TRANSPO

rjmmgonzalez@gmail.com
Atty. Rhea Joy Morales-Gonzalez
3-5pm, Sunday

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Guarantee:
. You will learn
. 1 less subject to worry about which is transpo

Reference
– Transpo Law Aquino& Hernando, 2020 version (Rex)

Syllabus is patterned in the book

Assignment:
– Refer to Screenshot

Recitation time agad next meeting

4 Cases
– Refer to Screenshot

Rules
– Attendance = Google Forms link
– Pwede kang ipasa
– Synchronous + Asynchronous learning

Profile name
– Surname, First Name

Recitation
– Volunteers
– Wheel
– Lifeline Option
– Not a reading class

Dress Code

Grading
– 30 CS and Quizzes
– 30 Midterms
– 40 Finals

Submission of Pictures
– 1x1 or 2x2
– Submitted to beadle

Beadle
– FB Page

CASES
. De Guzman v. CA
G.R. No. L-47822 (1988)
. First Philippine Industrial Corporation v. CA
G.R. No. 125948 (1998)
. Sps. Perena v. Sps. Nicolas
G.R. No. 157917 (2012)
. British Airways Inc v. CA and First International Trading and General
Services
G.R. No. 92288 (1993)

Meeting 1
Topics for Discussion:
– General Concept and Definition of Transportation
– Parties
– Contract of Carriage Perfection
– Common Carrier
– Tests
– Characteristics
– Charter Party
– Common Carrier vs Private Carrier
– Common Carrier vs Other Contracts
– Governing Laws

Transportation
– There is a contract of transportation
when a person obligates himself
to transport persons or property
from one place to another
for a consideration

Tiacot
wapoh
ttpop
fopta
fac

Parties
1 The Common Carrier
2 The persons whom the carrier is liable
– Passenger
– Shipper

Real parties in interest

Passenger
– One who travels in a public conveyance
by virtue of contract, express or implied,
with the carrier as to the payment of fare
or that which is accepted as an equivalent thereof

– Consideration may be onerous and gratuitous

 – Basis: Art. 1758
– i.e. Piso fare in airplanes

Owtiapc
b v o c, e o i,
wtcattp
ofotwiaaaet

Shipper
– The person who delivers the goods
to the carrier for transportation
and pays the consideration,
or on whose behalf
payment is made

T p w d t g t t c f t a p t c,
oowbpim

Perfection of Contract of Transportation

– perfected by mere consent.

Common Carrier
– 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 (NCC, 1732)

C c a p, c, f, o a
eitbocot
p o g o b,
b l, w, o a,
f c, o t s t t p

Private Carrier
– One which, without being engaged in the business of carrying as a public
employment,
undertakes to deliver goods or passengers for compensation.

Common Carrier Private Carrier

Law on Common Carriers Law on obligations and contracts
Subject to State regulation Not subject to state regulation
Holds himself out for all people Contracts with particular individuals
indiscriminately or groups only
 Common Carrier
Law on Common Carriers
Subject to State regulation
Holds himself out for all people
indiscriminately
Extraordinary Diligence
There is presumption of fault or
negligence
Exempting circumstances: Prove
extraordinary diligence, and Art
1734 of NCC
Parties may not agree on limiting the
carrier’s liability except when
provided by law. It cannot stipulate
that it is exempt from liability for the
negligence of its employees or
agents, being contrary to public
policy
Private Carrier
Law on obligations and contracts
Not subject to state regulation
Contracts with particular individuals
or groups only
Diligence of a good father of a family
No presumption of fault or
negligence
Caso fortuito, under Art 1174, NCC
Parties may limit the carrier’s
liability, provided it is not contrary to
law, morals, or good customs. It can
stipulate that it is exempt from
liability for the negligence of its
employees or agents

Tests to determine whether a party is a common carrier

. Two-Pronged Test
a. Part of General Business Test
– Engaged in the business of carrying or transporting passengers or goods
or both, by land, water, or air for compensation
– Is the carriage of persons or cargo an isolated undertaking or singular
transaction
or is it part of the general business of the carrier?

b. Public Representation Test

– Offering their services to the public
– Did the person hold himself out to the general public as undertaking to
engage in the activity of carrying persons or cargo as a business or
occupation?

. Four-Fold Test

To be a common carrier
. He must be Engaged in business of carrying goods for others as a public
employment,
and must hold himself out as ready to engage in the transportation of
goods or persons
generally as business and
not as a casual occupation
 . He must undertake to carry goods of the Kind to which his business is
confined

. He must undertake to carry by the Method

by which his business is conducted and over his establish roads

. The transportation must be for Hire

(Sps. Perena v. Sps. Nicolas)

The true test of a common carrier is not the quantity or extent of the business
actually transacted, or the number and character of the conveyances used in the
activity, but whether

(1) the undertaking is part of the activity engaged in by the carrier that

(2) he has held out to the general public as his business or occupation

Chapter 5 in book = review

Shipper and Common carrier are the only parties in a Contract of transportation
– Consignee only sometimes (i.e. Agency)

In dealing with the contract of common carriage of passengers for purpose of

accuracy, there are two (2) aspects of the same, namely: 

(a) the contract "to carry (at some future time)," which contract is consensual and
is necessarily perfected by mere consent - applicable in this case

(b) the contract "of carriage" or "of common carriage" itself which should be
considered as a real contract for not until the carrier is actually used can the
carrier be said to have already assumed the obligation of a carrier

Think of it as a timeline
– For ma’am = phases, not types or aspect
– Phase 1 contract to carry = mere consent = perfected
– Phase 2 contract of carriage = everything is complete
– Perfection continues until actual use
– Until when do I have these rights

By Bus/Jeep
– Continuing offer rule
 – By virtue of the continuing offer rule, it is the duty of the drivers to stop
their conveyances for a reasonable length of time in order to afford
passengers an opportunity to board and enter, and they are liable for
injuries suffered by boarding passengers resulting from sudden starting
up of the carrier.

It follows that the passenger is deemed to be accepting  the offer if he

already attempting to board the conveyances and the contract of carriage
is PERFECTED from that point.

Aircraft
– Buying of train

TRAIN
. Purchase of the ticket
. Person in proper place proper manner
. Bona fide intention to ride

The action of the security guard is the action of the common carrier

Assignment
Read at until the end of Chapter 1

ELEMENTS - COC
Consent
Object
– Prestation w/c is transportation of passenger or goods from one place to
another
Consideration
– Carrier
– Fare or freight paid by passenger/shipper
– Passenger
– promise to transport the passenger or goods

Meeting 2
Feb 27, 2022

What is a Common Carrier

– Art. 1732, NCC

De Guzman v. CA
2 things put into question
– 1 Whether he is a common carrier
– 2 Whether he is liable

. YES
– 1732 makes no distinctions in this

. Not liable
– The hijacking exempted him from liability
– But hijacking would not alone exempts him from liability
– SC provided exemptions
– 1) Grave irresistible threat or danger
– 2) Presence of armed men

What is covered as common carriers?

First Philippine Industrial Corporation v. CA(two things answered in this case)

1 Does the fact of having limited title remove it from the concept of common
carrier? NO…
– Petroleum products being carried by the pipeline

2 How about the fact that a motor vehicle was not used, rather it was via
pipelines?
– In this case, what is involved is not one with engine or one with motor
type of vehicle or conveyance, rather it is via pipeline
– SC: YES, it is still a common carrier

Four tests in determining whether a party is a common carrier

– 1) Not just a casual occupation
– 2) Exclusivity in goods
– 3) Explicitly in Route
– 4) For hire

Four-fold test should not be subscribed to

– Let us adhere to the National Steel Corporation case
– SC reiterated the ruling that the test of a common carrier is the
carriage of goods or passengers, provided it has space for all who
opt to avail themselves of its transportation for a fee.

Sps. Perena v. Sps Nicolas

– Students from Paranaque to Don Bosco are rendered school service
What is the decision of the SC?
– The school service is a common carrier.
– The SC deemed it important to distinguish Common Carrier and Private
Carrier

Common Carrier v. Private Carrier

Garcia example
– Situation: Mr. Garcia works in Makati. He lives in BF Homes
Paranaque. He has a car. He found out that two of his officemates,
namely: Ms Batara and Ms Mallare also lived in BF Homes Paranaque.
One day, Mr. Garcia had an idea to have a carpool so that they can
save on gas. He offered his services to Batara and Mallare. The two
agreed. They agreed to meet at a certain part of their village so that
MR. Garcia can drive them to their office. Is Mr. Garcia a common
carrier, or a private carrier?

– Garcia is not a common carrier

1. Available ba ito sa isa?

As long as sila lang, hindi available sa iba, Garcia would still be considered as a
private carrier

2. SC: There is a special agreement, special circumstance, special

arrangement, special undertaking, words of similar import, almost always
classify one as a private carrier.

3. Nag stop ba si Mr. Garcia sa ibang passenger?

1732 does not make a distinction that whether you are serving the general public,
or a narrow segment of the population.

All those new customers who are willing to attend their services, common carrier

4. You are still a common carrier even if you do not have a Certificate of
Public Convenience

If the media talks about PRANGKISA

– It pertains to the Permit of Certificate of Public Convenience

Colorum
 – Entities that have not secured a Certificate of Public Convenience
– Not regulated by the State

Why is it that the carrier did not secure the CPC, he is still liable?
– It is like rewarding them for circumventing the law

Why do we need to secure CPC

– 1) Required by law
– 2) Regulated by State; Assured passengers; Render Service; Safely and
conveniently transport them

1732 makes no distinction whether it is via land, air or sea

– Makes no distinction whether it is a motor vehicle
– Rather a lone route, fixed route, you issue a ticket
– Even do not publicly advertise yourself that you a common carrier
– Even if you do not own the vehicle you operate

CPC is issued for the OPERATOR, not the VEHICLE

Charter Parties. What are they?

– an agreement whereby a person, owner of a vehicle, leases it, or lends it
to another person

Charter Parties are common in transportation

– Charterer - borrower

2 Kinds of Charter Parties

– 1) Contract of Affreightment
– 2) Bareboat Charter (Demise Charter)

As between the two, as what instance a common carrier become a private

carrier?
– Bareboat charter
– It is of character already of a private carrier
– Bigay ang vessel, “Ikaw na ang bahala diyan”

Pro hac vice

– You are the owner for the time being

As to diligence
– PC — ordinary diligence
– CC — extraordinary diligence
As to governing law
– CC — specific provisions in civil law
– PC — ordinary contracts

As to stipulation
– PC — as long as not contrary to law, morals, public order, public policy

A common carrier distinguished from other contracts

Towage
– Is it a common carrier?
– Not a common carrier. Its purpose is to bring another vessel to another
place. It is being hired as such.

Arrastre
– Not a common carrier, but still, (Extraordinary diligence)EoD is expected
from them

Stevedoring - “Kargadoring”
– Kamada, Kargador
– Manual labor carrying and unloading
– Not a common carrier

Travel Agency
– SCENARIO: One day, Mr. Raymundo was feeling blue. “What could
make me happy is to see Mickey Mouse in Disneyland.” So he called
his travel agency. His travel agent is Ms. Fernandez. “Can you book
me a flight to HongKong tomorrow via Cebu Pacific. I wanted to get
there early. When I got to the airport I want chauffeur waiting for me
for transportation services wherever I go. I want to ride express train
to ride to Express Disneyland. I want to travel the whole of
HongKong. Lastly, I want a return flight to Manila. All of which, Ms.
Fernandez agreed. She finished all the bookings required and was
able to secure the tickets of Mr. Raymundo. The following day, Mr.
Raymundo went to airport in time, all packed, and ready to go.
However, there was a notification from the airlines Cebu Pacific that
the flight was cancelled. No reason for Cebu Pacific to cancel. The
weather was fine. He got furious. He called Ms. Fernandez. He
shouted, remanding return from his earnings. He threatened to file a
breach of contract to carriage because he was not able to pursue his
flight. Will the action pursue? — NO
 – The Traveling agency is a booking agency, NOT A COMMON CARRIER.
The Breach of Contract of Carriage Action will not pursue because the
travel agent is not a common carrier. The action can only be pursued
against the common carrier. Here, Cebu Pacific is the common carrier.
The action must be filed against the Cebu Pacific, and not the Traveling
Agency.

– Is the TA a common carrier? NO

– File breach of contract of carriage against Cebu Pacific
– Travel agent is merely arranging the booking
– When it comes to other breach, derecho

Assignment
Governing laws up to Chapter 2

Meeting 3
March 6, 2022

Governing Laws (take note p. 51-52)

Primary Law
– Civil Law
– 1732-1756

In case of matters not regulated by the Code

– Code of Commerce;

a. Coastwise Shipping
– 1. New Civil Code (Arts. 1732 - 1766) — primary law
– 2. Code of Commerce — governs suppletorily in absence of Civil Code
provisions

b. Carriage by Sea from Foreign Ports to Philippine Ports

– 1. New Civil Code — primary law
– 2. Code of Commerce — all matters not regulated by the Civil Code

c. Carriage from Philippine Ports to Foreign Ports

– 1) The laws of the country to which the goods are to be transported (Art.
1753, NCC)

d. Carriage by Sea by Foreign Vessels sanctioned under RA No. 10668

Cabotage and co-loading of foreign vessels that are covered by RA No.

10668, the carriage shall be governed by the Carriage of Goods by Sea Act
(COGSA) (Sec. 7, RA 10668)

e. Overland Transportation
– 1. Civil Code — Primary Law
– 2. Code of Commerce — Suppletorily

f. Air Transportation
– 1. Civil Code
– 2. Code of Commerce
– 3. For International Carriage — Convention for the Unification of Certain
Rules Relating to the International Carriage by Air or ‘Warsaw Convention’
with its amendments

Shipping
– look at the country where the goods is transported

Land Transportation
– Civil Code Primary
– Code of Commerce Suppletorily
– Land Transportation and Traffic Code

International Carriage

Note Constitutional Supremacy

Registered Owner Rule

– The rule in this jurisdiction is that the person who is the registered owner
of a vehicle is liable for any damage caused by the negligent operation of
the vehicle although the same was already sold or conveyed to another
person at the time of the incident.
– How do we relate this to “A common carrier shall be liable in the
negligent operation of the vehicle”
– A matter of public policy

Who will the injured party run after — Registered owner rule, or Common
Carrier?

Annotation on the Certificate

– Notice to the injured party that he can run after the registered owner

GR: In a contract of transportation only contracting parties will be held liable

XPN: Not only operators are liable, but also the registered owner for the
negligent operation of the vehicle

If registered owner sold the vehicle, who will injured party run after?
– Still the registered owner
– Include registered owner via 3rd party complaint, impleader

i.e. a Land title serves as constructive notice of the owner of land to the whole
world

The Mirror Doctrine

– Relate it to the vehicle

Registered Owner liable if vehicle stolen?

– NO

The Kabit system

– Your CPC is being lent to other person so that other person can operate
under your name
– Imagine Husband wife example

Is it a valid or void transaction?

Can the common carrier run after the kabit?

– No, due to in pari delicto rule
– Both hands are dirty, both cannot run against another

Boundary System
– Situation where there is a driver who pays a common carrier a fee Quota
to the common carrier called a boundary, the quota excess is earning of
the driver
– Hindi hinuhuli but it is found against the law
– Promotes negligence
– Who is liable here?
– The driver for causing the injury to the delivered good/person
– Reckless because the measure of their earnings depends largely
upon the number of trips they make
– The faster, the more customer serving
– Overloading
– All of these things result to a negligent result

OBLIGATIONS OF A COMMON CARRIER

 . To accept passengers and goods without discrimination
. To seasonably deliver the goods or bring the passenger to the
destination
. To deliver the goods or bring the passenger to the proper place or
destination
. To deliver the goods to the proper person
. To exercise extraordinary diligence in the performance of its duties

“Indiscriminately”
– Persons - Ke pangit ka o maganda ka, bawal mag discriminate
– Goods - cannot refuse particular class of goods

Valid Grounds for Non-acceptance (Carrier may validly Refuse to accept the
goods):
1. When the goods sought to be transported are dangerous objects, or
substances including dynamites and other explosives

2. Goods are unfit for transportation - improper packing or defect in their

containers; carrier may accept and limit its liability by stipulation
– When are goods unfit for transportation?
– 1 Improper packaging
– 2 Defect in container
– How about the nature of the goods?
– Example: You are a shipper and you intend to ship ‘yelo’. But the
vessel cannot properly carry it because it has no adequate storage
facilities/cooling equipment. In that particular situation, the goods
are unfit for that situation because of the nature of ‘yelo’. It will
easily melt.
– The nature of the goods renders it unfit for transportation. However,
should a carrier choose to accept goods that are unfit, any
precautionary measures that it should undertake to protect itself from
further incurring liability?
– In order to prevent liability on its part, it has to stipulate that ”
while am accepting these goods, I am limiting my liability to only
1000 pesos” in case there is damage to the goods.
– Any duty that the common carrier must be able to observe while
handling these unfit goods? — Art. 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.
3. Acceptance would result in overloading

4. Goods are considered contrabands or illegal

goods;

5. Goods are injurious to health

6. Goods will be exposed to untoward danger like flood, capture by enemies

and the like;

7. Goods like livestock will be exposed to diseases;

8. Strike; and

9. Failure to tender goods on time.

– Failure of the shipper to be there to hand over the goods at the time
agreed upon
– Common carrier can validly refuse such

There is an additional measure that a carrier must undertake in order to

prevent any further damage apart from stipulating
– Common carrier, even carrying unfit goods, should still exercise due
diligence

The common carrier is not obligated or mandated to inspect, but has the right
to do so if it has REASONABLE DOUBT

DUTY TO MAKE TIMELY DELIVERY

– Carrier is duty bound to deliver the goods within the time agreed upon to
a designated degree
– If no time stipulated
– There must be reasonable time

If perishable goods, i.e., time is of the essence

– i.e. Carrying of Ice

There are delays which can be excused or not excused

Consequences of Delays

Excusable delays in carriage suspend, but do not generally terminate, the

contract of carriage; when the cause is removed, the master must proceed with
the voyage and make delivery.

During the detention or delay, vessel continues to be liable as a common carrier,

not a warehouseman, and remains duty bound to exercise extraordinary
diligence.

– Merely suspended but not terminated

Inexcusable delays fr fr no cap lmao

1 Inexcusable na, but the cause of delay is fortuitous event

– Carrier is already negligent, therefore is liable

2 Any stipulation invalidated, because nagkaron na ng delay

3 Carrier is liable for damages caused by delay

4 Consignee can exercise duty to abandon

PLACE OF DELIVERY
– Goods must be delivered to the consignee in the place agreed upon by
the parties

Is it safe to say that it is the consignee’s place?

– YES, unless there is express agreement

What is your understanding of a consignee?

– Receipient, taong tumatanggap

What if the shipper changes his mind, ‘ay iba na lang consignee ko,’ can he do
that?
– provided that at the time of ordering the change of the consignee the bill
of lading signed by the carrier be returned to him, in exchange for
another wherein the novation of the contract appears. The expenses
occasioned by the change shall be for the account of the shipper.

What is the effect of surrendering or changing of Bill of Lading?

– Novation
– One of modes extinguishing a contract/obligation
– Because there is substantial change in the contract (i.e. naming a
new consignee)
To whom are the goods delivered?
– The consignee.

Is this absolute? NO
– Person lawfully authorized by the shipper to deliver the goods
– There is indorsement

A bill of lading may be a negotiable document

– Classified as a document of title
How do we negotiate
– By writing “to the order” in the bill of lading

⸻
Coverage = remaining of chapter 2 and chapter 3
– Duty to Exercise Extraordinary Diligence

Meeting 4
March 27, 2022

Two kinds of Diligence we should know:

Ordinary diligence
Extraordinary Diligence

IN TRANSPO, we will cover EXTRAORDINARY DILIGENCE

Extraordinary Diligence
– Highest degree of care as far as human care and foresight can
provide under the circumstances.

Common carrier has peculiar relationship with government and public

– Remember the security guard example where the passenger fell off the
tracks
– Common carrier is still held liable, because it failed to exercise
extraordinary diligence over the passenger

The duty to exercise EOD cannot be delegated. The common carrier cannot
raise it as defense that he delegated EOD over its constituents.

Vicarious liability (Respondiat Superior)

– Duty to exercise EOD
Presumption of Negligence
– The moment loss, destruction, deterioration, over goods or injury to
passenger happens, there is already a presumption of negligence.
– Only 2 things to establish
– 1 That contract exists
– 2 The loss, dest, deter, injury happened during the existence of the
contract

As defense, in order not to be liable, Carrier must prove the exercise of

extraordinary diligence

Is bad faith presumed?

– No. It should be established by clear and convincing evidence to get
moral or exemplary damages

Is there a presumption of gross negligence?

– Gross negligence amounts to bad faith.

May common carrier, may driver, at may pasahero. Meron accident. Ms

Fernandez filed a case against the taxi company. She wants to file a case
against the driver as well.

File a quasi-delict or criminal action against Driver

– If acquitted, what is the effect?
– It is immaterial. Action can be filed independently under Article 31

Temporary unloading/Storage. What is the duty?

– GR: to exercise extraordinary diligence

What is Stoppage in Transitu?

– The unpaid seller’s (shipper) right to resume possession of the goods at
any time while the goods are in transit, and he will then become entitled
to the same fights in regard to the goods as he would have had if he had
never parted with the possession.
– Shipper orders carrier to stop the possession. It is temporary loaded and
stored to the common carrier in this case.

Delivery to Customs Authorities

– GR: The goods remain to be the responsibility of the carrier if they are
still in the hands of customs official
– SC: Binigyan nila ng puso ang situation — the liability of the common
carrier may be limited through a stipulation.
Limitation of Liability vs. Lowering the Degree of Diligence
– These are not the same.
– When you limit liability, it does not necessarily mean you lower your
diligence.
– Pwede kang maglagay ng different amount of what you are supposed
to pay
– i.e. normally, if you usually pay 100k, it may be limited to only 10k
pesos, for instance since the mangoes are already near to perish.
– another example: piso fare. The airlines will limit its liability.
– In sum = Limiting liability = lowering liability
– In lowering Degree = lowering the ‘sipag’

Formalities for lowering diligence (note: this only take place on GOODS)
. In writing, signed by the shipper or owner
. Supported by a valuable consideration other than the service rendered
by the common carrier; and
. Reasonable, just and not contrary to public policy

Extraordinary Diligence shall not be lowered as to passengers

– EOD should still be exercised as Life is Precious hence diligence cannot
be lowered
– Even if you are a gratuitous passenger.

EOD in carriage by sea

– Seaworthiness = fitness of the vessel to withstand the rigors of the
voyage
. strength, durability and engineering skill
. made a part of a ship's construction and continued maintenance,
. together with a competent and sufficient crew,
. which would withstand the vicissitudes and dangers of the elements
which might reasonably be expected or encountered during her voyage
without loss or damage to her particular cargo.

Implied Warranty of Seaworthiness is enshrined under 1755 of the Civil Code

The carrier has the burden of proof that the ship is seaworthy

Issuance of certificate of seaworthiness is not suffice.

– EOD must exist before, during and after the occurrence of the loss

Cargoworthiness
– The vessel should only carry goods that it can carry.
Proper Manning
– Ship must be adequately equipped for the voyage and manned with
sufficient number of competent officers and crew

Adequate Equipment
– There are adequate exit doors, lifeboats, life vests, and other similar
items.

Titanic
– There is not enough life vests
– Women and Children na lang ang pwede nilang isakay
– It was overloaded
– Breach of improper manning
– The person who was supposed to see the Titanic from afar was not
paying attention. He was watching bold of jack and rose

Overloading

Proper Storage

Negligence of the Captain and Crew

Vessel picks an Improper Route

– Deviation
– Taking a shorter route/different route instead of the usual route
– Is this all the time improper? NO
– XPN: Force majeure (when vessel is constrained to go in take
another route to prevent accident from happening)
– Refueling(?)
– He might be liable if he did not check his fuel gauge. If
not, then it may be proper deviation.

Transshipment
– bad
– a violation of the contract and an infringement of the right of the shipper,
and subjects the carrier to liability if the freight is lost even by a cause
otherwise excepted.
– It is “the act of taking cargo out of one ship and loading it in another”

NEXT MEETING
– EOD BY LAND
– UP TO END OF CHAPTER 4
 Meeting 5
April 3, 2022

EXTRAORDINARY DILIGENCE IN CARRIAGE BY LAND

Roadworthiness
– Last April 1, you bought newly purchased tires in your car. In
exercise of EOD, you bought 4 car reserves. Your vehicle met an
accident. Can you come to court that you be exempt from liability?
– NO, mechanical defects will not excuse you from liability

ROADWORTHINESS
1) Common carriers that offer transportation by land are similarly required to
make sure that the vehicles that they are using are in good order and condition.

2) Rule on Mechanical Defects

• Explosion of tires are not considered fortuitous event.

• SC: A long outstanding rule that a carrier cannot escape liability by

claiming that the accident that resulted because of a defective brake or tire is
due to a fortuitous event. The duty to exercise extraordinary diligence
requires the carrier to purchase and use vehicle parts that are not defective.
They are duty bound to make sure that the parts are not defective.

3) Seats and other furniture or equipment to be used by the passenger are in

good order and condition

TRAFFIC RULES
1) The carrier fails to exercise extraordinary diligence if it will not comply with
basic traffic rules.

2) Article 2185 of Civil Code provides for a presumption of negligence in case

the accident occurs while the operator of the motor vehicle is violating traffic
rules.

• Article 2185 vs Article 1756

1. For Article 2185 to operate, there must be proof of violation of traffic rules.
a. Speeding
b. Failure to signal
c. Hit and Run
d. Driving without license
e. Overtaking in an intersection
f. Motorcycle driver not wearing protective headgear
2. For Article 1756 to operate, all that is required is proof of death or injury
to a passenger.

The basis of liability between Art 2185 and 1756

2185 - This is under quasi-delict (private and common carriers)
1756 - Mere fact of an accident/injury/death gives rise to a presumption of
negligence

What about in our example previously, (Security Guard having an altercation with
the passenger)

If the CC tells the court, “but your honor I already exercised my EOD. But the guard
is pasaway.”
– 1759, par 2
– This liability of 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

Vicarious Liability

Mode of Transportation — TRAINS

How EOD exercised?
– Must keep the train coaches, the platform and other facilities and
equipment in order and safe condition

3 topics mentioned TAKE NOTE

1 Persons and properties run over by trains

2 Damage to persons near railroad tracks
3 Railroad crossing cases
– In all these cases, is there contract of carriage?
– NO
– Are they deemed to be passengers?
– NO

But still, there is still due diligence required

BUT THERE IS NO CONTRACT OF CARRIAGE

SPS PERENA v. SPS NICOLAS again

– SC: No contractual relation between Zarate and PNR
– There being no example of contractual relations, these are quasi-
delict cases
The engineer must also take into consideration the prevailing condition in fixing
the speed of the train. (i.e. when it rains = slackening its speed)

Although they may not be expected to stop when there are obstructions, trains
should have safety devices and personnel to make sure the people are warned.

What do we do with Obstructions?

Safety Personnel
Blowing of the Horn (Safety devices)

A train company would not work efficiently if they are required to stop every time
there is obstruction.

Assumption of Risk
– Is in the passenger
– Pag parating na ang train, umiwas ka na
– XPN, children

– The train operator to ensure the safety of others through placing of

crossbars, signal lights, warning signs, and other permanent safety
barriers to prevent vehicles or pedestrians from crossing there.
– Place flagman or guard to main the intersection at all times was posted
on the day of the incident
– It is required to install such devices only at such places when reasonably
necessary

Article 1754
Rule on Checked-in baggage and hand carried baggage
– There must be exercise of EOD being a common carrier
Checked-in Baggage
– The rules on necessary deposit shall apply

What is the duty of passenger with hand-carried luggage

– Still, common carrier will not be exempt from damages

Sulpicio Lines v. Sesante (p.203)

– Personal effects important (jewelry and gun)
– Accident happened; items was missing
– Claim against common carrier; carrier wants to be absolved from liability
because passenger failed to take prior notice
– SC: It merely imposes additional duties, such as
 – Give notice to the common carrier of the effects
– The loss will not control the liability of the common carrier; liable
ONLY AS DEPOSITARY

CHAPTER 3
OBLIGATIONS OF THE PASSENGER AND SHIPPER

Duty on part of the passenger/shipper

– Duty to exercise Due Diligence
– Duty to Disclose
– Payment of Freight
– Timely Loading and Unloading

Sps Fabre v. CA
– Is there possible negligence on the part of the passenger? NO
– The fact that you give the directions for the driver. Will that make
you liable? NO
– They are merely giving directions
– How about the fact that you’re late? still NO
– It will happen if it will happen fr fr lmao no cap

2 DUTY TO DISCLOSE
– Give the common carrier proper information and proper caution

Practical Application
– If you misdeclare/underdeclare the value of the object, it is subject to
confiscation by the Customs

3 PAYMENT OF FREIGHT
– Exercise of POLICE POWER BY THE STATE
– So that passenger is protected from excess charging
– Protects the carrier as well
– To strike a balance in maintaining equilibrium in regulating the fares

PAYMENT OF FREIGHT
a. Subject to heavy regulation with respect to rates that they are charging the
public.

b. The regulation of rates of public utilities is founded upon the police power of
the State and statutes prescribing rules for the control and regulation of public
utilities are a valid exercise thereof.

c. JURIS privati – private property used for private purpose

i. Ceases if the private property is used for public purpose
• Becomes subject to regulation.

d. In regulating rates charged by public utilities, the State protects the public
against arbitrary and excessive rates while maintaining the efficiency and quality
of services rendered.
i. The rates prescribed by the State must be one that yields a fair return on the
public utility upon value of the property performing the service and one that is
reasonable to the public for the services rendered.
ii. The fixing of just and reasonable rates involves a balancing of the investor
and the consumer interests.
iii. If rates is subject to agreement of the parties, such rate should not be
beyond the maximum amount fixed by the appropriate government agencies.

e. The carrier cannot invoke an ALLEGED PREVIOUS FAILURE TO SETTLE A

CREDIT ARRANGEMENT to bar the passenger from using a confirmed ticket in the
absence of an express stipulation to that effect.

IF YOU IMPOSE FAIR OF HIGH BALANCE, sino ang lugi?

– Passenger cannot afford it. lugi lang din carrier,

IF IMPOSE LOW BALANCE

– Carrier will not go outside to get passengers. Suffer lang din passenger
for bad services

BASIS IS POLICE POWER

Police Power
– Promote general welfare
– Inherent power of the State to regulate private property for public
purpose

READ SESANTE v SULPICIO LINES IN FULL

Next meeting: CONTINUE CHAPTER 3

WHO PAYS THE FREIGHT up to CHAPTER 4

Meeting 6
April 10, 2022

Regarding fares, who is paying?

– No ticket, no boarding policy
As to the payment of freight, who pays the freight?
– Shipper may pay the necessary freight before or at the time he delivers
the goods to the carrier for shipment. However, the parties may also
stipulate that the consignee will pay the freight at the point of
destination. The consignee is bound by such stipulation the moment he
accepts the goods

Regarding Carriers lien

– Note preference of credit for goods that have not been paid
– If the consignor or consignee failed to pay the consideration for the
transportation of goods, the carrier may exercise his lien in accordance
with Art 375 of the Code of Commerce

Timely Loading and Unloading

– Among the enumeration in the duties is the carrier may refuse to accept
goods if the shipper does not tender the goods on time.

Demurrage
– Period allowable in which to obtain the delivery — Lay days

Shipper’s Load and Count - arrangement

– Arrangement telling the carrier”Transport my goods pls. I certify that all
information are true. I promise not to hold you liable if there is damage or
chuchu at the end”
– Its as if you are waiving your right as shipper for this. Why are you
still going under this transaction?
– Under this transaction, common carrier will not be liable in any kind
of discrepancy
– Reason:
– 1. Expediency — Nagmamadali lang talaga si shipper (time is of
the essence)
– 2. Confidentiality
– 3. Maganda kasi ang packaging

DUTIES OF A PASSENGER
– Pay the proper fare for the transportation of the said passenger

Amount and time of payment depend on the type of carrier, the practice, and
regulation in that particular carrier.

a. Passenger must present himself in the proper place

b. Passenger must present himself at the proper time
c. Carrier cannot be made liable if it left the station at the time fixed in the ticket or
agreement imposes Reciprocal Obligations
– Carrier to exercise EOD
– Passenger to exercise OD
– Once the ticket if paid and printed - presumed to have agreed to all T&C
d. Passenger is obligated to not to bring luggages that is in excess of the Weight
and Size prescribed by regulations or contract.
– Passenger is also prohibited from transporting prohibited materials or
goods, including animals.

Travel Documents
– obligation of passenger to secure appropriate travel documents

Air Transportation of Passengers

1 No person on board may interfere with a crew member in the performance of his
or her duties
2 Each passenger shall fasten his or her seat belt and keep it fastened while the
seat belt sign is lighted
3 No person on board an aircraft shall recklessly or negligently act or omit to act in
such a manner as to endanger the aircraft or persons and property therein
4 No person may secrete himself or herself nor secrete cargo on board an aircraft
5 No person may smoke while the no-smoking is lighted
6 No person may smoke in any airplane lavatory
7 No person may tamper with, disable or destroy any smoke detector installed in
any airplane lavatory

CHAPTER 4
Defenses of the Common Carrier

“The carrier is not an insurer of the passengers’ safety or the safety of the
goods that it is transporting”
– While it cannot promise safety, it can promise Extraordinary Diligence

Requisites before a carrier can raise defense: (Art. 1739)

. Proximate Cause
. Must be proximate AND ONLY cause of the loss
. Must have exercised EOD to forestall or lessen his loss and such EOD
must be exercised before, during and. after the occurrence of the loss

Proximate Cause
– That which in natural and continuous sequence, unbroken by an efficient
intervening cause, produces injury, and without which, the result would
not have occurred.
Do we need proximate cause in contract of carriage?
– NO, kasi meron presumption na, The Court need not finding of fault. All
that has to be done is that there has been injury
– Burden of proving is upon the carrier

Why does the carrier need proximate cause?

– He must prove under 1739 that it is the proximate and only cause of the
loss
– When using defenses, carrier will use proximate cause for Contributory
negligence

Enumeration of defenses in carriage of goods

– THE LIST IS EXCLUSIVE

. Flood storm, earthquake, lightning and other natural disaster and

calamity
. Acts of the public enemy at war, whether international or civil;
. Act or omission of the shipper or owner of the goos;
. The character of the packing of the goods in the packing or in the
containers
. Order or act of the competent authority; and
. Exercise of extraordinary diligence

How important is EOD?

– DEFENSE + EOD

As long as you have EOD, you may still be exempted from liability

Fortuitous event
– Those that are foreseen, and if foreseen, are inevitable
– Requisites:
– 1 The cause of the unforeseen event is independent of human will
– 2 It must be impossible to foresee, or if foreseen, impossible to avoid
– 3 Render the debtor impossible to fulfill his obligation
– 4 Debtor must be free from any participation or aggravation of injury
resulting to the creditor

Is caso fortuito limited to natural disaster?

– NO. Involves acts of god and acts of man
– Fortuitous event is defense of common carrier UNDER Article 1174 of the
NCC, not Article 1734, 1742, 1743
Recall De Guzman v. CA
– Hijacking qualified as Fortuitous event
– Attended by grave and irresistible and with force, threat and
intimidation

Can fire be considered natural disaster or calamity?

– NO, not a proximate cause.

How about Storm? Can you use it as defense?

– YES, key word: STRONG WIND + UNFORSEEABILITY

Hijacking
– GR: NOT FORTUITOUS EVENT
– XPN: Attended by grave and irresistible and with force threat
intimidation

Mechanical Defects
– Not fortuitous event

Other invalid defenses

– KKR (Kanya kanyang reading na p.239)
– a. Explosion
– b. Worms and Rats
– c. Water Damage
– d. Barratry — is an act committed by the master or crew of the ship
for some unlawful or fraudulent purpose, contrary to their duty to
owner.

PUBLIC ENEMY
– Defense that is available to the carrier not only under the Civil Code but
also under the COGSA

Thieves, Robbers, and Insurrectionees

– Not defense

How about Rebels?

– GR: not public enemies
– XPN:if cast off allegiance against own country
– Belligerency

How about Pirates?

 – ENEMIES OF ALL CIVILIZED NATIONS AND HUMANITY; operate in the
high seas

Nature of Goods and Improper Packaging

– How will a common carrier be exempted here?
– TWO THINGS:
– 1. Common carrier was not aware that the goods have a bad nature
to consider it as easily perishable /improperly packaged
– 2. Common carrier nevertheless exercised EOD to prevent or
lessen the damage

Defect is not the same as inferior quality

– Defect - incomplete item
– Inferior quality - poor, mediocre, second rate quality

Order of Public Authority

– Defense
– Public authority has no authority to issue subject order
– Public authority exceeded his authority

What happens if the act was committed by a co-passenger or a stranger

– Lesser degree of diligence required of common carrier
– Due diligence is required

Art. 1763
– A common carrier will still be responsible even if act committed is co-
passenger and stranger
– IF common carrier could have prevented it with exercise of diligence
of good father of family

Acts of Employees
– Carrier is presumed liable (Supervision)

Doctrine of Avoidable Consequences

– Related to Assumption of Risk

When you travel, you know that there will be a turbulent flight. There could be
bumpy road or strong waves. These are consequences of travel you cannot avoid.
You are open that the flight will not push through — delays and consequences due
to bad weather.

SC: likened the situation to those passengers of vessels who board the ship which
is overloaded. According to SC, if you will not give these people compensation it is
akin to the victims of maritime travel — You were forced to be loaded upon,
overloaded vessels. The liability will be on the common carrier for placing these
passengers of harms way when it allowed these passengers to be conveyed via
their overloaded vessel and so the victims of said vessel tragedies are thus
entitled to compensation. Even if there is risk that the passengers assumed, the
liability is still on the common carrier

Doctrine of Last Clear Chance

– When both parties involved in the accident were both negligent, the
negligence of the party will not be considered the proximate cause if the
other party has the last clear chance of avoiding the injury
– “The party who has the last opportunity to avoid the injury will be liable.”

RJM RECORDING NOTES

CHAPTER 5

BILL OF LADING AND OTHER FORMALITIES

Bill of Lading - A written acknowledgment of the receipt of goods and an

agreement to transport and to deliver them at a specified place to a person
named, or on his order.

The designation or the definition of the Bill of Lading is usually not material neither
is the form of instrument, so long as it contains an acknowledgment that the
carrier of the receipt of goods for transportation is in legal effect

Lading - means cargo, or action or process of loading a ship or other vessel with
cargo.

Three-fold Nature of a BoL

. It serves as a receipt of the goods shipped

. It is an evidence of contract of carriage
. It serves as an document of title over the goods

Contract
– names the contracting parties, fixes the terms of the contract, and
binding upon the parties, their assigns and heirs.

Receipt
– It recites the date and place of shipment, describes the goods, etc.
Document of Title
– In that is stated that the goods referred to therein will be delivered to the
bearer, or to the order of the bearer, or to the order of any person named
in such document.
– the BoL is the symbol of the cargo — indorsement and delivery is a
symbolic delivery of the cargo.

What kind of contract is a Contract of Carriage?

Real
– requires the delivery of the thing

Consensual
– perfected by mere consent

Formal
– one that entails a written agreement between the parties

– Is a bill of Lading necessary for the perfection of a Contract of

Carriage? NO.
– A bill of lading is not indispensable for the creation of a contract of
carriage.
– As to the issuance of the Bill of Lading although we have Article 350
of the Code of Commerce which provides that the shipper as well as
the carrier, when mutually demand that the bill of lading be made,
still, the BoL is not indispensable
– The obligation of the common carrier to exercise EOD is present
EVEN if it does not issue a BoL.

Effectivity
– Upon its delivery to and acceptance by the shipper

Presumption that the stipulation in a BoL are in the absence of fraud, concealment
or improper conduct known to the shipper, they are effective, and he is generally
bound by the acceptance whether he reads the bill or not. The shipper here, is
presumed that all terms were brought within his knowledge, and acceptance of the
bill without any dissent on his part is equivalent to estoppel. He is already
estopped from contesting the stipulations in the bill of lading because there is
already a binding contract between them.

Parties
– Shipper and Carrier
 – What about the Consignee?
– Although the consignee is a stranger to the bill of lading, he becomes
a party/he becomes liable when the BoL specifies that the charges
which are normally paid by the shipper are normally paid by him. His
liability arises from the following circumstances:
– 1. There is a relationship of agency between the consignee and
the shipper/consignor
– 2. There is an unequivocal acceptance of the Bill of Lading that
was delivered to him, and he has full knowledge of its contents
– 3. There is an availment of stipulation pour atrui or a stipulation in
favor of a third person
– Contracts or Provisions in a contract that confer a benefit to a
third party beneficiary.
– When there is such a stipulation drawn up by the shipper and
the carrier upon the consignee’s demand that the goods be
delivered to the consignee.
– In effect, in these cases, the consignee becomes a party
because of the obligation of the carrier to deliver the
goods to him.

Other important factors

– BoL is a Contract of Adhesion
– take it or leave it basis; generally prepared only by one party. The
only participation left on the other party is to affix his signature on
the document, hence the term adhesion.
– Are Contracts of Adhesion void?
– not entirely prohibited. So long as the contract is not contrary to
law, morals, good customs, public policy

– BoL covered under the Parole Evidence Rule

– The terms of the Contract are conclusive upon the parties, and
evidence allunde is not admissible to contradict its terms subject to
well-defined exceptions.
– Otherwise stated, the Parol Evidence Rule is based on consideration
that when the parties have reduced their agreement into writing, all
their previous and contemporaneous agreements on the matter are
merged therein.
– Is the Bill of Lading Covered by the Parole Evidence Rule? YES.
– Hence, all agreements are generally not admissible to vary the
terms their contract of Bill of Lading
– XPN:
- 1. There is a mistake of fact mutual to the parties
 –

– BoL as an Actionable Document

– When is a document actionable?
– Section 7, Rule 8 RoC
– A document is actionable when an action or defense is
grounded upon such written instrument or document. Hence,
Rules of Actionable Documents shall apply the genuineness
and due execution of a Bill of Lading are deemed admitted
unless specifically denied under oath by the adverse party
– Absence of such denial, there is judicial admission.

Stipulations in a BOL

Prohibited
– a. Exculpatory Contracts — one exempting the carrier from any and all
liabilities for loss, destruction or deterioration of goods occasioned by its
own negligence
– b. One providing for an unqualified limitation of such liability to an agreed
valuation.

***VOID — contrary to public policy

Limiting
– 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

**VALID and ENFORCEABLE

What is the purpose of limiting stipulation?

– it is to protect the carrier. It obliges the shipper to notify the common
carrier of the amount that the carrier may be liable in case of loss of the
goods. In this case, the carrier can take appropriate steps such as
getting an insurance, if needed, to cover or protect itself
– This is being prudent on the part of the carrier.
– There are scrupulous shippers who undervalue the goods in order to
avail of a lower rate of freight. And then afterwards, they will claim for
the real value of the goods if these goods are damage.
– Does the presence of a limiting stipulation remove the duty to
exercise extraordinary diligence? NO
– Art. 1752, NCC. Even when there is an agreement limiting the liability
of the common carrier in the vigilance over the goods, the common
carrier is disputably presumed to have been negligent in case of their
 –

loss, destruction or deterioration.

– What about stipulations reducing diligence?
– Rules to follow:
– The parties cannot stipulate in such as way as to totally exempt
the carrier from liability from exercising any degree of diligence
whatsoever
– That the common carrier shall exercise diligence less than
that of a good father of a family.
– They may however stipulate that the diligence be less than
extraordinary diligence, provided, the following requisites are
present:
– 1. It is a stipulation in writing signed by the parties
– 2. The stipulation is supported by invaluable consideration
other than the service rendered by the common carrier
– 3. The stipulation should be reasonable, just, and not contrary
to law.
– THESE ARE ONLY APPLICABLE FOR GOODS.
– Reduction of diligence IS NOT ALLOWED ON PASSENGERS
– Art. 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.
– Art. 1750. A contract fixing the sum that may be recovered
by the owner of 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.

1750 distinguished from 1755

– 1750 discusses stipulations fixing the limit of recover or
amount that may be recovered, which requires only two things
– 1 Reasonable and just under circumstances
– 2 Fairly and freely agreed upon

May a common carrier release the goods to the consignee even without the
surrender of Bill of Lading?

Yes. Article 353 (Code of Commerce)

In case the consignee, upon receiving the goods, cannot return the bill of lading
subscribed by the carrier, because of its loss or of any other cause, he must give
the latter a receipt for the goods delivered, this receipt producing the same
effects as the return of the bill of lading.

GR: Upon receipt of the goods, the consignee surrenders the BoL to the carrier
and their respective obligations are considered cancelled.

TWO EXCEPTIONS, where goods may be released without the surrender of BoL
because the Consignee can no longer return it

. BoL gets lost

. Other cause

In either case, the consignee must issue a receipt to the carrier upon the
release of the goods. Such receipt shall produce the same effect as the
surrender of the Bill of Lading.

The Supreme Court has previously ruled that non-surrender of the Bill of Lading
does not violate the carrier’s duty of extraordinary diligence over the goods.

Here, Carrier exercises EOD when it released the shipment to the consignee, not
upon the surrender of the Original Bill of Lading, but upon signing delivery
receipts, and surrender of certified true copies of the Bill of Lading.

The surrender of the original bill is not condition precedent for a common
carrier to be discharged of its contractual obligation.

________

INSTRUCTIONS FOR YOUR MIDTERMS:

1. The EXAM LINK will be posted tomorrow. Said link shall be activated five (5)
minutes before your exam schedule.
2. The exam will be proctored online. Be familiar with the AutoProctor program.
Please go through this link a few hours before taking the exam for the demo and
compatibility test: http://bit.ly/ap-ti-pro. Do not skip this in order to avoid technical
problems while taking your exams.
3. The exam shall be answered via Google Forms and has been set to "AutoSave"
so progress is automatically saved as a draft. This allows you to easily return to
your exams should there be technical glitches.
4. Take note that AutoProctor records everything. Act as if you are in a real
classroom while taking the exams.
The Noise Detection is very sensitive but you should not worry as I review all
reports rendered; hence, keyboard taps and other non-test related noises are
allowable.
Also, please make sure your whole face is seen on the camera. Auto Proctor takes
random shots.
Most importantly, multiple tabs, tab exchanges, and other similar screen
manipulations are recorded. DO NOT MAKE THE MISTAKE OF OPENING ANOTHER
TAB while taking the exam.
5. Should there be technical problems during the exam, please contact me directly
through 0916-2037328 or via FB Messenger. DO NOT CALL YOUR BEADLE during
the exam.
6. Exams should be promptly submitted. NO EXTENSIONS would be allowed.
There shall be one (1) point deduction for every minute of delay.
Good luck!

__________

REVIEWER BASED ON “ESSENTIALS OF TRANSPORTATION AND PUBLIC

UTITLITIES LAW” BY AQUINO AND HERNANDO

CHAPTER 1
CONTRACT OF TRANSPORTATION
When a person obligates himself to transport persons or property from one place
to another for consideration.
The contract may involve carriage of passengers or carriage of goods.
The person who obligates himself to transport the goods or passengers may be a
common carrier or a private carrier.
PARTIES
The contract of transportation would depend on whether it is for carriage of
passenger or carriage of goods.
Carriage of Passengers
·        Common Carrier
·        Passenger – one who travels in a public conveyance by virtue of contract,
express or implied, with the carrier subject to payment of fare or an equivalent
thereof.
Carriage of Goods
·        Carrier
·        Shipper – The person who delivers the goods to the carrier for
transportation. The person who pays the consideration or on whose behalf
payment is made.
Consignee
The person to whom the goods are to be delivered.
The consignee may be the shipper himself as in the case where the goods will be
delivered to one of the branch offices of the shipper. However, the consignee may
be a third person who is not actually a party to the contract of carriage.
PERFECTION
Two views in perfection of a contract of carriage of passengers.
·        Contract to Carry – an agreement to carry the passenger to carry the
passenger at some future date. This contract is consensual and is therefore
perfected by mere consent.
·        Contract of carriage or of common carriage itself – considered a real
contract for not until the facilities of the carrier are actually used can the carrier be
said to have already assumed the obligation of the carrier.
On Contract of Carriage of Goods
With respect to carriage of goods, there may be a consensual contract to carry
goods whereby the carrier agrees to accept and transport goods at some future
date.
Compania Maritima vs Insurance Company of North America
The test as to whether the relation of shipper and carrier had been
established is, Had the control and possession of the cotton been
completely surrendered by the shipper to the railroad company? 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.
Carriage of Passengers
Breach of contract to carry may be sustained even if no tickets were issued, a
verbal contract to carry is already a binding consensual contract.
WRITTEN CONRACT NOT ESSENTIAL
The presence of a ticket or a bill of lading or any written contract is not necessary
for the perfection of the contract of carriage.
The Code does not demand, as necessary requisite in the contract of
transportation, the delivery of the bill of lading to the shipper, but gives right to
both the carrier and the shipper to mutually demand of each other the delivery of
said bill.
AIRCRAFT
There is a perfected contract to carry passengers even if no tickets have been
issued to said passengers so long as there was already a meeting of minds with
respect to the subject matter and the consideration.
BUSES, JEEPNEYS, AND STREET CARS.
Continuing offer rule, it is the duty of the drivers to stop their conveyances for a
reasonable length of time in order to afford passengers an opportunity to board
and enter, and they are liable for injuries suffered by boarding passengers
resulting from sudden starting up of the carrier.
It follows that the passenger is deemed to be accepting  the offer if he already
attempting to board the conveyances and the contract of carriage is PERFECTED
from that point.
TRAINS
Requisites for a person to be deemed as a passenger (doesn’t have to be in order):
·        Bona fide intention to use the facilities of the carrier.
·        Possess sufficient fare with which to pay for his passage.
·        Present himself to the carrier for transportation in the place and manner
provided.
COMMON CARRIER
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.
·        It has also been defined as “one that holds itself out as ready to engage in
the transportation of goods for hire as a public employment and not as a casual
occupation.”
Public Service. The concept of “common carrier” under Art. 1732 may be seen to
coincide neatly with the notion of “public service,” under the Public Service Act
(Commonwealy Act No. 1416, as amended) that at least partially supplements the
law on common carriers set forth in the Civil Code. Under Section 13 paragraph (b)
of the Public Service Act, “public service” includes:
…every person that now or hereafter may own, operate, manage, or control
in the Philippines, for hire or compensation, with general or limited
clientele, whether permanent, occasional or accidental, and done for
general business purposes, any common carrier, railroad, street railway,
traction railway, sub-way motor vehicle, either for freight or passenger, or
both with or without fixed route and whether may be its classification,
freight or carrier service of any class, express service, steamboat or
steamship line, pontines, ferries, and water craft, engaged in the
transportation of passengers or freight or both, shipyard, marine railways,
marine repair shop, [warehouse] wharf or dock, ice plant, ice-refrigeration
plant, canal, irrigation system, gas, electric light, heat and power water
supply and power, petroleum, sewerage system, wire or wireless
communications system, wire or wireless broadcasting stations and other
similar public services: Provided, however, That a person engaged in
agriculture, not otherwise a public service, who owns a motor vehicle and
uses it personally and/or enters into a special contract whereby said motor
vehicle is offered for hire or compensation to a third party or third parties
engaged in agriculture, not itself or themselves a public service, for
operation by the latter for a limited time and for a specific purpose directly
connected with the cultivation of his or their farm, the transportation,
processing, and marketing of agricultural products of such third party or
third parties shall not be considered as operating a public service for the
purposes of this Act.
TEST
First Philippine Industrial Corp vs CA
 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.
Public Use. Means the same as “use by the public.” The essential feature of the
public use is that it is not confined to privileged individuals, but is open to the
indefinite public us is that it is not confined to privileged individuals, but is open to
the indefinite public.
Sps. Cruz v Sun Holidays
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.
THE TRUE TEST
Sps. Perena vs Sps. Nicolas
As all the foregoing indicate, the true test for a common carrier is not the
quantity or extent of the business actually transacted, or the number and
character of the conveyances used in the activity, but whether the
undertaking is a part of the activity engaged in by the carrier that he has
held out to the general public as his business or occupation. If the
undertaking is a single transaction, not a part of the general business or
occupation engaged in, as advertised and held out to the general public,
the individual or the entity rendering such service is a private, not a
common, carrier. The question must be determined by the character of the
business actually carried on by the carrier, not by any secret intention or
mental reservation it may entertain or assert when charged with the duties
and obligations that the law imposes.
CHARACTERISTICS
Common Carrier contemplated under Art.1732
·        Art. 1732 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 (side line).
·        1732 also carefully avoids making any distinction between a person or
enterprise offering [1]transportation service on a regular or scheduled basis AND
one offering such services on an occasional, episodic, or unscheduled basis.
·        1732 does not 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.
·        A person or entity is a common carrier and has the obligations of the
common carrier under the Civil Code even if he did not secure a Certificate of
Public Convenience.
·        The Civil Code makes no distinction as to the means of transporting, as long
as it is by land, water, or air.
·        The Civil Code does not provide that the transportation should be by motor
vehicle.
·        A person or entity may be a common carrier even if he has no fixed and
publicly known route, maintains no terminals, and issues no tickets.
·        A person or entity need not be engaged in the business of public
transportation for the provisions of the Civil Code on common carriers to apply to
them.
·        The Carrier can also be a common carrier even if the operator does not own
the vehicle or vessel that he or she operates
ANCILLARY BUSINESS
Art. 1732 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
De Guzman vs CA
Thus, even if the transportation of goods was ancillary to the main business
of buying and selling used bottles and scrap metals, the SC considered the
private respondent a common carrier.
LIMITED CLIENTELE
Although the clientele is limited, the regularity of the activities of a carrier may
indicate that the same carrier is a common carrier.
Sps. Perena vs Sps. Nicolas
Applying these considerations to the case before us, there is no question
that 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 clientèle, 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.
MEANS OF TRANSPORTATION
First Philippine Industrial Corp. vs CA
 Pipeline operators are common carriers that are subject to business taxes
on common carriers. Such operators are common carriers even if the oil or
petroleum products are being transported not through motor vehicles
but through pipelines.
NOT COMMON CARRIER BY LAW
Note that under Section 7 of R.A. No. 10668, foreign vessels engaging in carriage
conducted in accordance with the said law shall not be considered common
carriers under the New Civil Code; they are also not offering a public service and
this shall fall outside the coverage R.A. No. 9295 or the “Domestic Shipping
Development Act of 2004.
EFFECT OF CHARTER PARTY
A Charter Party may transform a common carrier into a private carrier. However, it
must be bareboat or demise charter where the charterer mans the vessel with his
own people and becomes, in effect the owner for the voyage or service stipulated.
The common carrier is not transformed into a private carrier if the charter party is
a contract of a affreightment like a voyage charter or a tome charter.
A Charter Party  is defined as a contract by which an entire ship, or some
principal part thereof, is let by the owner to another person for a specified time or
use. Charter Parties are of two types:
a.       Contract of affreightment which involves the use of shipping space on
vessels leased by the owner in part or as a whole, to carry goods for others
b.      Charter by demise or bareboat charter, by the terms of which the whole
vessel is let to the charterer with a transfer to him of its entire command and
possession and consequent control over its navigation, including the master and
the crew, who are his servants.

COMMON CARRIER VS THE WORLD

Common Carrier
A 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 such services to the public.
Private Carrier
One who, without making the
activity a vocation, or without
holding himself or itself out to the
public as ready to act for all who
may desire his or its services,
undertakes by special agreement in
a particular instance only, to
transport goods or persons from
one place to another either
gratuitously or for hire
Towage
One vessel is hired to bring another
vessel to another place.
Arrastre
A Spanish word that refers to
hauling cargo, comprehend the

TRAMP SERVICE VS LINE SERVICE
(basis is R.A. 9515)
Tramp Service
The operation of a contract carrier
which has no regular and fixed
routes and schedules but accepts
cargo wherever and whenever the
shipper desires, is hired on a
contractual basis, or chartered by
any one or few shippers under
mutually agreed terms and usually
carries bulk or break bulk cargoes.
GOVERNING LAWS
One vessel is hired to bring another
vessel to another place.
Arrastre
A Spanish word that refers to
hauling cargo, comprehend the
handling of cardo on the wharf or
between the establishment of the
consignee or shipper and the ship’s
tackle.
They are, in fact, no different from
those of a depository or
warehouseman.
Stevedoring
Involves the loading and unloading
of the coastwise vessels calling at
the port.
Refers to the handling of the cargo
in the holds of the vessel or between
the ship’s tackle and the holds of
the vessel.
Travel Agency
The object of contractual relation of
a person who purchases a ticket
through a travel agency is only the
agency’s service of arranging and
facilitating the booking, ticketing
and accommodation in a package
tour.
Line Service
The operation of a common carrier
which publicly offers services
without discrimination to any user,
has regular ports  of call/destination,
fixed sailing schedules and
frequencies and published freight
rates and attendant charges and
usually carries multiple
consignments.
Article 1766. In all matters not regulated by this Code, the rights and obligations
of common carriers shall be governed by the Code of Commerce and by special
laws.
Article 1753. The law of the country to which the goods are to be transported
shall govern the liability of the common carrier for their loss, destruction or
deterioration.
NATURE OF BUSINESS
Common carriers exercise a sort of pubic office, and have duties to perform in
which the public is interested.
Common carriers are public utilities; they are enterprise that specially cater to the
needs of the public and conduce to their comfort and convenience. As such
common carriers are impressed with public interest and concern. Consequently,
common carriers are subject to regulation by the State.
REGISTERED OWNER RULE AND KABIT SYSTEM
In certain cases, it is not only the operator of the vehicle who may be held liable
even if the cause if actions is culpa contractual[2]. Ordinarily, the person who can
be sued for breach of contract is the contracting party. However, in certain cases,
by reason of public policy, the law allows victims of accidents to sue those who,
strictly speaking, are third parties. This obtains in the cases covered by the
registered owner rule.
REGISTRATION LAWS
Registration of motor vehicles is now governed by R.A. 4136 otherwise known as
“The Land Transportation and Traffic Code.” The Land Transportation Office is
now administering the law on registration.
REGISTERED OWNER RULE
·        The rule in this jurisdiction is that the person who is the registered
owner of a vehicle is liable for any damage caused by the negligent operation
of the vehicle although the same was already sold or conveyed to another
person at the time of the incident. This rule is a matter of public interest. The
registered owner is liable to the injured party subject to his right of recourse
against the transferee or the buyer.
·        The registered owner is not liable if the vehicle was taken from his garage
without his knowledge and consent. To hold the registered owner liable would be
absurd as it would be like holding liable the owner of a stolen vehicle for an
accident caused by the person who stole such vehicle.
·        Indeed, unauthorized use and/or theft of the vehicle may be invoked in
proper cases. However, absent the circumstance of unauthorized use or that the
subject vehicle was stolen which are valid defenses available to a registered
owner, the registered owner cannot escape liability resulting from the use of the
registered owner’s vehicle.
·        The registered owner rule applies in a financial lease.
·        If the registered owner is made liable despite the transfer of the vehicle, the
transferee is liable to the registered owner for the damages caused to the
passenger.

KABIT SYSTEM
The “registered owner” rule is applicable whenever the persons involved are
engaged in what is known as the “kabit system”.
The Kabit System is an arrangement whereby a person who has been granted a
certificate of public convenience allows other persons who own motor vehicles to
operate then under his license, sometimes for a fee or percentage of the earnings.
Although the law does not outrightly penalize the parties to such an agreement,
the system is invariably recognized as being contrary to public policy and
therefore void and inexistent under Article 1409 of the Civil Code.
PARI DELICTO RULE
Persons who are parties to the kabit system cannot invole the same as against
each other either to enforce their illegal agreement or to invoke the same to
escape liability. This is consistent with the time-honored maxim “ex pacto ilicto no
oritur action” [ No action arises out of an illicit bargain].
LAND TRANSPORTATION RULES
The LTFRB imposes similar rules that implement the registered owner rule and
prohibits Kabit System.
AIRCRAFTS AND VESSELS
It is believed that the policy, which prohibits the Kabit system, may also be applied
to vessels and aircrafts that are covered by certificates of public convenience and
necessity.
It is a basic rule that no person can operate a common carrier without securing a
certificate of pubic convenience and necessity.
BOUNDARY SYSTEM
In land transportation where the boundary system may be implemented by the
common carrier, the carrier cannot escape liability by claiming that the driver is a
lessee.
The carrier cannot exempt himself on the ground he is a lessor because to tolerate
such position would not only abet flagrant violations of the Public Service Law but
also to place the riding public at the mercy of reckless and irresponsible driver –
reckless because the measure of their earning depends largely upon the number
of trips they make and, hence the speed at which they drive; and irresponsible
because the most if not all of them are in no position to pay the damages they
might cause.

SELF NOTES

CHAPTER 6
Actions and Damages in Case of Breach
Distinctions

Distinctions between Culpa Contractual and Culpa Aquiliana

Concurrent Causes of Action

Concurrence With Third Persons

Solidary Liability
– Alternative Causes of Action

Alternative Compensation Scheme

Elements of Cause of Action Against the Carrier

Recoverable Damages
– Reasons for Provisions

Extent of Recovery Art 2201

– Applied to Common Carrier
– Carrier’s Right of Recourse

Kinds of Damages

Actual or Compensatory Damages

Kinds of Actual Damages

Proof
– Determination of Amount of Liability in Carriage by Sea
– Valuation of Goods
– Damages in Personal Injury Cases

Damages in Case of Death

– Fixed Damage
– Loss of Earning Capacity

Attorney’s Fees
– Award of Attorney’s Fees
– When Available in Contract of Carriage
– 2208, 1,2,4,5,10,11
Interests
Moral Damages

Requisites

When Moral Damages Were Awarded

– Land Transportation
– When Moral Damages Awarded in Air Transportation Cases

Cases When There is no Awarded Moral Damages

Specific Cases When Recoverable

Factors to Consider

Nominal Damages

Temperate or Moderate Damages

– Rationale

Liquidated Damages

Exemplary or Corrective Damages

– Statutory Condition

PART II
AVIATION LAW

CHAPTER 7
THE AIRCRAFT AND CIVIL AVIATION

Applicable Laws xx

Regulatory Perspectives xx

Civil Aviation

Registration of Aircraft xx

Recording of Conveyances

Marine Insurance
Air Transportation in General xx

Persons Involved in Air Transportation

Charter of Aircraft

Sovereignty and Air Freedoms xx

Freedoms of the Air

– First Freedom of the Air to Ninth Freedom of the air

Cancellation of Commercial Agreement

Cabotage

COVERAGE:

Chapter 8, 10, 11, 15

– Excluding topics on Air Passengers’ Bill of RIghts and Admiralty
Jurisdiction

Meeting 7
May 29, 2022

CHAPTER 7

Applicable Laws:
1. The New Civil Code provisions on Common
Carriers
2. RA 9497 – Civil Aviation Authority Act of 2008
3. Civil Aviation Regulations (issued by CAAP)
4. Treaties and Conventions (Warsaw Convention)

Civil Aviation Authority of the Philippines (CAAP) — LTO

– transfers, lien, mortgage, registration — constructive notice for the whole
world
Civil Aeronautics Board (CAB) — LTFRB
– All economic aspects of air transportation

Air Transportation in General

– Scheduled
– Non-schedule — for hire
Commercial air transportation
Aerial Spraying of agricultural products
Aerial Photo mapping

Who owns air space

– STATE
– “Whoever owns below owns what’s above”
– “Consent to fly over their state”
– Chicago Convention
– Bilateral air negotiation - this is how to gain consent to fly over a state
– “Whatever they give us we also give”

Air service agreement

– What routes will other state be able to cross?

Air Freedoms

First Freedom

Second Freedom
– Technical, non-traffic
– Di pwede magbaba ng pasahero, magsakay din

Third Freedom & Fourth Freedom

– Most common freedom recognized in Air Service Agreement

Fifth Freedom
– 3 countries giving consent
– Allowed already in Philippines, profitable kasi
ICAO
– Int’l Civil Aviation Organization

Sixth, Seventh, Eighth, Ninth

– Most uncommon

6th 7th
– not widely recognized
– Common to countries with alliances (EU)

Cabotage
– PH has strong policy against cabotage
– Threat to security and sovereignty
 – Instead of giving profits to domestic players, why would we give the
profit to SG airlines?
– BENEFITS of Cabotage — competition
– More choices for better prices

CHAPTER 8

Extraordinary Diligence in Air Transportation

– Aircraft is airworthy
– Vessel has a competent captain and crew
– Captain and his crew exercised extraordinary diligence in operating the
aircraft
– In other words, “Able to withstand the rigors of the flight”
– Air cargo and air passage

Causes for breaching contract of carriage by air

– Delay,
– Fraud,
– Negligence,
– Cancellation
– Overbooking

NOTE: Cathay Pacific Airways Ltd. v. Spouses Vasquez

– Not all benefits and advantages are good; it can also breach our contract
of carriage
– Ayaw sa first class

Delays and Cancellations

– Notified within 24 hours = right to reimburse of flight
– If within the airport = You can endorse yourself to other airlines
– Amenities — food and hotel accommodation
– “Tubig skyflakes”

Air Passenger Bill of RIghts

NOTE: Cebu Pacific owns GO Hotels

Cancellation for causes that are Force Majeure and Security reasons
– Right to be reimbursed the fare

DELAY

1 Terminal Delay
 – Already in the boarding area
– 3 hours after ATT
– Right to be revoked, refund, reimbursed, right to amenities
– 6 hours delayed
– Consider flight cancelled; all rights you should get

Tarmac Delay
– Already in airplane, there is delay
– 2 hours — right to refreshments
– They should be telling you to disembark if its already too long
– When? From the time that they close the doors

Overbooking
– Booking beyond your capacity
– They accepted many passengers to fly In the course of the date of flight,
passengers have no space.
– Over-booking is the practice of air carriers of selling confirmed reserved
space beyond the actual seat capacity of the aircraft.

Is overbooking fraudulent act?

– No. Almost always, there is a possibility that the passenger will not
appear
– General Rule: Passenger cannot be denied the right to board the airport
without his consent
– Exception: When there is overbooking

Airline must look for volunteers willing to give up their seats.

– Through compensation

MARITIME LAW
CHAPTER 10
GENERAL CONCEPTS

REAL and HYPOTHECARY NATURE

Real (res itself)

– Res or real property which is involved — the vessel

Hypothecary
– Limited to the vessel itself (pledging, assurance security)

Hypothecate
– Meaning, to pledge
Limit of Liability Rule
– The limitation of liability of the agents to the actual value of the vessel
and the freight money (Zero vessel, zero liability)

Limited liability rule – means that the liability of a shipowner for damages in case
of loss is limited to the value of his vessel.
– No vessel, no liability
– The civil liability for collision is merely co-existent with the interest in the
vessel; if there was total loss, liability is also extinguished.

How will you be protected as a passenger despite the limited liability rule?
– 1 Through liability of the shipowner
– 2 Through INSURANCE — to answer for liabilities in case of accident

Negligence of the Shipowner negates his right to limited liability rule. Why?
– Because he is guilty of negligence. He is already committing a breach.
– Limited liability rule presupposes that conscience is clean

“Insurance is an incident of a limited liability rule”

Why does insurance affect limited liability rule?

Can the insurance company be subrogated to the rights of the claimants?

Will the limited liability rule now apply?

– Can the shipowner apply limited liability rule against the insurer?
– When insurer is subrogated the rights (but in this case shipowner
invokes zero vessel zero liability here)

Other exceptions
Under Worker’s Compensation Rule
– Based on Labor Contracts

Repairs Completed before the loss

Abandonment

What is Abandonment and what is its rule in claiming limited liability rule?
– Abandonment is necessary if there is partial existence of the vessel
– Manifestation is you are no longer interested in the vessel
When is abandonment not necessary anymore?
– When there is no more vessel

Protest
– Written statement by master of a vessel or any authorized officer,
attested by proper officer or a notary, to the effect that damages has
been suffered by the ship

Why protest required?

– When the vessel makes an arrival under stress
– Where the vessel is shipwrecked
– Where the vessel has gone through a hurricane or the captain believes
that the cargo has suffered damages or averages
– Maritime Collisions

Definition of Vessel

Are all vessels “vessels”?

– No, in such cases not considered as vessel under the law

Are vessels real property?

– No, personal property
– They are nevertheless, objects of acquisition

Do not say that a vessel may be acquired by any other means required by law
– One of the means recognized is intellectual creation, we cannot
intellectually create a vessel

Prescription
– Same thing as in ordinary and extraordinary vessels

Who governs the registration of vessels?

– Regulatory board, MARINA (Maritime Industry Authority)
– Takes care of registration both technical and economic aspect

Manifest
– reference/checklist which the customs officers can look up to to know
what goods are being transported inside the port
– Often heard in maritime accidents

W/N a bill of lading will prevail over manifest?

– Those two are different
 – BOL on a particular cargo
– A Manifest is on the whole cargo

CABOTAGE
– Not allowed in aviation; but allowed in MARITIME

IF MATULOY
– No class next week

IF NOT MATULOY
– DISCUSSION

“Do not go beyond what I cover or discuss”

Meeting 8
June 5, 2022

CHAPTER 15-19

1 Warsaw hand in hand with Montreal

2 TNVS (Grab)
3 COGSA
4 Public Utilities
– There is already a new Public Service Act
– Removed transportation as one of the public utilities
– Effect: 60/40 rule no longer applies

Exchange written reports

– To be submitted the night before finals

CHAPTER 15
Loans on Bottomry and Respondentia

Is security necessary in simple loan?

– YES

Loan on Bottomry – loan made by shipowner or ship agent guaranteed by vessel

itself and repayable upon arrival of vessel at destination; vessel/portion

Loan on respondentia – loan, taken on security of the cargo laden on a vessel,

and repayable upon safe arrival of cargo at destination; cargo/goods

When is there loan on bottomry/loan on respondentia?

Loan on Bottomry/Respondentia
– IT HAS NO CEILING in interest

Peculiarity
– Para siyang sugal on the part of the lender
– He is willing to lend his money thinking that there will be a higher
amount of return
– He will be paid plus extraordinary premiums

Why would you borrow money knowing that the payment of interest is
extraordinary?

– Purpose: You want it for equipment, repair for the vessel (kailangan mo
na yung pera) so you are willing to pay.

– No vessel owner prays that “sana hindi makabalik yung vessel para wala
nang bayad”

Lenders of bottomry and respondentia are affected by averages

Requisites:

. Shipowner borrows money for use, equipment or repair of vessel

. For a definite term and with extraordinary interest called premium
. Secured by pledged of vessel or portion thereof in the case on loan on
Bottomry; or pledge of goods in case of Respondentia
. Loan repayment depends or conditioned on the safe arrival of goods for
respondentia and obligation to repay is extinguished if pledged goods are
lost (Respondentia)
. Obligation to repay is extinguished if vessel is lost due to specified
marine perils in the course of voyage or within limited time (Bottomry)

CHAPTER 16
AVERAGES

What are averages?

– an extra-ordinary or accidental expense incurred during the voyage in
order to preserve the cargo, vessel or both; and all damages or
deterioration suffered by the vessel from departure to the port of
destination, and to the cargo from the port of loading to the port
consignment. (Art. 806)
Two Kinds of Averages

Simple or Particular Average

Gross or General Average

SIMPLE Average (Particular)

– Who bears the loss?
– Owner of the goods/owner of the vessel
– Why is it he who pays?
– Stating otherwise, damage affected only one person; it
doesn’t affect the rest, thus you bear the loss

Look at Art 809 of Code of Commerce, in case you forget particular/simple

average
– One example (one thing affected one good; it does not affect the rest)
– Nabasa ng seawater yung goods. Ayon lang na affect.
– Borne by the owner of the goods

GENERAL Average (Gross)

– The rest of owners of goods not affected by marine peril are asked to
pay.
– Why?
– You are paying because your goods are saved based on the
sacrifice of others.

Requisites for General Average

. Common danger
. Arising from accidents of sea, disposition of authority
. Peril Imminent and ascertained
. Part of vessel or cargo deliberately sacrificed
. Intended to save vessel or cargo
. Proper legal steps and authority taken

SIMPLIFIED:
– Average is “Aberya”
– Simple
– Wala kang na aberya kundi sarili mo
– Bakit ka sisingil sa ibang tao?
– General
– Na aberya ka. Pero dahil hindi na aberya yung iba, nakinabang yung
mga tao sa’yo, sa aberyang nangyari sa’yo
 – Dahil nakinabang sila, hindi lang pwedeng ako lang bumayad
– Because somebody sacrificed for you

“The expenses, for purposes of justice, is averaged among them”

Three things
1 Aberya
2 Jesus
3 Averaging the same

COMMON DANGER
– The ordinary perils of the sea
– Sudden strong typhoon

What is Common Safety?

DELIBERATE SACRIFICE

SUCCESSFUL SAVING

Jettison definition?
– the casting away of some portion of the
associated interests for the purpose of
avoiding the common peril from the whole to
a particular portion of those interests
– the goods on board refer to in jettison
should be proven by means of bill of lading
and with regards to those belonging to vessel
by means of inventory prepared before the
departure

NOTE: We do not jettison passengers, but cargo

CHAPTER 17
COLLISIONS

COLLISION
– Impact of 2 moving vessels

ALLISION
– Impact between a moving and a stationary vessel

3 Zones of Time in the Collision of vessels

 . First zone – all time up to the moment when risk of collision begins;
. Second zone – time between moment when risk of collision begins and
moment it becomes a practical certainty;
. Third zone – time when collision is certain and time of impact. (plus
actual contact)

SCENARIO: Lady and Baby Shark

1st Zone - Lady is swimming in a zone of sharks

2nd Zone - Lady is napapaligiran na ng mga sharks
3rd Zone - Kakagatin na siya ni Baby Shark

DOCTRINE OF ERROR IN EXTREMIS

– Sudden movement made by a faultless vessel during the 3rd zone of
collision with another vessel which is at fault during the 2nd zone. Even if
such sudden movement is wrong, no responsibility will fall on said
faultless vessel.

2 vessels colliding, cannot determine whose at fault. How will you determine
responsibility?
– Doctrine of Inscrutable Fault
– In case of collision where it cannot be determined which between the
two vessels was at fault, both vessels bear their respective damage,
but both should be solidarily liable for damage to the cargo of both
vessels.

Force majeure is cause of collision?

– No liability, each bears his own damage

If a vessel sank immediately, what is the rule?

– LIMITED LIABILITY
– No vessel, no liability

RULES ON COLLISION OF VESSELS UNDER Code of Commerce

. The collision may be due to the fault, negligence or lack of skill of the
captain, sailing mate, or any other member of the complement of the
vessel. The owner of the vessel at fault be liable for losses or damage.
(Art. 826)

. The collision may be due to the fault of both vessels. Each vessel shall
suffer its own losses, but as regards the owner of cargoes both vessels
shall be jointly and severally liable. (Art. 827)
 .

. If it cannot be determined which vessel is at fault. Each vessel shall also

suffer its own losses and both shall be solidarily liable for losses o
damages on the cargoes. (Art. 828)

. The vessels may collide with each other through fortuitous event or force
majeure. In this case each shall bear its own damage. (Art. 830)

. Two vessels may collide with each other without their fault by reason of a
third vessel. The third vessel will be liable for losses and damages. (Art.
831)

. A vessel which is properly anchored and moored may collide with those
nearby reasons of storm or other cause of force majeure. The vessel run
into shall suffer its own damage and expense. (Art. 832)

Cases covered by collision and allision:

. One vessel at fault – such vessel is liable for damage caused to innocent
vessel as well as damages suffered by the owners of cargo of both
vessels.
. Both vessels at fault – each vessel must bear its own loss, but the
shippers of both vessels may go against the ship owners who will be
solidarily liable.
. Vessel at fault not known – same as rule as (2). (Doctrine of Inscrutable
Fault)
. Third vessel at fault – same rule as (1).
. Fortuitous event – no liability. Each bears its own loss.

Abandonment
– There was collision; vessel did not completely sink; creditors are chasing
the vessel owners. What would you do? — ABANDONMENT; LIMITED
LIABILITY RULE
– So that you can claim the limited liability rule

How can we enforce an action for damages

– file a protest
– declaration that must be made in 24 hours to prove that collision
happened

CHAPTER 19
ARRIVAL UNDER STRESS
ARRIVAL UNDER STRESS
– Arrival of a vessel at the nearest and most convenient port which was
decided upon determining that there is well founded fear of seizure,
privateers, pirates, or accidents of sea disabling navigation

3 Instances that justifies arrival under stress?

.
. Well founded fear of seizure, privateers, pirates
. Accidents of sea disabling navigation

Steps to be taken in the determination of the propriety of arrival under stress

. captain should determine during the voyage if there is a well founded fear
of seizure, privateers of other valid grounds
. captain shall then assemble the officers
. captain shall summon the persons interested in the cargo who may be
present and who may attend but without right to vote
. the officers shall determine and agree if there is well founded reason
after examining the circumstances; Captain shall have the deciding vote
. agreement shall be drafter and the proper minutes shall be signed and
entered into the log book
. objections and protests shall likewise be entered in the minutes

SHIPWRECK
– The demolition or shattering of a vessel caused by her driving ashore or
on rocks and shoals in the mid-seas, or by the violence of winds or waves
in tempests

EFFECT of SHIPWRECK
– Who will bear the loss?
– It will be individually on the account of owners of said vessels
– Mostly caused by force majeure

Limited liability rule applies only when wala nang vessel na pag-uusapan

SALVAGE
– Services one person renders to the owner of a ship or goods, by his own
labor, preserving the goods or the ship which the owner or those
entrusted with the care of them have either abandoned in distress at sea,
or are unable to protect or secure

Simplified:
 – When the vessel can no longer continue voyage, it being helped by
another vessel

Elements of a valid salvage claim

DISTINGUISH SALVAGE v. TOWAGE

– Towage - there is almost always special contract between owner and
shipper
– That there will be someone saving once there is trouble
– Salvage - done out of VOLUNTEERISM, SPONTANEITY, REWARD, CLAIM
– Based upon equity of remunerating a particular individual, the crew,
who perform the salvage to save the vessel upon an impending peril
in order for that vessel to experience any more loss.
– REWARD: Claim for compensation
– NOTE: If there is a contract, it is not a reward anymore.

2 Groups of 8 — WARSAW AND MONTREAL and PUBLIC SERVICE ACT

2 Groups of 7 — COGSA and TNVS

4 Leaders:
COGSA - Dotong
PUBLIC SERVICE - Du
TNVS - Cairo
WARSAW and MOTREAL - Barlaan

4 topics not included in the Finals

COVERAGE
– CHAPTER 6 to CHAPTER 19
– Kung ano lang na discuss, ayon lang nalabas

DEADLINE:
– June 20, 11:59PM

NO FORMAT BASTA MERON MATERIAL