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Pedro de Guzman v. Court of Appeals G.R. No.

L-47822 Facts: Herein respondent Ernesto Cendana was engaged in buying up used bottles and scrap metal in Pangasinan. Normally, after collection respondent would bring such material to Manila for resale. He utilized (2) two six-wheelers trucks which he owned for the purpose. Upon returning to Pangasinan, he would load his vehicle with cargo belonging to different merchants to different establishments in Pangasisnan which respondents charged a freight fee for. Sometime in November 1970, herein petitioner Pedro de Guzman, a merchant and dealer of General Milk Company Inc. in Pangasinan contracted with respondent for hauling 750 cartons of milk. Unfortunately, only 150 cartons made it, as the other 600 cartons were intercepted by hijackers along Marcos Highway. Hence, petitioners commenced an action against private respondent. In his defense, respondent argued that he cannot be held liable due to force majuere, and that he is not a common carrier and hence is not required to exercise extraordinary diligence. Issues: 1. Whether or not respondent can be held liable for loss of the cartons of milk due to force majeure. 2. Whether or not respondent is a common carrier. Held:

1. The court ruled the affirmative. The circumstances do not fall under the exemption from liability as enumerated in Article 1734 of the Civil Code. The general rule is established by the article that common carriers are responsible for the loss, destruction or deterioration of the goods which they carry, unless the same is due to any of the following causes only: a. Flood, storm, earthquake, lightning or other natural disasters; b. Act of the public enemy, whether international or civil; c. Act or omission of the shipper or owner of the goods; d. Character of the goods or defects in the packing; e. Order or act of competent public authority. 2. The court ruled the affirmative. Article 1732 of the New Civil Code avoids any 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. It also avoids a distinction between a person or enterprise offering transportation services on a regular or scheduled basis and one offering such services on an occasional, episodic, and unscheduled basis. Planters Products, Inc. v. Court of Appeals G.R. No. 101503 Facts: Planters Products (Planters) purchased from Mitsubishi International Corporation of USA of 9,000 metric tons of urea fertilizer which the latter shipped abroad the cargo vessel owned by private respondent Kyosei Kisin Kabushiki Kaisha

(KKKK) from America to La Union. Prior to its voyage, a time charter party was entered into between Mitusbishi as shipper/charterer and KKKK as ship-owner. After the Urea fertilizer was loaded in bulk by stevedored hired by the shipper, the steel hatches were closed with heavy iron lids which remained closed during the entire journey. Upon arrival of the vessel, the hatches were opened with the use of the vessel boom. Planters unloaded the cargo from the holders into the steel bodied dump trucks. Each time the dump trucks were filled up, its load of urea was covered with tarpaulin before it was transported to the consignee’s warehouse located some (50) fifty meteres from the wharf. It took (11) eleven days from planters to unload the cargo. The report submitted by private marine and cargo surveyors revealed a shortage in the cargo, and some portion in the cargo was contaminated with dirt, rendering the same unfit for commerce. Planters filed an action for damages bu the appellate court absolved the carrier from liability. Issues: 1. Whether or not the respondent is a common carrier. 2. Whether or not the respondent is liable for damages. Held: 1. The court rules the affirmative as to the respondent being a common carrier. The term common carrier is defined in Article 1732 of the Civil Code. The definition refers to carriers either by land, water, or air which holds themselves out as ready to engage in carrying goods on transporting passengers or both for compensation as a public employment and not as a casual occupation; if the undertaking is a single transaction, not a part of the general business or

corporation, although involving the carriage of goods for a fee, then the person or corporation offering such services is a private carrier. In the case at bar respondent carrier transports goods indiscriminately for all persons. Being such, he is a common carrier. 2. The court rules the negative. True, being a common carrier, respondent must have observed extraordinary diligence over the goods it carries. In the case at bar it has been proven that the respondent has sufficiently overcome this, by clear and convincing proof, the prima facie presumption of negligence, due to the manner of storage of the goals during the vogyage. In fact, it was pointed out that there was a risk in shipping the urea due to its character.

F.C. Fisher v. Yangco Steamship Company G.R. No. L-8095 Facts: On June 10, 1912, the directors of Yangco Steamship Company which is duly licensced to engage in the coastwise trade in the Philippines, adopted a resolution which was thereafter ratified and affirmed by the shareholders of the company expressly declaring and providing that the classes of merchandise to be carried by the company in its business as a common carrier to include dynamite, power or other explosives and other expressly prohibiting the officers, agents, and servatnts of the company from offering to carry or accepting to carry said articles. In view of the resolution passed the collector of customs suspended the issuance of clearances for the vessles unless they allow the carriage of such articles. Hence, herein petitioner a major stockholder filed a petition for prohibition.

Issue: Whether or not the resolution of Yanco is justified. Held: The court rules the negative. Common carrier in the jurisdiction cannot lawfully decline to accept a particular class of goods, unless it appears that for some sufficient reason the discrimination is reasonalble and necessary. Yangco Steamships Company has not met those conditions. The nature of the business of a common carrier as a public employment is such that it is within the power of the state to impose such just regulation in the interest of the public as the legistalors may deem proper.

Issue: Whether or not the provincial government was prejudiced by the preferential privileges in favor of the shippers. Held: The court rules the affirmative. Sec. 5 of Act No. 98, provides that any person or corporation who may be damaged by the common carrier of any matter or things prohibited shall be entitled to sue or recover all damges so incurred. It is not believed that that law prohibits common carrier from making special rates for handling merchandise when the same are made for the purpose of increasing the business which are regarded as sound. That does not require absolute equality in all cases; it only applies where the services perfomed in the different cases are substantially the same and conditions similar.

United States v. Quinajon G.R. No. 8686

Facts: Herein defendants were charged with the violation of Act No. 98. The accused herein have been engaged for more than (4) four years in the transportation of passengers and merchandise in the port of Curimao, in the loading and unloading of passengers and merchandise by means of voyages from the shore. The facts state that sometime in September 1912, the said accused, by means of voyages, unloaded 5,986 sacks of rice belonging to the provincial government of Ilocos Norte where they regularly charge 6 cents for the unloading and loading of each package of merchandise.

Loadstar Shipping Co. Inc. v. Court of Appelas G.R. No. 131621 Facts: On November 19, 1984 herein petitioner shipping company carried, a shipment of (3) three bulk items on board its M/V Cherokee, which amounted to P6,067,178.00, the same being insured by the Manila Insurance Co. (MIC). The vessel in turn was insured by Prudential Guarantee and Assurance, Inc. of P4 million. Unfortunately the ship sank in the are of Limasawa.

MIC settled the insurance with the consignee and asked for the subrogation receipt, then MIC filed a claim against Loadstar. PGAI alleging the sinking was due to the fault and negligence of Loadstar. In their defense, Loadstar set up the argument of force majuere. PGAI was dropped from the case afer proving MIC had no locus standi against them. Inter alia all other defenses, Loadstar argues that it cannot be considered a common carrier because it was issued a certificate of public convenience and that it carried a particular type of cargo for a particular shipper. Issues: 1. Whether or not Loadstar’s Cherokee is a common carrier; 2. Wheter or not, considering the type of carriage the M/V is, the required amount of diligence was observed; Held: 1. The court rules the affirmative that the M/V Cherokee is a common carrier. It is not necessary that the carrier be issued a certificate of public convenience and their public character is not altered by the fact that the carriage of the goods in question was periodic, occasional, episodic, or unscheduled. Additionally, the second argument of Loadstar must fail; that the M/V Cherokee was carrying a particular type of cargo for one shipper which appears to be purely coincidental is not reason enough to convert a vessel that is a common carrier to a private one, especially where, as in the case, it was shown that the vessel was also carrying passengers. 2. The court rules the negative. Loadstar should have exercised extraordinary diligence since it is a common carrier; and the fact that it still allowed the voyage

despite the knowledge of a typhoon present counters their exercise of extra ordinary diligence required. First Philippine Industrial Corp. v. Court of Appeals G.R. No. 125948 Facts: Herein petitioner applied for a mayor’s permit to operate its pipeline concession. Before such permit was issued, the City treasurer required petitioner to pay local tax. In order not to hamper its operations, petitioner paid the tax under protest. Then the petitioner filed a letter protest addressed to the treasurer claiming exemption from payment of the tax because according to the Local Government Code of 1991, transportation contractors are not included in the enumeration of contractors which are liable to pay taxes. The city treasurer denied the protest. The petitioner filed a case before the trial court for tax refund, however it was subsequently dismissed. Hence, this petition. Issue: Whether or not the petitioner is a common carrier as contemplated to be exempted under the law. Held: The court rules the affirmative. The court enunciated the (4) tests in determining whether the carrier is that of a common carrier: a. must be engaged int eh business of carrying goods for other as a public employment and must hold itself out as ready to engage in the transportation of goods generally as a business and not a casual occupation

b. it must undertake to carry goods of the kind which its business is confined; c. it must undertake the method by which his business is conducted and over its established roads; d. the transportation must be for hire. In the case at bar, the court categorically ruled that the transporting of oil through pipelines is still considered to be an activity of a common carrier. The petitioner is a common carrier because it is engaged in the business of transporting passengers or goods; like petroleum. It undertakes to carry for all persons indifferently. The fact that the petitioner has limited clientele does not exclude it from the definition of common carrier. Under the petroleum act of the Philippines, the petitioner is considered a common carrier even if it is a pipeline concessionaire. And even as regards the petroleum operation, it is of public utility. Specifically, the Bureau of Internal Revenue considers petitioners as common carrier not subject to withholding tax.

Insurance on the other hand filed for the recovery of the P14,000.00 from Luzon Stevedoring. The Court of First Instance absolved Luzon Stevedoring, but ordered the American Steamship Agencies to reimburse the amount to Home Insurance, basing the ruling on Art. 587 of the Code of Commerce which makes the ship agent civilly liable for damages in favor of third persons due to conduct of carrier’s captain and that the stipulation in the charter party exempting the owner from liability is against public policy under Article 1744 of the New Civil Code. Issue: Between the provisions of the New Civil Code and the Code of Commerce, which should apply. Held: The court rules the affirmative as to the nonapplicability of the prohibition of the exemption of the carrier from liability. The provisions of our Civil Code on common carriers were taken from Anglo-American Law. Under American Jurisprudence, a common carrier undertakes to carry a special cargo or chartered to a special person only, becomes a private carrier. And thus, as a private carrier, a stipulation exempting the owner from liability for the negligence of its agent is not against public policy. The reason is that there is no strict public policy applied.

Home Insurance Co. v American Steamship Agencies 23 SCRA 24 April 4, 1968 Facts: Consorcio Pasquero Del Perse of South America shipped a freight of 21,740 jute bags of Peruvian fish meal through the SS Crowborough consigned to the Sam Miguel Brewery and insured by Home Insurance Company for $202,505.00. It arrived in Manila on March 7, 1963 and was loaded into the lighters of Luzon Stevedoring Company. However, it arrived with shortages. Thus SMB demanded that Home Insurance pay the claim of P14,000.00. Home

San Pablo v. PANTRANCO South Express G.R. No. L-61461 Facts:

Defendant PANTRANCO planned to operate a ferryboat service between Matnog and Allen as a common carrier. It requested authority from the MARINA to purchase the vessel M/V Black Double in accordance with the procedure provided for by law on such application for a certificate of public convenience (CPC). Its request was denied as the said routes are adequately serviced by existing authorized operators such as the Cardinal Shipping Company. However, the defendant continued to purchase the vessel and started operating. Defendant contends that what it proposed was to operate a PRIVATE FERRY BOAT service across a “small body of water” specially for its buses and trucks from Matnog to Allen, Tacloban for the purpose of continuing the highway. Thus, the ferry is merely an incident to its franchise to convey passengers and cargo from Pasay to Tacloban and need not secure a separate CPC. Defendants also contend that they are not a PUBLIC FERRY BOAT as they do not accept walkins. The Board of Transportation (BOT) enjoined PANTRANCO from operating the ferry. The petitioner along with Cardinal Shipping interposed their opposition as they are able to service the riding public. BOT sought for the opinion of then Minister of Justice Ricardo Puno that rendered and affirmative opinion in favor of PANTRACO. Justice Puno gave an opinion to the effect that there is no need for bus operators to secure a separate CPC to operate a ferryboat service. BOT rendered its decision holding that the ferry boat service is part of its CPC to operate from Pasay to Samar/Leyte by amending PANTRANCO's CPC. Petitioners filed for motions of consideration and were denied by BOT. Issue:

Whether or not the water transport service is a ferry service for purpose of continuing the highway or a coastwise/ interland service. Held: The court holds that the water transport service between Matnog and Allen is not a ferryboat service but a coastwise or interland shipping service. Under no circumstance can the sea between Matnog and Allen be considered a continuation of the highway. While a ferry boat service has been considered as a continuation of the highway when crossing rivers or even lakes, which are small body of waters - separating the land, however, Matnog and Allen are separated by an open sea it can not be considered as a continuation of the highway. Respondent PANTRANCO should secure a separate CPC for the operation of an interisland or coastwise shipping service in accordance with the provisions of law. Its CPC as a bus transportation cannot be merely amended to include this water service under the guise that it is a mere private ferry service. Argumento, PANTRANCO is a a ferry service, it is absurd to be called a Private ferry service. It is confusing that respondent PANTRANCO claims that it is a private carrier in relation to its ferry service but it affirms its obligation as a common carrier to observe extraordinary diligence and vigilance in the transportation of its passengers and goods. By considering that the authority granted to PANTRANCO is to operate a private ferry, it can still assert that it cannot be held to account as a common carrier towards its passengers and cargo. Such an anomalous situation that will jeopardize the safety and interests of its passengers and the cargo owners cannot be allowed.

National Steel Corporation v. Court of Appeals G.R. Nos. 112287/112350 Facts: Herein petitioner of G.R. No. 112350, Vlasons Shipping entered into a contract of afreightment on contract of vogage4 charter line with the petitioner of the other consolidated case, National Steel Corporation (NSC), whereby the latter hired Vlason’s vessel, the M/V Vlasons I to make a voyage to load steel products from Ilagan City to Manila. Under the agreement, the loading and unloading of the cargoes are the responsibility of the charter and the owner shall no be liable of the loss or damage of the cargo arising from the unseaworthiness unless counsel by want of diligence on the part of the owners to make the vessel seaworthy and to secure that it is properly manned, equipped and supplied. Upon arrival on August 12, 1974, it was found that nearly all the tin plates and hot rolled sheets were wet and rusty. The cargo was unloaded by the charterer Hence the petitioner filed for a claim of damages amounting to P941,145.58, alleging the negligence of the master and crew of the ship. Issue: Whether or not Vlasons Shipping is made liable notwithstanding the Charter Party stipulations. Held: The courts rule the negative. At bottom, this appeal really hinges on a factual issue as to then, how, and who

caused the damages to the cargo. Ranged against NSC are two formidable truhs. First, it was found that such damage was brought about during the unloading process when the rain seeped into the cargo due to the negligence of the stevedores employed by it. Second and more importantly, the agreement between the parties “The Contact of Voyage Charter Party for Hire” placed the burden of proof of such loss or damage upon the shipper, not upon the ship owner. Such stipulation, while disadvantageous to the NSC, is valid because the parties entered into a contract of private charter, not one of common carriage. Basic too is the doctrine that courts cannot relieve a party from the effects of a private contract fully entered into, on the ground that it is allegedly one-sided or unfair to the plaintiff. It has been held that the true test of a common carrier of passengers/goods is the carriage of the same, provided it has space, for all who opt to avail for its transportation service for a fee.