Reviewer: Torts involving Common Carriers

Subsection 1 General Provisions

WHAT IS THE BASIS OF PROVISIONS ON COMMON CARRIERS?

Articles 1732 – 1763 are based on Anglo-American law on Common Carriers. These provisions require a diligence higher than the ordinary diligence universally referred to as a diligence of a good father of a family or a man of ordinary prudence or caution.

WHAT ARE THE ELEMENTS OF A CONTRACT OF CARRIAGE?

The elements are as follows:

1. Consent of the parties; a passage ticket is evidence of consent;
2. Object of the contract is the transportation of the subjects (goods or passengers) from the place of departure to the place of destination stated in the ticket; and
3. Consideration is the fare paid.

IS CONTRACT OF CARRIAGE ATTENDED WITH PUBLIC DUTY?

YES. A contract of carriage to transports passengers generates a relation attended with public duty. Consequently, the neglect or malfeasance of the carrier’s employees gives ground for an action for damages.

ARTICLE 1732

WHAT IS THE DEFINITION OF COMMON CARRIERS?

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.

NOTE: Article 1732 makes no distinctions between one whose principal business activity is the carrying of persons or goods or both or one who does such carrying only as an ancillary activity (sideline). Neither it distinguishes between a carrier offering its service to the general public and one who offers services or solicits business from a narrow segment of the general population.

IS A CERTIFICATE OF PUBLIC CONVENIENCE A REQUISITE TO MAKE A COMMON CARRIER LIABLE FOR DAMAGES?

NO. A certificate of public convenience is not a requisite to make a common carrier liable as such for damages under Civil Code.

To exempt it would be offensive to public policy. The business of a common carrier impinges directly and intimately upon the safety and well-being and property of those members of general community who happen to deal with such carrier.

DISTINCTIONS OF COMMON CARRIER AND PRIVATE CARRIER
COMMON CARRIER	PRIVATE CARRIER
The carriage of passengers or goods provided it has space, for all who opt to avail themselves of transportation service for a fee.	A carrier which does not qualify as a common carrier. It is undertaken by special agreement and the carrier does not hold himself out to carry goods to the general public. E.g. Charter Party

 

WHAT IS THE TEST TO DETERMINE WHETHER OR NOT A PARY IS A COMMON CARRIER OF GOODS?

The following circumstances must be present to consider a party a common carrier of goods-

1. He must be engaged in the business of carrying goods for others as a public employment, and must hold himself out as ready to engage in the transportation of goods for persons 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 concluded and over his established roads; and
4. The transportation must be for hire.

NOTE:

1. It is a common carrier if the public may enjoy the vehicle by right and not by permission.

2. The operator is not a common carrier if the owner of the car operates it under the special contract carrying passengers and has not held himself out to carry all passengers and freight.

WHAT IS THE MEANING OF PUBLIC USE?

In the case of U.S vs. TAN Piaco (40 Phil 853; 40 Phil. 856), the SC held that Public use means the same as “use by the public”.

The essential feature of public use is that it is open to indefinite public and not confined to the privileged individuals.

In determining whether the use is public, we must look in:

1. The character of business to be done; and
2. To the proposed mode of doing it.

Thus, it is not a public use if the use is merely optional with the owners or the public benefit is merely incidental.

In general, there must be a right which the law compels the owner to give to the general public.

Public use is not synonymous with public interest. The true criterion by which to judge of the character of the use is whether the public may enjoy it by right or only by permission.

 

WHAT IS THE ULTIMATE TEST?

In general, a common carrier is one who holds himself out to the public as engaged in the business of transportation for the person or property from place to place, for hire or compensation, offering his services to all persons who may choose to employ or remunerate him.

The true test is whether it is his legal duty to carry for all alike, if not, it is a private carrier.

WHAT LAW SHALL GOVERN IN CONTRACT OF PRIVATE CARRIERS?

THE LAW ON OBLIGATIONS AND CONTRACTS (IV) SHALL GOVERN. In case the contract entered into is one for private carriage, the parties will be governed by the law on obligations and contacts and not by the rules on common carriers.

IS AN OIL PIPIELINE OPERATION A COMMON CARRIER?

YES. Under Article 86 of R.A 287 The Petroleum Act, a pipeline operation is a common carrier. The definition of common carrier makes no distinction as to means of transporting the object as long as it is by land, water or air. It does not provide that the transportation of passengers or goods should be by motor vehicle.

IS A TOWAGE CONTRACT A CONTRACT OF CARRIAGE OF GOODS?

NO. A contract of towage is not a contract of carriage of goods. Hence, the liability of a common carrier does not attach to a towage contract.

If the contract entered into by the entity is merely to provide vehicles but not actually carry or transport goods or persons, it is obvious not a carrier at all whether common or private.

IS A STIPULATION OF EXEMPTING THE CARRIER FROM LIABILITY VALID?

IT DEPENDS. IF IT’S A PRIVATE CARRIER, VALID AND IF IT’S A COMMON CARRIER, NOT VALID.

Thus, the stipulation in a charter party of a vessel exempting the carrier from liability for loss due to the negligence of its agent is valid when the carrier is private. Where the public at large is not involved, as in the case of a ship totally chartered for the use of a single party, the provisions on common carrier are not applicable.

IS A CUSTOMS BROKER A COMMON CARRIER?

IT MAY BE REGARDED AS A COMMON CARRIER.

It suffices that it undertakes to deliver the goods for pecuniary consideration though its principal function is to prepare the correct customs declaration and proper shipping documents. Thus, as a common carrier is mandated to observe extraordinary diligence in the vigilance over the goods it transports according to all the circumstances of each case.

 

ARTICLE. 1733

 WHAT IS THE CONCEPT OF EXTRAORDINARY DILIGENCE?

That extreme measure of care and caution which persons of unusual prudence and circumspection use for securing and preserving their own property or rights.

The phrase extraordinary diligence means that the carrier must safeguard the passengers as far as human care and foresight can provide and must, in the discharge of such obligation, use the UTMOST DILIGENCE of very cautious persons, with due regard for all the circumstances.

It is required because of the nature of business and by reason of public policy for the full safety of the riding public and for the protection of the goods being transported from the boarding time to arrival at the place of destination.

However, a common carrier is not an absolute insurer against the risk of travel from which the passenger may exercise due care and diligence.

Article 1734 provides for the exception when a common carrier is not liable for the loss, destruction, or deterioration of goods. With regards to the safety of the passengers, the common carrier is liable for the injuries or death suffered by them unless the cause is fortuitous event or if they can prove that they exercise the extraordinary diligence required by the law.

IS A COMMON CARRIER A CONTRACT OF ADHESION?

YES. In transportation business, contracts are ready made contracts prepared by the carrier as such as plane tickets and are not prohibited. If one does not agree to the conditions imposed, he is free to reject and find another carrier.

If the passenger adhered to the contract, he is bound thereby, because the contract is the law between the parties, unless the conditions imposed are contrary to law, public order, public policy, good customs, and morals.

In case of ambiguity in the provisions of the contract, the same shall be interpreted in favor of the passenger.

 

SUBSECTION 2. - Vigilance Over Goods

 

Article 1734

 

GR. Common carriers are responsible for the:

1. Loss;
2. Destruction; or
3. Deterioration

of the goods which they agreed to transport to certain destinations.

ETR. The common carrier is exempted from the liability if any of the 5 enumerated occurrences had caused the loss, destruction, or deterioration of the goods.

NOTE: The owner of the goods must not have contributed to the loss, destruction, or deterioration, otherwise, the liability of the common carrier shall be equitably reduced. (Article 1741)

(1) Flood, storm, earthquake, lightning, or other natural disaster or calamity;

With respect to the fortuitous event or force majeure, the natural disaster must have been the proximate cause of the loss, destruction, or deterioration in order that the common carrier be exempted from liability. Still, the carrier is required to exercise due diligence to prevent or minimize the damage. Otherwise, despite the natural disaster, the carrier shall be liable for damages.

(2) Act of the public enemy in war, whether international or civil;

The same duty is imposed on the common carrier in case of an act of a public enemy in a state of war.

WHAT IS THE CONCEPT OF STATE OF PUBLIC ENEMY?

It generally presupposes a state of war between a foreign country and the country to which the common carrier belongs or when a vessel or airplane is involved, the country where it is registered.

The war is international if a foreign country is involved. It is civil when it involves a civil war within the country. A coup d’ etat may be considered as a civil war.

GR. Common carriers are liable when the loss is due to robbery or thievery because robbers and thieves are not considered public enemies.

ETR. However, if they are armed and they used irresistible force, the common carrier is not liable.

(3) Act of omission of the shipper or owner of the goods;

WHAT IS THE EFECT OF THE ACT OR OMISSION OF THE SHIPPER OR OWNER?

The common carrier is exempt from liability. If the loss, destruction or deterioration is due to the act or omission of the shipper or owner of the goods.

(4) The character of the goods or defects in the packing or in the containers;

GR. The common carrier is likewise exempted from the liability when the loss, destruction, or deterioration arises from the natural decay of the perishable goods of which the carrier has nothing to do or from defective packing of goods resulting in their loss or destruction

ETR. However, when the carrier was aware of the defective packing of the, but still accepted them, it is not relieved of responsibility in case of loss, destruction or deterioration.

(5) Order or act of competent public authority.

The common carrier is free from responsibility if the goods it accepted for transportation were taken from it by virtue of a court order such as a writ of attachment or execution.

Another instance is when the goods are shown to be contaminated with contagious disease which justifies their confiscation and seizure or destruction in the exercise of the police power of the State.

It is noteworthy to stress that the police power is over and above all the contractual relations.

Article 1735

WHAT IS THE PRESUMPTIONIN CASE OF LOSS, DESTRUCTION, OR DETERIORATION?

When the goods accepted by the common carrier for the transportation are lost, destroyed, or deteriorate, there is a presumption of fault or negligence on the part of the common carrier.

The presumption is rebuttable. Thus, if the, common carriers have proved that they observed the extraordinary diligence required by the law, they are exempted from responsibility. If not, they are liable.

WHAT IS THE EFFECT OF THE PRESENCE OF ANY OF THE 5 CAUSES MENTIONED IN ARTICLE 1734?

THERE IS NO PRESUMPTION OF FAULT OR NEGLIGENCE ON THE PART OF THE COMMON CARRIER.

GR. Any excepted causes will exculpate the common carrier form the liability.

ETR. When the injury could have been avoided by the exercise of reasonable skill and attention on the part of the persons employed in the conveyance of the goods.

BURDERN OF PROOF: BOP is shifted upon the shipper to show the fault or negligence of the common carrier.

 

Article 1736

The period of responsibility of the common carrier lasts from the time the goods are unconditionally put in the possession of and received by the said carrier until the same are delivered to the consignee or person who has the right to receive them.

NOTE:

1. The delivery of the cargo to the customs authorities is not delivery to the consignee as they cannot exercise dominion over them.

2. Parties may agree to limit the liability of the carrier.

3. Delivery is without prejudice to the duty imposed by Article 1739.

4. The delivery may either:

a.      Actual; or

b.      Constructive.

The common carrier is required to exercise proper diligence to prevent or minimize loss, destruction or deterioration before, during, or after, the occurrence of the natural calamity. Failure to do so, will still make the CC liable for the same

WHAT IS THE RESPONSIBILITY OF THE CARRIER IN CASE OF MISDELIVERY?

THE COMMON CARRIER IS LIABLE FOR THE DAMAGE CAUSES. If there is delivery to a wrong person. The responsibility is not excused even if the shipper has already attempted to recover the value of the said goods from such person.

WHAT IS THE PRESCRIPTION OF ACTION FOR DAMAGES IN CASES OF MISDELIVERY AND LOSS OF THE CARGO?

The action for damages grounded on misdelivery must be filed within –

a. 10 years from the accrual of the action if the same is premised on a written contract;

b. 4 years if the action is based on quasi-delict.

c. 1 year only from the time of loss if the action is grounded on loss of goods.

Article 1737

WHAT IS THE EFFECT OF TEMPORARY UNLOADING OF GOODS OR STORAGE IN TRANSITU?

GR. THE COMMON CARRIER REMAIN LIABLE. The vigilance required over the goods during this period of temporary unloading or storing must still be characterized by extraordinary diligence.

ETR. If the shipper or owner of the goods had exercised his right of stoppage in transit, the common carrier ceases to be a common carrier because the contract of carriage is automatically terminated.

NOTE: The responsibility of the common carrier is converted into that of an ordinary depositary.

A depositary, the carrier is now bound to observe applicable obligations of the depositary under Articles 1972 – 1991

WHAT ARE THE WAYS OF EXERCISING THE RIGHT OF STOPPAGE IN TRANSITU? WHAT ARE THE DUTY OF THE CARRIER IN THE EXERCISE OF SUCH RIGHT?

The unpaid seller may exercise this right either by:

1. obtaining an actual of the goods; or
2. giving notice of his claim to the carrier or other bailee in whose possession the goods are.

The duty of the carrier is to deliver the goods to the seller or according to his directions when the notice of stoppage in transitu is given to the carrier or to other bailee

However, when a negotiable document of title representing the goods has been issued by the carrier or other bailee, the latter shall not be obliged to deliver or justified in delivering the goods to the seller. Except when such document is first surrendered for cancellation

Article 1738

WHAT IS THE EFFECT OF STORING THE GOODS IN THE CARRIER’S WAREHOUSE?

THE CARRIERS REMAIN RESPONSIBLE FOR THE GOODS UNDER THE SAME KIND OF VIGILANCE REQUIRED BY LAW. Some common carriers or consignees have their own warehouses at the place of destination. If the goods upon arrival were stored or deposited in their warehouses at the place of destination. The responsibility shall continue until the consignee has been advised of the arrival of the goods and their readiness to be picked up and has had the opportunity to remove or disposed of them.

NOTE: The advice is not enough. The consignee must have been afforded the full opportunity to take them or dispose of them.

So if the period given for the removal or disposition of the goods is too brief, and in the interregnum the goods were lost, destroyed or deteriorated, the common carriers remain responsible therefor.

Article 1739

WHEN ARTICLE 1739 APPLICABLE?

It applies only when the proximate and only cause of the loss, destruction or destruction is a natural disaster or calamity such as flood, storm, earthquake, or lightning.

WHAT IS THE DUTY OF CARRIER WHEN THE NATURAL DISASTER HAS CAUSED THE LOSS, DESTRUCTION OR DESTERIORATION?

THE LAW IMPOSES THE DUTY UPON THE CARRIER TO EXERCISE PROPER AND DUE DILIGENCE IN ORDER TO PREVENT OR MINIMIZE THE LOSS, DESTRUCTION, OR DETERIORATION, OF GOODS BEFORE, DURING AND AFTER THE OCCURRENCE OF THE NATURAL DISASTER. Even if the proximate and only cause of the loss, destruction or deterioration of the goods is a natural disaster. Failure to do so, exposes the common carrier to liability.

NOTE: This duty is expressly imposed upon the carrier equally applies in case of an act of a public enemy under Article 1734 (2) resulting the loss, destruction or deterioration of the goods (Article 1739, last paragraph).

IS PROIMATE CAUSE NEED TO BE THE IMMEDIATE CAUSE?

NO. In order to excuse the carrier for a loss upon the ground that it was caused by a natural calamity or disaster, such cause must have been the proximate cause of the loss.

However, it need not be the immediate cause. It is sufficient if the immediate cause of the final act was set in motion by the natural calamity or disaster and followed it in natural and continuous sequence, unbroken by any efficient intervening cause.

 

Article 1740

WHAT IS THE EFFECT OF DELAY IN TRANSPORTING OF GOODS?

IF THERE WAS A DELAY IN THE TRANSPORTATION OF GOODS THE COOMON CARRIER WIL NOT BE EXEMPT FROM REPONSIBILITY. Even if the proximate cause of the loss, destruction or deterioration of the goods is the occurrence of a natural disaster.

Article 1740 is a restatement of the principle under Article 1165 and 1170 of the Civil Code.

Article 1741

WHAT IS THE NEFFECT OF CONTRIBUTORY ACT OF THE SHIPPER OR OWNER TO THE DAMAGE?

THE COMMON CARRIER REMAINS LIABLE BUT SUBJECT TO AN EQUITABLE REDUCTION OF THE IMPOSABLE DAMAGES. If the proximate cause of the loss, destruction or deterioration is the negligence of the common carrier, and the shipper or owner has incurred meres contributory or slight negligence.

The amount of damages will be determined by the court in the exercise of sound discretion.

NOTE: This is akin to Article 2179 and 2214 (quasi-delicts) where the damages may be mitigated when there is contributory negligence on the part of the plaintiff.

Article 1741 applies to goods.

GR. When passengers are involved, responsibility cannot be dispensed with or lessened even by stipulation of the parties (Article 1757).

ETR. However, if the passenger’s negligence contributed to his own injuries, but the proximate cause is still the negligence of the common carrier, the amount of damage shall be equitably reduced (Article 1762)

Article 1742

GR. The character of the goods or defects in the packing or in their containers is one cause which exempts a common carrier form responsibility. (Article 1734).

ETR. However, if the common carrier or its employees are aware of the faulty or defective packing or the containers, the carrier must exercise due diligence to prevent or lessen the damage. Otherwise, it cannot escape responsibility from the damage.

Article 1743

WHAT IS THE REQUIREMENT TO AVAIL THE SEIZURE OR DESTRUCTION BY ORDER OF PUBLIC AUTHORITY AS DEFENSE BY THE COMMON CARRIER?

THE COMMON CARRIER MUST SHOW THAT THE SEIZING PUBLIC AUTHORITY MUST HAVE THE OFFICIAL POWER TO DO SO to avail itself the defense of seizure or destruction by the order of a public authority.

If the seizing entity is an unauthorized or is an impostor, the carrier is not free from responsibility, more so, if the carrier has acted in connivance with the said entity.

NOTE: Article 1743 is related to Article 1734 (5). It is one of the causes which exempts the common carrier from the responsibility as long as the public authority is competent that it had the power to issue the order of seizure or destruction.

 

Article 1744

WHAT IS THE LIMITATION OD THE COMMON CARRIER’S LIABILITY?

GR. The vigilance of the common carrier over the goods requires not ordinary but extraordinary diligence.

ETR. However, this may be limited in the sense that the degree of diligence may be lesser than extraordinary diligence if the following requites are presents:

1. There is a written agreement on the limitation of the liability signed by the parties;
2. It is supported by a valuable consideration other than the very service rendered by the common carrier; and
3. The agreement is reasonable, just and not contrary to the public policy.

NOTE:

1. If the agreement is oral, it is void.

2. Even if there is a written agreement to lessen the responsibility of the common carrier below the required extraordinary diligence, it cannot go down below ordinary diligence. Otherwise, the agreement is void.

3. The reduction of fare does not justify any limitation of the carrier’s liability (Article 1758).

WHAT IS THE CONSEQUENCE OF STIPULATED LIMITATION? 

THERE IS STILL LIABILITY. IT DOES NOT MEAN EXEMPTION.

It there is a stipulated limit on the responsibility of the common carrier, it does not mean exemption of the common carrier from the responsibility for its negligence.

In limitation, there is still negligence, while in exemption, there is none.

Article 1745

The article enumerates 7 kinds of stipulations or agreements which are void because they are unreasonable, unjust and contrary to public policy.

Paragraphs 1, 2, 3, 4 and 7 violate Article 1733 while paragraph 5 is void because it violates Articles 1759 and 1763.

NOTE: The list is not exclusive or limitative. Similar or analogous stipulations will also be void.

WHAT IS THE LIABILITY FOR THIEVES AND ROBBERS?

GR. The occurrence of the loss must be reasonably be regarded as fortuitous event. When the robbery or thievery was perpetrated with grave or irresistible violence or force such as when done with the use of firearms.

Even common carriers are not absolute insurers against all risks of travel and transport of goods and are not liable for acts or events which cannot be foreseen or are inevitable, provided that they shall have complied with rigorous standard of extraordinary diligence.

ETR. However, when the robbery or thievery was not done with irresistible force or violence, the common carrier is liable for the loss.

This liability cannot be dispensed with by stipulation, otherwise, common carriers will be lax in the observance of their duty to assure the safety of the goods and of the passengers under carriage.

NOTE: This Article as well as Articles 1998, 2000, 2001, 2002 and 2003 are made applicable to the baggage of the passenger.

WHAT IS THE EFFECT OF THE DEFECTIVE CONDITION OF THE MEANS OF THE TRANSPORTATION?

SETTLED IS THE RULE THAT THE MECHANICAL DEFECTS IN THE VEHICLES OF COMMON CARRIERS DO NOT CONSTITUTE FORTUITOUS EVENT AND DO NOT EXEMPT THEM FROM LIABILITY.

The requirement of extraordinary diligence in the vigilance over the goods and safety of the passengers will be undermined if the common carrier can escape liability through stipulation, when the loss is due to the defective condition of its car, vehicle, ship or airplane or other means of transportation used.

Article 1746

WHEN ARTICLE 1746 APPLICABLE?

IT APPLIES ONLY IF THERE IS AN AGREEMENT SIGNED BY THE SHIPPER OR OWNER OF THE GOODS LIMITING THE LIABILITY OF THE COMMON CARRIER IN CASE OF LOSS, DESTRUCTION, OR DETERIORATION OF THE GOODS.

It cannot apply to carriage of passengers because the same is not subject to stipulation. It is the law which will govern when there is death or injury to passenger and not the stipulations of the parties.

WHEN IS THE AGREEMENT VOIDABLE?

IF THE SHIPPER OR OWNER WAS CONSTRAINED TO SIGN THE AGREEMENT BECAUSE, UNLESS HE SIGNED IT, THE COMMON CARRIER WOULD NOT ACCEPT THE GOODS FOR TRANSPORTATION.

Thus, the consent given is tantamount to vitiated consent anchored on threats or undue pressure.

Consequently, the agreement is deemed voidable under Article 1390 (2). The shipper or owner has the prerogative to annul the agreement, unless he has agreed to it and this considered ratification that cleanses the agreement of its defects (Article 1392 and 1396).

NOTE:

The article does not authorize a unilateral act of annulment. There is a need for judicial action for annulment. (Article 1390, last paragraph). The proceedings should be made summary.

Article 1747

WHAT IS THE EFFECT OF DELAY OR CHANGE OF ROUTE WITHOUT JUST CAUSE?

GR. If there is an agreement limiting the liability of the common carrier authorized under Article 1744, the same cannot be availed of by the common carrier if there was - 

1. delay in the transporting of the goods; or
2.  a change in the stipulated or usual route.

ETR. Nevertheless, the common carrier can invoke the agreement on limitation of its liability in case of loss, destruction, or deterioration of goods if there is a valid reason for the delay or change of route.

Instances of valid reasons are:

1. to avoid the path of a typhoon, if a vessel is involved;
2. to avoid pirates in the high seas; or
3. to make necessary repairs.

ETE. Where two routes were available for sending the goods, one is safe and the other hazardous, and the carrier in defiance of the instructions of the owner of the goods, rejected the safe and adopted the hazardous one, resulting in the loss of the goods by robbery, the carrier was held liable, even though it was exempt under the bill of lading from loss from such cause. (United States Exp. vs. Kountze Bros)

Article 1748

WHAT IS THE EFFECT OF DELAY ON ACCOUNT OF STRIKES OR RIOT?

GR. Delay due to the negligence of the common carrier is an actionable wrong.

ETR. If the delay is due to causes beyond the control of the common carrier, it is not liable.

ETE. Unless it has assumed the risk of delay.

Strikes and riots are beyond the control of the common carriers, unless they are the cause thereof.

Thus, an agreement to limit the liability of the common carrier by reason of strikes or riots of which it had nothing to do, is a valid agreement.

STRIKE – Any temporary stoppage of work by the concerted action of the employees. (Article 260 [1], Labor Code).

RIOT – A public disturbance of the peace of a serious nature, committed by three or more persons, assembled to carry out a common purpose.

Article 1749

WHAT IS THE VALUE APPERAING ON THE BILL OF LADING?

In a bill of lading, the value of goods to be carried or transported is usually indicated.

GR. If the goods are lost due to the negligence of the common carrier, as a rule, only the value which appears on the bill will be paid.

ETR. Unless a higher valuation has been declared. This may be reflected in a formal agreement of the parties for the purposes of putting a ceiling on the liability of the common carrier. Such agreement is valid and binding.

Accordingly, if the shipper or owner of the goods desires greater protection whenever his goods carry value more than what appears on the bill of lading, he must make a declaration to that effect so that the carrier may be advised from the outset to give it the opportunity to prepare itself by extending higher safety measures, and for which, as a rule, the shipper or owner of the goods may be charged additional fare or fees for the freightage.

Article 1750

MAY THE AMOUNT RECOVERABLE BY THE SHIPPER OR OWNER OF THE GOODS BE FIXED?

YES. The carrier and the shipper or the owner of the goods may agree on the specific amount which the latter may recover from the former in case of loss, destruction or deterioration, of the goods under carriage.

However, the following are required for the validity of the said contract:

1. The contract is reasonable and just under circumstances; and
2. It has been fairly and freely agreed upon

Note: Fine prints in airplane tickets do not warrant the presumption that the passenger was aware of the conditions therein.

 

Article 1751

WHAT IS THE EFFECT OF THE ABSENCE/PRESENCE OF COMPETITOR?

THE ABSENCE OR PRESENCE OF COMPETITOR/S ALOND THE APPROVED LINE OR ROUTE, OR PART THEREOF, MAY AFFECT THE REASONABLENESS, FAIRNESS, OR CONSONANCE WITH THE PUBLIC POLICY OF A CONTRACT LIMITING THE LIABILITY OF A COMMON CARRIER WITH RESPECT TO THE POSSIBLE LOSS, DESTRUCTION OR DETRIORATION OF THE GOODS ON CARIAGE.

Thus, if there is no competitor, the carrier may tend to impose terms and conditions which are disadvantageous to the shipper or owner of the goods and there is no alternative or choice from. In which case, undue influence, may induce the shipper or owner of the goods to sign the agreement against his free will.

NOTE: The court may consider this absence of competitor as a factor in the determination of whether or not the stipulation of the parties is just and fair.

Article 1752

IS THE PRESUMPTION OF NEGLIGENCE IN CASE OF LOSS, DESTRUCTION OR DETERIORATION AFFECTED BY THE AGREEMENT ON LIMITATION?

NO. An agreement limiting the liability of the common carrier in case of loss, destructions or deterioration of the goods carried, DOES NOT IN ANY WAY ABOLISH the presumption of negligence on the part of the common carrier (Article 1735).

NOTE: It merely limits the damages recoverable but does NOT exempt the carrier from the responsibility for its damaging negligence.

 

Article 1753

WHEN IS ARTICLE 1753 APPLICABLE?

IT APPLIES ONLY WHEN THE PLACE OF DEPARTURE IS A COUNTRY DIFFERENT FROM THE DESTINATION. Thus, conflicts rule fins=ds operation, in case of loss, destruction or deterioration of the goods on carriage.

NOTE: It applies as long as the goods were accepted for transport to another country. It does not matter whether they reached their destination.

GR. The foreign law which is sought to govern the liability of the carrier should be proved, since the courts in our country cannot take judicial notice of said law.

ETR. However, if the foreign law sought to be applied is American Law, the court  can take notice of the fact that our law is based on American authorities and it is not necessary to inquire into the provision of the foreign law to decide the case.

 

Article 1754

WHAT ARE THE RULES ON PASSENGER’S BAGGAGE?

Baggage in personal custody of the passenger.

If the baggage is in the personal custody of the passenger and that of his employee/s, the common carrier will have the same responsibility as the hotel keeper. 

Articles 1998, 2000, 2001, 2002, and 2003 which deals on “deposits’ are thus made applicable to common carriers when the pieces of baggage are involved.

Baggage not in personal custody of the passenger or his employee/s.

If the baggage is not in the custody of the passenger or of his employee/s, (like when it is placed in the baggage compartment) but on the carriage, the rule on common carrier’s duty of vigilance over goods applies, meaning, the observation of extraordinary vigilance, as contemplated in Articles 1733 to 1753.

WHAT IS THE EFFECT OF NON-PAYMENT OF BAGGAGE FARE?

If the passenger failed to pay the fare of his baggage or if the bill of lading was not issued therefore, THIS FAILURE DOES NOT EEMPT THE COMMON CARRIER FROM ITS RESPONSIBILITY OF ASSURING THE SAFETY OF THE GOODS

Bill of Lading – Bills of lasing comprehend all forms of transportation, whether by sea or land, and includes bus receipts for cargo transported.

NOTE:

1. Freight tickets issued by the bus companies are considered bill of lading or receipts under the Documentary Stamp Tax Laws.
2. Bills of lading need not be signed personally by the shipper to make him liable for the freightage.

 

SUBSECTION 3. - Safety of Passengers

 

Article 1755

The degree of care required of a common carrier is not capable of precise formulation, applicable to all situations that may arise.

However, in general carriers of passengers are required to exercise the highest degree of care, vigilance, and precaution for the safety of those it undertakes to transport, and are liable for the slightest negligence.

REASON: The highest degree of care is imperatively demanded by the preciousness of human life, and by the consideration that every person must in every way be safeguarded against all the injury.

NOTE: A carrier is not an absolute insure of the safety of its passenger against the risks of travel from which the passenger may protect himself exercising ordinary care and diligence.

WHAT IS THE MEANING OF THE PHRASE “WITH DUE REGARD FOR ALL THE CIRCUMSTANCES?”

The circumstances refer to the nature of the obligation, circumstances of the persons, of the time and of the place.

These are factors to be considered in determining the fault or negligence (Article 1173) Other circumstances may be considered.

WHAT IS THE NATURE OF THE LIABILITY OF THE CARRIER?

DIRECT AND IMMEDIATE. When there is breach of the carrier’s contractual obligations to carry his passengers safely to their destination (culpa contractual), the liability of the carrier is not merely subsidiary or secondary, but direct and immediate.

WHO ARE CONSIDERED AS PASSENGER?

Passenger is a person who rides on a vehicle of a common carrier with the consent of the later for the purposes of reaching a particular destination and generally for a fixed fare.

NOTE: Not all who have taken ride on a common carrier are passengers.

WHAT IS THE NATURE OF THE CONTRACT OF CARRIAGE OF PASSENGERS?

CONSENSUAL CONTRACT. The contract is perfected as soon as there has been meeting of the minds even if the passenger has not yet boarded the vehicle such as by a purchase of tickets and the simultaneous insurance thereof by the carrier. Thus, ticket may be used at some immediate or future definite time.

WHAT IS THE RECKONING POINT OF THE LIABILITY OF THE COMMON CARRIER?

The reckoning point for the attachment of the liability of the common carrier is the time when the passenger has actually boarded the means of transportation. It is only then that the party becomes a passenger. (This is equivalent of “delivery” in real contract)

WHO ARE SPECIFIC PASENGERS?

There are some people already inside the means of transportation like a vessel or train who do not pay transportation, yet considered as passengers –

1. Concessionaires doing business in vessel or train. E.g. concessions for entertainment, food, newsstands, medicine, etc.
2. Newsboys permitted to sell magazines, etc. in the vessel.

WHO ARE STOWAWAY PERSONS?

The following are not considered passengers –

1. A rider who enters a vessel or train, or bus surreptitiously without any intention of paying the required fare.
2. A rider who when required to pay the transportation fare refused to make any payment.
3. A rider who refuses to alight for an unreasonable length of time after having been accorded several opportunities to safely alight from the train, vessel or vehicle.

NOTE: The diligence required in the cases of stowaway is merely the diligence of a good father of a family.

Article 1756

WHEN IS THERE AN AUTOMATIC PRESUMPTION OF FAULT OR NEGLIGENCE IN THE CONTRACT OF CARRIAGE?

THE COMMON CARRIER IS AUTOMATICALLY PRESUMED TO HAVE BEENAT FAULT OR TO HAVE ACTED NEGLIGENTLY WHEN THERE IS DEATH OR INJURIES CAUSED TO PASSENGERS.

There is no need to have an express finding of fault or negligence to hold the common carrier liable for damages, unless the presumption is rebuttable.

The injured passengers, or in case of death, their heirs need only to prove the:

1. Existence of the contract of carriage; and
2. Its non-performance.

• It is not incumbent upon them to establish the fault or negligence of the common carrier. It is already presumed.
• This is an exception to the GR that negligence or fault must be proven.

HOW TO OVERCOME THE PRESUMPTION?

Thus, the burden of proof is shifted to the common carrier to prove its strong and convincing defenses, if any, in order to overcome the presumption.

To avoid liability, the common carrier must succeed in proving that:

1. It has observed extraordinary diligence in the performance of its contractual obligation or
2. That the death or injuries suffered by the passenger/s is due to a fortuitous event.

WHAT ARE THE REMEDIES OF A PASENGER WHO WAS INJURED BY THE NEGLIGENCE OF THE DRIVER OF A COMMON CARRIER?

The passenger who suffered injuries due to the negligence of the driver of the common carrier may pursue any of the following remedies in court –

1. He can file a criminal case against the driver under Article 365 of the RPC (Reckless imprudence resulting in physical injuries). The civil aspect may be prosecuted in the same criminal case. If the driver is found guilty and is condemned to pay indemnity and damages, the carrier’s liability is subsidiary.
2. He can file the criminal case but prosecute the civil aspect separately as an independent civil action under Article 33 of the New Civil Code which will proceed independently of the criminal action and regardless of the outcome of the latter. But there shall be no double recovery of damages.
3. He can institute a civil case based on the violation of the contract of carriage (culpa contractual) against the common carrier. If the common carrier is adjudged to pay and the plaintiff, it or he can seek reimbursement from the errant driver.

NOTE:

GR. In common carrier, the injured passenger cannot seek moral damages because this situation is not included in Article 2219 of the Civil Code.

ETR. However, if there is death, moral damages may be awarded. (Article 2206 in relation to Article 1764).

Moral damages may also be granted, if the breach of the contract is fraudulent or attended with bad faith.

WHAT ARE THE REMEDIES OF A PEDESTRIAN INJURED DUE TO THE NEGLIGENCE OF A DRIVER OF A COMMON CARRIER?

1. He can file a criminal case against the driver. (Same as with the remedy of an ordinary passenger)
2. He can file an action for damages based on quasi delict against the driver (Article 2176) and against the employer (Article 2180 par. 4).
3. In case of death of the pedestrian, the heirs may file civil action based on Article 2206.

IS ARTICLE 1174 OF THE CIVIL CODE APPLICABLE TO COMMON CARRIERS?

YES. Insofar as the last portion of the article is concerned, “no person shall be responsible for those events which could not be foreseen, or which though foreseen, were inevitable.”

Thus, a carrier is not liable for injuries suffered by a passenger caused by another vehicle without negligence on the part of the former.

WHO SHALL BE MADE LIABLE IN CASE OF TRANSFER OF OWNERSHIP OF THE COMMON CARRIER?

IT DEPENDS. If the transfer of ownership is not registered, it is the registered owner and not the transferee who is liable for the resulting breach of contract of the common carriage.

Thus, the transferee, is liable to the registered owner. So a third party claim may be filed by the registered owner against the transferee.

WHAT IS THE CONCEPT AND THE VALIDITY OF THE “KABIT” SYSTEM?

It is an agreement whereby a person who has been granted a certificate of public convenience allows other persons who own motor vehicles to operate them under his license, sometimes for a fee or percentage of the earnings.

The kabit system is invariably recognized as being contrary to public policy and therefore void and inexistent under Article 1409 of the Civil Code although the parties to such agreement are not out rightly penalized by the law.

The thrust of the law in enjoining the kabit system is to identify the person upon whom the responsibility may be fixed in case of an accident with the end in view of protecting the riding public.

IS THE PRINCLE OF LAST CLEAR CHANCE APPLIES IN COMMON CARRIER?

GR. NO.  The principle of last clear chance does not apply where a passenger demands responsibility from the carrier to enforce its contractual obligation.

ETR. It applies to a suit between the owners and drivers of two colliding vehicles.

 

Article 1757

-        Under Arts. 1733 and 1755, the diligence required of common carriers for the safety of passengers is EXTRAORDINARY diligence or UTMOST diligence for very cautious persons, with due regard to all attendant circumstances.

-        The norm of diligence CANNOT be compromised or be subject of stipulation for its elimination or mitigation.

-        Notices, printed statements on tickets whether on fine prints or not, or by any other means of publication, dispensing with the specified responsibility or its lessening, are not binding to the passengers. They are VOID.

-        Mitigation of liability with regard to the safety of goods is however, allowed under Art. 1744, but not with the lives and limbs of passengers.

-        In carriage of goods, there may also be mitigation with respect to the award of damages in certain cases. (See Arts. 2204, 2214, 2215, and 2227)

Article 1758

-        Free or Gratuitous Ride. If a passenger is accorder a free or gratuitous ride, the liability of the common carrier for negligence may validly be limited by the parties.

Exceptions: (a) for wilful acts, or (b) gross negligence resulting in death or injuries to the free-riding passenger.

-        Riding on Reduced Fares. The reduction of the fare, unlike a free ride, does not justify any limitation on the carrier’s liability. Examples: Students or a Senior citizens

-        Rule on Limited Guests or Accommodation Passengers.

        In the absence of any agreement on the limitation of liability of the common carrier, if invited guests or accommodation passengers are involved in the accident arising from the fault or negligence of the carrier, they are entitled to reasonable care as passengers. However, they must observe the diligence of a good father of a family to avoid injuries to themselves.

Thus, if the proximate cause of the death or injury of the accommodation passenger is his own negligence, the carrier is not liable. (Lara vs Valencia)

WHAT IS THE STATUS OF SOME NON-PAYING RIDERS?

-        The following are considered passengers EVEN IF they are non-paying riders BUT with the consent of the carrier:

1.      A public officer who is granted free passage.

2.      A stranger who rides for free but with the consent of the carrier or a person who rides on a free pass.

3.      An employee of the carrier who rides not as an employee but as an ordinary stranger to attend to his own affairs.

WHAT IS THE STATUS OF BUS INSPECTORS?

-        NOT a passenger but employees of the carrier. If something happened to them during their trips, they are entitled to different rights and privileges under the Labor Code and Special Laws.

Article 1759

-        A contract of carriage generates a relation attended with public duty; neglect or malfeasance of employees of the carriers gives ground for action for damages against the latter.

-        When there is a breach of the common carrier’s contractual obligation to bring the passengers safely to their destination, the carrier’s liability is DIRECT and IMMEDIATE and NOT MERELY SUBSIDIARY or secondary.

-        A common carrier becomes liable for death of or injury to passengers when

(a)    through the negligence or wilful acts of its employees; or

(b)   on account of wilful acts or negligence of other passengers or of strangers if the common carrier’s employees through the exercise of the diligence could have prevented or stopped the act or omission.

-        The liability of the common carrier cannot be excused by the defense of the exercise of the diligence of a good father of a family in the selection and supervision of the employees.

The only defense available to the common carrier, in case there is death or injuries occasioned by the breach of the contract of carriage are:

1.      Force Majeure

2.      Observance of Extraordinary Diligence as prescribed by Arts. 1733 and 1755 (See. Art. 1756)

-        Art 1759 is an Exception to Art 2180 pars. 4 and 5

Under the rule on vicarious or imputed liability, to make an employer liable for the acts of an employee, the latter must be in the performance of his assigned task; otherwise the employee alone shall be responsible for the damage or injuries he had caused.

This rule is the reverse of the rule in Art. 1759. This article is an exception to the rule on vicarious liability or imputed liability.

-        Difference?  In the nature of diligence required in common carrier is extraordinary diligence while in vicarious or imputed liability, it is only the diligence of a good father or a family.

(See Maranan and Gillaco Cases, Distinguished)

Article 1760

-        The stringent norm in Art. 1759 cannot be eliminated or limited by

(a)    stipulation of the parties;

(b)   posting of notices;

(c)    statement on the tickets; or

(d)   other means of communication

-        Art 1760 is a complementary provision to Art. 1757.

-        The rule on the vigilance over goods is different. Under Art 1744, there can be a valid agreement on the lessening on the degree of vigilance over the goods if the parties have so agreed in writing under the condition imposed on the said article.

Article 1761

-        While common carriers are mandated to observe extraordinary diligence in the vigilance over the goods and for the safety of the passengers transported by them, passengers are required only to observe the diligence of a good father of a family.

-        This article applies to invited guests or accommodation passengers who are extended free ride as gesture of courtesy or kindness

 

Article 1762

-        Contributory Negligence has been defined as the act or omission amounting to want of ordinary care on the part of the person injured which, concurring with the defendant’s negligence, is the proximate cause of the injury.

-        To hold a person as having contributed to his injuries, it must be shown that he performed an act that brought about his injuries in disregard of warnings or signs of an impending danger to heath and body.

WHAT ARE THE EFFECTS OF CONTRIBUTORY NEGLIGENCE?

1.      If the sole cause of the passenger’s death or injuries is his own fault, he cannot recover damages from the common carrier.

Emergency Rule Exempts Common Carrier

Where a carrier’s employee is confronted with a sudden emergency, the fact that he is obliged to act quickly and without chance for deliberation must be taken into account, and he is not held to the same degree of care that he should otherwise be required to exercise in the absence of such emergency but must exercise only such care as an ordinary prudent person would exercise under like circumstances and conditions, and the failure on his part to exercise the best judgment the case renders possible does not establish lack of care and skill on his part which renders the company liable.

2.      If the negligence of the passenger is merely contributory and the proximate cause of his death or injuries is the negligence of the common carrier, there can be recovery from the common carrier but the amount of damages shall be equitably reduced.

-        Art. 1762 refers to the contributory negligence of the passengers, while Art. 1741 refers to the contributory negligence of the shipper or owner of the goods transported.

 

Article 1763

-        While as a general rule, common carriers are bound to exercise extraordinary diligence in the safe transport of its passengers, it is not the standard by which its liability is to be determined when intervening acts of strangers directly cause the injury while the contract exists.

1.      The common carrier becomes liable when the former’s employees were aware of the on-going damaging event but did nothing to prevent it, although it is still within the power or influence to do so.

2.      When the death or injuries to passengers are caused by the wilful acts of the common carrier’s employees, the carrier is liable for damages even if said employees

(a)    acted beyond the scope of their authority or

(b)   in violation of the common carrier’s orders (Art. 1759).

 

Article 1764

-        Damages that may be awarded arising from the provisions on Common Carriers shall be governed by Title XVIII of the New Civil Code dealing on Damages – Arts. 2195 – 2235.

-        Art. 2206 which provides damages for the death of a person due to crime or quasi delict is made applicable in a case involving the death of a passenger due to a breach of a contract of a common carrier.

-        Moral damages are recoverable in a damage suit predicated upon a breach of contract of carriage ONLY WHEN;

a.      the mishap results in the death of a passenger and

b.      it is proved that the carrier was guilty of fraud and bad faith even if death does not result

-        The common carrier in breach of its contract of carriage that results in the death of a passenger is liable to pay the following:

1.      indemnity for death,

2.      indemnity for loss of earning capacity, and

3.      moral damages

 

Article 1765

-         The Public Service Commission has been abolished and replaced by the Land Transportation Commission.

 

Article 1766.

-        In all conflicts between the New Civil Code (NCC) and the Code of Commerce and existing special laws (which do not repeal the NCC), the NCC shall prevail in so far as common carriers are concerned.

-        Art 1766 must be distinguished from Art. 18. The latter is the general rule which makes the NCC merely suppletory to the Code of Commerce in matters governed by the Code of Commerce. On the other hand, Art 1766 is the reverse rule but only insofar as common carriers are concerned.

-        Special Laws. Among the existing special laws contemplated under Art 1766 are

a.      the Public Service Act,

b.      Commonwealth Act No. 146 as amended,

c.      Carriage of Goods by Sea Act.

A new special law repealing or amending Art. 1766 shall not be deemed included because the legislature has the full power and authority to pass new laws which amend or repeal existing Codes, laws or special laws

REFERENCE: Torts and Damages; Dean Ernesto L. Pineda