which plaintiff's left arm was
completely severed and the severed portion fell inside the bus. Plaintiff was rushed to a
hospital and he incurred expenses amounting to P623.40, excluding medical fees which
were paid by defendant.
Plaintiff brought this action against defendants for damages alleging that the
collision was mainly due to the gross incompetence and recklessness of the driver of the bus
operated by defendant and that defendant incurred in culpa contractual arising from its non-
compliance with its obligation to transport plaintiff safely to his, destination.
Issue:
Has defendant observed extraordinary diligence or the utmost diligence of every
cautious person, having due regard for all circumstances, in avoiding the collision which
resulted in the injury caused to the plaintiff?
Ruling:
It appears that the bus, immediately prior to the collision, was running at a moderate
speed because it had just stopped at the school zone. The pick-up car was at full speed and
was running outside of its proper lane. The driver of the bus, upon seeing the manner in
which the pick-up was then running, swerved the bus to the very extreme right of the road
until its front and rear wheels have gone over the pile of stones or gravel situated on the
rampart of the road. Said driver could not move the bus farther right and run over a greater
portion of the pile, the peak of which was about 3 feet high, without endangering the safety
of his passengers. And notwithstanding all these efforts, the rear left side of the bus was hit
by the pick-up car.
It was held that "where a carrier's employee is confronted with a sudden emergency,
the fact that he is obliged to act quickly and without a chance for deliberation must be taken
into account, and he is held to the some degree of care that he would otherwise be required
to exercise in the absence of such emergency but must exercise only such care as any
ordinary prudent person would exercise under like circumstances and conditions, and the
failure on his part to exercise the best judgement the case renders possible does not
establish lack of care and skill on his part which renders the company liable. Considering all
the circumstances, we are persuaded to conclude that the driver of the bus has done what a
prudent man could have done to avoid the collision and in our opinion this relieves appellee
from legibility under our law.
COMPAÑIA MARITIMA vs. COURT OF APPEALS and VICENTE CONCEPCION

G.R. No. L-31379 August 29, 1988
Third Division, Chief Justice Fernan
Digested by: Jsa Noble Gironella
Facts:
Being a Manila based contractor, Vicente E. Concepcion had to ship his construction
equipment to Cagayan de Oro City. Concepcion negotiated with petitioner, thru its collector,
Pacifico Fernandez, 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. 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.
The payloader was damaged and was thereafter taken to petitioner's compound.
Consolidated Construction, wrote Compañia Maritima to demand a replacement of
the payloader which it was considering as a complete loss because of the extent of damage.
Consolidated Construction likewise notified petitioner of its claim for damages. Unable to
elicit response, the demand was repeated.
Meanwhile, 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 Bill of Lading, petitioner denied the claim for damages of Consolidated
Construction, contending that had Vicente declared the actual weight of the payloader,
damage to their ship as well as to his payloader could have been prevented. To replace the
damaged payloader, Consolidated Construction in the meantime bought a new one at
P45,000.00 from Bormaheco Inc., and Vicente filed an action for damages against petitioner.
Issue:
Whether or not the act of private respondent Vicente E. Concepcion in furnishing
petitioner Compañia 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.
Ruling:
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.
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.
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 safe 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 characteristic of goods tendered for
shipment, and to exercise due care in the handling and stowage including such methods as
their nature requires.
The weights stated in a bill of lading are prima facie evidence of the amount received
and the fact that the weighing was done by another will not relieve the common carrier
where it accepted such weight and entered it on the bill of lading. Besides, common carriers
can protect themselves against mistakes in the bill of lading as to weight by exercising
diligence before issuing the same.
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.
PHILIPPINE NATIONAL RAILWAYS vs. THE HONORABLE COURT OF APPEALS and ROSARIO
TUPANG
G.R. No. L-55347 October 4, 1985
ESCOLIN, J.: Second Division
Digested by: Janro Narag
Facts:
Winifredo Tupang, husband of plaintiff Rosario Tupang, boarded 'Train No. 516 of
appellant at Libmanan, Camarines Sur, as a paying passenger bound for Manila. Due to some
mechanical defect, the train stopped at Sipocot, Camarines Sur, for repairs, taking some two
hours before the train could resume its trip to Manila. Unfortunately, upon passing Iyam
Bridge at Lucena, Quezon, Winifredo Tupang fell off the train resulting in his death.The train
did not stop despite the alarm raised by the other passengers that somebody fell from the
train. Instead, the train conductor Perfecto Abrazado, called the station agent at Candelaria,
Quezon, and requested for verification of the information. Police authorities of Lucena City
were dispatched to the Iyam Bridge where they found the lifeless body of Winifredo Tupang.
As shown by the autopsy report, Winifredo Tupang died of cardio-respiratory failure
due to massive cerebral hemorrhage due to traumatic injury
Issue:
Whether or not PNR exercise extraordinary diligence
Ruling:
The appellate court found, the petitioner does not deny, that the train boarded by
the deceased Winifredo Tupang was so over-crowded that he and many other passengers
had no choice but to sit on the open platforms between the coaches of the train. It is
likewise undisputed that the train did not even slow down when it approached the Iyam
Bridge which was under repair at the time, Neither did the train stop, despite the alarm
raised by other passengers that a person had fallen off the train at lyam Bridge. The
petitioner has the obligation to transport its passengers to their destinations and to observe
extraordinary diligence in doing so. Death or any injury suffered by any of its passengers
gives rise to the presumption that it was negligent in the performance of its obligation
under the contract of carriage.
Thus, as correctly ruled by the respondent court, the petitioner failed to overthrow
such presumption of negligence with clear and convincing evidence. But while petitioner
failed to exercise extraordinary diligence as required by law, it appears that the deceased
was chargeable with contributory negligence. Since he opted to sit on the open platform
between the coaches of the train, he should have held tightly and tenaciously on the upright
metal bar found at the side of said platform to avoid falling off from the speeding train. Such
contributory negligence, while not exempting the PNR from liability.
Standard Vacuum Oil vs Luzon Stevedoring
GR L-5203, 18 April 1956

En Banc, Bautista, J.
Digested by: Jareed Reyes
Facts:
Standard Vacuum Oil Co. entered into a contract with Luzon Stevedoring Co. Inc.
to transport between the ports of Manila and Nin Bay, Sagay, Iloilo, 2,916.44 barrels of bulk
gasoline belonging to the former. The gasoline was delivered in accordance with the
contract but Luzon Stevedoring failed to transport it to its place of destination. It appeared
that the tugboat towing barge L-522 which was laden with gasoline, among others, stalled
due to a broken idler during the morning of 4 February 1947. The barges that tied to it broke
off due to the rough condition of the sea during the afternoon. The tugboat and the barges
were dashed against rocks, the tugboat sunk, and barge L-522 was so badly damaged that
the gasoline leaked out. Standard Vacuum Oil brought an action in the CFI of Manila to
recover the sum of P75,578.60 as damages.
Luzon Stevedoring, in its answer, pleaded that its failure to deliver the gasoline was
due to fortuitous event or caused by circumstances beyond its control and not to its fault or
negligence or that of any of its employees. The court, after receiving the evidence,
rendered decision fi nding that the disaster that had befallen the tugboat was the
result of an unavoidable accident and the loss of the gasoline was due to a fortuitous event
which was beyond the control of Luzon Stevedoring and, consequently, dismissed the case
with costs against Standard Vacuum Oil. Hence this present recourse.
Issue:
Whether or not Luzon Stevedoring is liable for the loss
Ruling:
The tugboat was put into operation without first submitting it to an overhaul in a dry-
dock. The tugboat had previously made several trips and each time it had to obtain a special
permit from the Bureau of Customs because it had never been dry-docked and did not have
complete equipment to be able to obtain a permanent permit. The special permits that were
issued by said Bureau specifi cally state that they were issued “pending
submission of plans and load line certificate, including test and final inspection of
equipment.” When the tugboat was inspected by the Bureau of Customs on 18 October
1946, it found it to be inadequately equipped and so the Bureau required Luzon Stevedoring
to provide it with the requisite equipment but it was never able to complete it. The fact that
the tugboat was a surplus property, has not been dry-docked, and was not provided with
the requisite equipment to make it seaworthy, shows that Luzon Stevedoring did not use
reasonable diligence in putting the tugboat in such a condition as would make its use
safe for operation. Where owner buys old tug, licensed coastwise, and equips it for ocean
going, it is negligence to send tug out without knowing something of her stability and
especially without stability test, where history and performance with respect to crankiness
and tenderness are matters of official record.
Planter Products Inc. vs CA, et al.
G.R. No. 101503 September 15, 1993

En Banc, Bellossillo, J.
Digested by: Jareed Reyes
Facts:
Planters Products purchased from Mitsubishi International Corp.
9 . 3 K m e t r i c t o n s o f U r e a , 46% of which the latter shipped in bulk aboard the cargo
vessel M/V “Sun Plum” owned by Kyosei Kisen Kabushiki Kaisha (KKKK).
After the Urea fertilizer was loaded in bulk by hired stevedores by and under the
supervision of the shipper, the steel hatches were closed with heavy iron lids,
covered with 3 layers of tarpaulin, then tied with steel bonds. The hatches remained
closed and tightly sealed throughout the entire voyage. The survey report upon arrival
revealed a shortage in the cargo of 106.726 M/T and that a portion of the Urea
fertilizer approximating 18 M/T was contaminated with sand, rust and dirt Planters Products
sent a claim letter to Soriamont Steamship Agencies, the resident agent of the carrier, for
damages.
Issue:
Whether or not Soriamon Steamship Agency is liable for the loss
Ruling:
No. Before the fertilizer was loaded, the 4 hatches of the vessel were
cleaned, dried and fumigated. After completing the loading of the cargo in bulk in the
ship’s holds, the steel pontoon hatches were closed and sealed with iron lids, then
covered with 3 layers of serviceable tarpaulins which were tied with steel bonds. The
hatches remained close and t i g h t l y s e a l e d w h i l e t h e s h i p w a s i n t r a n s i t a s t h e
w e i g h t o f t h e s t e e l c o v e r s m a d e i t impossible for a person to open without the
use of the ship’s boom. The hull of the vessel was in good condition, foreclosing the
possibility of spillage of the cargo into the sea or seepage of water inside the hull of the
vessel tevedores unloaded the cargo under the watchful eyes of the shipmates who were
overseeing the whole operation on rotation basis.
Urea also contains 46% nitrogen and is highly soluble in water. However, during
storage, nitrogen and ammonia do not normally evaporate even on a long voyage,
provided that the temperature inside the hull does not exceed 80 degrees centigrade.
Dissipation of quantities of fertilizer, or its deterioration in value, is caused
either by an extremely high temperature in its place of storage, or when it comes in
contact with water probability of the cargo being damaged or getting mixed or
contaminated with foreign
particles was made greater by the fact that the fertilizer was transport
e d i n “ b u l k , ” thereby exposing it to the inimical effects of the elements and the grimy
condition of the various pieces of equipment used in transporting and hauling it. The risk
was to the shipper which cannot be imputed to the carrier.
Mecenas, et.al vs. CA
G.R. No. 88052, December 14, 1989

Third Division, Justice Feliciano
Digested by: Lovely Grazette Quiben
Facts:
On April 22, 1980, the M/T "Tacloban City," a barge-type oil tanker of Philippine
registry, owned by the Philippine National Oil Company (PNOC) and operated by the PNOC
Shipping and Transport Corporation (PNOC Shipping), having unloaded its cargo of
petroleum products, left Amlan, Negros Occidental, and headed towards Bataan. At about
1:00 o'clock in the afternoon of that same day, the M/V "Don Juan," owned and operated by
the Negros Navigation Co., Inc. (Negros Navigation) left Manila bound for Bacolod with
seven hundred fifty (750) passengers listed in its manifest, and a complete set of officers and
crew members.
On the evening of that same day, the "Tacloban City" and the "Don Juan" collided at
the Talbas Strait near Maestra de Ocampo Island in the vicinity of the island of Mindoro.
When the collision occurred, the sea was calm, the weather fair and visibility good. As a
result of this collision, the M/V "Don Juan" sank and hundreds of its passengers perished.
Among the ill-fated passengers were the parents of petitioners, the spouses Perfecto
Mecenas and Sofia Mecenas, whose bodies were never found despite intensive search by
petitioners. They file an action for damages alleging the negligence of Capt. Santisteban
(captain of Don Juan) and Negros Navigation (owner of Don Juan).
Issues:
Who between M/V Tacloban and M/V Don Juan was negligent?
Ruling:
M/V Tacloban was primarily and solely at fault. M/V Don Juan was also at fault.
Rule 18 of the International Rules of the Road which requires 2 power-driven vessels
meeting end on or nearly end on each to alter her course to starboard so that each vessel
may pass on the port side of each other. In the case, M/V Tacloban, as held by the report of
the Commandant of the Philippine Coast Guard, failed to follow the Rules. Hence, she was
deemed negligent.
As to M/V Don Juan, the behavior of the captain -playing mahjong before and up to
the time of collision constituted gross negligence. This behavior is unacceptable on the part
of the master of a vessel to whose hands the lives of at least 750 passengers were
entrusted. It does not matter that the Captain was off-duty or on-duty. Realistically speaking,
there is no such thing as off-duty hours for the master of the vessel at sea that is a common
carrier who is required extraordinary diligence. Hence, Negros Navigation in permitting or in
failing to discover and correct such behavior is also grossly negligent.
Briñas vs. People of the Philippines
G.R. No. L-30309, November 25, 1983

First Division, Justice Guitierrez Jr.
Digested by: Lovely Grazette Quiben
Facts:
On January 6, 1957, Juanito Gesmundo bought a train ticket at the railroad station in
Tagkawayan, Quezon for his 55-year old mother Martina Bool and his 3-year old daughter
Emelita Gesmundo. The two were bound for Lusacan in Tiaong, Quezon.
Upon approaching Barrio Lagalag at 8pm, the train slowed down and the conductor,
accused-appellant, Clemente Brinas, shouted “Lusacan, Lusacan!” The old woman walked
towards the train exit carrying the child with one hand and holding her baggage with the
other. When they were near the door, the train suddenly picked up speed. The old woman
and the child stumbled from the train causing them to fall down the tracks and were hit by
an oncoming train, causing their instant death.
A criminal information was filed against Victor Milan, the driver, Hermogenes
Buencamino, the assistant conductor and Clemente Brinas for Double Homicide thru
Reckless Imprudence. The lower court acquitted Milan and Buencamino. On appeal to the
Court of Appeals, respondent CA affirmed the decision.
Issue:
Whether or not the accused-appellant was negligent.
Ruling:
Yes. It is a matter of common knowledge and experience about common carriers like
trains and buses that before reaching a station or flagstop they slow down and the
conductor announces the name of the place. It is also a matter of common experience that
as the train or bus slackens its speed, some passengers usually stand and proceed to the
nearest exit, ready to disembark as the train or bus comes to a full stop. This is especially
true of a train because passengers feel that if the train resumes its run before they are able
to disembark; there is no way to stop it as a bus may be stopped.
The appellant was negligent because his announcement was premature and
erroneous, for it took a full 3 minutes more before the next barrio of Lusacan was reached.
That the announcement was premature and erroneous is shown by the fact that
immediately after the train slowed down, it unexpectedly accelerated to full speed. This
announcement prompted the victims to stand and proceed to the nearest exit. Without said
announcement, the victims would have been safely seated in their respective seats when
the train jerked as it picked up speed. The connection between the premature and
erroneous announcement of petitioner-appellant and the deaths of the victims is direct and
natural, unbroken by any intervening efficient causes. Any negligence of the victims was at
most contributory and does not exculpate the accused from criminal liability.
BATANGAS LAGUNA TAYABAS BUS COMPANY & ARMANDO PON v. INTERMEDIATE

APPELLATE COURT
G.R. Nos. 74387-90 November 14, 1988
SECOND DIVISION, Justice Paras
Digested by: Kathleen Bankey
Facts
A bus owned by petitioner BLTB and driven by petitioner Pon collided with a
bus owned by Superlines, when the former tried to overtake a Ford Fiera just as the
Superlines' Bus was coming from the opposite direction.
The collision resulted in the death of Rosales, Pamfilo and Neri, as well as injuries to the wife
of Rosales, and Sales. These people were passengers of the petitioner's bus. Rosales and
Sales, as well as the surviving heirs of Pamfilo, Rosales and Neri instituted separate cases
before the Court of First Instance (CFI) against BLTB and Superlines, together with
their drivers. Criminal cases against the drivers were also filed in a different CFI.
CFI ruled that only BLTB and Pon should be liable, and they were ordered jointly and
severally to pay damages and exonerated Superlines.
On appeal, the IAC affirmed the CFI's ruling.
Petitioners contended that the CFI erred in ruling that the actions of private respondents are
based on culpa contractual, since if it were private respondents' intention to file an action
based on culpa contractual, they could have done so by merely impleading BLTB and Pon.
Instead the respondents filed an action against all defendants based on culpa aquiliana or
tort.
Issue
Is the IAC correct in affirming the decision of the lower court?
Ruling
A reading of the respondent court's decision shows that it anchored petitioners'
liability both on culpa contractual and culpa aquiliana, to wit:
For his own negligence in recklessly driving the truck owned by his employer,
appellant Armando Pon is primarily liable. On the other hand the liability of Pon's
employer, appellant BLTB, is also primary, direct and immediate in view of the fact
that the death of or injuries to its passengers was through the negligence of its
employee, and such liability does not cease even upon proof that BLTB had exercised
all the diligence of a good father of a family in the selection and supervision of its
employees.
The common carrier's liability for the death of or injuries to its passengers is based on
its contractual obligation to carry its passengers safely to their destination. That obligation is
so serious that the Civil Code requires "utmost diligence of very cautious person (Article
1755, Civil Code). They are presumed to have been at fault or to have acted negligently
unless they prove that they have observed extraordinary diligence" (Article 1756, Civil Code).
In the present case, the appellants have failed to prove extraordinary diligence. Indeed, this
legal presumption was confirmed by the fact that the bus driver of BLTB was negligent. It
must follow that both the driver and the owner must answer for injuries or death to its
passengers. The liability of BLTB is also solidarily with its driver even though the liability of
the driver springs from quasi delict while that of the bus company from contract.
BATANGAS TRANSPORTATION COMPANY v. GREGORIO CAGUIMBAL, PANCRACIO

CAGUIMBAL, MARIA MARANAN DE CAGUIMBAL, BIÑAN TRANSPORTATION COMPANY and
MARCIANO ILAGAN
G.R. No. L-22985, January 24, 1968
EN BANC, Chief Justice Concepcion
Digested by: Kathleen Bankey
.
Facts
Caguimbal who was a paying pasenger of Batangas Transportation Company (BTCO)
bus died when the bus of the Biñan Transportation Company (Binan) which was coming
from the opposite direction and a calesa managed by Makahiya, which was then ahead of
the Biñan bus met an accident.
A passenger requested the conductor of BTCO to stop as he was going to alight, and
when he heard the signal of the conductor, the driver slowed down his bus swerving it
farther to the right in order to stop; at this juncture, a calesa, then driven by Makahiya was
at a distance of several meters facing the BTCO bus coming from the opposite direction; that
at the same time the Biñan bus was about 100 meters away likewise going northward and
following the direction of the calesa; that upon seeing the Biñan bus the driver of the BTCO
bus dimmed his light; that as the calesa and the BTCO bus were passing each other from the
opposite directions, the Biñan bus following the calesa swerved to its left in an attempt to
pass between the BTCO bus and the calesa; that without diminishing its speed of about 70
kilometers an hour, the Biñan bus passed through the space between the BTCO bus and the
calesa hitting first the left side of the BTCO bus with the left front corner of its body
and then bumped and struck the calesa which was completely wrecked; that the driver was
seriously injured and the horse was killed; that the second and all other posts supporting the
top of the left side of the BTCO bus were completely smashed and half of the back wall to
the left was ripped open. The BTCO bus suffered damages for the repair of its damaged
portion. As a consequence of this occurrence, Caguimbal and Tolentino died, apart from
others who were injured.
The widow and children of Caguimbal sued to recover damages from the BTCO. The
latter, in turn, filed a third-party complaint against the Biñan and its driver, Ilagan.
Subsequently, the Caguimbals amended their complaint, to include therein, as defendants,
said Biñan and Ilagan. CFI dismissed the complaint insofar as the BTCO is concerned,
without prejudice to plaintiff's right to sue Biñan and Ilagan. CA reversed said decision and
rendered judgment for Caguimbal.
Issue
Is BTCO liable to pay damages for failure to exercise extraordinary diligence?
Ruling
Yes, BTCO has not proven the exercise of extraordinary diligence on its part.
The recklessness of the driver of Binan was, manifestly, a major factor in the
occurrence of the accident which resultedin the death of Pedro Caguimbal. Indeed, as driver
of the Biñan bus, he overtook Makahiya's horse-driven rig or calesa and passed between the
same and the BTCO bus despite the fact that the space available was notbig
enough therefor, in view of which the Biñan bus hit the left side of the BTCO bus and then
the calesa.
Article 1733 of the Civil Code provides the general rule that extraordinary diligence
must be exercised by the driver of a bus in the vigilance for the safety of his passengers.
The record shows that, in order to permit one of them to disembark, the BTCO bus
driver drove partly to the right shoulder of the road and partly on the asphalted portion
thereof. Yet, he could have and should have seen to it — had he exercised "extraordinary
diligence" — that his bus was completely outside the asphalted portion of the road, and
fully within the shoulder thereof, the width of which being more than sufficient to
accommodate the bus. When the BTCO bus driver slowed down his BTCO bus to permit said
passenger to disembark, he must have known, therefore, that the Biñan bus would overtake
the calesa at about the time when the latter and BTCO bus would probably be on the same
line, on opposite sides of the asphalted portions of the road, and that the space between
the BTCO bus and the "calesa" would not be enough to allow the Biñan bus to go through. It
is true that the driver of the Biñan bus should have slowed down or stopped, and, hence,
was reckless in not doing so; but, he had no especial obligations toward the passengers of
the BTCO unlike the BTCO bus driver whose duty was to exercise "utmost" or
"extraordinary" diligence for their safety. Perez was thus under obligation to avoid a
situation which would be hazardous for his passengers, and, make their safety dependent
upon the diligence of the Biñan driver.
In an action based on a contract of carriage, the court need not make an express
finding of fault or negligence on the part of the carrier in order to hold it responsible to pay
the damages sought for by the passenger. By the contract of carriage, the carrier assumes
the express obligation to transport the passenger to his destination safely and to observe
extraordinary diligence with a due regard for all the circumstances, and any injury that might
be suffered by the passenger is right away attributable to the fault or negligence of the
carrier (Article 1756, new Civil Code). This is an exception to the general rule that negligence
must be proved, and it is therefore incumbent upon the carrier to prove that it has exercised
extraordinary diligence as prescribed in Articles 1733 and 1755 of the New Civil Code.
ALFREDO MALLARI SR. and ALFREDO MALLARI JR. vs. COURT OF APPEALS and BULLETIN
PUBLISHING CORPORATION
G.R. No. 128607. January 31, 2000
Second Division, Justice Bellosillo
Digested by: Keouh Rosario
Facts:
A passenger jeepney driven by petitioner Alfredo Mallari Jr. and owned by his co-
petitioner Alfredo Mallari Sr. collided with the delivery van of respondent Bulletin Publishing
Corp. Petitioner Mallari Jr. testified that he went to the left lane of the highway and
overtook a Fiera which had stopped on the right lane. Before he passed by the Fiera, he saw
the van of respondent BULLETIN coming from the opposite direction. It was driven by one
Felix Angeles. The sketch of the accident showed that the collision occurred after Mallari Jr.
overtook the Fiera while negotiating a curve in the highway. The impact caused the jeepney
to turn around and fall on its left side resulting in injuries to its passengers one of whom was
Israel Reyes who eventually died due to the gravity of his injuries. Manikanä
Issue:
Whether or not Mallari, Sr. is liable.
Ruling:
Yes. The negligence and recklessness of the driver of the passenger jeepney is
binding against petitioner Mallari Sr., who admittedly was the owner of the passenger
jeepney engaged as a common carrier, considering the fact that in an action based on
contract of carriage, the court need not make an express finding of fault or negligence on
the part of the carrier in order to hold it responsible for the payment of damages sought by
the passenger. Under Art. 1755 of the Civil Code, a common carrier is bound to carry the
passengers safely as far as human care and foresight can provide using the utmost diligence
of very cautious persons with due regard for all the circumstances. Moreover, under Art.
1756 of the Civil Code, in case of death or injuries to passengers, a common carrier is
presumed to have been at fault or to have acted negligently, unless it proves that it
observed extraordinary diligence. Further, pursuant to Art. 1759 of the same Code, it is liable
for the death of or injuries to passengers through the negligence or willful acts of the
former’s employees.
Clearly, by the contract of carriage, the carrier jeepney owned by Mallari Sr. assumed
the express obligation to transport the passengers to their destination safely and to observe
extraordinary diligence with due regard for all the circumstances, and any injury or death
that might be suffered by its passengers is right away attributable to the fault or negligence
of the carrier
HERMINIO L. NOCUM v. LAGUNA TAYABAS BUS COMPANY

G.R. No. L-23733, October 31, 1969
En Banc, Justice Barredo
Digested by: Keouh Rosario
Facts:
Appellee, who was a passenger in appellant's Bus No. 120 then making a trip within
the barrio of Dita, Municipality of Bay, Laguna, was injured as a consequence of the
explosion of firecrackers, contained in a box, loaded in said bus and declared to its
conductor as containing clothes and miscellaneous items by a co-passenger.
Issue:
Whether appellant Laguna observed the extraordinary or utmost diligence of a very
cautious person required of a common carrier.
Ruling:
Yes. The Bus Company has succeeded in rebutting the presumption of negligence by
showing that it has exercised extraordinary diligence for the safety of its passengers.
In this case, the circumstance that must be considered in measuring a common

carrier’s duty towards its passengers is the reliance that should be reposed on the sense of
responsibility of all the passengers in regard to their common safety. It is to be presumed
that a passenger will not take with him anything dangerous to the lives and limbs of his co-
passengers, not to speak of his own. Not to be lightly considered must be the right to
privacy to which each passenger is entitled. He cannot be subjected to any unusual search,
when he protests the innocuousness of his baggage and nothing appears to indicate the
contrary, as in the case at bar. Hence, the bus company’s failure to confiscate the baggage
cannot be considered as a negligent act, but in accord to the circumstance of the case.
PHILIPPINE AIRLINES, INC. vs. COURT OF APPEALS and PEDRO ZAPATOS

G.R. No. L-82619 September 15, 1993
Facts:
Respondent was among the twenty-one (21) passengers of PAL Flight 477 that took
off from Cebu bound for Ozamiz City. The plane was not able to land because the airport
was closed due to heavy rains and inclement weather and that he should proceed to
Cotabato City instead. Upon arrival at Cotabato City, the PAL Station Agent informed the
passengers of their options to return to Cebu. It also informed them that Flight 560 bound
for Manila would make a stop-over at Cebu to bring some of the diverted passengers but
that there were only six (6) seats available. Private respondent was not accommodated.
PAL then issued to private respondent a free ticket to Iligan city, which the latter
received under protest. Private respondent was left at the airport and could not even hitch a
ride in the Ford Fiera loaded with PAL personnel. PAL neither provided private respondent
with transportation from the airport to the city proper nor food and accommodation for his
stay in Cotabato City. The following day, private respondent purchased a PAL ticket to Iligan
City. In Iligan City, private respondent hired a car from the airport to Lanao del Norte,
reaching Ozamiz City by crossing the bay in a launch. On 25 November 1976, private
respondent filed a complaint for damages for breach of contract of carriage.
The trial court rendered its decision in favor of the plaintiff. PAL appealed to the
Court of Appeals which on 28 February 1985, finding no reversible error, affirmed the
judgment of the court a quo.
Issue
Can the Court of Appeals render a decision finding petitioner (then defendant-
appellant in the court below) negligent and, consequently, liable for damages on a question
of substance which was neither raised on a question nor proved at the trial?
Ruling
Yes. PAL did not seem to mind the introduction of evidence which focused on its
alleged negligence in caring for its stranded passengers. When issues not raised by the
pleadings are tried by express or implied consent of the parties, they shall be treated in all
respects as if they had been raised in the pleadings.
The contract of air carriage is a peculiar one. Being 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. The position taken by PAL in this case clearly illustrates its failure
to grasp the exacting standard required by law.
Undisputably, PAL's diversion of its flight due to inclement weather was a fortuitous
event. Nonetheless, such occurrence did not terminate PAL's contract with its passengers.
Being in the business of air carriage and the sole one to operate in the country, PAL is
deemed equipped to deal with situations as in the case at bar. What we said in one case
once again must be stressed, i.e., the relation of carrier and passenger continues until the
latter has been landed at the port of destination and has left the carrier's premises.
Hence, PAL necessarily would still have to exercise extraordinary diligence in

safeguarding the comfort, convenience and safety of its stranded passengers until they have
reached their final destination. On this score, PAL grossly failed considering the then
ongoing battle between government forces and Muslim rebels in Cotabato City and the fact
that the private respondent was a stranger to the place.
Vda. De Abeto vs. PAL

G.R. No. L-28692, July 30, 1982
First Division, Relova, J.:
Digested by Claire Cabson
Facts:
PAL plane bound for Manila from Iloilo City crashed somewhere at Mt. Baco in Mindoro.
All passengers, including the relative of the plaintiffs, Judge Abeto, died instantly and their
remains were scattered all over the area. Among the articles recovered was the leather bag of
Judge Abeto with his name on it. PAL would not hear demands for settlement of damages so
the Abetos were compelled to institute the instant case. The trial court found that PAL is liable
because it did not exercise extraordinary diligence required to transport passenger.
Issue:
Whether or not PAL is liable for violation of its contract of carriage.
Held:
Yes. The prescribed route was not followed by the pilot by a clear showing that the
crash site was not within the area, this tragedy would not have happened had the pilot
continued the indicated route. The weather was clear, contrary to the claim of PAL, during that
day so there was no need to divert from the prescribed route.
At any rate, in the absence of a satisfactory explanation as to how the accident

occurred, the presumption is that PAL is at fault. By the contract of carriage, the carrier
assumes the express obligation to transport the passenger to his destination safely and to
observe extraordinary diligence with a due regard for all the circumstances, and any injury that
might be suffered by the passenger is right away attributable to the fault or negligence of the
carrier (Art. 1756, New Civil Code). This is an exception to the general rule that negligence must
be proved.
Japan Airlines v. Michael Asuncion, et al.

G.R. No. 161730, January 28, 2005
First Division, Justice Ynares – Santiago
Digested by: Alfred H. Campañano
Facts:
Spouses Jeanette and Michael Asuncion left for Los Angeles, California engaging the
service of Japan Airlines. En Route, as indicated in their travel itinerary, the plane will have to
make a stop – over at Narita Airport . They had checked – in at Hotel Nikko Narita. Upon
arrival at Narita, the JAL representative in the area had endorsed them to the immigration
officer for their application for a shore pass. This is needed for any foreigner who wishes to
stay in the locality for not more than 72 hours. During the application, the immigration
officer found that there is an inconsistency as to the height indicated in Michael Asuncion’s
passport and that of his actual height. This resulted in their application for a shore pass
being denied. They were redirected and checked – in at Narita Airport Rest house where
they were heavily guarded up to the time they left for Los Angeles and they were asked to
pay USD $40,000 each for the services and meals provided to them. This prompted the
spouses to file a claim for damages against the airline. The allegation of the respondents in
the said complaint was that they, as travelers, were not fully apprised of the requirements
needed which resulted to the incident. JAL argues that this is beyond their control as this are
the requirements set for by the state.
The RTC ruled in favor of the respondents. This was affirmed by the CA and a
subsequent motion for reconsideration was denied. Also denied was the counterclaim for
litigation expenses, attorney’s fees, and exemplary damages.
Issue:
Was the carrier in breach of the contract?
Ruling:
No, it was not in breach of the contract of carriage.
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.
From the facts, the obligation of the Japanese airlines to check if the travelers have
all the necessary documents for travel does not include the obligation to check the veracity
of every entry in these documents.
The power to admit aliens in the port is a sovereign power that even the airline
carriers cannot control. 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.
It is important to take note that prior to their departure, the spouses are already
aware that they will be required to secure shore pass applications upon arrival at Narita
which is in direct refutation to the spouses claim that the airline had assured them that the
shore passes will be secured.
As to the allegation that the JAL did not exhaust all means to prevent the incident, it
is reiterated that the admission of aliens is not a matter that the airliner can interfere with
because it is an act of state. More importantly, it cannot be said that the airline did not do
everything it can do since upon arrival, the representative from JAL had immediately
endorsed their applications to the immigration officer. And after having knowledge of the
denial of their application, the JAL had made alternative arrangements at the Narita Airport
Rest House. These acts are the most that can be expected from the airliner given the
circumstances of the case.
H. E. HEACOCK COMPANY v. MACONDRAY & COMPANY, INC.

G.R. No. L-16598, October 3, 1921
EN BANC, Justice Johnson
Digested by: Alfred Dizon Jr.
Facts:
Facts: Heacock caused to be delivered on board of steamship Bolton Castle, four cases of
merchandise one of which contained twelve (12) 8-day Edmond clocks properly boxed and
marked for transportation to Manila, and paid freight on said clocks from New York to
Manila in advance. The said steampship arrived in the port of Manila on or about the 10th
day of September, 1919, consigned to defendant. Neither the master of said vessel nor the
defendant herein, as its agent, delivered to the plaintiff the aforesaid twelve 8-day Edmond
clocks, although demand was made upon them for their delivery.
The invoice value of the said twelve 8-day Edmond clocks in the city of New York was
P22 and the market value of the same in the City of Manila at the time when they should
have been delivered to the plaintiff was P420. The bill of lading issued and delivered to the
plaintiff by the master of the said steamship Bolton Castle contained, among others, the
following clauses:
1. It is mutually agreed that the value of the goods receipted for
above does not exceed $500 per freight ton, or, in proportion for
any part of a ton, unless the value be expressly stated herein and
ad valorem freight paid thereon.
9. Also, that in the event of claims for short delivery of, or
damage to, cargo being made, the carrier shall not be liable for
more than the net invoice price plus freight and insurance less all
charges saved, and any loss or damage for which the carrier may
be liable shall be adjusted pro rata on the said basis.
The case containing the aforesaid twelve 8-day Edmond clocks measured 3 cubic feet, and
the freight ton value thereof was $1,480, U. S. currency.No greater value than $500, U. S.
currency, per freight ton was declared by the plaintiff on the aforesaid clocks, and no ad
valorem freight was paid thereon. The lower court, in accordance with clause 9 of the bill of
lading above quoted, rendered judgment in favor of the plaintiff against the defendant for
the sum of P226.02.
The plaintiff-appellant insists that it is entitled to recover from the defendant the
market value of the clocks in question, to wit: the sum of P420. The defendant-appellant, on
the other hand, contends that, in accordance with clause 1 of the bill of lading, the plaintiff is
entitled to recover only the sum of P76.36, the proportionate freight ton value of the said
clocks. The claim of the plaintiff is based upon the argument that the two clause in the bill of
lading above quoted, limiting the liability of the carrier, are contrary to public order and,
therefore, null and void. The defendant, on the other hand, contends that both of said
clauses are valid, and the clause 1 should have been applied by the lower court instead of
clause 9.
Issue:
Whether or not a common carrier, by stipulations inserted in the bill of lading, limit its
liability for the loss of or damage to the cargo to an agreed valuation.
Ruling:
Three kinds of stipulations have often been made in a bill of lading. The first is one
exempting the carrier from any and all liability for loss or damage occasioned by its own
negligence. The second is one providing for an unqualified limitation of such liability to an
agreed valuation. And the third is one limiting the liability of the carrier to an agreed
valuation unless the shipper declares a higher value and pays a higher rate of freight.
According to an almost uniform weight of authority, the first and second kinds of
stipulations are invalid as being contrary to public policy, but the third is valid and
enforceable.
A reading of clauses 1 and 9 of the bill of lading here in question, however, clearly
shows that the present case falls within the third stipulation, to wit: That a clause in a bill of
lading limiting the liability of the carrier to a certain amount unless the shipper declares a
higher value and pays a higher rate of freight, is valid and enforceable.
It seems clear from the foregoing authorities that the clauses (1 and 9) of the bill of
lading here in question are not contrary to public order. Article 1255 of the Civil Code
provides that "the contracting parties may establish any agreements, terms and conditions
they may deem advisable, provided they are not contrary to law, morals or public order."
Said clauses of the bill of lading are, therefore, valid and binding upon the parties thereto.
Other issue related to the case (as to interpretation of BOL):
It will be noted, however, that whereas clause 1 contains only an implied undertaking
to settle in case of loss on the basis of not exceeding $500 per freight ton, clause 9 contains
an express undertaking to settle on the basis of the net invoice price plus freight and
insurance less all charges saved. "Any loss or damage for which the carrier may be
liable shall be adjusted pro rata on the said basis," clause 9 expressly provides. It seems to
us that there is an irreconcilable conflict between the two clauses with regard to the
measure of defendant's liability. It is difficult to reconcile them without doing violence to the
language used and reading exceptions and conditions into the undertaking contained in
clause 9 that are not there. This being the case, the bill of lading in question should be
interpreted against the defendant carrier, which drew said contract. "A written contract
should, in case of doubt, be interpreted against the party who has drawn the contract." It is
a well-known principle of construction that ambiguity or uncertainty in an agreement must
be construed most strongly against the party causing it. (6 R. C. L., 855.) These rules as
applicable to contracts contained in bills of lading. "In construing a bill of lading given by the
carrier for the safe transportation and delivery of goods shipped by a consignor, the
contract will be construed most strongly against the carrier, and favorably to the consignor,
in case of doubt in any matter of construction."
AGUSTINO B. ONG YIU vs HONORABLE COURT OF APPEALS and PHILIPPINE AIR LINES, INC.,
G.R. No. L-40597, June 29, 1979
FIRST DIVISION, Justice Melencio - Herrera
Digested by: Alfred Dizon Jr.
Facts:
Petitioner, a passenger of respondent PAL, was scheduled to attend a trial in Butuan City.
Arriving at Bancasi Airport, Butuan, his luggage which contained vital documents needed for
his trial the next day couldn’t be found. PAL Butuan sent a message to PAL Cebu which was
informed by PAL Manila that the luggage has been overcarried to Manila. Petitioner wired
PAL Cebu demanding the delivery of his luggage otherwise he would hold PAL liable for
damages for causing him inconvenience, worry and anxiety.
The next day, the petitioner went to Bancasi Airport but immediately left so when
the luggage arrived, he was no longer there. Dagorro, driver of the petitioner, volunteered
to take the luggage to the latter. He opened the luggage and examine its contents but did
not touch them.
Upon delivery to the petitioner, he refused to accept the luggage on ground that the
folder containing the exhibits was missing. He went to Cebu to demand for his luggage to be
produced intact and be compensated for actual and moral damages, and to know the
personnel who pilfered the baggage. However PAL Cebu still was not able to pinpoint the
one responsible and to find the missing documents.
Thus petitioner filed a complaint for damages for breach of contract, which LC granted. Both
parties appealed, petitioner because only awarded P80,000 and defendant which reversed
the decision of LC.
ISSUE:
Whether PAL is liable for damages and gross negligence and for acting in bad faith for the
loss of the baggage and whether PAL is bound the limited liability imposed by the provisions
of the ticket.
Ruling:
No. PAL has exercised due diligence and has exerted all efforts to locate to missing luggage;
thus petitioner is not entitled to moral nor exemplary damages. Despite the absence of a
contract, the ticket binds the passengers to the policies and provisions of PAL.
PAL had not acted in bad faith which is a breach of duty through ill will. PAL’s duty
was to look for the petitioner’s luggage which has been miscarried; and PAL exerted due
diligence to comply with such duty. Efforts has been exerted to locate the missing luggage
as seen in the sending of the telegraphic message and the delivery of the luggage. In the
absence of fraud or bad faith, petitioner is not entitled to moral damages. Neither is he
entitled to exemplary damages as defendant has not acted in a wanton reckless and
oppressive manner.
Likewise, the decision of the CA to lower the liability of the carrier to P100 for the lost
luggage was proper. Despite the fact that he had not entered into a contract of carriage
with PAL limiting the latter’s liability, he is bound by the provisions of the ticket which states
that for failure to declare a higher value for his luggage, he is bound by the P100 charge for
miscarriage.
SEA-LAND SERVICE, INC. v. INTERMEDIATE APPELLATE COURT

G.R. No. 75118; August 31, 1987
First Division, Justice Narvasa
Digested by: Chris
FACTS:
A shipment (received from Seaborne Trading Company in Oakland, California) was
loaded on board the MS Patriot, a vessel owned and operated by Sea-Land, for discharge at
the Port Cebu. The shipment was discharged in Manila, and while awaiting transshipment to
Cebu, the cargo was stolen and never recovered.
Paulino Cue, the consignee, made formal claim upon Sea-Land for the value of the
lost shipment allegedly amounting to P179,643.48. Sea-Land offered to settle for US$4,000
asserting that said amount represented its maximum liability for the loss of the shipment
under the package limitation clause in the bill of lading - which only states “8 CTNS on 2
SKIDS-FILES”. No value thereof was indicated; hence, liability is only $500 per package as
indicated under “Clause 22 of the bill”. Paulino Cue rejected the offer and thereafter brought
suit for damages against Sea-Land. The trial court sentenced Sea-Land to pay Cue P186,048
representing the Philippine currency value of the lost cargo, P55, 814 for unrealized profit
and P25,000 for attorney’s fees. CA affirmed the trial court’s decision.
ISSUE: Whether Sea-Land is liable to pay Cue.
RULING:
Yes. Sea-Land is liable (but limited). Article1749 of the NCC provides that “a
stipulation that the common carrier's liability is limited to the value of the goods appearing
in the bill of lading, unless the shipper or owner declares a greater value, is binding.” In the
case at bar, the stipulation in the bill of lading limiting the liability of Sea-Land for loss or
damages to the shipment covered by said rule to US$500 per package unless the shipper
declares the value of the shipment and pays additional charges is valid and binding on
Paulino Cue.
WHEREFORE, the Decision of the Intermediate Appellate Court complained of is

reversed and set aside. The stipulation in the questioned bill of lading limiting Sea-Land's
liability for loss of or damage to the shipment covered by said bill to US$500.00 per package
is held valid and binding on Paulino Cue. There being no question of the fact that said
shipment consisted of eight (8) cartons or packages, for the loss of which Sea-Land is
therefore liable in the aggregate amount of US$4,000.00.
CITADEL LINES, INC. v. COURT OF APPEALS and MANILA WINE MERCHANTS, INC

G.R. No. 88092; April 25, 1990
Second Division, Justice Regalado
Digested by: Chris
FACTS:
Manila Wine Merchants (CONSIGNEE) is the importer of Dunhill Cigarettes from
England. Citadel Lines, Inc. (CARRIER) is the general agent of the vessel “Cardigan Bay/Strait
Enterprise”. The vessel "Cardigan Bay/Strait Enterprise" loaded on board at Southampton,
England, for carriage to Manila, 180 Filbrite cartons of mixed British manufactured cigarettes
called "Dunhill International Filter" and "Dunhill International Menthol,” as evidenced by Bill
of Lading No. 70621374 and Bill of Lading No. 70608680. The shipment arrived at the Port of
Manila, Pier 13. Due to lack of space at the special cargo, the aforesaid cigarettes were
placed in two container vans. In the morning, the CARRIER’s headchecker discovered that
one of the container vans had a different padlock and the seal was tampered with. It was
found that 90 cases of imported British manufactured cigarettes were missing.
When the CONSIGNEE learned that 90 cases were missing, it filed a formal claim with
the CARRIER, demanding the payment of P315,000 representing the market value of the
missing cargoes. The CARRIER, in its reply letter, admitted the loss but alleged that the
ARRASTRE should be liable because it has the absolute control thereof. The ARRASTRE also
denied the claim of the CONSIGNEE. A case was filed in court. After trial, the lower court
rendered a decision exonerating the ARRASTRE of any liability. CA affirmed the lower court’s
ruling.
ISSUE: Whether the stipulation limiting the liability of the carrier contained in the bill of
lading is binding on the consignee.
RULING:
Yes. It is clearly and expressly provided under Clause 6 of the aforementioned bills of
lading issued by the CARRIER that its liability is limited to $2.00 per kilo. As a rule, a
stipulation limiting the liability of the carrier to the value of the goods appearing in the bill of
lading, unless the shipper or owner declares a greater value, is binding. Further, a contract
fixing the sum that may be recovered by the owner or shipper for the loss, destruction or
deterioration of the goods is valid, if it is reasonable and just under the circumstances, and
has been fairly and freely agreed upon.
The CONSIGNEE itself admits in its memorandum that the value of the goods shipped
does not appear in the bills of lading. Hence, the stipulation on the carrier's limited liability
applies. There is no question that the stipulation is just and reasonable under the
circumstances and have been fairly and freely agreed upon.
EVERETT STEAMSHIP CORPORATIO v. COURT OF APPEALS

GR No. 122494 October 8, 1998
Second Division, Justice Martinez
Digested by: Kriztel-Ann Cabradilla
FACTS
Hernandez Trading imported three crates of bus spare parts from Maruman Trading,
a foreign supplier based in Japan. The crates were then shipped from Japan to Manila on
board Adelfaeverett. Petitioner owns the vessels which transported the goods. It should be
noted that the crates were covered by a bill of lading. When the vessel arrived at port of
Manila, it was discovered that one of the crates was missing. The loss was admitted by
petitioner in its letter addressed to Hernandez trading. The latter claims the full amount of
the crate amounting to Y1,552,500.00 but petitioner offered only Y100,000.00 as the
stipulated maximum amount under the bill of lading. Said offer was rejected by Hernandez
Trading thus prompted it to file a collection suit.
The RTC ruled in favor of Hernandez Trading. On appeal, the CA affirmed the ruling of
the trial court stating that Hernandez Trading cannot be bound by the terms under the bill of
lading.
ISSUE
Whether or not a stipulation in the bill of lading limiting the liability of the carrier valid
RULING
Yes. Under Article 1749 stipulation limiting the liability of the common carrier as to
the value of the goods appearing in the bill of lading is valid, and the owner or shipper may
declare a greater value. Moreover, Article 1750 states that a contract fixing the sum that may
be recovered by the owner for the loss, destruction or deterioration of the goods is valid,
provided that the amount fixed by the contract is reasonable and just and fairly agreed upon
by the parties.
The court ruled that the amount stipulated under the bill of lading which is
Y100,000.00 is reasonable and just. The shipper is given the option to declare a higher
valuation if the limited liability imposed under the bill of lading is not equivalent to the value
of the cargo. However, the shipper in the present case did not declare a higher valuation
hence the shipper cannot burden the carrier of the full value of the cargo.
On the other hand, the consignee who is not a party to the contract became bound
to the stipulations between the shipper and the carrier when it claimed for reimbursement
of the missing goods for the carrier. Hence it can now be implied that the consignee
accepted the provisions of the bill of lading providing for the limited liability of the carrier.
Private respondent as the consignee cannot reject or disregard the carrier’s limited liability
stipulation in the bill of lading.
ANICETO SALUDO JR. v. COURT OF APPEALS

GR No. 95536 March 23, 1992
Second Division, Justice Regalado
Digested by: Kriztel – Ann Cabradilla
FACTS
Plaintiffs’ mother died in Chicago Illinois. They engaged the services of Pomierski and
Son Funeral home to prepare and arrange the remains for the shipment to the Philippines.
The funeral home brought the remains to Continental Mortuary Air Services at the airport
which arranged the flight. CMAS then booked the shipment PAL thru the carrier’s agent Air
Care International. Under which it was stated that the funeral home is the shipper and Mario
Saludo as the consignee.
Plaintiffs on the other hand were booked with United Airlines. Upon inquiry they
were informed by the funeral director that the remains were booked with TWA flight. Thus
they changed their booking arrangement. However upon inquiry with the TWA no body was
on that flight, but nevertheless took the TWA flight. When plaintiffs inquired again they were
informed that the remains were on a plane to Mexico and that since there were two remains
they were switched. CMAS told TWA that they are to send the remains back to California.
Upon arrival, the shipment of remains was transferred to or received by PAL. The shipment
was immediately loaded on PAL flight for Manila that same evening and arrived in Manila a
day after its expected arrival. sPetitioners filed a complaint for damages. The lower court
held that the airlines were not liable for damages. The same was affirmed by the CA.
ISSUE
Whether or not there was delivery of the cargo upon mere issuance of the airway bill
RULING
No. Bill of lading refers to the written acknowledgment of the receipt of the goods
and an agreement to transport and deliver them at a specified place to a person named or
on his order. Thus upon the issuance of a bill of lading, there is a presumption that the goods
were delivered to the carrier issuing the bill, for immediate shipment. However the Court
ruled that in some instances the order of events may not be the same thus there may be
execution of the bill of lading even prior to actual possession and control by the carrier of
the cargo to be transported.
It the preset case the remains were booked for PAL flight thus a PAL Airway bill was issued,
such cannot be considered as evidence of receipt of delivery of the cargo on that day but
merely as a confirmation of the booking thus made for the San Francisco-Manila flight
scheduled for the next day. The delivery to the carrier contemplated is only when the goods
are ready for and have been placed in the exclusive possession, custody and control of the
carrier for the purpose of their immediate transportation and the carrier has accepted
them. But the records show that the cargo was not placed in the possession of PAL thus the
switching prior to the delivery to PAL cannot be attributed to them.
Northwest Airlines, Inc. v. Cuenca

GR No. L-22425 August 31, 1965
En Banc, Justice Concepcion
Digested by: Regine Anne Lacasandile
Facts:
Respondent held the Office of the Commissioner of Public Highways. He boarded
petitioner’s lane with a first class ticket to Tokyo, but he was, upon arrival at Okinawa,
transferred to the tourist class compartment. An agent of the petitioner rudely compelled
him to the tourist class despite revealing that he was travelling in his official capacity as
delegate of the Republic to a conference in Tokyo. Respondent had no choice but to obey in
order to reach the conference on time. Thus, an action for damages for alleged breach of
contract was filed against petitioner. The CFI of Manila held petitioner liable for the sum of
P20,000 as moral damages and P5,000 exemplary damages, with legal interest thereon from
the date of filing of complaint (December 12, 1959) until fully paid, plus P2,000 attorneys
fees. Petitioner appealed the case to the Court of Appeals, but the appellate court affirmed
the decision of the lower court, but deleted the exemplary damages and that the award of
moral damages was converted into nominal damages. Aggrieved, petitioner filed the instant
petition for review by certiorari.
Petitioner argues that an air carrier is liable only in the event of death or injury to passengers
and/or to loss or destruction of his goods, basing from the articles of the Warsaw
Convention. Also, he contends that the award of nominal damages is erroneous.
Issue: Are petitioner’s contentions tenable?
Ruling: No.
The Court held that the Warsaw Convention merely stated or declared that the
carrier shall be held liable for damages in case of death or injury to passengers and/or to loss
or destruction of his goods. There is no provision in the Convention excluding liability for
damages for other breaches of contract by the carrier. Therefore, the petitioner’s claim that
an air carrier would be exempt from any liability for damages in the event of absolute
refusal, in bad faith to comply with a contract of carriage, which is absurd.
It also ruled that nominal damages cannot co-exist with compensatory damages, and the CA
in this case awarded no damages. With the circumstance of the case, respondent is entitled
to believe that it was a confirmation of his first class reservation, and will be effective until
ultimate destination. The Court noted that since the offense had been committed with full
knowledge of the fact that respondent was an official representative of the Republic, the
sum of P20,000 awarded as damages may well be considered as merely nominal.
Thus, the decision of the lower court is affirmed, with costs against the petitioner.
ALITALIA vs. INTERMEDIATE APPELLATE COURT and FELIPA E. PABLO

G.R. No. 71929 : December 4, 1990.
FIRST DIVISION, Justice Narvasa
Digested by: Serafin Michaelle Alzate
Facts:
Dr. Felipa Pablo — an associate professor in the University of the Philippines, and a
research grantee of the Philippine Atomic Energy Agency — was invited to take part at a
meeting of the Department of Research and Isotopes of the Joint FAO-IAEA Division of
Atomic Energy in Food and Agriculture of the United Nations in Ispra, Italy. She was invited
in view of her specialized knowledge in "foreign substances in food and the agriculture
environment." She accepted the invitation, and was then scheduled by the organizers. To
fulfill this engagement, Dr. Pablo booked passage on petitioner airline, ALITALIA.
She arrived in Milan on the day before the meeting in accordance with the itinerary and time
table set for her by ALITALIA. She was however told by the ALITALIA personnel there at
Milan that her luggage was delayed inasmuch as the luggage was in one of the succeeding
flights from Rome to Milan. Her luggage consisted of two (2) suitcases which included her
files for the meeting. However, the other flights arriving from Rome did not have her
baggage on board.
She went to Rome to try to locate her bags herself. There, she inquired about her suitcases
in the domestic and international airports, and filled out the forms prescribed by ALITALIA
for people in her predicament. However, her baggage could not be found. Completely
distraught and discouraged, she returned to Manila without attending the meeting in Ispra,
Italy.
Once back in Manila she demanded that ALITALIA make reparation for the damages thus
suffered by her. ALITALIA offered her free airline tickets to compensate her for any alleged
damages. She rejected the offer, and forthwith commenced the action.
As it turned out, Prof. Pablo's suitcases were in fact located and forwarded to Ispra, Italy,
but only on the day after her scheduled appearance and participation at the U.N. meeting
there. The suitcases were not actually restored to Prof. Pablo by ALITALIA until eleven (11)
months later, and four (4) months after institution of her action.
Issue:
Whether or not the Warsaw Convention should have been applied to limit ALITALIA'S
liability.
Ruling:
The Warsaw Convention denies to the carrier availment of the provisions which exclude or
limit his liability. The Convention does not operate as an exclusive enumeration of the
instances of an airline's liability, or as an absolute limit of the extent of that liability. Such a
proposition is not borne out by the language of the Convention, as the court has pointed
out.
Nevertheless, the fact is that some special species of injury was caused to Dr. Pablo because
petitioner ALITALIA misplaced her baggage and failed to deliver it to her at the time
appointed — a breach of its contract of carriage, to be sure. Apart from this, there can be no
doubt that Dr. Pablo underwent profound distress and anxiety, which gradually turned to
panic and finally despair, from the time she learned that her suitcases were missing up to the
time when, having gone to Rome, she finally realized that she would no longer be able to
take part in the conference.
She is not, of course, entitled to be compensated for loss or damage to her luggage since
the same was returned to her, only at a tardy manner. She is however entitled to nominal
damages — which, as the law says, is adjudicated in order that a right of the plaintiff, which
has been violated or invaded by the defendant, may be vindicated and recognized, and not
for the purpose of indemnifying the plaintiff for any loss suffered.
Pan American World Airways, Inc. v. IAC

G.R. No. 70462, August 11, 1988
Third Division, Justice Cortes
Digested by: Sol Joanna Frany
Facts:
Rene V. Pangan, obtained from Pan Am an economy class airplane ticket for passage
from Manila to Guam upon payment by him of the regular fare. Pangan was at the Pan Am's
ticket counter at the Manila International Airport and presented his ticket and checked in his
two luggages, for which he was given baggage claim tickets. The two luggages contained
the promotional and advertising materials, the clutch bags, barong tagalog and his personal
belongings. Subsequently, Pangan was informed that his name was not in the manifest and
so he could not take Flight No. 842 in the economy class. Since there was no space in the
economy class, Pangan took the first class, paying an additional sum. When Pangan arrived
in Guam, his two luggages did not arrive with his flight, as a consequence of which his
agreements with Slutchnick and Quesada for the exhibition of the films in Guam and in the
United States were cancelled. He filed a written claim for his missing luggages. Pan Am
assured Pangan that his grievances would be investigated. Due to the defendant's failure to
communicate with Pangan about the action taken on his protests, the present complaint
was filed. The Court of First Instance found petitioner liable. On appeal, the Intermediate
Appellate Court affirmed the trial court decision. Hence, the instant petition.
Issue:
Whether petitioner's liability for the loss of the baggage should be limited as the
latter did not declare a higher value for his baggage and pay the corresponding additional
charges.
Ruling:
Yes. Under Art.1107 of the Civil Code, a debtor in good faith may be held liable only
for damages that were foreseen or might have been foreseen at the time the contract of
transportation was entered into. In the case at bar, the absence of a showing that
petitioner's attention was called to the special circumstances requiring prompt delivery of
Pangan's luggages, petitioner cannot be held liable for the cancellation of private
respondents' contracts as it could not have foreseen such an eventuality when it accepted
the luggages for transit. The evidence reveals that the proximate cause of the cancellation
of the contracts was private respondent Pangan's failure to deliver the promotional and
advertising materials on the dates agreed upon. For this petitioner cannot be held liable.
Private respondent Pangan had not declared the value of the two luggages he had checked
in and paid additional charges.
CHINA AIRLINES vs. DANIEL CHIOK

G.R. No. 152122. July 30, 2003
THIRD DIVISION, Justice Panganiban
Digested by: Mae Margaret E. Calapati
FACTS:
Daniel Chiok purchased a ticket from China Airlines Ltd. Covering Manila-Taipei-Hong
Kong-Manila. The ticket was exclusively endorsable to Philippine Airlines. The trips covered
by the ticket were pre-scheduled and confirmed.
In Taipei, Chiok went to CAL office to confirm his Hong Kong-Manila flight. CAL
attached a yellow sticker, indicating that flight was OK.
In Hong Kong, Chiok went to PAL office to confirm his Manila flight. PAL confirmed
and attached its own sticker.
During the scheduled flight bound to Manila, it was cancelled due to a typhoon. All
confirmed ticket holders were booked automatically for it’s next flight (next day).
However on the following day, a PAL employee informed Chiok that his name did not
appear in PAL’s computer list of passengers and therefore could not be permitted to board
PAL flight no. PR 307.
Chiok filed a complaint for damages.
The Regional Trial Court held that CAL and PAL jointly and severely liable to
correspondent, affirmed by Court of Appeals.
ISSUE:
WON China Airline is liable as a principal carrier?
HELD:
In citing several cases:
As the principal in the contract of carriage, the petitioner in British Airways v. Court of
Appeals was held liable, even when the breach of contract had occurred, not on its own
flight, but on that of another airline. The Decision followed our ruling in Lufthansa German
Airlines v. Court of Appeals, in which we had held that the obligation of the ticket-issuing
airline remained and did not cease, regardless of the fact that another airline had
undertaken to carry the passengers to one of their destinations.
In the instant case, following the jurisprudence cited above, PAL acted as the carrying
agent of CAL. In the same way the court ruled against British Airways and Lufthansa in the
aforementioned cases,the Court also rule that CAL cannot evade liability to respondent,
even though it may have been only a ticket issuer for the Hong Kong-Manila sector.
A common carrier has a peculiar relationship with and an exacting responsibility to its
passengers. For reasons of public interest and policy, the ticket-issuing airline acts as
principal in a contract of carriage and is thus liable for the acts and the omissions of any
errant carrier to which it may have endorsed any sector of the entire, continuous trip.
AUGUSTO BENEDICTO SANTOS III v. NORTHWEST ORIENT AIRLINES

G.R. No. 101538, June 23, 1992
EN BANC, Justice Cruz
Digested by: Maynard Bryan Ofilas
FACTS:
Augusto Benedicto Santos III is a minor represented by his dad. In October 1986, he
bought a round trip ticket from Northwest Orient Airlines (NOA) in San Francisco. His flight
would be from San Francisco to Manila via Tokyo and back to San Francisco. His scheduled
flight was in December. A day before his departure he checked with NOA and NOA said he
made no reservation and that he bought no ticket. The next year, due to the incident, he
sued NOA for damages. He sued NOA in Manila. NOA argued that Philippine courts have no
jurisdiction over the matter pursuant to Article 28(1) of the Warsaw Convention, which
provides that complaints against international carriers can only be instituted in:
1.the court of the domicile of the carrier (NOA’s domicile is in the USA);
2.the court of its principal place of business (which is San Francisco, USA);
3.the court where it has a place of business through which the contract had been made
(ticket was purchased in San Francisco so that’s where the contract was made);
4.the court of the place of destination (Santos bought a round trip ticket which final
destination is San Francisco).
The lower court ruled in favor of NOA. Santos III averred that Philippine courts have
jurisdiction over the case and he questioned the constitutionality of Article 28 (1) of the
Warsaw Convention.
ISSUE:
Whether or not Philippine courts have jurisdiction over the matter to conduct judicial
review.
Ruling:
No. The Supreme Court ruled that they cannot rule over the matter for the SC is
bound by the provisions of the Warsaw Convention which was ratified by the Senate. Until &
unless there would be amendment to the Warsaw Convention, the only remedy for Santos
III is to sue in any of the place indicated in the Convention such as in San Francisco, USA.
The SC cannot rule upon the constitutionality of Article 28(1) of the Warsaw Convention. In
the first place, it is a treaty which was a joint act by the legislative and the executive. The
presumption is that it was first carefully studied and determined to be constitutional before
it was adopted and given the force of law in this country. In this case, Santos was not able to
offer any compelling argument to overcome the presumption.
UNITED AIRLINES, petitioner, vs. WILLIE J. UY, respondent.

G.R. No. 127768, November 19, 1999
SECOND DIVISION, Justice Bellosillo
Digested by: Maynard Bryan Ofilas
FACTS:
On October 13, 1989, respondent, a passenger of United Airlines, checked in together with
his luggage one piece of which was found to be overweight at the airline counter. To his
utter humiliation, an employee of petitioner rebuked him saying that he should have known
the maximum weight allowance per bag and that he should have packed his things
accordingly. Then, in a loud voice in front of the milling crowd, she told respondent to repair
his things and transfer some of them to the light ones. Respondent acceded but his luggage
was still overweight. Petitioner billed him overweight charges but its employee reused to
honor the miscellaneous charges under MCD which he offered to pay with. Not wanting to
leave without his luggage, he paid with his credit card. Upon arrival in manila, he discovered
that one of his bags had been slashed and its contents stolen. In a letter dated October 16,
1989, he notified petitioner of his loss and requested reimbursement. Petitioner paid for his
loss based on the maximum liability per pound. Respondent considered the amount grossly
inadequate. He sent two more letters to petition but to no avail. On June 9, 1992,
respondent filed a complaint for damages against petitioner Airline. Petitioner moved to
dismiss the complaint invoking the provisions of Article 29 of the Warsaw Convention.
Respondent countered that according to par. 2 of Article 29, “the method of calculating the
period of limitation shall be determined by the law of the court to which the case is
submitted.”
ISSUES:
1.) Whether or not the Warsaw Convention precludes the operation of the Civil Code and
other pertinent laws?
2.) Whether or not his cause of action has prescribed.
Ruling:
1. No. Within our jurisdiction we have held that the Warsaw Convention can be applied,
or ignored, depending on the peculiar facts presented by each case. Convention
provisions do not regulate or exclude liabilities for other breaches of contract by the
carrier or misconduct of its officers and employees, or for some particular or
exceptional type of damage. Neither may the Convention be invoked to justify the
disregard of some extraordinary type of damage. Neither may the Convention be
invoked to justify the disregard of some extraordinary sort of damage resulting to a

passenger and preclude recovery therefore3 beyond the limits set by said
convention.
Likewise, we have held that the Convention does not preclude the operation of the
Civil Code and other pertinent laws. It does not regulate, much less exempt, the
carrier from liability for damages for violating the rights of its passengers under the
contract of carriage, especially if willful misconduct on the part of the carriers
employee is found or established.
2. No. While his 2nd cause of action (an action for damages arising from theft or
damage to property or goods) is well within the bounds of the Warsaw convention,
his 1st cause of action (an action for damages arising from the misconduct of the
airline employees and the violation of respondent’s rights as passengers) clearly is
not.
The 2-yr limitation incorporated in Art. 29 of the Warsaw Convention as an absolute

bar to suit and not to be made subject to the various tolling provisions of the laws of
the forum, forecloses the application of our own rules on interruption of prescriptive
periods.
However, it is obvious that respondent was forestalled from immediately filing an

action because petitioner gave him the runaround, answering his letters but not
giving in to his demands. True, respondent should have already filed an action at the
first instance when petitioner denied his claims but the same could only be due to his
desire to make an out-of-court settlement for which he cannot be faulted. Hence,
despite the express mandate of Article 29 of the Warsaw Convention that an action
for damages should be filed within 2 years from the arrival at the place of destination,
such rule shall not be applied in the instant case because of the delaying tactics
employed by petitioner airlines itself. Thus, respondent’s 2nd cause of action cannot
be considered as time barred.
FABRE V. COURT OF APPEALS

G.R. No. 111127 , July 26, 1996
Second Division, Mendoza, J.
Digested by: Michael Niño Savellano
Facts:
Petitioners Fabre were owners of a minibus which is used as a bus service for school
children. The driver of this bus was Porfirio Cabil whose job was to take school children to
and from the St. Scholastica’s College in Malate, Manila. On November 2, 1984, private
respondent Word for the World Christian fellowship Inc. (WWCF) hired the bus of the
petitioner in going to La Union from Manila.
While their way to Caba, La Union, the bridge in Carmen, Pangasinan was under
repair so the driver (Cabil), who is not familiar on the place, took another route. Due to rain
showers, the road was slippery causing the bus to skid to the left corner of the road.
Unfortunately, the passengers of the bus had some injuries. One of these passengers was
Amyline Antonio, who was thrown out of the window and suffered serious physical injuries.
Hence, Amyline Antonio filed a case against the petitioners and Cabil.
Issue:
Whether or not petitioners are liable of quasi-delict.
Ruling:
The petitioners are liable for the injury of the passengers because they did not
exercise their extra-ordinary diligence in hiring a qualified bus driver with regard to the job.
The court held that due diligence in the selection of employees suitable to the job does not
only constitutes that he has a professional driver’s license, but the employer should also
examine the qualifications of the employee. However, the petitioners did not examine and
test the qualifications of Cabil in the present case which makes them liable for the action
made by their employee.
Moreover, common carriers are liable for the death of or injuries to passengers
through the negligence or wilful acts of the former’s employees, although such employees
may have acted beyond the scope of their authority or in violation of the orders of the
common carriers. This liability of the common carriers does not cease upon proof that they
exercised all the diligence of a good father of a family in the selection and supervision of
their employees. The evidences showed that petitioners are liable under Arts. 2176 and 2180
for quasi delict, fully justify finding them guilty of breach of contract of carriage under Arts.
1733, 1755 and 1759 of the Civil Code.
PHILIPPINE AMERICAN GENERAL INSURANCE CO., INC V. SWEETLINES, INC

G.R. No. 87434 , August 5, 1992
Digested by: Michael Niño Savellano
Facts:
The vessel SS "VISHVA YASH" belonging to or operated by the foreign common
carrier, took on board consignments of cargoes for shipment to Manila and later for
transhipment to Davao City, with arrival notice to Tagum Plastics, Inc., Madaum, Tagum,
Davao City. Said cargoes were covered, respectively, by Bills of Lading Nos. 6 and 7 issued by
the foreign common. The cargoes were likewise insured by the Tagum Plastics Inc. with
plaintiff Philippine American General Insurance Co., Inc. In the course of time, the said vessel
arrived at Manila and discharged its cargoes in the Port of Manila for transhipment to Davao
City. For this purpose, the foreign carrier awaited and made use of the services of the vessel
called M/V "Sweet Love" owned and operated by defendant interisland carrier.
On May 15, 1977, the shipment(s) were discharged from the interisland carrier into
the custody of the consignee. However, the survey shows shortages, damages and losses to
some of the cargoes. These cargoes were in good conditions but when they were delivered,
some of them are deteriorating.
Issue:
Whether or not petitioner complied with the requirement for the filing of a notice of
claim within the prescribed period.
Ruling:
It bears restating that a right of action is the right to presently enforce a cause of
action, while a cause of action consists of the operative facts which give rise to such right of
action. The right of action does not arise until the performance of all conditions precedent
to the action and may be taken away by the running of the statute of limitations, through
estoppel, or by other circumstances which do not affect the cause of action. Performance or
fulfillment of all conditions precedent upon which a right of action depends must be
sufficiently alleged, considering that the burden of proof to show that a party has a right of
action is upon the person initiating the suit.
The fundamental reason or purpose of such a stipulation is not to relieve the carrier
from just liability, but reasonably to inform it that the shipment has been damaged and that
it is charged with liability therefor, and to give it an opportunity to examine the nature and
extent of the injury. This protects the carrier by affording it an opportunity to make an
investigation of a claim while the matter is fresh and easily investigated so as to safeguard
itself from false and fraudulent claims. Hence, in the present case, there was no proof that
the petitioner complied with the requirement for the filing of a notice of claim within the
prescribed period.
DOMINGO ANG vs. AMERICAN STEAMSHIP AGENCIES, INC.

G.R. No. L-22491, January 27, 1967
En Banc ,Justice Bengzon J.P
Digested by: Raihanah Sarah Macarimpas
FACTS:
Yau Yue Commercial Bank Ltd. agreed to sell 140 packages of galvanized steel
durzinc sheets to Herminio G. Teves.
Yau Yue drew a demand draft together with the bill of lading against Herminio G. Teves,
through the Hongkong & Shanghai Bank.
When the articles arrived in Manila Hongkong & Shanghai Bank demanded payment from
Teves but the latter failed. The bank returned the bill of lading and demand draft to Yau Yue
which indorsed the said bill of lading to Domingo Ang.
Teves was able to obtain a bank guaranty in favor of the American Steamship Agencies, Inc.,
as carrier's agent thus, the articles were released and delivered to him.
Domingo Ang filed a complaint against the American Steamship Agencies, Inc., for having
allegedly wrongfully delivered and/or converted the goods covered by the bill of lading
belonging to plaintiff Ang.
ISSUE:
1. Whether or not there was "loss" of the goods.
2. Whether or not the plaintiff-appellant’s cause of action prescribed under Section 3(6),
paragraph 4 of the Carriage of Goods by Sea Act.
HELD:
1. No. As defined in the Civil Code and as applied to Section 3 (6) paragraph 4 of the Carriage
of Goods by Sea Act, "loss" contemplates merely a situation where no delivery at all was
made by the shipper of the goods because the same had perished, gone out of commerce,
or disappeared that their existence is unknown or they cannot be recovered. It does not
include a situation where there was indeed delivery but delivery to the wrong person, or a
misdelivery, as alleged in the complaint in this case.
2. No. There being no loss or damage to the goods, the aforequoted provision under Section
3(6), paragraph 4 Carriage of Good by Sea Act stating that “In any event, the carrier and the
ship shall be discharged from all liability in respect of loss or damage unless suit is brought
within one year after delivery of the goods or the date when the goods should have been
delivered,” does not apply. Said one-year period of limitation is designed to meet the
exigencies of maritime hazards.
In a case where the goods shipped were neither last nor damaged in transit but were, on the
contrary, delivered in port to someone who claimed to be entitled thereto, the situation is
different, and the special need for the short period of limitation in cases of loss or damage
caused by maritime perils does not obtain.
It follows that for suits predicated not upon loss or damage but on alleged misdelivery (or
conversion) of the goods, the applicable rule on prescription is that found in the Civil Code,
namely, either ten years for breach of a written contract or four years for quasi-delict. (Arts.
1144[1], 1146, Civil Code).
MITSUI O.S.K. LINES LTD., vs. COURT OF APPEALS

G.R. No. 119571, March 11, 1998
Second Division, Justice Mendoza
Digested by: Raihanah Sarah Macarimpas
FACTS:
Petitioner Mitsui O.S.K. Lines Ltd. entered into a contract of carriage through Meister
Transport, Inc., with private respondent Lavine Loungewear Manufacturing Corporation to
transport goods of the latter from Manila to Le Havre, France.
On July 24, 1991, petitioner’s vessel loaded private respondent’s container van for carriage.
However, the shipment arrived in Le Havre only on November 14, 1991.
The consignee allegedly paid only half the value of the said goods on the ground that they
did not arrive in France until the “off season” in that country. The remaining half was
allegedly charged to the account of private respondent which in turn demanded payment
from petitioner through its agent. Private respondent filed a case in the Regional Trial Court
on April 14, 1992.
ISSUE:
1. Whether or not there was "loss" of goods.
2. Whether or not the action has prescribed.
HELD:
1. No. As defined in the Civil Code and as applied to Section 3(6), paragraph 4 of the Carriage
of Goods by Sea Act, “loss” contemplates merely a situation where no delivery at all was
made by the shipper of the goods because the same had perished, gone out of commerce,
or disappeared in such a way that their existence is unknown or they cannot be recovered.
In the case at bar, there is neither deterioration nor disappearance nor destruction of goods
caused by the carrier’s breach of contract. Whatever reduction there may have been in the
value of the goods is not due to their deterioration or disappearance because they had been
damaged in transit.
Indeed, what is in issue in this petition is not the liability of petitioner for its handling of
goods as provided by §3(6) of the COGSA, but its liability under its contract of carriage with
private respondent as covered by laws of more general application.
2. No. Section 3(6), paragraph 4 Carriage of Good by Sea Act provides that “In any event, the
carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit
is brought within one year after delivery of the goods or the date when the goods should have
been delivered,” .
Damages suffered by appellant as a result of the delay in the shipment of his cargo are not
covered by the prescriptive provision of the Carriage of Goods by Sea Act above, because
such damages were due, not to the deterioration and decay of the goods while in transit,
but to other causes independent of the condition of the cargo upon arrival.
FILIPINO MERCHANTS INSURANCE COMPANY, INC. v. Alejandro

G.R. No. L-54140; G.R. No. L-62001, October 14, 1986
SECOND DIVISION, Justice Gutierrez, Jr.
Digested by: Zoey Gacod
FACTS:
Petitioner insured the goods of Plaintiff Mr. Choa Seng. The latter filed a a complaint
against petitioner before the then Court of First Instance of Manila for recovery of a sum of
money under the marine insurance policy on cargo alleging that the goods insured with the
petitioner sustained loss and damage.
SS Frotario which was owned and operated by private respondent Frota Oceanica
Brasiliera, (Frota) discharged the goods at the port of Manila on December 13, 1976. The said
goods were delivered to the arrastre operator E. Razon, Inc., on December 17, 1976 and on
the same date were received by the consignee-plaintiff.
An identical case was likewise files by Joseph Chua whose goods were received by
the consignee on January 25-28, 1977.
Petitioner filed a third-party complaint against the carrier, private respondent Frota
and the arrastre contractor, E. Razon, Inc. for indemnity, subrogation, or reimbursement in
the event that it is held liable to the plaintiff. It filed an amended third-party complaint
against respondent carrier, the Australia-West Pacific Line (Australia-West).
The private respondents alleged in their separate answers that the petitioner is
already barred from filing a claim because under the Carriage of Goods by Sea Act, the suit
against the carrier must be filed within one year after delivery of the goods or the date when
the goods should have been delivered.
The petitioner contended that the provision relied upon by the respondents applies
only to the shipper and not to the insurer of the goods.
Respondent judge dismissed the complaints filed on the ground that the action has already
prescribed.
ISSUES:
1. Whether the one-year prescriptive period within which to file a case against the
carrier also applies to a claim filed by an insurer who stands as a subrogee to the
insured.
2. Whether the third-party complaint filed by the petitioner cannot be reckoned

from the filing of the main action because such complaint is independent of, and
separate and distinct from the insured's action against the petitioner.
RULING:
1. Yes. Section 3(b) of the Carriage of Goods by Sea Act provides in part:
"In any event the carrier and the ship shall be discharged from all liability in respect of loss or
damage unless suit is brought within one year after delivery of the goods or the date when
the goods should have been delivered: Provided, that if a notice of loss or damage, either
apparent or concealed, is not given as provided for in this section, that fact shall not affect
or prejudice the right of the shipper to bring the suit within one year after the delivery of the
goods or the date when the goods should have been delivered.”
Clearly, the coverage of the Act includes the insurer of the goods. Otherwise, what
the Act intends to prohibit after the lapse of the one-year prescriptive period can be done
indirectly by the shipper or owner of the goods by simply filing a claim against the insurer
even after the lapse of one year. This would be the result if we follow the petitioner's
argument that the insurer can, at any time, proceed against the carrier and the ship since it is
not bound by the time-bar provision. In this situation, the one-year limitation will be
practically useless. This could not have been the intention of the law which has also for its
purpose the protection of the carrier and the ship from fraudulent claims by having "matters
affecting transportation of goods by sea be decided in as short a time as possible" and by
avoiding incidents which would "unnecessarily extend the period and permit delays in the
settlement of questions affecting the transportation."
2. Yes. the third-party complaint of the petitioner cannot be considered to have

been filed upon the filing of the main action because although it can be said that a third-
party complaint is but ancilliary to the main action (Eastern Assurance and Surety
Corporation v. Cui 105 SCRA 622), it cannot abridge, enlarge, nor modify the substantive
rights of any litigant. It creates no substantive rights. Thus, unless there is some substantive
basis for the third-party Plaintiff's claim, he cannot utilized the filing of such action to acquire
any right of action against the third-party defendant. (See also Francisco, The Revised Rules
of Court in the Philippines, Vol. 1, 1973 Ed., p. 507). The petitioner can only rightfully file a
third-party complaint against the respondents if, in the first place, it can still validly maintain
an action against the latter.
In the case at bar, the petitioner's action has prescribed under the provisions of the
Carriage of Goods by Sea Act. Hence, whether it files a third-party complaint or chooses to
maintain an independent action against herein respondents is of no moment. Had the
plaintiffs in the civil cases below filed an action against the petitioner after the one-year
prescriptive period, then the latter could have successfully denied liability on the ground
that by their own doing, the plaintiffs had prevented the petitioner from being subrogated
to their respective rights against the herein respondents by filing a suit after the one-year
prescriptive period. The situation, however, does not obtain in the present case.
MAYER STEEL PIPE CORPORATION and HONGKONG GOVERNMENT SUPPLIES

DEPARTMENT v. COURT OF APPEALS,
G.R. No. 124050, June 19, 1997
SECOND DIVISION, Justice Puno
Digested by: Zoey Gacod
FACTS:
Petitioner Hongkong Government Supplies Department (Hongkong) contracted

petitioner Mayer Steel Pipe Corporation (Mayer) to manufacture and supply various steel
pipes and fittings. These were insured by private respondents herein.
Industrial Inspection certified all the pipes and fittings to be in good order condition
before they were loaded in the vessel. Nonetheless, when the goods reached Hongkong, it
was discovered that a substantial portion thereof was damaged.
Petitioners filed a claim against private respondents for indemnity under the insurance
contract.
Private respondents averred that they have no obligation to pay the amount claimed
by petitioners because the damage to the goods is due to factory defects which are not
covered by the insurance policies.
The trial court on its decision held that the insurance companies are held liable
because the damage was not due to factory defects, further the contract extends to “all
risk” which covers all causes.
The court of appeals how ever held that the action is barred by prescription under
Section 3(6) of the Carriage of Goods by Sea Act since it was filed only on April 17, 1986,
more than two years from the time the goods were unloaded from the vessel. Section 3(6)
of the Carriage of Goods by Sea Act provides that "the carrier and the ship shall be
discharged from all liability in respect of loss or damage unless suit is brought within one
year after delivery of the goods or the date when the goods should have been delivered."
ISSUE:
Whether the Court of Appeals erred in holding that petitioners' cause of action had
already prescribed on the mistaken application of the Carriage of Goods by Sea Act and the
doctrine of Filipino Merchants Co., Inc. v. Alejandro.
RULING:
Yes. The Filipino Merchants case is different from the case at bar. In Filipino
Merchants, it was the insurer which filed a claim against the carrier for reimbursement of the
amount it paid to the shipper. In the case at bar, it was the shipper which filed a claim
against the insurer. The basis of the shipper's claim is the "all risks" insurance policies issued
by private respondents to petitioner Mayer.
The ruling in Filipino Merchants should apply only to suits against the carrier filed
either by the shipper, the consignee or the insurer. When the court said in Filipino
Merchants that Section 3(6) of the Carriage of Goods by Sea Act applies to the insurer, it
meant that the insurer, like the shipper, may no longer file a claim against the carrier beyond
the one-year period provided in the law. But it does not mean that the shipper may no
longer file a claim against the insurer because the basis of the insurer's liability is the
insurance contract. An insurance contract is a contract whereby one party, for a
consideration known as the premium, agrees to indemnify another for loss or damage which
he may suffer from a specified peril. An "all risks" insurance policy covers all kinds of loss
other than those due to willful and fraudulent act of the insured. Thus, when private
respondents issued the "all risks" policies to petitioner Mayer, they bound themselves to
indemnify the latter in case of loss or damage to the goods insured. Such obligation
prescribes in ten years, in accordance with Article 1144 of the New Civil Code.
DOLE Philippines, Inc. v. Maritime Company of the Philippines

G.R. No. L-61352, February 27, 1987
FIRST DIVISION, Justice Narvasa
Digested by: Brian Jonathan T. Paraan
Facts:
This action originated from a claim of damages sustained by cargo shipped by the
petitioner with respondent, the cargo was consigned on December 18, 1971 and the claim for
damages thereto was filed on May 4, 1972. The first two actions were dismissed with
prejudice, due to extrajudicial settlement involving the two, wherein the last cause of action
was dismissed without prejudice, because it was not included in the settlement, on
December 11, 1974. Respondent contends that the action has prescribed under the Carriage
of Goods by Sea Act which provides that an action for the recovery of damages due to
damage or loss of goods after one year after delivery or the date from which the goods
should have been delivered. Petitioner contends that Article 1155 of the Civil Code which
provides that an extrajudicial written demand of the creditor shall toll the prescriptive
period of an action.
Issue:
Whether or not Article 1155 of the Civil Code is applicable to the provisions of the
Carriage of Goods by Sea Act
Ruling:
The general provisions of the Code on Civil procedure on prescription shall not apply
to the provisions of the Carriage of Goods by Sea Act. Similarly Article 1155 of the Civil Code
cannot be made to apply such application would have the effect of extending the one-year
period of prescription fixed in the law. It is desirable that matters affecting transportation of
goods by sea be decided in as short a time as possible; the application of the provisions of
Article 1155 of the new Civil Code would unnecessarily extend the period and permit delays in
the settlement of questions affecting transportation, contrary to the clear intent and
purpose of the law.
Insurance Company of North America v. Asian Terminals, Inc.

G.R. No. 180784, February 15, 2012
THIRD DIVISION, Justice Peralta
Digested by: Brian Jonathan T. Paraan
Facts:
Macro-Lite Korea shipped to San Miguel Corporation through M/V DIMI P 185
packages of electrolytic tin free steel with declared value of $ 169, 850.35 insured by
petitioner herein. When the vessel arrived at the port of Manila on November 19, 2002
custody over the goods were turned over to respondent herein wherein it was found that 7
packages of the goods were damaged. R.V. Marzan Brokerage Corp., San Miguel
Corporation’s authorized customs broker, withdrew the packages from respondent on that
dates of November 22, 23, and 29, 2002. A Bad Order Survey was conducted over the goods
prior to the final withdrawal of the goods by Marzan. At the request of San Miguel
Corporation, an independent investigation made by BA McLarens Phils., Inc. was conducted
and it was found that a total of 9 skids were damaged. Petitioner as insurer paid San Miguel
Corporation the amount of ₱431,592.14. Petitioner now seeks for indemnification against the
respondent for the amount of the damage. Respondent contends that the action has
prescribed based on the provisions of the Carriage of Goods by Sea Act (COGSA)
Issues:
1. Whether or not the action has prescribed under the provisions of the COGSA
2. Whether or not petitioner can claim for compensation of the actual damages paid to
San Miguel Corporation as its insurer
Ruling:
1. The provisions of the COGSA on prescription provides that “In any event the carrier
and the ship shall be discharged from all liability in respect of loss or damage unless
suit is brought within one year after delivery of the goods or the date when the
goods should have been delivered…” refers only to carriers and ships. Furthermore,
the term “carriage of goods” is defined by the COGSA as the period from the time
when the goods are loaded to the time when they are discharged from the ship, thus
the period of time when the goods have been discharged from the ship and given to
the custody of the arrastre operator is not covered by the COGSA. The applicable law
is found in Section 7.01 of the Contract for Cargo Handling Services executed
between the Philippine Ports Authority and Marina Ports Services, Inc. (now Asian
Terminals, Inc.) which provides that the consignee has 15 days to file a formal claim
for damages due to loss or damage of goods from delivery. The Bad Order Survey
conducted on the last day of withdrawal of the Goods by Marzan is within the 15 days
to file a formal claim. the request for, and the result of, the bad order examination,
which were filed and done within fifteen days from the haulage of the goods from
the vessel, served the purpose of a claim, which is to afford the carrier or depositary
reasonable opportunity and facilities to check the validity of the claims while facts are
still fresh in the minds of the persons who took part in the transaction and
documents are still available.
2. The amount paid to San Miguel was for damage on the goods that were present
upon arrival in the port of Manila and before custody of the goods were turned over
to respondent, thus as it happened during the carriage of the goods, the action has
prescribed. However, the 4 skids that were damaged in the custody of respondent
may still be a cause for action for claiming actual damages incurred thereto.
Benjamin Cua v. Wallem Philippines Shipping, Inc. and Advance Shipping Co.
G.R. No. 171337. July 11, 2012
Second Division, Justice Brion
Digested by: Janzeri Labiaga
Facts:
Cua asks for the payment for damage of shipment of Brazilian Soyabean from Brazil
to Philippines. He claimed that the loss was due to the respondents’ failure to observe
extraordinary diligence in carrying the cargo. Advance Shipping was the owner and manager
of M/V Argo Trader that carried the cargo, while Wallem was its local agent. Wallem filed a
motion to dismiss on the ground of prescription which is under section3 (6) of the Carriage
of Goods by Sea Act (COGSA). Wallem alleged that the goods were delivered to Cua on
August 16, 1989, but the damages suit was instituted only on November 12, 1990, beyond the
one year prescriptive under the COGSA, thus, Cua’s action has been barred. Cua allege that
an August 10, 1990 message by Mr. A.R. Filder of Thomas Miller, manager of the UK P&I Club,
stated that Advance Shipping agreed to extend the commencement of suit for 90 days,
from August 14, 1990 to November 12, 1990; the extension was made with the concurrence
of the insurer of the vessel, the UK P&I Club. The RTC found respondents jointly and
severally liable. The CA Set Aside the decision of RTC because it found that the August 10,
1990 message, extending the period to file an action, was neither attached to Cua’s
opposition to Wallem’s motion to dismiss, nor presented during trial.
Issue:
Whether or not Cua’s claim for payment of damages against the respondents has
prescribed.
Held:
The COGSA is the applicable law for all contracts for carriage of goods by sea to and
from Philippine ports in foreign trade. Thus it shall be applied. Under Section 3(6) of the
COGSA, the carrier is discharged from liability for loss or damage to the cargo unless the suit
is brought within one year after delivery of the goods or the date when the goods should
have been delivered." Jurisprudence, however, recognized the validity of an agreement
between the carrier and the shipper/consignee extending the one-year period to file a claim.
Respondents admitted on the existence of an agreement extending the period to file the
claim. The pleadings submitted by the respondents discloses that they failed to specifically
deny Cua’s allegation of an agreement extending the period. Wallem’s motion to dismiss
simply referred to the fact that Cua’s complaint was filed more than one year from the
arrival of the vessel, but it did not contain a denial of the extension. Advance Shipping’s
motion to dismiss focused solely on its contention that the action was premature for failure
to first undergo arbitration. While the joint answer of the respondents denied Cua’s
allegation of an extension, they made no further statement other than a bare and
unsupported contention that Cua’s complaint is barred by prescription and/or laches. The
respondents did not provide in their joint answer any factual basis for their belief that the
complaint had prescribed. The Supreme Court considered the extension of the period as an
admitted fact.

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Transportation Law Case Digests

A.Y. 2014 – 2015, 2nd Semester

ABOITIZ SHIPPING CORPORATION V. COURT OF APPEALS

1|Page| TRANSPORTATION LAW

DANGWA TRANSPORTATION CO, INC v. COURT OF APPEALS

It is the duty of common carriers of passengers, to stop their conveyances a

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3|Page| TRANSPORTATION LAW

4|Page| TRANSPORTATION LAW

5|Page| TRANSPORTATION LAW

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be considered STILL AS PASSENGERS OF THE CARRIER, ENTITLED TO THE PROTECTION

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JAPAN AIRLINES v. COURT OF APPEALS

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Philippine Airlines v. Court Of Appeals

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Fortune Express , Inc. vs CA

PILAPIL v. COURT OF APPEALS

Singapore Airlines Limited vs. Andion Fernandez

situation. Petitioner did not exercise due diligence in communicating to its

Fortune Express, Inc. vs. CA

Bachelor Express, Inc. v. CA

De Gillaco v. Manila Railroad Company

Is the carrier liable?

Cathay Pacific Airways Ltd. V CA

CESAR L. ISAAC vs. A. L. AMMEN TRANSPORTATION CO., INC.

COMPAÑIA MARITIMA vs. COURT OF APPEALS and VICENTE CONCEPCION

Standard Vacuum Oil vs Luzon Stevedoring

GR L-5203, 18 April 1956

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Mecenas, et.al vs. CA

G.R. No. 88052, December 14, 1989

Briñas vs. People of the Philippines

G.R. No. L-30309, November 25, 1983

BATANGAS LAGUNA TAYABAS BUS COMPANY & ARMANDO PON v. INTERMEDIATE

BATANGAS TRANSPORTATION COMPANY v. GREGORIO CAGUIMBAL, PANCRACIO

Whether or not Mallari, Sr. is liable.

HERMINIO L. NOCUM v. LAGUNA TAYABAS BUS COMPANY

In this case, the circumstance that must be considered in measuring a common

PHILIPPINE AIRLINES, INC. vs. COURT OF APPEALS and PEDRO ZAPATOS

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Vda. De Abeto vs. PAL

At any rate, in the absence of a satisfactory explanation as to how the accident

Japan Airlines v. Michael Asuncion, et al.

H. E. HEACOCK COMPANY v. MACONDRAY & COMPANY, INC.

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ALITALIA vs. INTERMEDIATE APPELLATE COURT and FELIPA E. PABLO

Pan American World Airways, Inc. v. IAC

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AUGUSTO BENEDICTO SANTOS III v. NORTHWEST ORIENT AIRLINES

UNITED AIRLINES, petitioner, vs. WILLIE J. UY, respondent.

2.) Whether or not his cause of action has prescribed.

invoked to justify the disregard of some extraordinary sort of damage resulting to a