TRANSPORTATION LAW CASE DIGEST

1) De Guzman v. CA (GR L-47822)

FACTS:
 The case can be stemmed from a series of events, specifically when
the respondent who is a junk dealer and at the same time also
delivers certain cargos to merchants contracted with the petitioner
to deliver the latter’s cartons of Milk from Makati.
 Unfortunately, due to a hijack incident, some of the cartons of the
petitioner (600) were not delivered and even the driver and his
helper were brought somewhere.
 As a result, the petitioner filed before the CFI an action against
the respondent for the payment of P22,150.00 as a claim for the
lost merchandise plus damages and attorney’s fees on the ground
that as a common carrier he manifested a failure to exercise
extraordinary diligence. As a response, the respondent denied that
he was a common carrier and that he cannot be held responsible
for the loss since what happened was force majeure.
 The trial court found the respondent to be a common carrier and
held him liable for the lost goods.
 When the case had reached the CA, it ruled that the respondent
is not a common carrier since he merely engaged in transporting
return loads of freight as his sideline to his scrap iron business.
 Hence, this petition.

ISSUE #1:
 Is the respondent a common carrier?

RULING:
 Yes.
 Pursuant to “Article 1732, common carriers are persons,
corporations, firms, or associations engaged in the business of
carrying or transporting passengers or goods or both, by land,
water, or air for compensation, offering their services to the
public.”
 The above article makes no distinction between one whose
principal business activity is the carrying of persons or goods
or both, and one who does such carrying only as an ancillary
activity (in local idiom, as “a sideline”). Article 1732 also
carefully avoids making any distinction between a person or
enterprise offering transportation service on a regular or scheduled
basis and one offering such service on an occasional, episodic or
unscheduled basis. Neither does Article 1732 distinguish between a
carrier offering its services to the “general public,” i.e., the general
community or population, and one who offers services or solicits
business only from a narrow segment of the general population. We
think that Article 1733 deliberately refrained from making such
distinctions.
 Moreover, a certificate of public convenience is not a requisite for
the incurring of liability under the Civil Code provisions governing
common carriers. To exempt private respondent from the liabilities
of a common carrier because he has not secured the necessary
certificate of public convenience, would be offensive to sound public
policy; that would be to reward private respondent precisely for
failing to comply with applicable statutory requirements.

ISSUE #2:
 Is the respondent liable for the lost of the merchandise?

RULING:
 No.
 Under Article 1734, common carriers are responsible for the
loss, destruction or deterioration of the goods which they
carry, “unless the same is due to any of the following causes
only: (1) Flood, storm, earthquake, lightning, or other natural
disaster or calamity; (2) Act of the public enemy in war, whether
international or civil; (3) Act or omission of the shipper or owner of
the goods; (4) The character of the goods or defects in the packing
or in the containers; and (5) Order or act of competent public
authority.
 However, while it is true that the hijack incident does not fall
on the enumeration, Article 1735 is still clear that a common
carrier may not be held responsible for acts committed by
thieves or of robbers who act with irresistible threat, violence
and force such in this case.
 Moreover, the robbers were charged with willfully and
unlawfully taking and carrying away with them the second
truck, driven by Manuel Estrada and loaded with the 600 cartons
of Liberty filled milk destined for delivery at petitioner’s store in
Urdaneta, Pangasinan. The decision of the trial court shows that
the accused acted with grave, if not irresistible, threat, violence or
force.3 Three (3) of the five (5) hold-uppers were armed with
firearms. The robbers not only took away the truck and its cargo
but also kidnapped the driver and his helper, detaining them for
several days and later releasing them in another province (in
Zambales).
 Hence, the occurrence of the loss must reasonably be
regarded as quite beyond the control of the common carrier
and properly regarded as a fortuitous event. It is necessary to
recall that even common carriers are not made absolute insurers
against all risks of travel and of transport of goods, and are not
held liable for acts or events which cannot be foreseen or are
inevitable, provided that they shall have complied with the
rigorous standard of extraordinary diligence.
2) Fist Industrial Corp v. CA (GR 125948)

-Petition for review on certitorari assailing the CA’s decision affirming

the Trial Court’s decision.
FACTS:
 The case can be stemmed from a series of events, specifically when
the petitioner, a grantee of pipeline concession, applied for Mayor’s
Permit.
 Unfortunately, pursuant to the LGC, the petitioner was required
by the city treasurer to pay a local tax based on its gross receipts
for the fiscal year 1993 amounting to huge amount of money
(956,076.04).
 As a consequence, the petitioner filed a letter protest addressed to
the city treasurer asserting that their company being a pipeline
operator with a government concession under Petroleum Act is
engaged in the business of transporting petroleum and therefore
exempted from paying tax on gross receipts under Section 133 of
LGC but the protest was denied by the city treasurer.
 The petitioner then filed with the RTC arguing that the collection
and imposition of the business tax on its gross receipts violates
Section 133 of the LGC. In the contrary, the respondent asserted
that the petitioner cannot be exempted from taxes under Section
133 of LGC as the exemption only applies to transportation
contractors and persons engaged in the transportation by hire and
common carriers by air, land and water.
 Moreover, the respondent even asserted that a common carrier
refers solely to to ordinary carriers such as trucks, trains, ships
and the like.
 The Trial Court however dismissed the complaint ruling that tax
exemptions are construed strictly against the tax payers and that
the petitioner is not a common carrier but a special carrier
extending its services and facilities to a single specific or special
customer.
 The CA affirmed that Trial Court’s decision. Hence, this petition.

ISSUE:
 Is the petitioner a common carrier?

RULING:
 Yes.
 Art. 1732 of the Civil Code defines a "common carrier" as "any
person, corporation, firm or association engaged in the business of
carrying or transporting passengers or goods or both, by land,
water, or air, for compensation, offering their services to the
public." A "common carrier" may be defined, broadly, as one who
holds himself out to the public as engaged in the business of
 transporting persons or property from place to place, for
compensation, offering his services to the public generally.
TEST for Determining WON a party is a common carrier of
goods:
1. He must be engaged in the business of carrying goods for others
as a public employment, and must hold himself out as ready to
engage in the transportation of goods for person generally as a
business and not as a casual occupation;
2. He must undertake to carry goods of the kind to which his
business is confined;
3. He must undertake to carry by the method by which his
business is conducted and over his established roads; and
4. The transportation must be for hire.
 There is no doubt that petitioner is a common carrier. It is
engaged in the business of transporting or carrying goods,
i.e. petroleum products, for hire as a public employment. It
undertakes to carry for all persons indifferently, that is, to
all persons who choose to employ its services, and transports
the goods by land and for compensation. The fact that
petitioner has a limited clientele does not exclude it from the
definition of a common carrier.
 As correctly pointed out by petitioner, the definition of
“common carriers” in the Civil Code makes no distinction as
to the means of transporting, as long as it is by land, water or
air. It does not provide that the transportation of the passengers
or goods should be by motor vehicle. In fact, in the United States,
oil pipe line operators are considered common carriers.
 Under the Petroleum Act of the Philippines (Republic Act 387),
petitioner is considered a “common carrier.” Thus, Article 86
thereof provides that: “Art. 86. Pipe line concessionaire as
common carrier.—A pipe line shall have the preferential right to
utilize installations for the transportation of petroleum owned by
him, but is obligated to utilize the remaining transportation
capacity pro rata for the transportation of such other petroleum as
may be offered by others for transport, and to charge without
discrimination such rates as may have been approved by the
Secretary of Agriculture and Natural Resources.” Republic Act 387
also regards petroleum operation as a public utility.
 Pertinent portion of Article 7 thereof provides: “that everything
relating to the exploration for and exploitation of petroleum
x x x and everything relating to the manufacture, refining,
storage, or transportation by special methods of petroleum,
is hereby declared to be a public utility.” (Italics Supplied).
3. Spouses Perena v. Spouses Nicolas

FACTS:
 The case commenced when Zarates contracted with the Perenas
to transport the former’s son from Don Bosco to his school.
 Because of a possibility that the passengers might be late to their
classes due to heavy traffic, the driver, Alfaro took the passengers
to an alternate route by traversing the narrow path underneath
the Magallanes interchange.
 The usual short cut was a railroad crossing of the Philippine
National Railway (PNR). Alfaro saw that the barandilla (the pole
used to block vehicles crossing the railway) was up which means it
was okay to cross. He then tried to overtake a bus. However, there
was in fact an oncoming train but Alfaro no longer saw the train as
his view was already blocked by the bus he was trying to overtake.
The bus was able to cross unscathed but the van’s rear end was
hit. During the collision, Aaron, was thrown off the van. His body
hit the railroad tracks and his head was severed. He was only 15
years old. It turns out that Alfaro was not able to hear the train
honking from 50 meters away before the collision because the
van’s stereo was playing loudly.
 The Zarates sued PNR and the Pereñas (Alfaro became at-large).
Their cause of action against PNR was based on quasi-delict. Their
cause of action against the Pereñas was based on breach of
contract of common carriage.
 In their defense, the Pereñas invoked that as private carriers they
were not negligent in selecting Alfaro as their driver as they made
sure that he had a driver’s license and that he was not involved in
any accident prior to his being hired. In short, they observed the
diligence of a good father in selecting their employee.
 PNR also disclaimed liability as they insist that the railroad
crossing they placed there was not meant for railroad crossing
(really, that’s their defense!).
 The RTC ruled in favor of the Zarates. The Court of Appeals
affirmed the RTC. In the decision of the RTC and the CA, they
awarded damages in favor of the Zarates for the loss of earning
capacity of their dead son.
 The Pereñas appealed. They argued that the award was improper
as Aaron was merely a high school student; hence, the award of
such damages was merely speculative. They cited the case of
People vs Teehankee where the Supreme Court did not award
damages for the loss of earning capacity despite the fact that the
victim there was enrolled in a pilot school.

ISSUES:
 1. Whether or not the defense of due diligence of a good father by
the Pereñas is untenable.
2. Whether or not the award of damages for loss of income is
proper.
HELD:

Yes, in both issues.

The Defense of Due Diligence of a Good Father of a Family is not
tenable in this case. The Pereñas are common carriers. They are not
merely private carriers. (Prior to this case, the status of private
transport for school services or school buses is not well settled as to
whether or not they are private or common carriers – but they were
generally regarded as private carriers). Private transports for schools
are common carriers. The Pereñas, as the operators of a school bus
service were: (a) engaged in transporting passengers generally as a
business, not just as a casual occupation; (b) undertaking to carry
passengers over established roads by the method by which the
business was conducted; and (c) transporting students for a fee.
Despite catering to a limited clientele, the Pereñas operated as a
common carrier because they held themselves out as a ready
transportation indiscriminately to the students of a particular school
living within or near where they operated the service and for a fee.

Being a common carrier, what is required of the Pereñas is not

mere diligence of a good father. What is specifically required from
them by law is extraordinary diligence – a fact which they failed to
prove in court. Verily, their obligation as common carriers did not
cease upon their exercise of diligently choosing Alfaro as their
employee.

On the Award of Damages for Aaron’s loss of earning capacity

despite him being a high school student at the time of his death, the
award is proper. Aaron was enrolled in a reputable school (Don
Bosco). He was of normal health and was an able-bodied person.
Further, the basis of the computation of his earning capacity was not
on what he would have become. It was based on the current minimum
wage. The minimum wage was validly used because with his
circumstances at the time of his death, it is most certain that had he
lived, he would at least be a minimum wage earner by the time he
starts working. This is not being speculative at all.

The Teehankee case was different because in that case, the

reason why no damages were awarded for loss of earning capacity was
that the defendants there were already assuming that the victim
would indeed become a pilot – hence, that made the assumption
speculative. But in the case of Aaron, there was no speculation as to
what he might be – but whatever he’ll become, it is certain that he will
at the least be earning minimum wage.
Notes:

On Extraordinary diligence
--Article 1755 of the Civil Code specifies that the common carrier
should “carry the passengers safely as far as human care and
foresight can provide, using the utmost diligence of very cautious
persons, with a due regard for all the circumstances.” To successfully
fend off liability in an action upon the death or injury to a passenger,
the common carrier must prove his or its observance of that
extraordinary diligence; otherwise, the legal presumption that he or it
was at fault or acted negligently would stand. No device, whether by
stipulation, posting of notices, statements on tickets, or otherwise,
may dispense with or lessen the responsibility of the common carrier
as defined under Article 1755 of the Civil Code.

The test by which to determine the existence of negligence in a

particular case may be stated as follows: Did the defendant in doing
the alleged negligent act use that reasonable care and caution which
an ordinarily prudent person would have used in the same situation?
If not, then he is guilty of negligence. The law here in effect adopts the
standard supposed to be supplied by the imaginary conduct of the
discreet paterfamilias of the Roman law.

As to the PNR, the RTC rightly found the PNR also guilty of
negligence despite the school van of the Pereñas traversing the
railroad tracks at a point not dedicated by the PNR as a railroad
crossing for pedestrians and motorists, because the PNR did not
ensure the safety of others through the placing of crossbars, signal
lights, warning signs, and other permanent safety barriers to prevent
vehicles or pedestrians from crossing there. The RTC observed that
the fact that a crossing guard had been assigned to man that point
from 7 a.m. to 5 p.m. was a good indicium that the PNR was aware of
the risks to others as well as the need to control.
4) Calvo v. UCPB General Insurance (GR 148496)

-Petition to review the decision of the CA affirming the decision of RTC

FACTS:
 The case can be stemmed from a series of events, specifically when
the petitioner, a sole proprietorship customs broker, entered into
contract with San Miguel Corp to transfer certain cargos of the
latter(114 reels of semi-chemical fluting paper and 124 reels of
kraft liner board to its warehouse. The cargos were insured by the
respondent.
 Unfortunately, upon delivery to the warehouse of SMC, Marine
Cargo Surveyorsd declared that some of the cargos were
wet/stained/torn placing a damage of 93,112.00 pesos.
 As a consequence, SMC collected payment from the respondent
which resulted into the filing of the latter of a suit against the
petitioner before the RTC for the damages of the shipment.
 The RTC ruled in favor of the respondent stating that the
petitioner as a customs broker, warehouseman and as a common
carrier was supposed to have exercised extraordinary diligence as
required by law.
 The CA affirmed the RTC’s decision. Hence, this petition.

ISSUE #1:
 Is the petitioner a common carrier?

RULING:
 Yes.
 The Civil Code defines “common carriers” in the following terms:
“Article 1732. Common carriers are persons, corporations, firms
or associations engaged in the business of carrying or transporting
passengers or goods or both, by land, water, or air for
compensation, offering their services to the public.” The above
article makes no distinction between one whose principal business
activity is the carrying of persons or goods or both, and one who
does such carrying only as an ancillary activity . . . Article 1732
also carefully avoids making any distinction between a
person or enterprise offering transportation service on a
regular or scheduled basis and one offering such service on
an occasional, episodic or unscheduled basis. Neither does
Article 1732 distinguish between a carrier offering its
services to the “general public,” i.e., the general community
or population, and one who offers services or solicits
business only from a narrow segment of the general
 population. We think that Article 1732 deliberately refrained
from making such distinctions.
 Moreover, there is greater reason for holding petitioner to be a
common carrier because the transportation of goods is an
integral part of her business. To uphold petitioner’s contention
would be to deprive those with whom she contracts the protection
which the law affords them notwithstanding the fact that the
obligation to carry goods for her customers, as already noted, is
part and parcel of petitioner’s business.

ISSUE #2:
 Is the petitioner liable?

RULING:
 Yes.
 The extraordinary diligence in the vigilance over the goods
tendered for shipment requires the common carrier to know
and to follow the required precaution for avoiding damage to,
or destruction of the goods entrusted to it for sale, carriage and
delivery. It requires common carriers to render service with the
greatest skill and foresight and “to use all reasonable means to
ascertain the nature and characteristic of goods tendered for
shipment, and to exercise due care in the handling and stowage,
including such methods as their nature requires.”
 From the [Survey Report], it [is] clear that the shipment was
discharged from the vessel to the arrastre, Marina Port Services
Inc., in good order and condition as evidenced by clean Equipment
Interchange Reports (EIRs). Had there been any damage to the
shipment, there would have been a report to that effect made
by the arrastre operator. The cargoes were withdrawn by the
defendant-appellant from the arrastre still in good order and
condition as the same were received by the former without
exception, that is, without any report of damage or loss.
Surely, if the container vans were deformed, cracked,
distorted or dented, the defendant-appellant would report it
immediately to the consignee or make an exception on the
delivery receipt or note the same in the Warehouse Entry Slip
(WES). None of these took place. To put it simply, the
defendant appellant received the shipment in good order and
condition and delivered the same to the consignee damaged.
We can only conclude that the damages to the cargo occurred
while it was in the possession of the defendant appellant.
Whenever the thing is lost (or damaged) in the possession of
the debtor (or obligor), it shall be presumed that the loss (or
damage) was due to his fault, unless there is proof to the
contrary. No proof was proffered to rebut this legal
presumption and the presumption of negligence attached to a
common carrier in case of loss or damage to the goods.
 Anent petitioner’s insistence that the cargo could not have been
damaged while in her custody as she immediately delivered the
containers to SMC’s compound, suffice it to say that to prove the
exercise of extraordinary diligence, petitioner must do more than
merely show the possibility that some other party could be
responsible for the damage. It must prove that it used “all
reasonable means to ascertain the nature and characteristic
of goods tendered for [transport] and that [it] exercise[d] due
care in the handling [thereof].” Petitioner failed to do this.
 Finally, the rule is that if the improper packing or, in this
case, the defect/s in the container, is/are known to the
carrier or his employees or apparent upon ordinary
observation, but he nevertheless accepts the same without
protest or exception notwithstanding such condition, he is
not relieved of liability for damage resulting therefrom. In this
case, petitioner accepted the cargo without exception despite the
apparent defects in some of the container vans. Hence, for failure
of petitioner to prove that she exercised extraordinary diligence in
the carriage of goods in this case or that she is exempt from
liability, the presumption of negligence as provided under Art.
173515 holds.
5) Spouses Cruz v. Sun Hlidays Inc.

FACTS:
 The case commenced when the respondent ferried the petitioners
to Batangas who experient the horrors of the waves crashing their
boat and as a result made the latter lost his son and wife.
 Consequently, the petitioner filed before the RTC for damages
arising from the death of his son who perished with his wife.
Unfortunately, the respondent denied the any responsibility for
the incident which it considered as a fortuitous event and only
offered 10,000 pesos as an act of commiseration.
 The RTC ruled in favor of the respondent. This ruling was affirmed
by the CA contending that the respondent is a private carrier
which is only required to observe ordinary diligence and
considered the incident as a squall and therefore a fortuitous
event.
 Hence, this petition.

ISSUE#1:
 Is the respondent a common carrier?

RULING:
 Yes.
 Indeed, respondent is a common carrier. Its ferry services are
so intertwined with its main business as to be properly
considered ancillary thereto. The constancy of respondent’s
ferry services in its resort operations is underscored by its
having its own Coco Beach boats. And the tour packages it
offers, which include the ferry services, may be availed of by
anyone who can afford to pay the same. These services are
thus available to the public.
 That respondent does not charge a separate fee or fare for its ferry
services is of no moment. It would be imprudent to suppose that it
provides said services at a loss. The Court is aware of the practice
of beach resort operators offering tour packages to factor the
transportation fee in arriving at the tour package price. That
guests who opt not to avail of respondent’s ferry services pay the
same amount is likewise inconsequential. These guests may only
be deemed to have overpaid.
 As De Guzman instructs, Article 1732 of the Civil Code defining
“common carriers” has deliberately refrained from making
 distinctions on whether the carrying of persons or goods is the
carrier’s principal business, whether it is offered on a regular
basis, or whether it is offered to the general public. The intent of
the law is thus to not consider such distinctions. Otherwise,
there is no telling how many other distinctions may be
concocted by unscrupulous businessmen engaged in the
carrying of persons or goods in order to avoid the legal
obligations and liabilities of common carriers.

ISSUE#2:
 Is the respondent liable?
RULING:
 Yes.
 Under the Civil Code, common carriers, from the nature of
their business and for reasons of public policy, are bound to
observe extraordinary diligence for the safety of the passengers
transported by them, according to all the circumstances of each
case. They are 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.
 When a passenger dies or is injured in the discharge of a contract
of carriage, it is presumed that the common carrier is at fault or
negligent. In fact, there is even no need for the court to make an
express finding of fault or negligence on the part of the common
carrier. This statutory presumption may only be overcome by
evidence that the carrier exercised extraordinary diligence.
 The evidence shows that PAGASA issued 24-hour public
weather forecasts and tropical cyclone warnings for shipping
on September 10 and 11, 2000 advising of tropical
depressions in Northern Luzon which would also affect the
province of Mindoro. By the testimony of Dr. Frisco Nilo,
supervising weather specialist of PAGASA, squalls are to be
expected under such weather condition. A very cautious
person exercising the utmost diligence would thus not brave
such stormy weather and put other people’s lives at risk. The
extraordinary diligence required of common carriers demands
that they take care of the goods or lives entrusted to their
hands as if they were their own. This respondent failed to do.
 Respondent’s insistence that the incident was caused by a
fortuitous event does not impress either. The elements of a
“fortuitous event” are: (a) the cause of the unforeseen and
unexpected occurrence, or the failure of the debtors to comply with
their obligations, must have been independent of human will; (b)
the event that constituted the caso fortuito must have been
impossible to foresee or, if foreseeable, impossible to avoid; (c) the
occurrence must have been such as to render it impossible for the
debtors to fulfill their obligation in a normal manner; and (d) the
 obligor must have been free from any participation in the
aggravation of the resulting injury to the creditor.
 To fully free a common carrier from any liability, the
fortuitous event must have been the proximate and only cause
of the loss. And it should have exercised due diligence to
prevent or minimize the loss before, during and after the
occurrence of the fortuitous event.[ Respondent cites the squall
that occurred during the voyage as the fortuitous event that
overturned M/B Coco Beach III. As reflected above, however, the
occurrence of squalls was expected under the weather condition of
September 11, 2000. Moreover, evidence shows that M/B Coco
Beach III suffered engine trouble before it capsized and sank. The
incident was, therefore, not completely free from human
intervention.

NOTE ON NET EARNING CAPACITY:

Documentary evidence shows that Ruelito was earning a basic
monthly salary of $900[35] which, when converted to Philippine peso
applying the annual average exchange rate of $1 = P44 in 2000,[36]
amounts to P39,600. Ruelito’s net earning capacity is thus computed
as follows:

Net Earning Capacity = life expectancy x (gross annual income -

reasonable and necessary living expenses). = 35 x (P475,200 -
P237,600) = 35 x (P237,600) Net Earning Capacity = P8,316,000
6) Crisostomo v. CA

FACTS:
 The case commenced when the petitioner contracted the services
of the respondent to arrange and facilitate her booking, ticketing
and accommodation in a tour.
 Her, niece Menor who is working under the respondent personally
delivered the travel documents and informed her that she must go
to NAIA on a certain date for her tour.
 Unfortunately, the petitioner without checking her travel
documents went to NAIA on the date told by Menor and found out
that her scheduled date for flight should have been the day before
that day when she went NAIA.
 Menor then arranged another tour with additional payments other
what she already paid for but after the tour, the petitioner
demanded for reimbursements representing the difference between
the sum she paid for the first and the last tours but to no avail.
 As a result, the petitioner filed a complaint for breach of contract
pf carriage and damages before the RTC. It ruled that the
respondent was negligent in erroneously advising petitioner of her
departure through its employee Menor. However, the petitioner
should have verified the travel documents for the exact date of
departure, hence, she was guilty of contributory negligence.
 When the case reached the CA, it found both parties at fault but it
held that the petitioner was more negligent, because as a lawyer
and well-traveled person she should have known better.
 The petitioner contends that the respondent as a common carrier
did not observe the required extraordinary diligence in the
fulfillment of its obligation and hence, this petition.

ISSUE:
 Is the respondent a common carrier and must have acted with
extraordinary diligence in the fulfillment of its obligation to the
petitioner?

RULING:
 No.
 By definition, a contract of carriage or transportation is one
whereby a certain person or association of persons obligate
themselves to transport persons, things, or news from one
place to another for a fixed price.9 Such person or association
of persons are regarded as carriers and are classified as private
or special carriers and common or public carriers. A common
carrier is defined under Article 1732 of the Civil Code as persons,
corporations, firms or associations engaged in the business of
carrying or transporting passengers or goods or both, by lane,
water or air, for compensation, offering their services to the public.
 It is obvious from the above definition that respondent is not
an entity engaged in the business of transporting either
passengers or goods and is there fore, neither, a private nor a
common carrier. Respondent did not undertake to transport
petitioner from one place to another since its covenant with its
customers is simply to make travel arrangements in their behalf.
Respondent’s services as a travel agency include procuring tickets
and facilitating travel permits or visas as well as booking
customers for tours.
 While petitioner concededly bought her plane ticket through the
efforts of respondent company, this does not mean that the latter
ipso facto is a common carrier. At most, respondent acted merely
as an agent of the airline, with whom petitioner ultimately
contracted for her carriage to Europe. Respondent’s obligation to
petitioner in this regard was simply to see to it that petitioner was
properly booked with the airline for the appointed date and time.
Her transport to the place of destination, meanwhile, pertained
directly to the airline.
 In sum, we do not agree with the finding of the lower court
that Menor’s negligence concurred with the negligence of
petitioner and resultantly caused damage to the latter.
Menor’s negligence was not sufficiently proved, considering that
the only evidence presented on this score was petitioner’s
uncorroborated narration of the events. It is well-settled that the
party alleging a fact has the burden of proving it and a mere
allegation cannot take the place of evidence. If the plaintiff, upon
whom rests the burden of proving his cause of action, fails to show
in a satisfactory manner facts upon which he bases his claim, the
defendant is under no obligation to prove his exception or defense.
 Contrary to petitioner’s claim, the evidence on record shows
that respondent exercised due diligence in performing its
obligations under the contract and followed standard
procedure in rendering its services to petitioner. As correctly
observed by the lower court, the plane ticket issued to petitioner
clearly reflected the departure date and time, contrary to s
petitioner’s contention. The travel documents, consisting of the
tour itinerary, vouchers and instructions, were likewise delivered
to petitioner two days prior to the trip. Respondent also properly
booked petitioner for the tour, prepared the necessary documents
 and procured the plane tickets. It arranged petitioner’s hotel
accommodation as well as food, land transfers and sightseeing
excursions, in accordance with its avowed undertaking.
 Therefore, it is clear that respondent performed its prestation
under the contract as well as everything else that was essential to
book petitioner for the tour. Had petitioner exercised due diligence
in the conduct of her affairs, there would have been no reason for
her to miss the flight. Needless to say, after the travel papers were
delivered to petitioner, it became incumbent upon her to take
ordinary care of her concerns. This undoubtedly would require
that she at least read the documents in order to assure herself of
the important details regarding the trip. The negligence of the
obligor in the performance of the obligation renders him liable for
damages for the resulting loss suffered by the obligee. Fault or
negligence of the obligor consists in his failure to exercise due care
and prudence in the performance of the obligation as the nature of
the obligation so demands.
 There is no fixed standard of diligence applicable to each and
every contractual obligation and each case must be
determined upon its particular facts. The degree of diligence
required depends on the circumstances of the specific obligation
and whether one has been negligent is a question of fact that is to
be determined after taking into account the particulars of each
case.
7) FGU Insurance Corp v. GP Sarmiento

FACTS:
 The case commenced when the respondent undertook to deliver
30 units of refrigerators to Conception Industries (CI) with
Lambert Eroles (Eroles) as the driver. During the trip the truck
collided with another truck and thus fell into the canal and
damaged the refrigerators in the process.
 As a consequence, the petitioner paid CI, hence was subrogated
for the claims against GPS. FGU demanded reimbursement form
GPS, but GPS paid no heed. FGU filed a complaint against GPS
and its driver for breach of contract and damages.
 As a response, GPS claimed that they were the exclusive hauler for
CI and its was not engaged in the business as common carrier and
later on filed a motion to dismiss the complaint by demurrer of
evidence on the ground that the petitioner in this case failed to
prove that it was a common carrier.
 RTC ruled in favour of GPS since the FGU did not present any
single evidence that would prove that GPS is a common carrier
and for failure to present evidence that prove that the driver was
negligent, it granted motion to dismiss.
 The CA affirmed the decision since they were on the topic of
common carriers, and since it was not proven that GPU was a
common carrier, they could not be presumed negligent, and thus
are not required to pay the reimbursement. Hence, this petition.

ISSUE:
 Whether Eroles may be liable for the damages caused to the goods
 Whether GPS, either as a common carrier or a private carrier, may
be presumed to have been negligent when the good it undertook to
transport safely were subsequently damaged while in its protective
possession.

RULING:
 No. Eroles cannot be held liable as it was not proven that he was a
common carrier, hence negligence cannot be presumed. Not being
 a party, to the contract of carriage between petitioner’s principal
and defendant may not be held liable under the agreement.
 Moreover, the driver, not-being a party to the contract of
carriage between petitioner’s principal and defendant, may
not be held liable under the agreement. A contract can only
bind the parties who have entered into it or their successors who
have assumed their personality or their juridical position.
Consonantly with the axiom res inter alios acta aliis neque nocet
prodest, such contract can neither favor nor prejudice a third
person. Petitioner’s civil action against the driver can only be
based on culpa aquiliana, which, unlike culpa contractual, would
require the claimant for damages to prove negligence or fault on
the part of the defendant.
 Yes damages may be sought. Since no evidence was submitted by
the petitioners for proof that GPS was a common carrier, the court
of appeals and RTC were correct in their judgment that GPS is a
private carrier since it was stated that they are only rendering its
services to no other individual or entity other than CI, hence it is
proper to be compensated through breach of contract (culpa
contractual).
 Under culpa contractual, breach upon the contract confers upon
the injured party a valid cause for recovering that which may have
been lost. Thus, FGU has a claim for the amount paid out. The law
recognizing obligatory forces of contracts, will not permit a party to
be set free from liability of any kind of misperformance of the
contractual undertaking or a contravention of the tenor thereof.
 Respondent trucking corporation recognizes the existence of a
contract of carriage between it and petitioner’s assured, and
admits that the cargoes it has assumed to deliver have been
lost or damaged while in its custody. In such a situation, a
default on, or failure of compliance with, the obligation—in this
case, the delivery of the goods in its custody to the place of
destination—gives rise to a presumption of lack of care and
corresponding liability on the part of the contractual obligor the
burden being on him to establish otherwise. GPS has failed to do
so.
8) Kilusang Mayo Uno Labor Center v. Garcia Jr.
10) Tiu v. Arriesgado

FACTS:
 The case commenced when the tires of a cargo truck marked
"Condor Hollow Blocks and General Merchandise" had exploded
while on its way for work. The driver, Sergio Pedrano, then parked
along the right side of the national highway and removed the
damaged tire to have it vulcanized at a nearby shop and left his
helper Jose to keep watch over the stalled vehicle, and instructed
the latter to place a spare tire six fathoms away behind the stalled
truck to serve as a warning for oncoming vehicles. The truck's tail
lights were also left on.
 Unfortunately, a passenger bus driven by Virgilio Te Laspiñas was
cruising along the national highway and which was also bound for
Cebu City, saw the stalled truck, which was then about 25 meters
away.] He applied the breaks and tried to swerve to the left to
avoid hitting the truck. But it was too late; the bus rammed into
the truck's left rear.
 As a result, The impact damaged the right side of the bus and left
several passengers injured including Respondent Pedro Arriesgado
lost consciousness and suffered a fracture but his wife died due to
the accident.
 Respondent Pedro A. Arriesgado then filed a complaint for breach
of contract of carriage, damages and attorney's fees before the
Regional Trial Court against the petitioners, D' Rough Riders bus
operator William Tiu and his driver, Virgilio Te Laspiñas. The
respondent alleged that the passenger bus in question was
cruising at a fast and high speed along the national road, and that
petitioner Laspiñas did not take precautionary measures to avoid
the accident.
 The trial court ruled that the absence of an early warning device
near the place where the truck was parked was not sufficient to
impute negligence on the part of respondent Pedrano, since the
tail lights of the truck were fully on, and the vicinity was well
lighted by... street lamps. It also found that the testimony of
 petitioner Tiu, that he based the selection of his driver Laspiñas on
efficiency and in-service training, and that the latter had been so
far an efficient and good driver for the past six years of his...
employment, was insufficient to prove that he observed the
diligence of a good father of a family in the selection and
supervision of his employees.
 The appellate court rendered judgment affirming the trial court's
decision with the modification that the awards for moral and
exemplary damages were reduced to P25,000. According to the
appellate court, the action of respondent Arriesgado was based not
on quasi-delict but on breach of contract of carriage. As a common
carrier, it was incumbent upon petitioner Tiu to prove that
extraordinary diligence was observed in ensuring the safety of...
passengers during transportation. Since the latter failed to do so,
he should be held liable for respondent Arriesgado's claim.

ISSUE#1:
 Is the driver negligent?

RULING:
 Yes.
 In his testimony before the trial court, petitioner Laspiñas claimed
that he was traversing the two-lane road at Compostela, Cebu at a
speed of only forty (40) to fifty (50) kilometers per hour before the
incident occurred. He also admitted that he saw the truck which
was parked in an “oblique position” at about 25 meters before
impact,and tried to avoid hitting it by swerving to the left.
However, even in the absence of expert evidence, the damage
sustained by the truck itself supports the finding of both the
trial court and the appellate court, that the D’ Rough Rider
bus driven by petitioner Laspiñas was traveling at a fast pace.
Since he saw the stalled truck at a distance of 25 meters,
petitioner Laspiñas had more than enough time to swerve to
his left to avoid hitting it; that is, if the speed of the bus was
only 40 to 50 kilometers per hour as he claimed.
 As found by the Court of Appeals, it is easier to believe that
petitioner Laspiñas was driving at a very fast speed, since at 4:45
a.m., the hour of the accident, there were no oncoming vehicles at
the opposite direction. Petitioner Laspiñas could have swerved to
the left lane with proper clearance, and, thus, could have avoided
the truck. Instinct, at the very least, would have prompted him to
apply the breaks to avert the impending disaster which he must
have foreseen when he caught sight of the stalled truck. As we had
occasion to reiterate:
 A man must use common sense, and exercise due reflection in
all his acts; it is his duty to be cautious, careful and prudent,
if not from instinct, then through fear of recurring
punishment. He is responsible for such results as anyone
 might foresee and for acts which no one would have performed
except through culpable abandon. Otherwise, his own person,
rights and property, and those of his fellow beings, would ever
be exposed to all manner of danger and injury.
 Indeed, petitioner Laspiñas’ negligence in driving the bus is
apparent in the records. By his own admission, he had just passed
a bridge and was traversing the highway of Compostela, Cebu at a
speed of 40 to 50 kilometers per hour before the collision occurred.
The maximum speed allowed by law on a bridge is only 30
kilometers per hour. And, as correctly pointed out by the trial
court, petitioner Laspiñas also violated Section 35 of the Land
Transportation and Traffic Code, Republic Act No. 4136, as
amended.
ISSUE #2:
 Was Mr. Tiu negligent?

RULING:
 Yes.
 The rules which common carriers should observe as to the safety
of their passengers are set forth in the Civil Code, Articles 1733,32
175533 and 1756.34 In this case, respondent Arriesgado and his
deceased wife contracted with petitioner Tiu, as owner and
operator of D’ Rough Riders bus service, for transportation from
Maya, Daanbantayan, Cebu, to Cebu City for the price of
P18.00.35 It is undisputed that the respondent and his wife were
not safely transported to the destination agreed upon. In actions
for breach of contract, only the existence of such contract, and the
fact that the obligor, in this case the common carrier, failed to
transport his passenger safely to his destination are the matters
that need to be proved.This is because under the said contract
of carriage, the petitioners assumed the express obligation to
transport the respondent and his wife to their destination
safely and to observe extraordinary diligence with due regard
for all circumstances. Any injury suffered by the passengers in
the course thereof is immediately attributable to the
negligence of the carrier. Upon the happening of the accident,
the presumption of negligence at once arises, and it becomes
the duty of a common carrier to prove that he observed
extraordinary diligence in the care of his passengers. It must
be stressed that in requiring the highest possible degree of
diligence from common carriers and in creating a presumption
of negligence against them, the law compels them to curb the
recklessness of their drivers.
 While evidence may be submitted to overcome such presumption
of negligence, it must be shown that the carrier observed the
required extraordinary diligence, which means that the carrier
must show the utmost diligence of very cautious persons as far as
human care and foresight can provide, or that the accident was
caused by fortuitous event. As correctly found by the trial court,
 petitioner Tiu failed to conclusively rebut such presumption. The
negligence of petitioner Laspiñas as driver of the passenger bus is,
thus, binding against petitioner Tiu, as the owner of the passenger
bus engaged as a common carrier.

ISSUE #3:
 Were the driver and and owner of Cargo negligent?

RULING:
 Yes.
 In Phoenix Construction, Inc. v. Intermediate Appellate Court,
where therein respondent Dionisio sustained injuries when his
vehicle rammed against a dump truck parked askew, the Court
ruled that the improper parking of a dump truck without any
warning lights or reflector devices created an unreasonable risk for
anyone driving within the vicinity, and for having created such
risk, the truck driver must be held responsible. In ruling against
the petitioner therein, the Court elucidated, thus:
 In our view, Dionisio’s negligence, although later in point of time
than the truck driver’s negligence, and therefore closer to the
accident, was not an efficient intervening or independent cause.
What the petitioners describe as an “intervening cause” was no
more than a foreseeable consequence of the risk created by the
negligent manner in which the truck driver had parked the dump
truck. In other words, the petitioner truck driver owed a duty
to private respondent Dionisio and others similarly situated
not to impose upon them the very risk the truck driver had
created. Dionisio’s negligence was not that of an independent
and overpowering nature as to cut, as it were, the chain of
causation in fact between the improper parking of the dump
truck and the accident, nor to sever the juris vinculum of
liability.
 In this case, both the trial and the appellate courts failed to
consider that respondent Pedrano was also negligent in leaving the
truck parked askew without any warning lights or reflector devices
to alert oncoming vehicles, and that such failure created the
presumption of negligence on the part of his employer, respondent
Condor, in supervising his employees properly and adequately. As
we ruled in Poblete v. Fabros:
 It is such a firmly established principle, as to have virtually formed
part of the law itself, that the negligence of the employee gives rise
to the presumption of negligence on the part of the employer. This
is the presumed negligence in the selection and supervision of
employee. The theory of presumed negligence, in contrast with the
American doctrine of respondeat superior, where the negligence of
the employee is conclusively presumed to be the negligence of the
employer, is clearly deducible from the last paragraph of Article
2180 of the Civil Code which provides that the responsibility
therein mentioned shall cease if the employers prove that they
 observed all the diligence of a good father of a family to prevent
damages.
 The manner in which the truck was parked clearly endangered
oncoming traffic on both sides, considering that the tire
blowout which stalled the truck in the first place occurred in
the wee hours of the morning. The Court can only now
surmise that the unfortunate incident could have been
averted had respondent Condor, the owner of the truck,
equipped the said vehicle with lights, flares, or, at the very
least, an early warning device. Hence, we cannot subscribe to
respondents Condor and Pedrano’s claim that they should be
absolved from liability because, as found by the trial and
appellate courts, the proximate cause of the collision was the
fast speed at which petitioner Laspiñas drove the bus. To
accept this proposition would be to come too close to wiping
out the fundamental principle of law that a man must respond
for the foreseeable consequences of his own negligent act or
omission. Indeed, our law on quasi-delicts seeks to reduce the
risks and burdens of living in society and to allocate them
among its members. To accept this proposition would be to
weaken the very bonds of society