Ty - Transportation Law

TRANSPORTATION LAW
Prof. Nicholas Felix L. Ty

University of the Philippines College of Law
Transportation Law - Ty
COMMON CARRIERS
DEFINITION
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.
DE GUZMAN v. CA
● Merely "back-hauled" goods for other merchants from Manila to Pangasinan
● “sideline”
● 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"). No 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," or a narrow segment of the
general population.
BASCOS v. CA
● Bascos was subcontractor of a hauler
● Reiterated De Guzman
● The test to determine a common carrier is "whether the given

undertaking is a part of the business engaged in by the carrier
which he has held out to the general public as his
occupation rather than the quantity or extent of the business
transacted." In this case, petitioner herself has made the admission
that she was in the trucking business, offering her trucks to those
with cargo to move.
FIRST PHIL. INDUSTRIAL v. CA

● Strictly speaking tax case, not common carriers in NCC, but is a little bit too
interesting not to be noticed
● The test for determining whether a party is a common carrier of goods is:
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.
FIRST PHIL. INDUSTRIAL v. CA
● 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 pipeline
operators are considered common carriers.
CRUZ v. SUN HOLIDAYS
● Asked in 2019 bar

● Is a resort a common carrier for its incidental
ferry services to guests?
● Reiterated De Guzman

● “Indeed, respondent is a common carrier. Its ferry services
are so intertwined with its main business as to be properly
considered ancillary thereto. X x x. 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.”
CRISOSTOMO v. CA
● Is a travel agency common carrier?
● It is obvious from the above definition that respondent is not

an entity engaged in the business of transporting either
passengers or goods and is therefore, neither a private nor a
common carrier. Respondent did not undertake to transport
petitioner from one place to another since its covenant with
its customers is simply to make travel arrangements in their
behalf. Respondent’s services as a travel agency include
procuring tickets and facilitating travel permits or visas as
well as booking customers for tours.
CRISOSTOMO v. CA
● The object of petitioner’s contractual relation with respondent is the
latter’s service of arranging and facilitating petitioner’s booking,
ticketing and accommodation in the package tour. In contrast, the
object of a contract of carriage is the transportation of passengers
or goods. It is in this sense that the contract between the parties in
this case was an ordinary one for services and not one of carriage.
Petitioner’s submission is premised on a wrong assumption.
BAR QUESTION (2000)

X has a Tamaraw FX among other cars. Every other day during the
workweek, he goes to his office in Quezon City using his Tamaraw FX
and picks up his friends as passengers at designated points along the
way. His passengers pay him a flat fee for the ride, usually P20 per
person, one way. Although a lawyer, he never bothered to obtain a
license to engage in this type of income generating activity. He
believes that he is not a common carrier within the purview of the law.
Do you agree with him. Explain.
BAR QUESTION (1999)

AM Trucking, a small company operates two trucks for hire on selective
basis. It caters only to a few customers, and its trucks do not make
regular or scheduled trips. It does not even have a certificate of public
convenience.
On one occasion, Reynaldo contracted AM to transport, for a fee, 100
sacks of rice from Manila to Tarlac. However, AM failed to deliver the
cargo, because its truck was hijacked when the driver stopped in
Bulacan to visit his girlfriend.
May Reynaldo hold AM liable as a common carrier? Explain
SIGNIFICANCE OF CLASSIFICATION
● Apply Civil Code provisions on common carriers, contract of

carriage
● Very high standards, onerous provisions for common carriers
● Otherwise its an ordinary contract (governed by ordinary

rules on contract, or maybe lease)
DILIGENCE REQUIRED
Article 1733. Common carriers, from the nature
of their business and for reasons of public policy,
are bound to observe extraordinary diligence in the
vigilance over the goods and for the safety of the
passengers transported by them, according to all
the circumstances of each case.
See DE GUZMAN v. CA
Under Article 1745 (6), a common carrier is held responsible — and
will not be allowed to divest or to diminish such responsibility — even
for acts of strangers like thieves or robbers, except where such thieves
or robbers in fact acted "with grave or irresistible threat, violence or
force." We believe and so hold that the limits of the duty of
extraordinary diligence in the vigilance over the goods carried are
reached where the goods are lost as a result of a robbery which is
attended by "grave or irresistible threat, violence or force."
See TAN CHIONG v. INCHAUSTI

[I]t is held that the loss of the said lorcha was due to force majeure,
a fortuitous event, with no conclusive proof or negligence or of the
failure to take the precautions such as diligent and careful persons
usually adopt to avoid the loss of the boat and its cargo, it is neither
just nor proper to attribute the loss or damage of the goods in
question to any fault, carelessness, or negligence on the part of the
defendant
See TAN CHIONG v. INCHAUSTI

Moreover, it is to be noted that, subsequent to the wreck, the
defendant company's agent took all the requisite measures for the
salvage of such of the goods as could be recovered after the accident,
which he did with the knowledge of the shipper x x x
From all the foregoing it is concluded that the defendant is not liable for
the loss and damage of the goods shipped x x x inasmuch as such loss
and damage were the result of a fortuitous event or force majeure, and
there was no negligence or lack of care and diligence on the part of the
defendant company or its agents.
LIABILITIES OF A COMMON CARRIER

Article 1734. Common carriers are responsible for the loss, destruction,
or deterioration of the goods, unless x x x
Article 1735. In all cases other than those mentioned in Nos. 1, 2, 3, 4,

and 5 of the preceding article, if the goods are lost, destroyed or
deteriorated, common carriers are presumed to have been at fault or to
have acted negligently, unless they prove that they observed
extraordinary diligence as required in article 1733.
LIABILITIES OF A COMMON CARRIER

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 a due regard for all the
circumstances.
Article 1756. In case of death of or injuries to passengers, common

carriers are presumed to have been at fault or to have acted
negligently, unless they prove that they observed extraordinary
diligence as prescribed in articles 1733 and 1755.
YNCHAUSTI STEAMSHIP v. DEXTER

The mere proof of delivery of goods in good order to a carrier, and
of their arrival at the place of destination in bad order, makes out a
prima facie case against the carrier, so that if no explanation is given
as to how the injury occurred, the carrier must be held responsible.
It is incumbent upon the carrier to prove that the loss was due to
accident or some other circumstance inconsistent with its liability
VIGILANCE OVER GOODS

EXEMPTING CLAUSES
Article 1734. Common carriers are responsible for the loss,
destruction, or deterioration of the goods, 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;
(5) Order or act of competent public authority.
ABSENCE OF NEGLIGENCE
Article 1739. In order that the common carrier may be
exempted from responsibility, the natural disaster must have
been the proximate and only cause of the loss. However, the
common carrier must exercise due diligence to prevent or minimize loss
before, during and after the occurrence of flood, storm or other natural
disaster in order that the common carrier may be exempted from liability
for the loss, destruction, or deterioration of the goods. The same duty
is incumbent upon the common carrier in case of an act of the
public enemy referred to in article 1734, No. 2.
ABSENCE OF NEGLIGENCE
Article 1741. If the shipper or owner merely contributed to the loss,
destruction or deterioration of the goods, the proximate cause thereof
being the negligence of the common carrier, the latter shall be liable in
damages, which however, shall be equitably reduced.
Article 1743. If through the order of public authority the goods are
seized or destroyed, the common carrier is not responsible, provided
said public authority had power to issue the order.
ASIA LIGHTERAGE v. CA
● In the case at bar, the barge completely sank after its towing bits
broke, resulting in the total loss of its cargo. Petitioner claims that
this was caused by a typhoon, hence, it should not be held liable for
the loss of the cargo. However, petitioner failed to prove that
the typhoon is the proximate and only cause of the loss of
the goods, and that it has exercised due diligence before,
during and after the occurrence of the typhoon to prevent or
minimize the loss. The evidence show that, even before the towing
bits of the barge broke, it had already previously sustained damage
when it hit a sunken object while docked at the Engineering Island. It
even suffered a hole.
ASIA LIGHTERAGE v. CA
● Clearly, this could not be solely attributed to the typhoon. The
partly-submerged vessel was refloated but its hole was patched
with only clay and cement. The patch work was merely a
provisional remedy, not enough for the barge to sail safely. Thus,
when petitioner persisted to proceed with the voyage, it recklessly
exposed the cargo to further damage.
BAR QUESTION (2016)

Nautica Shipping Lines bought a secondhand passenger ship from
Japan. It modified the design of the bulkhead of the deck of the ship
to accommodate more passengers. The ship sunk with its passengers
in Tablas Strait due to heavy rains brought about by the monsoon.
The heirs of the passengers sued Nautica for its liability as a common
carrier based on the reconfiguration of the bulkhead which may have
compromised the stability of the ship. Nautica raised the defense that
the monsoon is a fortuitous event and, at most, its liability is
prescribed by the Limited Liability Rule. Decide the reasons.
ABSENCE OF DELAY
Article 1740. If the common carrier negligently incurs in delay in
transporting the goods, a natural disaster shall not free such carrier
from responsibility.
DUE DILIGENCE TO PREVENT/LESSEN LOSS

Article 1739. In order that the common carrier may be exempted from
responsibility, the natural disaster must have been the proximate and only
cause of the loss. However, the common carrier must exercise due
diligence to prevent or minimize loss before, during and after the
occurrence of flood, storm or other natural disaster in order that
the common carrier may be exempted from liability for the loss,
destruction, or deterioration of the goods. The same duty is
incumbent upon the common carrier in case of an act of the public enemy
referred to in article 1734, No. 2.
EASTERN SHIPPING v. IAC

● Carrier claims that the loss of the vessel by fire exempts it from
liability under the phrase “natural disaster or calamity.” However, we
are of the opinion that fire may not be considered a natural disaster
or calamity. This must be so as it arises almost invariably from some
act of man or by human means.
● And even if fire were to be considered a “natural disaster” within the
meaning of Article 1734, it is required under Article 1739 that the
“natural disaster” must have been the “proximate and only cause of
the loss,” and that the carrier has “exercised due diligence to
prevent or minimize the loss before, during or after the occurrence
of the disaster.” Carrier has also failed to establish this satisfactorily.
EASTERN SHIPPING v. IAC
● In this case, both the Trial Court and the Appellate Court found that
there was “actual fault” of the carrier shown by "lack of diligence" in
that "when the smoke was noticed, the fire was already big; that
the fire must have started twenty-four (24) hours before the same
was noticed; “and that "after the cargoes were stored in the
hatches, no regular inspection was made as to their condition
during the voyage.”
DUE DILIGENCE TO PREVENT/LESSEN LOSS

Article 1742. Even if the loss, destruction, or deterioration of the
goods should be caused by the character of the goods, or the faulty
nature of the packing or of the containers, the common carrier must
exercise due diligence to forestall or lessen the loss.
SOUTHERN LINES v. CA
● Petitioner claims exemption from liability by contending that the

shortage in the shipment of rice was due to such factors as the
shrinkage, leakage or spillage of the rice on account of the bad
condition of the sacks at the time it received the same and the
negligence of the agents of respondent City of Iloilo in receiving the
shipment. The contention is untenable, for, if the fact of improper
packing is known to the carrier or his servants, or apparent upon
ordinary observation, but it accepts the goods notwithstanding such
condition, it is not relieved of liability for loss or injury resulting
therefrom.
CONTRIBUTORY NEGLIGENCE
Article 1741. If the shipper or owner merely contributed to the loss,

destruction or deterioration of the goods, the proximate cause thereof
being the negligence of the common carrier, the latter shall be liable in
damages, which however, shall be equitably reduced.
DURATION OF LIABILITY
(Delivery of goods to common carrier)
Article 1736. The extraordinary responsibility of the common

carrier lasts from the time the goods are unconditionally placed
in the possession of, and received by the carrier for
transportation until the same are delivered, actually or constructively,
by the carrier to the consignee, or to the person who has a right to
receive them, without prejudice to the provisions of article 1738.
COMPANIA MARITIMA v.
INSURANCE COMPANY OF AMERICA
● Loss took place while goods were on lighters; not on the vessel tasked
to carry.
● The test as to whether the relation of shipper and carrier had been
established is -- Had the control and possession of the goods
been completely surrendered by the shipper to the carrier?
Whenever the control and possession of goods passes to the carrier and
nothing remains to be done by the shipper, then it can be said with
certainty that the relation of shipper and carrier has been established.
(Actual or constructive delivery)
Article 1736. The extraordinary responsibility of the common carrier
lasts from the time the goods are unconditionally placed in the
possession of, and received by the carrier for transportation until the
same are delivered, actually or constructively, by the carrier
to the consignee, or to the person who has a right to receive
them, without prejudice to the provisions of article 1738.
(Actual or constructive delivery)
Article 1738. The extraordinary liability of the common carrier
continues to be operative even during the time the goods are stored in
a warehouse of the carrier at the place of destination, until the
consignee has been advised of the arrival of the goods and has had
reasonable opportunity thereafter to remove them or otherwise
dispose of them.
NEDLLOYD LIJNEN v. GLOW LAKS
● Goods lost in hands of Port Authority at place of destination
● In this case, there is no dispute that the custody of the goods

was never turned over to the consignee or his agents but was
lost into the hands of unauthorized persons who secured
possession thereof on the strength of falsified documents. The
loss or the misdelivery of the goods in the instant case gave rise
to the presumption that the common carrier is at fault or
negligent.
NEDLLOYD LIJNEN v. GLOW LAKS

● In the present case, petitioners failed to prove that they did exercise
the degree of diligence required by law over the goods they
transported. Indeed, aside from their persistent disavowal of liability
by conveniently posing an excuse that their extraordinary
responsibility is terminated upon release of the goods to the
Panamanian Ports Authority, petitioners failed to adduce sufficient
evidence they exercised extraordinary care to prevent unauthorized
withdrawal of the shipments.
LU DO v. BINAMIRA
● Goods lost in hands of customs authorities, but there was stipulation to limit
duration of liability
● While we agree with the Court of Appeals that while delivery of the cargo to the
consignee, or to the person who has a right to receive them", contemplated in
Article 1736, because in such case the goods are still in the hands of the
Government and the owner cannot exercise dominion over them, we believe
however that the parties may agree to limit the liability of the carrier considering
that the goods have still to through the inspection of the customs authorities
before they are actually turned over to the consignee. This is a situation where
we may say that the carrier loses control of the goods because of a custom
regulation and it is unfair that it be made responsible for what may happen
during the interregnum.
(Temporary unloading or storage)
Article 1736. The common carrier's duty to observe extraordinary

diligence over the goods remains in full force and effect even when they
are temporarily unloaded or stored in transit, unless the shipper or
owner has made use of the right of stoppage in transitu.
STIPULATIONS FOR LIMITATION OF LIABILITY

(Void stipulations)
Article 1745. Any of the following or similar stipulations shall be
considered unreasonable, unjust and contrary to public policy:
(1) That the goods are transported at the risk of the owner or
shipper;
(2) That the common carrier will not be liable for any loss,
destruction, or deterioration of the goods;
(3) That the common carrier need not observe any diligence in the
custody of the goods;
(4) That the common carrier shall exercise a degree of diligence less
than that of a good father of a family, or of a man of ordinary
prudence in the vigilance over the movables transported;

(Void stipulations)
(5) That the common carrier shall not be responsible for the acts or
omission of his or its employees;
(6) That the common carrier's liability for acts committed by thieves, or
of robbers who do not act with grave or irresistible threat,
violence or force, is dispensed with or diminished;
(7) That the common carrier is not responsible for the loss, destruction,
or deterioration of goods on account of the defective condition of
the car, vehicle, ship, airplane or other equipment used in the
contract of carriage.

(Limitation of liability to fixed amount)
Article 1750. 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.

(Limitations of liability in absence of declaration of
greater value)
Article 1749. 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.
HEACOCK v. MACONDRAY
● 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.
SHEWARAM v. CA
● It is required, however, that the contract must be reasonable and just
under the circumstances and has been fairly and freely agreed upon.
In the instant case, the fact that the conditions are printed at the
back of the ticket stub in letters so small that they are hard to read
would not warrant the presumption that the appellee was aware of
those conditions such that he had "fairly and freely agreed" to those
conditions. Appellee, therefore, is not and cannot be bound, by the
conditions of carriage found at the back of the ticket stub issued to
him when he made the flight.
ONG YIU v. CA
● There is no dispute that petitioner did not declare any higher
value for his luggage, much less did he pay any additional
transportation charge.
● But petitioner argues that there is nothing in the evidence to

show that he had actually entered into a contract with PAL
limiting the latter's liability for loss or delay of the baggage of its
passengers, and that Article 1750 of the Civil Code has not been
complied with.
ONG YIU v. CA
● While it may be true that petitioner had not signed the plane
ticket, he is nevertheless bound by the provisions thereof. "Such
provisions have been held to be a part of the contract of carriage,
and valid and binding upon the passenger regardless of the latter's
lack of knowledge or assent to the regulation". It is what is known
as a contract of "adhesion", in regards which it has been said that
contracts of adhesion wherein one party imposes a ready-made
form of contract on the other, as the plane ticket in the case at
bar, are contracts not entirely prohibited.
BAR QUESTION (1998)

X took a plane from Manila bound for Davao via Cebu where there
was a change of planes. X arrived in Davao safely but to his dismay,
his two suitcases were left behind in Cebu. The airline company
assured X that the suitcases would come in the next flight, but they
never did.
X claimed P2,000.00 for the loss of both suitcases, but the airline was
willing to pay only P500.00 because the airline ticket stipulated that
unless a higher value was declared, any claim for loss cannot exceed
P250.00 for each piece of luggage. X however reasoned out that he
did not sign the stipulation and in fact had not even read it.
X did not declare a greater value despite the fact that the clerk had
called his attention to the stipulation in the ticket. Decide the case.
BAR QUESTION (2002)

Discuss whether or not the following stipulations in a contract of carriage of a
common carrier are valid:
1) A stipulation limiting the sum that may be recovered by the shipper

or owner to 90% of the value of the goods in case of loss due to
theft.
2) A stipulation that in the event of loss, destruction or deterioration of

goods on account of the defective conditions of the vehicle used in
the contact of carriage, the carrier’s liability is limited to the value of
the goods appearing in the bill of lading unless the shipper or owner
declares a higher value.
LIABILITY FOR BAGGAGE OF PASSENGERS

(Checked-in baggage)
Article 1998. The deposit of effects made by travelers in hotels or

inns shall also be regarded as necessary. The keepers of hotels or
inns shall be responsible for them as depositaries, provided that
notice was given to them, or to their employees, of the effects
brought by the guests and that, on the part of the latter, they take
the precautions which said hotel-keepers or their substitutes advised
relative to the care and vigilance of their effects.
LIABILITY FOR BAGGAGE OF PASSENGERS

(Baggage in the possession of passengers)
Article 1754. The provisions of articles 1733 to 1753 shall
apply to the passenger's baggage which is not in his
personal custody or in that of his employee. As to other
baggage, the rules in articles 1998 and 2000 to 2003
concerning the responsibility of hotel-keepers shall be
applicable.
BAR QUESTION (1995)

Antonio, a paying passenger, boarded a bus bound for Batangas
City. He chose a seat at the front row, near the bus driver, and
told the bus driver that he had valuable items in his hand-carried
bag which he then placed beside the driver’s seat. Not having slept
for 24 hours, he requested the driver to keep an eye on the bag
should he doze off during the trip. While Antonio was asleep,
another passenger took the bag away and alighted at Calamba,
Laguna. Could the common carrier be held liable by Antonio for
the loss?
SAFETY OF PASSENGERS
(Void stipulations)
Article 1757. The responsibility of a common carrier for the safety of
passengers as required in articles 1733 and 1755 cannot be dispensed
with or lessened by stipulation, by the posting of notices, by statements
on tickets, or otherwise.
Article 1758. When a passenger is carried gratuitously, a stipulation

limiting the common carrier's liability for negligence is valid, but not for
willful acts or gross negligence.
The reduction of fare does not justify any limitation of the common
carrier's liability.
SAFETY OF PASSENGERS
(Duration of liability)
● Unlike for carriage of goods, NCC has no specific provision on the
duration of liability for carriage of passengers
● Waiting for carrier or boarding of carrier

DEL PRADO v. MERALCO

● With respect to the legal aspects of the case we may observe at
the outset that there is no obligation on the part of a street
railway company to stop its cars to let on intending passengers at
other points than those appointed for stoppage. X x x
Nevertheless, although the motorman of this car was not bound
to stop to let the plaintiff on, it was his duty to not act that would
have the effect of increasing the plaintiff's peril while he was
attempting to board the car. The premature acceleration of the
car was, in our opinion, a breach of this duty.
DEL PRADO v. MERALCO
● The relation between a carrier of passengers for hire and its

patrons is of a contractual nature; and in failure on the part of the
carrier to use due care in carrying its passengers safely is a breach
of duty (culpa contructual) under the Civil Code. Furthermore, the
duty that the carrier of passengers owes to its patrons extends to
persons boarding the cars as well as to those alighting therefrom.
CANGCO v. MANILA RAILROAD

(Arrival at destination)
● In that case the plaintiff stepped off of a moving train, while it was
slowing down in a station, and at the time when it was too dark for
him to see clearly where he was putting his feet. The employees of
the company had carelessly left watermelons on the platform at the
place where the plaintiff alighted, with the result that his feet slipped
and he fell under the car, where his right arm badly injured
LA MALLORCA v. CA
(Arrival at destination)
● It has been recognized as a rule that 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.
LIABILITY FOR ACTS OF OTHERS

(Employees)
Article 1759. Common carriers are liable for the death of or injuries to
passengers through the negligence or willful 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.
MARANAN v. PEREZ
● 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.
LIABILITY FOR ACTS OF OTHERS

(Other passengers and strangers)
Article 1763. A common carrier is responsible for injuries suffered
by a passenger on account of the wilful acts or negligence of other
passengers or of strangers, if the common carrier's employees
through the exercise of the diligence of a good father of a family
could have prevented or stopped the act or omission.
PILAPIL v. CA
● In consideration of the right granted to it by the public to engage
in the business of transporting passengers and goods, a common
carrier does not give its consent to become an insurer of any and
all risks to passengers and goods. It merely undertakes to perform
certain duties to the public as the law imposes, and holds itself
liable for any breach thereof.
PILAPIL v. CA
● Clearly under the above provision, a tort committed by a stranger
which causes injury to a passenger does not accord the latter a cause
of action against the carrier. The negligence for which a common
carrier is held responsible is the negligent omission by the carrier's
employees to prevent the tort from being committed when the same
could have been foreseen and prevented by them. Further, under the
same provision, it is to be noted that when the violation of the
contract is due to the willful 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.
BAR QUESTION (1994)

Mariter, a paying bus passenger, was hit above her left eye by a
stone hurled at the bus by an unidentified bystander as the bus was
speeding through the National Highway. The bus owner’s pesonnel
lost no time in brining Mariter to the provincial hospital where she
was confined and treated.
Martier wants to sue the bus company for damages and seeks your
advice whether she can legally hold the bus company liable. What
will you advise her?
LIABILITY FOR DELAY IN COMMENCEMENT OF VOYAGE

See Code of Commerce Provisions on Passengers on Sea Voyage
Article 698. In case a voyage already begun should be interrupted the passengers shall be obliged
only x x x
In case the departure of the vessel is delayed the passengers have a right to remain on
board and to be furnished with food for the account of the vessel, unless the delay is due
to an accidental cause or to force majeure. If the delay should exceed ten days, the
passengers who request it shall be entitled to the return of the passage; and if it were
due exclusively to the captain or agent they may furthermore demand indemnity for
losses and damages.
A vessel which is exclusively destined to the transportation of passengers must take them directly to
the port or ports of destination, no matter what the number of passengers may be, making all the
stops indicated in her itinerary.
NECESSITO v. PARAS
(Liability for defects in equipment and facilities)
● A passenger is entitled to recover damages from a carrier for an injury
resulting from a defect in an appliance purchased from a manufacturer,
whenever it appears that the defect would have been discovered by the carrier
if it had exercised the degree of care which under the circumstances was
incumbent upon it, with regard to inspection and application of the necessary
tests. For the purposes of this doctrine, the manufacturer is considered as
being in law the agent or servant of the carrier.
● The rationale of the carrier's liability is the fact that the passenger has neither
choice nor control over the carrier in the selection and use of the equipment
and appliances in use by the carrier.
EXTENT OF LIABILITY FOR DAMAGES
Article 1764. Damages in cases comprised in this Section shall be

awarded in accordance with Title XVIII of this Book, concerning
Damages. Article 2206 shall also apply to the death of a passenger
caused by the breach of contract by a common carrier.
ACTUAL DAMAGES
Article 2199. Except as provided by law or by stipulation, one is

entitled to an adequate compensation only for such pecuniary loss
suffered by him as he has duly proved. Such compensation is
referred to as actual or compensatory damages.
ACTUAL DAMAGES
Article 2201. In contracts and quasi-contracts, the damages for which
the obligor who acted in good faith is liable shall be those that are the
natural and probable consequences of the breach of the obligation, and
which the parties have foreseen or could have reasonably foreseen at
the time the obligation was constituted.
In case of fraud, bad faith, malice or wanton attitude, the obligor shall
be responsible for all damages which may be reasonably attributed to
the non-performance of the obligation. (1107a)
CARIAGA v. LTBCo. and MRR

● Under the Civil Code the damages for which the obligor, guilty of a breach of contract but who
acted in good faith, is liable shall be those that are the natural and probable consequences of
the breach and which the parties had forseen or could have reasonably forseen at the time the
obligation was constituted, provided such damages have been duly proved. Upon this premise it
claims that only the actual damages suffered by Edgardo Cariaga consisting of medical, hospital
and other expenses in the total sum of P17,719.75 are within this category.
● The Court is of the opinion, however, that the income which Edgardo Cariaga could earn if he
should finish the medical course and pass the corresponding board examinations must be
deemed to be within the same category because they could have reasonably been foreseen by
the parties at the time he boarded the bus No. 133 owned and operated by the LTB. At that
time he was already a fourth-year student in medicine in a reputable university. It is sufficient
to justify the assumption that he could have passed the board test in due time.
ACTUAL DAMAGES
Article 2206. The amount of damages for death caused by a crime or
quasi-delict shall be at least three thousand pesos, even though there
may have been mitigating circumstances. In addition:
(1) The defendant shall be liable for the loss of the earning capacity
of the deceased, and the indemnity shall be paid to the heirs of
the latter; such indemnity shall in every case be assessed and
awarded by the court, unless the deceased on account of
permanent physical disability not caused by the defendant, had
no earning capacity at the time of his death;
ACTUAL DAMAGES
(2) If the deceased was obliged to give support according to the
provisions of article 291, the recipient who is not an heir called
to the decedent's inheritance by the law of testate or intestate
succession, may demand support from the person causing the
death, for a period not exceeding five years, the exact
duration to be fixed by the court;
(3) The spouse, legitimate and illegitimate descendants and

ascendants of the deceased may demand moral damages for
mental anguish by reason of the death of the deceased.
MORAL DAMAGES
Article 2217. Moral damages include physical suffering, mental

anguish, fright, serious anxiety, besmirched reputation, wounded
feelings, moral shock, social humiliation, and similar injury. Though
incapable of pecuniary computation, moral damages may be recovered
if they are the proximate result of the defendant's wrongful act for
omission.
FORES v. MIRANDA
Anent the moral damages ordered to be paid to the respondent,
the same must be discarded. We have repeatedly ruled that moral
damages are not recoverable in damage actions predicted on a
breach of the contract of transportation,
By contrasting the provisions of these two article it immediately
becomes apparent that:
In case of breach of contract (including one of transportation)
proof of bad faith or fraud (dolus), i.e., wanton or deliberately
injurious conduct, is essential to justify an award of moral
damages.
FORES v. MIRANDA
The exception to the basic rule of damages now under

consideration is a mishap resulting in the death of a passenger,
in which case Article 1764 makes the common carrier expressly
subject to the rule of Art. 2206, that entitles the deceased
passenger to "demand moral damages for mental anguish by
reason of the death of the deceased
OTHER DAMAGES
Article 2221. Nominal damages are adjudicated in order that a right of
the plaintiff, which has been violated or invaded by the defendant, may be
vindicated or recognized, and not for the purpose of indemnifying the
plaintiff for any loss suffered by him.
Article 2224. Temperate or moderate damages, which are more than

nominal but less than compensatory damages, may be recovered when the
court finds that some pecuniary loss has been suffered but its amount can
not, from the nature of the case, be provided with certainty.
OTHER DAMAGES
Article 2226. Liquidated damages are those agreed upon by

the parties to a contract, to be paid in case of breach thereof.
Article 2229. Exemplary or corrective damages are imposed,

by way of example or correction for the public good, in addition
to the moral, temperate, liquidated or compensatory damages
MONTREAL
CONVENTION
APPLICABILITY
● The Montreal Convention amended important parts of
the Warsaw Convention in 1999; the Philippines
became a party to the Montreal Convention in 2015
APPLICABILITY
ARTICLE 1
1. This Convention applies to all international carriage of persons, luggage or
goods performed by aircraft for reward. It applies equally to gratuitous
carriage by aircraft performed by an air transport undertaking.
2. For the purposes of this Convention the expression "international carriage" means
any carriage in which, according to the contract made by the parties, the place of
departure and the place of destination, whether or not there be a break in the
carriage or a transhipment, are situated either within the territories of two
High Contracting Parties, or within the territory of a single High
Contracting Party, if there is an agreed stopping place within a territory x
x x of another Power, even though that Power is not a party to this Convention. A
carriage without such an agreed stopping place between territories subject to the
sovereignty, suzerainty, mandate or authority of the same High Contracting Party is
not deemed to be international for the purposes of this Convention.
QUESTION
After winning the lottery, Homer and Marge Singson went on a trip. They also sponsored separate
trips for each of their three children, Bart, Lisa and Maggie. Homer and Marge booked the airline
tickets for all the trips with Springfield Airlines. For themselves, Homer and Marge booked a trip
from Manila to Kuala Lumpur, Malaysia then back to Manila; for Bart, a trip from Manila to
Bangkok, Thailand then back to Manila; for Lisa a trip from Manila to Cebu then back to Manila;
and for Maggie, a trip from Manila to Cebu then to Jakarta, Indonesia, and finally back to Manila.
Discuss if each of the four trips are subject to the Warsaw Convention. For purposes of this
question, assume that only the Philippines and Malaysia are State Parties to the Warsaw
Convention.
LIMITATION OF LIABILITY
(Passengers, checked-in baggage, hand-carried baggage
ARTICLE 22
1. In the carriage of passengers the liability of the carrier for each passenger is limited to
the sum of 125,000 francs. x x x
2. In the carriage of registered luggage and of goods, the liability of the carrier is limited to
a sum of 250 francs per kilogram, unless the consignor has made, at the time when the
package was handed over to the carrier, a special declaration of the value at delivery and
has paid a supplementary sum if the case so requires. In that case the carrier will be
liable to pay a sum not exceeding the declared sum, unless he proves that that sum is
greater than the actual value to the consignor at delivery.
3. As regards objects of which the passenger takes charge himself the liability of the carrier
is limited to 5,000 francs per passenger. x x x
BAR QUESTION (1993)
A shipped 13 pieces of luggage through LG Airlines from Tehran to Manila as evidenced by LG

Air Waybill which disclosed that the actual gross weight of the luggage was 180 kg. Z did not
declare an inventory of the contents or the value of the 13 pieces of luggage. After the said
pieces of luggage arrived in Manila, the consignee was able to claim from the cargo broker only
12 pieces, with a total weight of 174 kg. X advised the airline of the loss. Efforts to trace the
missing luggage were fruitless. Since the airline failed to comply with the demand of X to
produce the missing luggage, X filed an action for breach of contract with damages vs LG
Airlines. In its answer, LG Airlines alleged that the Warsaw Convention which limits liability if the
carrier with respect to cargo to a sum of $20 per kilo, unless a higher value is declared in
advance and additional charges are paid by the passenger and the conditions of the contract as
set forth in the air waybill, expressly subject the contract of carriage of cargo to the Warsaw
Convention. May the allegation of LG Airlines be sustained? Explain.
WILFULL MISCONDUCT
ARTICLE 25
1. The carrier shall not be entitled to avail himself of the provisions of
this Convention which exclude or limit his liability, if the damage is
caused by his willful misconduct or by such default on his part as, in
accordance with the law of the Court seized of the case, is
considered to be equivalent to willful misconduct.
2. Similarly the carrier shall not be entitled to avail himself of the said
provisions, if the damage is caused as aforesaid by any agent of the
carrier acting within the scope of his employment.
CATHAY PACIFIC v. CA
“As We have repeatedly held, although the Warsaw Convention has the force
and effect of law in this country, being a treaty commitment assumed by the
Philippine government, said convention does not operate as an exclusive
enumeration of the instances for declaring a carrier liable for breach of
contract of carriage or as an absolute limit of the extent of that liability. The
Warsaw Convention declares the carrier liable for damages in the enumerated
cases and under certain limitations. However, it must not be construed to
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 wilfull
misconduct on the part of the carrier's employees is found or established,
which is clearly the case before Us.”

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TRANSPORTATION LAW

Prof. Nicholas Felix L. Ty

Article 1732. Common carriers are persons,

● No distinction between one whose principal business activity is the carrying

● The test to determine a common carrier is "whether the given

FIRST PHIL. INDUSTRIAL v. CA

1. He must be engaged in the business of carrying goods for others as a public

FIRST PHIL. INDUSTRIAL v. CA

● The definition of "common carriers" in the Civil Code makes

CRUZ v. SUN HOLIDAYS

● Asked in 2019 bar

CRUZ v. SUN HOLIDAYS

CRUZ v. SUN HOLIDAYS

● It is obvious from the above definition that respondent is not

BAR QUESTION (2000)

BAR QUESTION (1999)

● Apply Civil Code provisions on common carriers, contract of

● Very high standards, onerous provisions for common carriers

● Otherwise its an ordinary contract (governed by ordinary

See TAN CHIONG v. INCHAUSTI

See TAN CHIONG v. INCHAUSTI

LIABILITIES OF A COMMON CARRIER

Article 1735. In all cases other than those mentioned in Nos. 1, 2, 3, 4,

LIABILITIES OF A COMMON CARRIER

Article 1756. In case of death of or injuries to passengers, common

YNCHAUSTI STEAMSHIP v. DEXTER

VIGILANCE OVER GOODS

BAR QUESTION (2016)

DUE DILIGENCE TO PREVENT/LESSEN LOSS

EASTERN SHIPPING v. IAC

EASTERN SHIPPING v. IAC

DUE DILIGENCE TO PREVENT/LESSEN LOSS

● Petitioner claims exemption from liability by contending that the

Article 1741. If the shipper or owner merely contributed to the loss,

Article 1736. The extraordinary responsibility of the common

NEDLLOYD LIJNEN v. GLOW LAKS

● Goods lost in hands of Port Authority at place of destination

● In this case, there is no dispute that the custody of the goods

NEDLLOYD LIJNEN v. GLOW LAKS

Article 1736. The common carrier's duty to observe extraordinary

STIPULATIONS FOR LIMITATION OF LIABILITY

STIPULATIONS FOR LIMITATION OF LIABILITY

STIPULATIONS FOR LIMITATION OF LIABILITY

STIPULATIONS FOR LIMITATION OF LIABILITY

● But petitioner argues that there is nothing in the evidence to

BAR QUESTION (1998)

BAR QUESTION (2002)

1) A stipulation limiting the sum that may be recovered by the shipper

2) A stipulation that in the event of loss, destruction or deterioration of

LIABILITY FOR BAGGAGE OF PASSENGERS

Article 1998. The deposit of effects made by travelers in hotels or

LIABILITY FOR BAGGAGE OF PASSENGERS

BAR QUESTION (1995)

Article 1758. When a passenger is carried gratuitously, a stipulation

● Waiting for carrier or boarding of carrier

DEL PRADO v. MERALCO

DEL PRADO v. MERALCO

● The relation between a carrier of passengers for hire and its

CANGCO v. MANILA RAILROAD

LIABILITY FOR ACTS OF OTHERS

● Accordingly, it is the carrier’s strict obligation to select its drivers

LIABILITY FOR ACTS OF OTHERS

BAR QUESTION (1994)