DILAG Transportation Law (Quick Guide)

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Jocs Dilag

Public Utilities

LUZON STEVEDORING V PSC (1953) !"#$%& "(%$%() %* +, ! #$!$%&'($# )* !+$ ! " # $ % & ( ) * % ( * + % , - .  ! " # # $ & ' ( ) ' * + , - ( ! " # $ & ' # ( # ) # * + , & &  ! " # % & ' ( ) * & ) % !"#$"!"$ &#'( )#$"! !"#$%&!$ (%)*)#$ & ! " # $ % & ' ) * " # + , - & . % ! " # $ % & " ( % $ %  ! " # % ! % & !"#$ "&'&(()*$ +,)+ !" $%&" !' &($) *+,

Definition: A public utility is a business/service engaged in regularly supplying the public with some commodity or service of public consequence such as electricity, gas, water, 1 transportation, telephone, or telegraph service . Elements of a public utility 1. There must be public interest/consequence; 2. Private property devoted to public use; 3. Offers to the public indiscriminately; and 4. For hire/compensation. Consequences of being a public utility  2  1. Ceases to be juris privati; 2. Grants to the public an interest in its use/utility; and 3. Can be regulated

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MUNN V ILLINOIS (1876) !"#$ &$# '#(&)#* "+* !"#!$"%& %# ( )*$ +,  ! " # $ " & " ' ( ) * + # $ " , -  ! " $ " % & ' & ( % ) * & ) $ " ! " " ! # $ % ' ( ) * $ + $ , $ -  ! # $ % & ' ( ) * ' * + ! , ! - +   ! " !"#! %&'( #)* +%&! &!"#$% %' "(

3rd element 

Petitioners argued that they could not come under the PSC’s regulation because they were not public utilities, as they only offered services to a limited clientele and not to the public at large, through private lease agreements and not ordinary transportation contracts. WON Luzon Stevedoring is a public utility. YES. SC ruled that they were engaged in ordinary transportation contracts, and that they were public utilities despite having a limited clientele since the circumstances showed that their business was impressed with public concern. Public does not have to be clientele

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Munn & Scott were found guilty of violating the Illinois general assembly act that regulates public warehouses by operating their ‘public warehouse’ [receiving and storing grains; rates are based on annually published rates of storage as agreed upon by different warehouse owners] without procuring license as required by the act and by charging more than the rates fixed by the law. Can the general assembly regulate the warehouse business of Munn & Scot without violating the constitutional protection on property rights? YES. Court held that the Act does not constitute a ‘deprivation of property without due process’ as the State has inherent power to regulate property clothed with public interest. In the case at hand, Munn’s business ceased to be a private property as their business most certainly "tends to a common charge, and is become a thing of public interest and use."

 NPC V CA

Elements of a public service: 1. It must be for hire/compensation; general/Limited clientle; 2. Serving a general/Limited 3. Either permanent, occassional or accidental; and 4. For general business purposes.

PUBLIC SERVICE VIS-À-VIS PUBLIC UTILITY Class notes:

3

Public Service: Defined under Section 13 (b), CA 146 Public Utility : Defined by tests in jurisprudence All public services are public utilities but not all public utilities are public services. - But in essence, they are the same.

3

"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 whatever may be its classification, freight or carrier service or any class, express service, steamboat, or steamship line, pontines, ferries, and water craft, engaged in the transportation of passengers and freight or both, shipyard, marine repairshop, [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

Public Utilities

LUZON STEVEDORING V PSC (1953) !"#$%& "(%$%() %* +, ! #$!$%&'($# )* !+$ ! " # $ % & ( ) * % ( * + % , - .  ! " # # $ & ' ( ) ' * + , - ( ! " # $ & ' # ( # ) # * + , & &  ! " # % & ' ( ) * & ) % !"#$"!"$ &#'( )#$"! !"#$%&!$ (%)*)#$ & ! " # $ % & ' ) * " # + , - & . % ! " # $ % & " ( % $ %  ! " # % ! % & !"#$ "&'&(()*$ +,)+ !" $%&" !' &($) *+,

Definition: A public utility is a business/service engaged in regularly supplying the public with some commodity or service of public consequence such as electricity, gas, water, 1 transportation, telephone, or telegraph service . Elements of a public utility 1. There must be public interest/consequence; 2. Private property devoted to public use; 3. Offers to the public indiscriminately; and 4. For hire/compensation. Consequences of being a public utility  2  1. Ceases to be juris privati; 2. Grants to the public an interest in its use/utility; and 3. Can be regulated

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MUNN V ILLINOIS (1876) !"#$ &$# '#(&)#* "+* !"#!$"%& %# ( )*$ +,  ! " # $ " & " ' ( ) * + # $ " , -  ! " $ " % & ' & ( % ) * & ) $ " ! " " ! # $ % ' ( ) * $ + $ , $ -  ! # $ % & ' ( ) * ' * + ! , ! - +   ! " !"#! %&'( #)* +%&! &!"#$% %' "(

3rd element 

Petitioners argued that they could not come under the PSC’s regulation because they were not public utilities, as they only offered services to a limited clientele and not to the public at large, through private lease agreements and not ordinary transportation contracts. WON Luzon Stevedoring is a public utility. YES. SC ruled that they were engaged in ordinary transportation contracts, and that they were public utilities despite having a limited clientele since the circumstances showed that their business was impressed with public concern. Public does not have to be clientele

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Munn & Scott were found guilty of violating the Illinois general assembly act that regulates public warehouses by operating their ‘public warehouse’ [receiving and storing grains; rates are based on annually published rates of storage as agreed upon by different warehouse owners] without procuring license as required by the act and by charging more than the rates fixed by the law. Can the general assembly regulate the warehouse business of Munn & Scot without violating the constitutional protection on property rights? YES. Court held that the Act does not constitute a ‘deprivation of property without due process’ as the State has inherent power to regulate property clothed with public interest. In the case at hand, Munn’s business ceased to be a private property as their business most certainly "tends to a common charge, and is become a thing of public interest and use."

 NPC V CA

Elements of a public service: 1. It must be for hire/compensation; general/Limited clientle; 2. Serving a general/Limited 3. Either permanent, occassional or accidental; and 4. For general business purposes.

PUBLIC SERVICE VIS-À-VIS PUBLIC UTILITY Class notes:

3

Public Service: Defined under Section 13 (b), CA 146 Public Utility : Defined by tests in jurisprudence All public services are public utilities but not all public utilities are public services. - But in essence, they are the same.

3

"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 whatever may be its classification, freight or carrier service or any class, express service, steamboat, or steamship line, pontines, ferries, and water craft, engaged in the transportation of passengers and freight or both, shipyard, marine repairshop, [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

ALBANO V REYES (1989) ! " # % & ' & ! ( ! & ) * & * ! "  !  ! # $ % & ' ( ' ) ' ( $ % ! " # $ ! % & ' # ) * " & + + , $ '  ! " $ % % & ' ( ! ) * + " +

Legal Basis: Sec. 6, Article XII, 1987 Constitution Rationale: Police Power 4

Rules on exercise of police power  : Protection against arbitrary and excessive rates. But not rates that are so low as to deprive the public utility of a reasonable return on investment. - Requires the balancing of investor and consumer interests

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After bidding, the President of the Philippine then approved the proposed MICT contract. The next day, the PPA and ICTSI perfected the MCTI contract. Now, petitioner assails the award of the contract on the argument that since the MICT is a public utility, it needs a legislative franchise (as provided under the 1987 Const.) before it can legally operate as a public utility. WON the PPA may grant the authority

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REPUBLIC V MERALCO (2002) !"# %#&'()!*+, +- %) !"# !% &" '()*+", &-  !"#$%& "(%$%(%)* %* !"#$%&% !"#$ &'( "#)*+( ! " # $ % & " ( ) * $ & ) + ) $  ! " # % & ! & ' & ( % !"#$%"&'&() "+,#$ -.! #$% &'(#!') *(+ ! " # $ % & ' ( ) * ) , - $ . % ( /   ! " # $ # " # % & ( ) % ( * ( $ #  ! !"!#$%&! ()!#!*+,

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MERALCO applied for a rate increase, which ERB provisionally granted. After COA audit, ERB reduced the rate increase granted and ordered the excess to be refunded.

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RATIONALE/BASIS LEGISLATIVE

 ADMINISTRATIVE  AGENCIES

By virtue of police power and the lawmaking powers under the constitution. By virtue of delegated powers by Congress, as it would be very impractical for Congress to handle everything.

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  YES. See doctrine.

KMU LABOR CENTER V GARCIA (1994)

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DOTC issued a Memorandum Order allowing provincial bus operators to fix transportation fares without any approval from the LTFRB. WON it was proper for the LTFRB to issue such order NO. SC ruled that there was undue delegation of legislative authority when the LTFRB gave provincial bus operators the power to fix and make transportation rates.

BATANGAS CATV V CA (2004) !"# !"#$%&'()* $*,"! '-"  !"#"$%&

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CASE NAME NEBBIA V NEW YORK

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TATAD GARCIA

V

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WHAT MADE IT NOT A PUBLIC UTILITY

Price-fixing for the milk industry.

Not private property devoted for public use. But state intervened anyway, in its exercise of police power. The Constitution limits the foreign ownership of corp operating public utilities.

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QUICK FACTS

LGU v NTC. Sangguniang Panlungsod granted a permit to operate to CATV through a resolution, with a condition that any increase of rates shall be subject to SP’s approval. CATV increased rate without seeking approval. Mayor threatened to revoke permit. WON the LGU has the right to regulate the rates of the CATV NO. Based on the laws enumerated below, the NTC exercises regulatory power over those matters which are peculiarly within the NTC’s competence to the exclusion of other bodies.

ILOILO ICE V PUB

TERESA ELECTRIC V PSC  JG SUMMIT V CA

EDSA LRT, a foreign corp, was granted by the DOTC the award to construct the LRT III project under a BLT agreement. Ice company with limited supply that only caters to specific clientele. Application for a company electric plant in Rizal. Shipyard

What happened to the PSC  5? PERIOD

HIGHLIGHTS REGULATION

 20TH CENTURY

Birth and growth of public utility regulation in the PH; creation of the Coastwise Rate Commission, Board of Rate Regulation, Board of Public Utility Commission and the Public Utility Commission National Assembly passed CA No. 146 or the Public Service Act, which created the Public Service Commission (PSC) PD No. 1, PSC was abolished and replaced by the Board of Transportation (BOT) [lasted 13 years], Board of Communications and the Board of Power and Waterworks. BOT was later abolished along with the Bureau of Land Transportation. Their powers were merged into the Land Transportation Commission (LTC). LTC was abolished and LTFRB was created. LTFRB is the existing franchising and regulatory body for overland transportation today.

COMMON WEALTH 1972

1987

IN

PUBLIC

UTILITY

EDSA LRT does not devote the property for public use. Does not offer the property to the public indiscriminately. Plant not for providing service to the general public but exclusively for its own use. Not legally obliged to render its services indiscriminately to the public

List of enterprises that are not covered by the definition of “public service” as stated under the CA 146: 1. Warehouses; 2. Vehicles drawn by animals and bancas moved by oar or sail, and tugboats and lighters; 3. Airships within the Philippines except as regards rate fixing; 4. Radio companies except as regards rate fixing; 5. Public services owner or operated by any instrumentality of the Government/GOCC except as regards rate fixing. Nature of concession agreements FREEDOM FROM DEBT COALITION V MWSS (2007) ! " # $ % & ' $ & ( * % + # , ( + - $  ! # $ % % & ' ( ) * ( + , ) !"#$ &$"&'((!$" )*+'!   " ! # $ % ' ( $ ) !  ! " # $ ! !  ! " # $ ! & ' ( ! ) & * ! " # $ " & ' ( ) * + ' , - . )  !  ! "

 ! " # $ % & ' ( ) & + ) ( , ! - . ! ! # ! ! $ % & ' % ( ) $ ! % * + ! " # $ % & ' ( * + , " ! - & ( . / !  ! " # $ ! !  ! " # $ ! & ' !"#$%&"' )**)+,' -.,  !"#$ $&'()!' *+$* !"#$ &#'# ()! *+,-./  !"#$#"#%&' )*&&  ! " # $ % & " % ( & ) * + " * + , - ! " $ % & ' ( ) * ' $ +

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GAMBOA V TEVES (2011) !"# !#%& '()*+!),- % !"!#$ &' ('))'*

Section 6, Article XII, 1987 Constitution The use of property bears a social function, and all economic agents shall contribute to the common good. Individuals and private groups, including corporations, cooperatives, and similar collective organizations, shall have the right to own, establish, and operate economic enterprises, subject to the duty of the State to promote distributive justice and to intervene when the common good so demands.

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Section 11 No franchise, certificate, or any other form of authorization for the operation of a public utility shall be granted except to citizens of the Philippines or to corporations or associations organized under the laws of the Philippines, at least sixty per centum of whose capital is owned by such citizens; nor shall such franchise, certificate, or authorization be exclusive in character or for a longer period than fifty years. Neither shall any such franchise or right be granted except under the condition that it shall be subject to amendment, alteration, or repeal by the Congress when the common good so requires. The State shall encourage equity participation in public utilities by the general public. The participation of foreign investors in the governing body of any public utility enterprise shall be limited to their proportionate share in its capital, and all the executive and managing officers of such corporation or association must be citizens of the Philippines.

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In times of national emergency, when the public interest so requires, the State may, during the emergency and under reasonable terms prescribed by it, temporarily take over or direct the operation of any privately-owned public utility or business affected with public interest.

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Section 18

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The State may, in the interest of national welfare or defense, establish and operate vital industries and, upon payment of just compensation, transfer to public ownership utilities and other private enterprises to be operated by the Government.

The State shall regulate or prohibit monopolies when the public interest so requires. No combinations in restraint of trade or unfair competition shall be allowed.

This case involved the validity of the sale of shares of stock of PTIC by the government to MPAH, an affiliate of a foreign firm. WON the sale of such stock violated the ownership rule under the Constitution PARTLY YES. To construe broadly the term "capital" as the total outstanding capital stock, including both common and non-voting preferred shares, grossly contravenes the intent and letter of the Constitution that the "State shall develop a self-reliant and independent national economy effectively controlled by Filipinos."

IN RE: CORPORATE REHAB OF BAYANTEL (2012)

Section 17

Section 19

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Bayantel was unable to pay off its debts, hence it was put under rehabilitation. The Rehab Court and the CA limited the equity conversion of the unsustainable to debt to 40% of its paid-up capital in accordance with the constitutional limitation of the allowable foreign equity in Filipino corporations. WON the CA erred in giving a ceiling on the conversion agreement NO. The Court ruled that this would violate the constitutional limit of foreign ownership of public utilities. In the plan proposed by the petitioners, the capital stock that would end up in the hands of foreign companies would reach up to 77.7% which is above the 40% limit provided by law.

B. EXCLUSIVITY METRO CEBU WATER V ADALA (2007) !"#$ &' () *+ ,-.

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 A. OWNERSHIP Class Notes: Rationale: For public utilities to be under the effective control by the Filipino people. The evident purpose of the citizenship requirement is to prevent aliens from assuming control of public utilities, which may 6 be inimical to the national interest.

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MCWD contests the granting of NWRB a CPC to Respondent pursuant to P.D. 198 wherein it was required that before a ‘franchise’ may be granted, MCWD’s BOD must give their consent through a resolution, which was not given in this case. WON MCWS must consent to the granting of franchise to other water companies.

  NO. See doctrine.

latter the option to extend the concession for 50 years. WON such stipulation is valid

TAWANG MULTI-PURPOSE COOP V LA TRINIDAD WATER DISTRICT (2011) !"#$# &' () *$#+')(+ !"# %&' "#()*)+%*#,

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YES, BUT ONLY FOR A MAXIMUM OF 20 YEARS (ACCUMULATED = 50 YEARS). While the TRB is

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TMPC applied with NWRB for CPC to operate a waterworks system. Court also invalidated the exclusive franchise granted LTWD.

C. SUBJECT TO AMENDMENT

G.R.: An administrative agency may amend a legislative franchise. Citation needed Violative of the constitution

E:

RCPI V NTC (1987)  ! # $ ! % & ' ( ) * + , * ( % - . ! " ! # $

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vested by law with the power to extend the administrative franchise or authority that it granted, nevertheless, it cannot do so for an accumulated period exceeding fifty years. Otherwise, it would violate the Constitution.

E. TAKE OVER POWER Principles in the exercise of emergency powers7 : 1. There must be a war or other emergency. 2. The delegation must be for a limited period only. 3. The delegation must be subject to such restrictions as the congress may prescribe. 4. The emergency powers must be exercised to carry out a national policy declared by congress.

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DAVID V MACAPAGAL-ARROYO (2006)

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RCPI put up a radio telecommunications service pursuant to its legislative franchise granted to it. When Kayumanggi Radio started to operate, it filed a complaint against RCPI for not having a certificate of public convenience and necessity. WON RCPI needs to have a CPCN YES. EO No. 546 now requires radio communications services to secure a certificate (unlike before in CA 146)

!"#$%&##&# ())&*+&, !"#$ &'()"* "+#,-,.#  !"#! %"&'() *+ !#,+-  !"#$% !"# %&#'()#*! ! " # % ! & ' ( ) & * % ( + & ,  ! " # $ " & ' " ' $ ( ) !"#$%!"& ()(*+(!,- . !"

FRANCISCO V TRB (2010) PNCC entered into JVAs with private entities for toll operation. PD 1113 granted PNCC a franchise to construct, maintain and operate toll facilities in F: NLEX and SLEX, with the right to collect toll fees at such rates as the TRB may fix and/or authorize for 30 years. Prior to the franchise’s expiration, it

$%&&'"( )* +",-./ 

!

! " ! # $ % & ! % ( & ) * + ! # (  ! # $ % & ! ' & ( ) ( * ' $ # & + ,  $ ! " # $ % ' ( ) * + , ( - + * + - +  ! " $ % & ' ( " ) % ! " "  ! " " # $ % # & ( ) % * + , - . ) $  ! " # $ % $ & # '

F:

D. FIXED – TERM Class note: Under Francisco, it does not mean that PNCC cannot anymore ask for a new franchise from the government that is more than 50 years. What is prohibited is the handling the same franchise for an accumulated period of more than 50 years.

!"# %&#'()#*! "+' *,

! " # $ % ' " ! " ( ) ' " * ' '  ! " $ % & " ' ( )

PP No. 1017 and GO No. 5 were issued as a response to rising unrest and plots to destabilize government and assassinate. The police also raided The Daily Tribune and confiscated anything pertaining to a “mock-up” of the dispersal that took place.

AGAN V PIATCO (2004) !"#$%& !"(&) %*++",

!" $%&%'%()"$* +",

 ! " # $ % ' % ( % ! ) % ' * + ! $ ! # $ % & ' ( # & ) $ ' * & + ! " # " $ % & ' ( * % ' + , - . # " (  ! " # ! % & ' ( ) ! * !"#$%&" %() *(+"&",+ 

!

F:

PIATCO won the bid for operation of NAIA IPT III. In an earlier decision, this court held that there were irregularities in the granting of the bid to PIATCO and declared the contracts for the NAIA IPT III project null and void. Respondents contests this

I  :

R:

decision and to ask for compensation for the take over of the government of NAIA IPT III, as provided under the concession agreement. WON the State could validly take over the operation of NAIA III without just compensation YES. This is an exercise of police power and not the power of eminent domain, and therefore does not require the payment of just compensation. See doctrine.

SUMMARY OF CONSTITUTIONAL RULES RULES OWNERSHIP OPERATION

&

F. PRIVATIZATION OF STATE-OPERATED PUBLIC UTILITIES KUWAIT AIRWAYS V PAL (2009) ! " # $ % ' ( ) * ( ! ' + " , ( -  ! " # $

&'(#&$)* +,#

! " # $ % " ' ( ) $ * " + $ % , -  ! " # % & ' % ( % # ! ) # * % #  !

EXCLUSIVITY

!"#"!$%& "( )*+,-"%. !"

F:

I  :

R:

There was an existing commercial agreement between PAL and KA which gives the former a share in the revenue earned by the latter in transporting passengers from Manila to Kuwait. However this was removed in the subsequent agreement contracted by representatives of the government. WON the bilateral agreement between the government and KA is superior than the comercial agreement NO. The court held that by virtue of PAL’s privatization, the role of the state was limited to its regulatory capacity. It could not infringe the property rights of PAL without the due process of law.

SUBJECT TO  AMENDMENT

FIXED-TERM

TAKE-OVER POWER

PRIVATIZATION

What is regulated is the OPERATION of public utilties. Who may operate? - Filipino citizens; or - Corpo/assocs organized under the laws of the PH with at least 60% Filipino ownership. What are the control mechanisms? - Foreigners can only occupy seats on the Board of Directors proportionate to their share in the capital. - Managing and executive officers must be Filipino citizens. franchise, certificate, or - No authorization be exclusive in character. - Monopolies are not per se prohibited. The state may regulate or prohibit them, depending on the public interest. certificates, or - Franchises, authorizations shall be subject to amendment, alteration, or repeal by Congress WHEN THE COMMON GOOD REQUIRES. franchise, certificate, or - No authorization be longer than 50 years (continuous or accumulated). Temporary take-over/control of public utility OR business affected with public interest 1. In times of national emergency; 2. When the public interest so requires; and 3. Under reasonable terms prescribed by Congress Permanent control of private enterprises [NATIONALIZATION ] OR establishment of vital industries (utilities or private enterprises) [ORIGINAL CREATION ] 1. In the interest of national welfare/defense; and 2. Payment of just compensation. - State policy to encourage equity participation by the general public.

NAPOCOR V CA (1997) !"#$%&! () # &!*+,&# !"#$ &'()*+",$ 

Ways of regulation 1. Authority to operate 2. Rate-fixing 3. Area of operation 4. Approval of sale, mortgage, lease of public utility assets/equities 5. Power to set fees and other charges 6. Other means of regulation

F:

PIA no longer needs to acquire a certificate of public convenience for it to avail of a direct power connection from the NPC. This is because it has been authorized by law, PD 538, to perform the functions of a public utility.

OROPORT V PHIVIDEC (2008) !"#$%&'()( !"+, %+$-!"## %!" &'( ! " # $ % ! " & ( " ) * ! " " + , -   ! " # % & % ' ( ) * + , - . !"#$#"% '(% )*+,("+ !"#$%&" ()" *$+ )$& !"#$%&' )&"%#!" $%&!"!'()$(!*+ $, !"#$!% !"# %&'#( !& )(*+! , !"#$%#% '() () *(  ! " # $ % & ' ( ) # $ ) % + ) & ! # ! " # " % & ' ( ) * ! # + , - . !  !

Types of authorizations 1. Management contracts 2. JVA 3. TOA/STOA 4. Provisional authority 5. Administrative franchise 6. Legislative franchise 7. CPC 8. CPCN ALBANO V REYES !"#$%&! () #*+,(-.+/ !" $%!$& '%!" !"#"$%!%#& ()#&*"(&+

F:

EO 30 (which authorized the PPA to take over, manage and operate the Manila International Port in accordance with PD 857) and PD 857, specifically Section 6, empowers the PPA to provide services within the Port Districts “ whether on its own, by contract, or otherwise” and to “ make or enter into contracts of any kind or nature to enable it to discharge its functions.”

PLDT V NTC (1990) !"#$%&! () #*+,(-.+/ !" $%&'!

!"#$#"#%&'

 A. GENERAL QUALIFICATIONS  According to Vda. De Lat: 1. Nationality requirements; 2. Financial capability and technical know-how; and 3. Applicant must prove that the operation of such will promote the public interest in a proper and suiitable manner. Test for ruinous competition8: It must be shown that the existing businesses would not have sufficient gains to pay a fair rate of interest in its capital investments. The mere possibility of reduction in the earnings is not sufficient.

FRANCHISE CPC Grant or privilege from sovereign power VDA DE LAT V PSC (1988) ! " # " $ % ' ( ) * ' + + , - . /  ! " # $ & " ' ( ) ) * ! " # $ % "

! " # $ % & % # ' ( ) ( + , - # " % ,  ! 

F:

NTC is the regulatory agency of the government with  jurisdiction over all telecommunications entities. It is legally clothed with authority and given ample discretion to grant a provisional permit or authority.

 ! # $ ! % & ' ( ) * + $ ! & , & ! # $ % & ' ( ' ) * + , # ! " # $ % & ' ( ) * % " # $ , " - . &  ! " # ! $ % ' ( ) * ( !"#$%& %()*+*,) -(. !"#$%& &()*+)%+)&+,

F: I :

FRANCISCO V TRB !"#$%&! () #*+,(-.+/ !" $%&'!  ! " # $ % $ & ' ( ! ' $ ) * , ( ! % - ! " # $  

F:

PD 1112, in relation to Sec 49 of PD 1894, have vested the TRB with sufficient power to grant a qualified person or entity with authority to construct, maintain, and operate a toll facility and to issue the corresponding toll operating permit or TOC. By explicit provision of law, the TRB was given the power to grant administrative franchise for toll facility projects.

Form of regulation through administrative agencies

R:

Private respondent applied for a CPC for an ice plant in Davao City but was opposed by the petitioners, due to ruinous competition WON CPC may be granted YES. The Court held that the private respondents have met the requirements ( see above) for the awarding of a CPC and that there is insufficient proof of ruinous competition.

KMU LABOR CENTER V GARCIA

PAL V CAB (1997)

! " # $ % & % ( ! ) % & * $ % + (  ! " # $ ! " # $ % & " ( & ) * + " !

!"#$%& &()*+)%+)&+ ,!" !$%$&&'() $*'&(&

! " $ % & ' ! ( ) " * + " % ) , -  ! " # $ % & ( $ ) * + , , - . / " !

!"#$ &"# '()')*#+ ,- !"#"$% '"## ())$ *

!"# %!&'( )'# )*!"+'!"#$ &' $#(#)*&# &+* !

! " # $ % & # ' ( " * # & + % , +  ! " $ % & ' ( ) * + , - % $ $ ' .  

!"#$% '" ( )"**"+ )( !!"#!$

& '!&()*+!' !"#$%&!$' !$ !&)#$ "!"#$% '()*$%(+

 ! # $ $ % & ' ( ) ' * ' $ $ + ( ! " # $ % ' ( ) # * # " # + ! , - ! " #  ! " # $ % ! & # ' ( ! * * + , " -

B. REVOCATION / CANCELLATION F: 9

Grounds for the revocation/cancellation of a CPC  : 1. The holder is a mere dummy; 2. Operator has ceased operations and placed vehicles on storage; or 3. Operator totally abandoned service.

I :

* A CPC cannot be revoked if there is no showing of willful and contumacious violation of the law and rules.

DIVINAGRACIA V CBS (2009) ! " # $ % ' ( $ ' ) * + , $ - $  !

# $ % & ' ! % ( ) $ * ' $ %  ! "

R:

!"#$ #$& '(!&) #( "* !"# %&%! '( )*(+,%+!!

!"#"$%&!' $" $! &%"

! " # $ ! % % & ' ) ! % * ! + , - *  !

!"# %&'#( !& )*+)#,

!"#$ #&#!' ()

!"#$%&'($ $*+!&$%$, !" $%&'&(! ! " # $ % & $ ' ( ' ( $ ( * # + ' ,  ! " # % & ' ( ! ) ) & * % !"#$%&'()( #$+ %,%( !"#$ #&'"()*+, "(-*#

PAL questions the issuance of a temporary operating permit (TOP) and the authority of the CAB to grant CPCNs to GrandAir despite it not having a legislative franchise. WON a legislative franchise is necessary before the issuance of a TOP NO. There is nothing in the constitution which indicates that a legislative franchise is an indispensable requirement for an entity to operate as a domestic air transport operator. The use of the word "necessity", in conjunction with "public convenience" in a certificate of authorization to a public service entity to operate, does not in any way modify the nature of such certification, or the requirements for the issuance of the same. It is the law which determines the requisites for the issuance of such certification, and not the title indicating the certificate.

!" $%&%'()(!* )$+$(! !"#

F:

I  :

R:

Divinagracia sought before the NTC the cancellation or revocation of the provisional authorities or CPCs granted to PBS and CBS, alleging that PBS and CBS failed to comply with the conditions set forth in their respective legislative franchises. WON NTC can cancel the CPC issued by the old PSC NO. See doctrine. Although the PSC originally had the power to cancel/ revoke, the same did not pass on to the NTC as broadcast stations were not under the PSC’s authority back then. Industries over which the PSC does not have jurisdiction are spared from the jurisdiction of the administrative entities subsequently replacing the PSC.

C. CPC V. CPN

TRADITIONAL DIFFERENCE CPC CPCN Does not require a prior Requires prior issuance of issuance of municipal municipal franchise franchise * Currently, there is no need to differentiate because of PAL v CAB

Class notes: This is a balancing of public interest and return on interest of enterprises, both protected by the constitution. State policy will declare whether rate-fixing would be strict or liberal. Rationale for control by government 10: By embarking capital in a utility, an investor agrees that its charges to the public shall be reasonable. It becomes a public servant – a substitute for the State in the performance of the public service . The compensation or opportunity to earn guaranteed by the Constitution is the reasonable cost of conducting the business . What is just and reasonable 11? It is not a question of formula but of sound business  judgment   based upon the evidence it is a question of fact calling for the exercise of discretion, good sense, and a fair, enlightened and independent judgment. According to Republic v Meralco, the SC has consistently adopted a 12% rate of return for public utilities.

10

 REPUBLIC V MERALCO, CITING J. BRANDEIS

PADUA V RANADA (2002)  ! " ! $ % & " & ' ( ) ! ( & * + ! , ! " # $ & ' $ ! " # $ % & % # ' ( ) ) * ( ! ! " # $  ! # $ % ! & ' ( ) * + , - . !"#$#"#%& (#")*!" +

!"#$%&'( *!"&

NAPOCOR V CA

!"#$%!"! '! #$%&'( )#*+,- '&&. ! #

%$! " ! $ % &  ! " $ % & ' ( $ ) ' $ ( * + , -  ! " # " % & % '

! " # $ % & ( $ ) * # ) + ! % , (  ! " # $ % &

(%)*! %(*+ ,-  ! " # $ % ' ( ! ) % # * ! # + , - % ! " # $

!"#$%&'() &+,-)" '( !"#$%$&'( *+ ! " # $ % % $ " & ( ) * + ( , - (  ! " $ " % & ' ( & % & ) * ' + ,

Citra, an investor in the Skyway Project, filed before the TRB an application to increase toll rates, in view of the depreciation of the peso to the US dollar. TRB approved a provisional adjustment, which petitioners sought to set aside. WON notice and hearing is necessary before the issuance of a provisional adjustment in rates.

F:

I  : R:

!"#$% '( )*+ #,"# " !"#$%& %())$%&"() ! " # $ & ' ( ) * + , - . / * &  ! " # $

&!' ()'*#

! " # $ ! " % & ' & " ( * # + * " (  ! " # $ %

  NO. See doctrine.

KMU LABOR CENTER V GARCIA ! " # $ & " ' ( ) * + ! ! " # $ ! " # " $ % " '  ! # $ % & ' ! ( $  ! " # % & " % ' ( ' ) & * + ) & , " ! " # $ & ' # ( $ ) * # $ + , $ !"#$%!"& (")*"!%*+ , ! #$%&'()* +)% ,-$)% !"#$%&'"() +"', ',& !"##$"% '()$ (*  ! " " # $ # % & ! ( ! ) * + ( ! ! " $ % & ' ( ! & ) * % $ & + %  ! " " # $ % ! & ' # % ) & ) % * % ! " $ % & ' ( ) % * ( ' ( * + , -  ! !"# %&'()* 

FRANCISCO V TRB ! " # ! % & ' " ( ) * + ! " ! # $ % & ! % ( & # ) ( !  $ ! " # " $ % !"#$%& ($&)$* )" +) !" $%& &'()'* ()+ ! " # $ % & $ " ( $ ) % * + , % %  !

#$%&'()* +',

 ! " # ! $ % ' ! ( ) * + ) * , ) * ! # $ % # # $ & ' % # & ( !"#$%& () *$!+ ,-& . !"#$%"&'!(

F:

! " # $ % & ' " ( ! ) # ( $ # # ( !   ! " " # $ % # & ( ) * + ! % #

By express legal provision, the TRB is authorized to approve the initial toll rates without the necessity of a hearing. It is only when a challenge on the initial toll rates fixed ensues that public hearings are required. On the other hand, subsequent toll rate adjustments are mandated by law to undergo both the requirements of public hearing and publication.

Process: PSC has to hold a public hearing with notice to all interested parties to determine if there are good and reasonable grounds to justify the transfer. Rationale 12 : A franchise is personal in nature therefore any transfer or lease thereof should be notified to the PSC. The PSC is in charge of safeguarding the public interest. Class notes: The sale, lease, mortgage, or any form of alienation of the property or franchise of a public utility must be approved by the PSC, otherwise, such shall not be binding with the 13 PSC . - But in any case, the contract between the parties shall be binding between them. - This acts as a limitation to the rights of an owner to dispose/abuse his/her property MONTOYA V IGNACIO (1953) ! " # $ % ' ( ) ' ) * + ) $ , ( #  ! " $ ! % " & ! ' ( ) * $ (

!"#$%&' #)&! #)& *"+  !"#$%#& &#(#"$) ! " # $ % & " ' ( ! * + , ' + * $ -  ! ! # $ % & ' ( ) * + , - $ , .   !"#$# $&'#()&*+$ ,$ !"#$%!%&' )*"

BF HOMES V MERALCO (2010) ! " # % & &  $ ! " # # $ % & ( ) # * " + , ( - %  ! # $ % & $ ' ( ) !"#$ $&"'()# '*'+,-. !"# #%#&!'(& )(%%* ! " # $ & ' # ! ( ) & $ * & + + ! ! # $ % & ' ( ) * + , - + . , -  ! !"#$% '"()*"+ ,-"(%. !"#!$%&

F:

After the Meralco refund cases, Meralco cut the power supply on some of petitioners’ water pumps, asking the latter to pay their overdue bill immediately. Petitioners, relying on the refund case, asked that Meralco apply said bill to the amount it owes petitioners.

12

13

 MONTOYA V IGNACIO

  Public Service Act, Section 20:  Acts requiring the approval of the

Commission. (g ) To sell, alienate, mortgage, encumber or lease its property, franchises, certificates, privileges, or rights or any part thereof; or merge or consolidate its property, franchises privileges or rights, or any part thereof, with those of any other public service. The approval herein required shall be given, after notice to the public and hearing the persons interested at a public hearing, if it be shown that there are just and reasonable grounds for making the mortgaged or encumbrance, for liabilities of more than one year maturity, or the sale, alienation, lease, merger, or consolidation to be approved, and that the same are not detrimental to the public interest, and in case of a sale, the date on which the same is to be consummated shall be fixed in the order of approval: Provided, however, that nothing herein contained shall be construed to prevent the transaction from being negotiated or completed before its approval or to prevent the sale, alienation, or lease by any public service of any of its property in the

 ! " " # $ % ! & $ ( ) * + " , - ! " # $ % " ' # % ' ( ) * + , " !"#$%& ()* )##"+ )*"!"#$ &#$'() !(

R:

 ! " ! # $ & ' # ( ) * ( + , ' -  ! " # $ % ! " # % " & " ' ( ) ! *

F: I:

R:

Jeep killed someone and respondent asserts nonownership of the car and therefore, excuse from liability. WON Ignacio will be held liable. YES. Based on the facts, the sale of the franchise by Ignacio was never approved by the PSC. See doctrine. Failure to comply with this requirement renders the original grantee of the franchise (Ignacio) liable in case of any accident notwithstanding the existence of any unapproved lease agreement. Insofar as the law is concerned, it is Ignacio who is still the operator of the jeep.

YES. SC held that the transfer(s) lacked approval of the Public Service Commission. See doctrine.

FRANCISCO V TRB There is nothing illegal, let alone unconstitutional, with the delegation to the President of the authority to approve the assignment by PNCC of its rights and F: interest in its franchise, the assignment and delegation being circumscribed by restrictions in the delegating law itself. PLDT V NTC !"!# %& '(! )*%+%#,- !"#$%&#'()*! &,( ! " # $ % & ' " " ' ( ! * ' + " % * !   "#$ &' !('&)#" !"#$% #' ()*"+)#,-+"!"

$%& '()*+%,!&

!"#$%&' %) %*& +)",) !"#$%! #$%#&#'# (#

PEREZ V GUTIERREZ (1973)

! " # $ & ' ( ) * + " , - " , & (  ! " # $

! " # % & ' ( ! # # ) * ( ! + ( , #  ! # $ % & ' & ! ( $ ) ! * % + &

&' &# (#)!)*$

!"#$%#&'( $" '*%($+

!"#$% '($ )%*"+(,-$ !" $%&'(!)" () (*% + !"  ! " # % & ' ( ) * + , - . / 0 % ! ! # $ % & ! ' ( ! % # ! & !"#!$%"&'( &* &+% *, !"#$%&' &) $*!

!"#$%&"' )*" )+ ,#"-  !"#

%$'())#*#($*+

ZAMBOANGA TRANSPORT V PUC (1927)  ! " " # $ % ! & ( $ ) * + $ , ! - ! " # $ $ & " " ' ' " ( $ ) * + !"#$%&%'"& )* '+" ,) !"#$%"&

()" *"+

!""#$%$&'

F:

I:

R:

Zamboanga and Bachrach entered into a mortgage to secure the purchase of two trucks. According to the Public Utility Law, the public utility is the one that must seek approval from the commissioner for the sale or mortgage of its properties but it was Bachrach,which sought the approval as the mortgagee. WON the mortgagee may seek the approval by the PSC. YES. The Court held that the purpose of approval is the protection of the public interest, and Bachrach may be the one to seek approval from the commissioner in order to protect its intrest as the mortgagee.

Rationale: Such fees and other charges is used for the reimbursement of the expenses in the operations of the administrative agency and is not a tax measure. REPUBLIC V ICC (2006) !"#$%&' )*+,- &. $/"  !"#$%&

!"#$%&'(!) +!(,-.-(/  !"#$"%&' ') '*+ ! " ! # $ % & ! ( ) * + ! & * , *  ! " # % & ' ( ) ! % & * ! + ,

F:

I :

#$%&'(!$!!' )!$!*+ 

!"#$ &!" '()") *) *+!"#$ &' #(! !"#$%&"!"' )*+"!%,

F:

I:

Bus company transferred ownership of its buses to its President. While a labor case was pending against the bus company, the President sold the buses to petitioner company. The LA issued a ruling holding the bus company liable for non-payment of allowance and levied upon the bus company’s property, including the buses which were sold to the petitioner, so the petitioner filed a third party complaint. Third party complaint was granted, but the NLRC reversed and ordered the levy. WON the levy may be enforced on the buses.

ICC applied for a CPCN with the NTC. This was accepted on the condition that ICC pay a permit fee of P1.19M. WON the NTC may impose a fee upon application of a CPCN

YES, BUT THIS AMOUNT WAS EXORBITANT AND THE CASE AT BAR HAD A PARITY CLAUSE, THEREFORE THE FEE MUST BE RETURNED. The

Y TRANSIT V NLRC (1994) ! " # $ % & ' " ) ) * + , " ! - . /  !

( ) * + % & ) , & - %  !

! " # % # % & ' ( % ) * + ( , *  ! # $ % & ' ( )

R:

SC ruled that the subject provision of RA7925 did not amend the Public Service Act. The absence alone of the word “authorization” in Section 5(g) of RA 7921 cannot be construed to mean that the NTC has been deprived of the power to collect such fees. The words “authorization, supervision and/or regulation” used in Section 40(g) of the Public Service Act are not distinct and completely separable concepts which may be taken singly or piecemeal.

1. 2. 3. 4. 5.

Law requiring to interconnect telcos Emission standards 14 Ridjo Tape  doctrine Provisional reliefs Reasonable standard in establishing regulations.

rules

to continue indefinitely until suddenly the public utilities concerned demand payment for the unrecorded electricity utilized when, in the first place, they should have remedied the situation immediately. If we turn a blind eye on MERALCO's omission, it may encourage negligence on the part of public utilities, to the detriment of the consuming public.

and

Ridjo Tape doctrine: A public utility has the imperative duty to make a reasonable and proper inspection of its apparatus and equipment to ensure that they don’t malfunction. - Failure to do so is negligence on their part – burdening them with the consequence of such oversight.

BF HOMES V MERALCO ! " # % & ! ' ( ) ! " % ( * " + ! " $ % & ' ( ) ( & ! * + % , + ( ,  ! "

TAXICAB OPERATORS V BOT (1982) !" !$ !%&'()"!)(* "+ !"#$%&' %)%*+ ',-.&,! ! " $ " % & ! ' % ! ' % ( ) * $ +  ! ! " # $

&'()*(+",#-

! " # # " % & ' ( ) " * # + ' ! " # $ $ & " $ ' $ # " ( ) * +  !

PLDT V NTC

!"# %&&' !& !"# (%&) !"#$ #& '()!"*)+

!"#$%&'""$&#!'" !) * !"#$ "! !"#$%&$"#!'" !"#$ &'(&)'#* '"+$#, !"#$%$&! ()

!"#$%#&%!' )!""#$%& (!%%)"#!*+ ,!"

$%$!

!"#$%&'$&( !"*+, "- !"#$#%&'( %*+ ",!&-

! " # $ % # ' ( ) * " " + , % - * '  ! # $ % # & ' ( # ) * %

!"#$%& ()* +,-()./#) !"

!"#$%#&% ()!" *+ #%, !"#$ "& '!!() "& '(( ! " # $ % & " ' ) * * " % + " , - .  ! " # $ % & ' (

!"#"$%&&'()$*!)%(+ +!"#$%!& $( )*! ! " # $ # ! ! # % & '  #  ! " # % & ' ( % ) ! # ' * + !"#$%&'(()"* $,-!#.)!   " $% &'" ()**)+ !""#$

F:

HENARES V LTFRB (2006) Petitioners filed a petition for mandamus to compel F: the respondents to require the use of CNG by motorvehicle owners as alternative fuel. I  : WON the petition was proper. NO. The Court held that mandamus in this case was an improper remedy since there is no law R: compelling respondents to order the owners of such vehicles to use CNG. MERALCO V WILCON (2008) !"#$%& ()*+%&) &,-!.!"#$ &'"(' )* !*+ !"!#$%&! (#)*!+$! %+ !"# %&'(")*+# ,!"#$% '(!$#) )"*++ ,! #$%! &' (!$) &*! !"#$%&'%#!%$ ") $'!* !"#$%&'()*

F:

I  :

R:

MERALCO claims that on 1984, Wilcon’s electricity consumption dropped. 7 years later, they inspected respondent’s premise and found the meter to be tampered with. WON Meralco may enforce its claim against Wilcon NO. See doctrine. The rationale behind this ruling is that public utilities should be put on notice, as a deterrent, that if they completely disregard their duty of keeping their electric meters in serviceable condition, they run the risk of forfeiting, by reason of their negligence, amounts originally due from their customers. Certainly, we cannot sanction a situation wherein the defects in the electric meter are allowed

"*!$&'( *+,

 ! " # $ % & '

I :

R:

BOT and BLT issued memo phasing out taxis which are already 6 years old. Taxi operators alleged that they were not consulted depriving them of due process and that the circulars violate the equal protection clause. WON there was a violation of due process and equal protection NO. Court said the law provides that the agencies can choose how they would gather their info hence there was no need to consult the operators, and that it did not violate the equal protection clause since there was a substantial distinction between them and operators in other areas given the volume of traffic in Manila.

PANTRANCO V PSC (1940) !"#$# &$# '&$()*&+ , !"#$!% !"'()* !"#$ ! " # $ % ' ( " ) * ! " # $ " & ' ( ) * + , + ( - + $  ! " # " % " & ! " $ % & ' ( ( ) ! " * + & , - .  ! " $ % & ' & $ ( ) ' * ( % ) ! " # $ % ' ! % ( ) $ ) # " * ( %  ! # ! $ % & ' # ( % $ ) * +

! " # $ % & ' ( * ! % + ! % & + , -  ! " #

%&" '()&% *+ %&" 

! " # $ % ' ( $ ) # ) * $ ) + , #  ! " " # $ % # & % ( ) * # + # , % !"# %&' ()#* )'+ #,-!"# %&"'%()% "( ! " # # $ % & & ( ) % ) $ * + & ( )   ! " # $ % & ' ( *  ! " # % & " ' ! " # $ % & ' ( * + ' ' , % & ' # !  ! # $ ! % ! & ' ! ( ) & ( * + % '   ! " # $ & ' ( $ ) ! * + , ) ' & -  ! ! " # $ & $ ' ( ) * & ' & " +

!"#$ "&'&(()*+,- *&.!"#$% '( %$)"%$ !"#$%&'

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PANTRANCO’s application was for an increase of its equipment to enable it to comply with the conditions of its certificates of public convenience (CPCs). On the matter of limitation of 25 years on the life of its CPCs, there had been neither notice nor opportunity given the petitioner to be heard or present evidence. WON there was violation of due process YES. See doctrine. This principle emanates from the more fundamental principle that the genius of constitutional government is contrary to the vesting of unlimited power anywhere. Law is both a grant and a limitation upon power.

KMU LABOR CENTER V GARCIA ! " # $ ! " # $ % # & ' ) * + , $ - . * / #  ! " ! $ % & ' ( ) * " + + , !"# %& '() %**+,&-) !" $%$& '& ()*'+(,! " # $ % & ' ( ! ) * + ' " - ! " #  ! " # $ # % & " % ( $ % ) # & * + ! " ! " $ % & ' ( ) * + , - & . / + ,  !

# $ % & ' ( ) $ ( * ! + , ) * !  !

! " # ! # % # & & ' ( ) # % ! * +  ! " $ % & ! " ' & ( ) * + , ! " # ! $ " & # ' ( ) $ * & + , $ !   "#$% '(!' '() !"#$%&'!( !* &+# ",- !"# %&'("#& )'*)*%&+ !"## %&'(')* %+,#"- !"#$%$&# !" ( )%*)$%  ! " # % & ' ( ! ) * + , ! " " + - .

Transportation Law

COGEO-CUBAO V CA (1992)  ! " # $ % & ' $ # $ ) * ) + , - % ! " # $ % % ' ( % ) % ) *

!"#$%&' !")!'"&*+ #&  !"

$%%&'(&) *!(+ $

!"#$%& %()*+*,) -(. !"#$ &' #"&!($$') $* !"# %&'!(&) &* !"# + !"#$%&#%' )!$ '*# !"##"$ &""'

A contract of transportation  is one whereby a persons or association of person obligate themselves to transport persons, things or news from one place to another for a 15 fixed price .

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If you examine Section 13(b) of the Public Service Act, various modes of transportation are listed, thus putting such modes within the coverage of the term “public service” if used by certain persons for hire or compensation, with general or limited clientele.

CPC was given to respondent to ply the CogeoCubao route. Perturbed by respondent’s Bandera System, Petitioner formed a human barricade and assumed the dispatching of passenger jeepneys within the respondent’s route. WON petitioner usurped the property rights of respondent YES. Petitioner forcibly took over operation of the  jeepney service without authorization from the PSC, in violation of the right of respondent to operate its services in the said route under its CPC.

SAN PABLO V PANTRANCO (1987) !"##$ &"#'()"* !"#$%!&'$ ')&*'+ ,-

!"#$%& ()$)! )! %$*"!

!"#$%&'

#$%%$&% '$()$$*

!"# %&'() *+ & ,-.#, !" $%"&'() *% *$ ' !"#$%#&'$%"# ") $*+ !"#!$%& $!()

 According to jurisprudence: A CPC can be sold as it has considerable material value 16 (considered as a valuable asset) . It is affected with public interest and therefore, must be 17 submitted to the control of government . A CPC does not confer upon the holder any properietary 18 right over the route covered thereby .

! " # $ $ % & ' " % ) * " $ # " *  ! " # % & ' " ( ) * + , * & - " !"#$$ &'() '* +#,-.! !"#$%$&'() &+" ! ! " # $

! " # $ % ! & ' ( " ) + % , + ( & #  ! " # $ & ' ( ) $ *  ! # $ % & ' ( $ !"#! %&'()'*+ !"* ,+ ! #$ %&!'()#'& #* ! " # " $ % " & # ( ) $ * + , ) % )  ! " # # $ & ' ( ( # ) # $ !

! " # $ % & " ' ! % ) * # ) ! % + ,  ! " #

!" %#&& '"#()

!"#$%&'( %&! *+(, -* !" $! %"&& '(!)(%"*'   ! " # # ! " % & ' ( ) * + ! , & ' * ! " $ % & ! ' & ( ) & * +

RAYMUNDO V LUNETA (1933)  ! # $ % & ' ( ' # ! & $ ) ( * + , ! " # # % & ' ( & " ( & # ( # ) & ! " ! " # $ & ' ( ) * ) " # $ * + (  ! " # " $ % ' " ( ) * + " , - ! ) ! !"#$%&'()*+' -).'(%)! #$!%& $'( )* !"#$%&'('& * +*,-*.,! #$$!%

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GT defaulted on its loans. Its CPC and trucks were subject to a writ of attachment. Pending the case, Guzco sold the said property to Raymundo. The lower court then ordered the sale of the attached property via public auction. Two sales occurred. The PSC approved the second sale. WON YES. The Court holds that it is the sale via public auction that should prevail. The Court discussed the nature of a franchise and CPC is that, since it is “property”, it can be subject to writs of attachment and execution, however, still subject to the approval of the PSC.

 CRISOSTOMO V CA  RAYMUNDO V LUNETA 17  COGEO-CUBAO V CA 15 16

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PANTRANCO extended its bus operations to include ferry services between Matnog (Sorsogon) and Allen (Samar). Its theory is that the ferry service is a continuation of the highway which is interrupted by the water, therefore no need of a separate CPC as the same was necessary and incidental to the transporation of passengers and cargoes. WON A CPC is still necessary YES. The court held that the respondent is engaged in interisland/coastal service ( see doctrine). A separate CPC is needed to operate such service as mandated by law.

Definition of the Prior Operator Rule 19 A first licensee/operator with a prior license should have more or less a vested and preferential right over a person who seeks to acquire another and a later license over the same route provided that the following are complied with: 1. Keeps and performs with the terms and conditions of the license; 2. Complies with the reasonable rules and regulations of the commission; and 3. Meets the reasonable demands of the public. Rationale

To secure adequate sustained service  for the public at the least possible cost, and to protect and conserve investments already made for this purpose. BATANGAS TRANSPO V ORLANES (1928) !" $"%& '! ()* +,-!( !"#$%&$$ () *%

It has been identified as one of the root causes of the prevalence of graft and corruption in the government 21 transportation offices .

KABIT SYSTEM UNREGISTERED SALE Sale is registered but not with the owner of the assets rd Void as to the parties and 3 persons

No approval by regulator Binding between parties

the the

Effects of Kabit system: The operator on record is considered the operator of the rd 22 vehicles under it as regards the public or 3  persons . Ratio: To protect the riding public23 Parties to a kabit system will not be given any relief under the law against each other ( in pari delicto)24. - But a kabit  may enforce a claim against an offending party as the evil sought to be prevented by the law 25 enjoining the kabit system is not present therein .

!"#$%&!$ ()&* % "$)! ! #$%&'(& )&&*( +', !"#$%#&' )*" )"#&' + !" !"#$%&%!   "# !% &'# (&)*"#* +!" $%&'()*+

TEJA V IAC (1987) ! " # %  ! " # $ % ' ( ' % ) * ! "

!"#$ #$& '&()*+(,-& !"#$% '()

! " # % # & ' ( ) & * + # , # - & )  ! "

$ % & ' ( ) * + * , + - & . %  ! " # %&&'!(') %&&'!*(

! " # $ % & ' " ( $ * $ + , & - &  ! " #

! " # $ % & ' ( ) * + ) - ' . " /  ! " " # $ $ # ! % ' % ( " ) ) * $

 ! " ! # $ % & ( ) * + # , ( - + # , ! # $ % & ' ( ) ( # & $ & * (

$% &'( )*+,-./ -& 

!"#$%& "()* +#,* #, !"## %& ' ("#)"* '+*

! " # $ % & ( ) " * & % # + ) + * !   "# %& '()*+,

!"#$#"#%&'() "'+,& - !"# % &"#'() *+(

!"#$%#&%#!% () ( )*%!   "#$ &'"("$)*)

! " " # ! % & ' ( ) * + , " ' - & ! " # $ & ' ( & ) & ! #  !

! " # $ % & & % ' ) * + , % - " .  ! " # $ ! # % & ( % ) $ * + # % , !" $% $&'() &* !+) , !"#$%% '( )"*+

! " # $ % & $ ( ) $ * + , $ & - .  ! # $ % & ! '

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Orlanes, an irregular operator of an autobus line, applied for a CPC to become a regular operator. BTC opposed but PSC granted Orlanes’ petition. WON Orlanes may be granted a CPC NO. See doctrine. In this case, BTC has complied with the prior –operator rule.

! " # $ # % & ' & ( * + # , + , - .  ! " #

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Definition of a kabit system: A system where the grantee of a CPC allows another person to operate under such franchise for a fee. Rationale against the system: A CPC is a special privilege conferred by government. Any abuse of such privilege is against public policy and cannot 20 be countenanced . - It is not per se illegal as there is no law punishing it as a crime. - Against public policy as if we are to allow such, owners wil just transfer the erring vehicle to another who do not have property to escape liability.

R:

!"# %&#'(!%' %) '#*% !" $% &'(%$")!)" *+)  ! " # $ % & ! $ ! ( & ) # * # ) +  ! " # % & ! ' & ( # ) * " + ( % ' &  

 LITA ENTERPRISES V CA  SANTOS V SIBUG 23  LIM V CA 24  LITA ENTERPRISES V CA 22

 BTCO V ORLANES

Teja sued Nale for the unpaid price, with interest and damages, of a motorcycle. Their transaction included an agreement where Jaucian (Teja) was to be registered as owner of the motorcycle with the LTC, while simultaneously allowing Nale to use Teja’s existing transport franchise. WON they are in pari delicto YES. SC held that this agreement constituted a “kabit system,” which is a fictitious registration of the motor vehicle in the name of one party while allowing another person to use his franchise and operate a transport service, and is therefore void for being against public policy. Thus, the SC upheld the IAC’s ruling that neither party can recover from one another on the basis of said void agreement.

SANTOS V SIBUG (1981)

21

19

%& '"(!#&!)!'&*

!" $%& '()*$+

! " $ % & % ' ( ) * % ( + ' , -  ! # $ % & ' ( ) * + , - ' . +

BALIWAG TRANSIT V CA (1987)

!"#$%&$ "("& )* +," !"#$%&" $(!)&!"* $(

!"# !"#"$%&'&'( *+,#-$ - ! #$% %&'(#%)*%

! " # % & & ' ( # ) ! " % ( * # #  ! # $ % & ' $ ( ! $ ' ) * + !"#$# &'(" &)*# ")+ !"# %&&! '(()"*&+ %, 

!" $ %$&'( )*)(+, ') !"##$##%"& "( ) ! " # $ % & ' ( ) + , , - ) " # + )  !

!"# !"#% &'()*+ !"#$%&" &())%!!%(*+

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Santos owns a jeep, Vidad has a CPC. Santos has a kabit arrangement with Vidad. The jeep hit Sibug. Sibug filed a case against Vidad and won. Jeep was levied. WON the levy was proper YES. As far as Sibug is concerned, Vidad is the owner of the jeep. The recourse of Santos is to go after Vidad for his jeep that was levied upon. Jeep was registered in Vidad’s name, although Santos and Vidad has a private document evidencing the true ownership of the jeep.

#$% %&' ())*+#,' $ !

! ### $%&'

I :

2 bus lines, BT and BTI, were granted separate franchises but only 1 SSS ID#. Martinez (EE of BT) filed a petition with SSC to compel BTI to remit his SSS premiums. WON the bus lines are in a kabit system

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NO. See doctrine.

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LITA ENTERPRISES V CA (1984) ! " # % & ' ( ! ) * ) ! # + ( )  ! # $ % & ' ( ' ) * + + , + - $ . !"#! %#&&'! () !'' * !"!#!$% '()*!+)!*, ! " $ % & ' " ! " ( " ) ' * & ! +  ! " # $ % $ " & ( ! " & % ) * !""# %&'() "% ()* !" !"#$%"$&'

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The Sps. Ocampo made kabit to Lita Enterprises’ CPC for the formers’ taxi cabs. Subsequently, an accident occurred where the taxi collided with a motorcycle, killing the driver of the latter. After the incident, the Sps. wanted the registration of the taxis back, so they filed a case. WON the lower court erred in granting relief to the parties YES. The SC held that this kabit system is void for being contrary to public policy and therefore, the parties, being in pari delicto, must not be given any remedies.

LIM V CA (2002) ! " # $ % ! ' ( ! " ) * + , ) - !   "#$#$% '() *+,#' !"!#$%& %&' (& )*+, -( '& ./%-012/ ',/ .-3'1/( 4*' '& 15/%'167 ',/ ./3(&% *.&% 8,&) 3/(.&%(14101'7 )-7 4/ !"#$% "' ()*$ !" $% $&&'()%* +'*, !"# #%& '(#) *+ ! " # $ % & $ ' ( ) $ + % " ' , ' (  ! # $ % & ' ( )

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Gonzales’ passenger jeepney collided with a truck due to the truck driver’s fault. Gonzales sued for damages but the truck owner alleged that Gonzales had no legal personality to sue since he was not the registered owner of the jeepney. WON the kabit may claim damages YES. SC awarded damages to Gonzales, despite being a kabit, since the evil sought to be prevented by the law enjoining the kabit system was not present in this case.  A KABIT HAS RIGHTS TOO!

Private Vehicles They are not public utilities (since no compensation) and their passengers are considered accommodation passengers . Their responsibility is to exercise ordinary or reasonable care 26 to avoid injuring his/her passengers . Note that under Art. 1761, passengers must also observe due diligence to avoid injury to him/herself.

COMMON CARRIER

PRIVATE CARRIER

 AVAILABILITY

Holding out indiscriminately

REQUIRED DILIGENCE REGULATION

Extraordinary diligence Subject to state regulation Allowed as provided by law

Contracts with special groups or individuals Ordinary diligence

LIMITATION LIABILITY

OF

EXEMPTING CIRCUMSTANCE PRESUMPTION OF NEGLIGENCE GOVERNING LAW

Proving EOD and Art. 1733 There is a presumption Law on common carrier

Not subject Allowed, provided not contrary to law, morals, good customs, public policy Caso fortuito, Art. 1174 No presumption Law on oblicon

 A.  ABSENT A TRANSPORTATION CONTRACT LARA V VALENCA (1958) !"# %&'#( %( %)#(*!% ! #$ %& %'(#)#*+,!"#$ &'# ()&* &! +, !"#!$%& ()%*$ $+ !"!#$%&! #!(&)*(+,! !"#$ &' &() *+$#"(&* ! "  ! " # " % & ' " ( ) ! * % " ! + , -  ! " $ % & " ' $ ( ) * ! " !"#$%& "#! (#)*&+ ,+  !"#$%&'!"( *+% !"#"$% '( )$"*+,- !+  !"#$ &'&()*#& !"#$%&"' !" ")&*!%&+ !" $%&" '( %)(*+ !"#$%!"& (!) *+)),"&!"#

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Lara, sick with malaria, hitched a ride with Valencia to Davao. He chose to sit in the back of the pick-up. En route, Lara fell from the pick-up and sustained serious injuries leading to his death. WON Valencia is liable NO. The Court held that Valencia could not be liable for Lara’s death. Lara was merely an accommodation passenger, to whom Valencia was only obligated to extend reasonable care, and not the extraordinary diligence required of common carriers. Further, Lara himself had negligently declined the invitation to sit in front. Lara’s death was thus ruled to be an accident, for which Valencia could not be responsible.

Responsibilities of registered owner: Liable for any quasi-delict caused by his/her vehicle even if rd a 3  person was driving it. PCI LEASING V UCPB (2008) %&"% '# ()%

Subject to control and supervision by the DOTC

Only required to communicate with the DOTC for policy and program coordination More or less autonomous

MIRASOL V DPWH (2006) !"# %&!"'()!* !' (#+ !"#$% $'% (")* )( !"#$%&'() +)(,,$% ('!"# %&'!( (!&)* ! " # $ % " # ' $ ( ) ( ) " ! " # $   ! " # " % & & ' ( # ) * ' +

!"# %!&!# '% ()*+,

!"#$ &$ '() *'+",+-, !" $%&'!(&)*%(%''+

 ! " # ! % % " & # ' # ( & )

! " # ! $ " $ % ' ( ) ' * + ( ! % ,  ! " $ % & ' ( $ $ & " ) & & * ! " # $ & ! ' ( # $ ! " & ) ( ! " # $ % & ( ) * % + , ( - , % . /  ! "  ! # $ % # & ' ( ) * + + * ) , + % # ! # $ # % & ! ' ( ) * +

R:

Regulates the business or economic aspect of the franchise.

LINE AGENCY ATTACHED AGENCY LTO, LTFRB MARINA, CAAP, CAB

!" $%& '!($)* '!+*,-

!"#$%&"!"' )$&* &*" !"# %"&!! '#(% )#"

I  :

In-charge with the policy planning, direction and general welfare of the industry.

!" $"%&'!"( )$%"* +,  !"#$%&'()*  !" $%&'()

 ! # $ ! % $ & ' ( ) ! ) * ( ! # # ! " # !

F:

DIFFERENTIATING REGULATORY AGENCIES CAAP CAB LTO LTFRB

DOTC may amend, modify and revoke their actions

B. LIABILITY OF REGISTERED OWNER

!"#$ &'$ ()'*+#* ,-+

General areas of regulation: 1. Area of service 2. Rate-fixing 3. Penalties 4. Permits 5. Equipment

!

Accident involving a truck owned by petitioner but leased by a 3rd party. 1st tried to evade liability by saying that the registration requirement does not apply because it’s not a public utility. WON PCI, as financing company, is liable YES. Court said that even if it’s a private vehicle, the registered owner must be held responsible to avoid prolonging the suffering of those injured Lastly, the court said that the financing company act will only take effect it the lease is registered.

 A.  AIR Civil Aviation Authority of the Philippines (CAAP) Responsible for implementing policies on civil aviation to assure safe, economic, and efficient air travel. The agency prescribes safety standards and also investigates aviation accidents. It undertakes the maintenance and operation of airports and other similar facilities; registers aircrafts and other incidents concerning the same and provides safety regulations for air travel. Civil Aeronautics Board (CAB) Mandated to regulate, promote, and develop the economic aspect of air transportation. Among others, it has supervision and jurisdiction and control over air carrier, general sales agents, cargo sales agents and airfreight forwarders, as well as their property, property rights, equipment, facilities and franchise. It issues CPC for air carriers.

PAL V CAB (1968) !"# !"# %!& '()&* %( +## !" $%"&'()*)+ !"#$%&'() "#$+'&,- 

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PAL opposes the grant by CAB to Fairways of a temporary operating permit, as it had not yet presented evidence in the economic proceedings. WON CAB may grant the TOP YES. The SC ruled that the CAB has the authority to issue such permits on its own initiative, and that there was no denial of due process since what was at issue is a mere interlocutory order and not a decision on the merits.

 A. DEFINITIONS, ESSENTIAL ELEMENTS What is a common carrier  27 ? 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.

B. LAND Land Transportation Office (LTO) Concerned with the registration of drivers and motor vehicles. RA 4136 prescribes procedure for the examination, licensing and bonding of drivers; the registration and reregistration of motor vehicles, transfer of ownership, change of status, etc. Land Transportation Franchising and Regulatory Board (LTFRB) Exercises quasi-judicial and regulatory powers with respect to land transportation; among its more important powers include the power to issue, amend, revise CPCs; prescribe routes, reasonable fare rates. Class notes: DOTC has control and supervision over land agencies, which is not the case in air agencies. Rationale: Land transportation is more sensitive and requires more care and caution. KMU LABOR CENTER V GARCIA !"#$% '$() *+ ,- ./$  !"#$%&

()*+%&) ,&-.

!"#

! " # $ % ! & ' ( ) " + " ! " # & ' "  ! # $ # % & ' # ( ) * # % & !"#$% '(" )$($%*+,$- !!"#$!%&"'

)**!+,"  ! " # % & ' ( ) # ( * ! + + , ' & - ! " # % & ' % ' ( ) * + , !"#$%&#'(" *#!"$+ !#!"# %&' (!)"* ! " # $ % " & ( ) $ ! * " + , ! " # ! " # $ % " ' " ( %

!"#$%&'!( !* "+,-'. !"#$ &'"#()*'&"&+*# !"#$%&"! (#)$%*"* +, !"#"$%&'( *'+%,-'./0  !"#$ &'(')*+,-. ,! * !!"#$% '( ")%$) *"  ! " ! # $ $ & $ ' ( ) ! " # $ % & ' ! ( " * + , - $ . ' / 0   ! " !"#$%& ()*$+

C.  WATER Maritime Industry Authority (MARINA) Has jurisdiction over the development, promotion, and regulation of all enterprises engaged in the business of vessels, shipyards, dry-docks, marine railways, shipping and freight forwarding agencies and similar enterprises. Rationale for deregulation of shipping industry To encourage investments in the industry by existing operators and attract new investments.

FPIC Test 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. Bascos Test: Whether the given undertaking is a part of the business engaged in by the carrier which he has held out to the general public as his occupation rather than the quantity or extent of the business transacted. Extraordinary diligence A common carrier must render service with the greatest skill and utmost foresight. Rationale:  The nature of the business of common carriers and the exigencies of public policy Rationale of Presumption 28: In requiring compliance with the standard which is in fact that of the highest possible degree of diligence, from common carriers and in creating a presumption of negligence against them, the law seels to compel them to

control their employees, to tame their reckless instincts and to force them to take adequate care of human beings and their property. US V TAN PIACO (1920) ! " $ " % & ' ! ( ) * + % , + -  ! " # $ % ' (

! " # $ % & ' ( % ) * + # , + ) ( '  ! " ! # $ & ' " ( ) * # + , ! " # $ % & ' ' ) & ' " ! " # * ' + ! " # $ % & # ( # # ) * + # " , - #  ! !"#$"! &"!'()" *+ ,- ! #$% &'( '))!(* $+

27

 Art. 1732

!"##$% '( !$#)*+(,(+

 ! # $ % & ' ( $ ) ' & ' ) * + , - !

! " # " $ % & ( ) * & + , % - . +  ! # $ $ % & ' ( ) # * + ' ( , - +

!"#$%& "()*

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! " # $ ! " # % & ' ( ! ) ! * + , # - ! #  ! " $ % " & '

Tan Piaco rented two automobile trucks in Leyte for the purpose of carrying some passengers and freight. They were charged with violating the Public Utility Law for operating without a permit. WON such operation was a public utility NO. These trucks furnished service under special agreements to carry particular persons and property and therefore, not for public use.

!"#$%&## ()*%#*+(&,-

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NOT A GOOD CASE ANYMORE

HOME INSURANCE V AMERICAN STEAM. (1968)  ! # $ % % $ & # ! ' ' ( ) ' * & + ! " # $ % & ' ( # * + $ " " , !"#$ & '()*+&# *&,-! !" !"#$%&$&' )*+, %)  ! # $ % & ' ! ( $ % ) # * + , % & ! " # $ & ' ( ) * & + #

Cipriano subcontracted with BT to help him with the delivery of soya bean meal pursuant to hauling contract he had with Jibfair. BT failed to deliver WON Bascos is a common carrier YES. See doctrine. Bascos herself made a judicial admission that she was in the trucking business, offering her trucks to those with cargo to move. Judicial admissions are conclusive and no evidence is required to prove the same.

PPI V CA (1993) ! " ! $ % & ' ( ) *  ! " $ % ! & % ' ( $ ! ( ) " & * +  ! " # % & ' ( ! " # % # & & # ' ( ) * + ! & ,  ! " # $

&' () & *&!"*+& !

! " $ % & ' ( % ) * + ) + , ! &  ! " # % & ' ' ( ) ' * ) % " ! ) +

! " # $ % & ' ( % & * ' % + & # ,  ! " # $ %

!"##$%#&

$! '()

!"#$%&'("# *+,"-. &+!"#$%& ()" *)+#("#$

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Fish meal was shipped through American Steam. Upon arrival in Manila, the cargo was discharged but there were shortages in the cargo. WON American Steam is liable. NO. See doctrine.  It has already been established that the SS Crowborough is a private carrier for the fish meal of San Miguel. Thus, the provisions on common carriers cannot apply for its case.

! " # $ % ' % ( ) * + , - . ( / $  ! " $ % & ' ( $ % ) $ & * ) $ ' &   !"#$""% '%" $(')" *+ !"#!$%& ()*!"+** !* ,#'!"#$%""&!'

!"#$%&#'(#&) +(

!"#$%&'$% )*!+!, *-% !"#$ $&'(#)& *+

! " " " $ % & " ' ( ) * + $ ( , + -  ! " $ % & ' ( ) ' )

F:

)*!+ !"#$""% ' (")*+%

! " " # $ % & ' ) * % + + # $ , % -  ! # $   !

#$%&'!#()#

 ! # $ % & ' ( ' ) ) $ % * ( +

,+ !""#$%!&#' !) *+%$!, !"

!"#$#% '"#(')* +, -!"#!$%#!&$

!" ()*+

I : R:

! " # $ " " % ' ( ' ) ) * " ) + ,  ! " # $ % & $ ( ) ) " # * $ + " ) ! "

!"# %#&#'() *+,)-./

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FPIC is a grantee of a pipeline concession. City Treasurer required FPIC to pay a local tax. FPIC claims exemption by virtue of its being a common carrier. WON FPIC is exempt from paying local tax YES. See doctrine. It is engaged in the business of transporting or carrying goods, i.e. petroleum products, for hire as a public employment.

 ! " # % " & ' ( % % ) ) & * + , !

!" $%&'()(' %*+!(&$,

F:

  YES. See doctrine.

! " # $ # " % & % ( ) * % ( + $ , ! " # " $ % & ' ) * + + , $ - " . % ,  !

)#& "#*

! " # # % & ' ( ) * + # * , - . "  ! " $ % & ! ' ! & ( $ " $ )

!"#$"%&$"'% "#

I :

PPI ordered Urea from Mitsubishi who entered into a time charter-party with KKKK. PPI sued KKKK because some of its urea was damaged/lost. KKKK’s defense was that it was not a common carrier by virtue of the time charter-party agreement. WON KKKK is a common carrier

FPIC V CA (1998)

*** DE GUZMAN V CA (1988)

 ! " # $ % % ! & ' ! # ) $ * $ ) ' +

F:

R:

NOT A GOOD CASE ANYMORE

!"# %&''(&)# *+

!"#$% '( )*+),#+,-.

Respondent was a junk dealer who occasionally engaged in carrying the goods of others as a side business. Petitioner had him deliver 750 cartons of milk to his establishment. However, 600 cartons were undelivered because one of the trucks got hijacked by armed men. WON respondent was a common carrier

  YES. See doctrine.

BASCOS V CA (1993) ! " # ! # % ! & % ' " # ! " # ( ! " # % & ' # ( ) ( * # + ! , - & (  ! !" $ %$&' () '*+ ,-"!"#$$ #"&'&#( !" )* !"# !"##$%# '($!( (% (") !"#$ &'( (& (!"

LOADSTAR V CA (1999) !" !$ %&" %'('$$)*+ !"#! !"% &#''(%' )% ! " " # $ % ' ! " ! $ % & ' ! % ( ) * + ' , ' +  ! " ! $ % & & % ' !"##$%#

F: I :

R:

Loadstar sank on its way to Manila. WON Loadstar is liable as a common carrier YES. See doctrine.  Then the Court found that Loadstar is negligent in embarking on its voyage. The vessel was found to be not seaworthy when it embarked.

ASIA LIGHTERAGE V CA (2003)  ! # $ % % $ & # ! ' ' ( ) ' & ) ) ! # $ % & ' ( ) * + , ) ! ' # ! ! " # $ % & $ ' ) * + , * - + " . /  ! " $ % & ' ( % ) * + % ! & ' !"#$ &' (")*&")* !"#$%&'() +# %))," !"#$%!&'

F:

I  : R:

Petitioner is engaged in carrying goods (white wheat) by water. Typhoon came. A few days after, the barge developed a list because of a hole it sustained after hitting an unseen protuberance underneath the water. The hole was then patched with clay and cement. Towed then sank. WON Asia Lighterage is liable as a common carrier

  YES. See doctrine. They were clearly negligent.

CRISOSTOMO V CA (2008)  ! # $ % & ' ! # & $ ( # ! ' ' ) ! ! " $ % & % ' ( ) * $ % & ' & + $ (   !" $%& '(&)&*+ , -&)!"#$ !"#$%& %#  ! " " # $ % ! & % # ' # ) * + , " # ! " $ % & ' ( ) * + !"#$%#&'#% !) !*+,%-!"#

%&"'!(') #*+(,')

!" $%&' ("!) !$% *+, !" $% &'%$(") *%) & !"#$% '(")$*

F: I  :

R:

Missed flight for Jewels of Europe. She accused the travel agency of negligence for wrongly informing her of her trip details. WON the agency is liable as a common carrier NO. See doctrine. The contract entered into by the petitioner and the respondent is an ordinary contract of service and only required diligence of a good father of a family.

CRUZ V SUN HOLIDAYS (2010) Child of couply died when the boat that was included as transportation to and from the resort in a tour they F: booked sank during a typhoon. WON Sun Holidays is liable I  : YES. Here are the reasons: a) Sun’s ferry services are so intertwined with its main business   as to be properly considered ancillary thereto. b) The constancy of Sun’s ferry services in its resort operations is underscored by its having its own boats. R: c) The tour packages it offers, which include the ferry services, may be availed of by anyone who can afford to pay d) The fact that Sun does not charge separate fee for boat fare is of no moment because transportation fee is factored in at the tour package price THIS IS AN EXAMPLE OF A COMPANY THAT INCLUDES A CONTRACT OF CARRIAGE AS PART OF ITS SERVICES.

B. NATURE AND BASIS OF LIABILITY Basis of Liability The basis is the breach of contract of carriage Nature of Liability The nature is direct and immediate.

CULPA ACQUILIANA V CULPA CONTRACTUAL CULPA CULPA CONTRACTUAL AQUILIANA CAUSE OF  ACTION NATURE OF LIABILITY OF COMMON CARRIER

The breach of the obligation under the contract Direct and immediate

The wrongful or negligent act or omission Vicarious

Principles governing the liability of the common carrier  29 1. The liability of a carrier is contractual and arises upon breach of its obligation, said breach occurring if it fails to exert extraordinary diligence according to all circumstances of each case; 2. A carrier is obliged to carry its passenger with the utmost diligence of a very cautious person, having due regard for all the circumstances; 3. A carrier is presumed to be at fault or to have acted negligently in case of death of, or injury to, passengers, it being its duty to prove that it exercised extraordinary diligence; and 4. It is not an insurer against all risks of travel.

FORES V MIRANDA (1959) ! " #  ! " # $ % & ( % ) * ) + ! " , % (  ! " # $ % & ! $

! " # $ % & % $ ( ) * & + & , & (  ! " # $ & " ' ' ( ) ' " ! " # $ % & ! ' ( ) * ) , - ( . / (  ! " # $ & ' ( ) * + , + ' , ( ( -   !" $%&'() *! *+, -./

!"#$"%& ()"# ()"

!"#$%& () *+,-%$ .& !"# %&''(#' !) *')+#  !"#! %! &#' ()* !+ # ! #!$%&'((! ()(!* %& !" $"%&' ()*'+%' !" !"#$%! '($)!"!#$ 

F:

I : R:

Driver Eugenio Luga lost control of jeepney while descending Sta. Mesa bridge at excessive speeds. 5 passengers injured including Ireneo, who suffered a fracture of the upper right humerus. WON jeepney is liable YES. There was a clear breach of contract of carriage. And since the sale was not recorded with the PSC, the original owner is liable.

PHIL RABBIT V IAC (1990) ! " # ! $ % & $ ' % ( * % + $ , - $  ! " # ! # $ % & ' ( ) % * + , ! " # $ % ! & ( ) * ) % + ) & * #  ! " # $ & # ' ! ( ) " * ! " # $ % # $ % ' ! ( ) * * + , + !   "#

%& !'&%()"* %()

!"#$ $&"$ $&' "#$() !"#$%"& ()&"*+, !)& !"#$%& "()* +#,*!**- !"# #%!#&! '( !"# ! " # $ & # ' ! ( $ " ) ) ( # *  ! # $ % & $ % '

(&&)**+,

!"# %!& '(")"%& *+, !"#$ &'()* +(,&+'-

CANGCO V MRR (1918) ! " # % & ' ( ) * ! + & ( & % , #  ! " # # % " & % # % ' ( % ) ' * +   ! " # $ % & ! $ " ( ! & % % ) & * +   ! " # % & ' " ! % ( ) ' * +

F:

!"# %&'(&%&!) &* +&, !"# %&' ())!'(%#!*

F: I  :

R:

Watermelons on the platform left by the train employees tripped the alighting passenger, causing injuries. WON MRR is liable YES. MRR was liable because of breach of contract of carriage and such liability, being direct and immediate, could not be excused by proof that fault was imputable only to its employees.

I :

R:

The jeep suddenly U-turned because of one of its rear wheels got detached. Almost at the same time it turned, a bus coming from the opposite direction bumped its rear, killing 3 passengers. WON jeepney owners were liable YES. Court held that in this case, the jeepney owners were liable (for breach of contract of carriage) and for being negligent (failed to rebut the presumption of negligence using extra-ordinary diligence).

LRTA V NAVIDAD (2003) ! " # % & ' ( ) * ! + & ( & % , + !   "#$#%& #( %)* !"#$%&!$ "( !"##$"%& "() $*+ ,-. !"#$!%&

ISAAC V A.L. AMMEN (1957)

! " $ % & ' ( % $ ) * ! + ' , $ -  ! " # % & " ' ( ' ) & * # ! + ( ! " # $ % & ( ) * & $ * % ( + * " ! " # % & ' ( ! ) * + * , - # )

! " " " $ % & " ' ( ) * + $ ( , + -  ! "

F: I  :

R:

Isaac boarded Ammen’s bus, placed his left arm outside the window. Bus figured in a collision that resulted to Isaac’s left arm being severed. WON bus is liable NO. the Court agreed that appellee Ammen had done everything they had in their power to avoid the accident, but could not do it due to the attending circumstances. (Case with pile of rocks that caused the blocking of a lane)

!"#$%&' )* '+'&,#-' !"# "%&" '%(%&#)*# ! " # $ % ! " & ( ) * ( + + ( , *  !   ""#$"%&

F:

Navidad had an altercation with the security guard in LRT, fell on the LRT tracks, struck by a moving LRT train then died.

C. CLASSES OF COMMON CARRIERS  As to service - Carrier of goods; - Carrier of passengers  As to mode of transportation - Land - Water - Air

D. LAW APPLICABLE

!"##$%#& ()"( *+,*%- !"#$%&

())*+" ($ $," 

!"#$%&'$%(& %& *'! ( !"#!$

 Applicability of laws (in order) 1. Civil Code 2. Code of Commerce 3. Special laws Note: According to Art. 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. NAECO V CA (1988) ! " # % & ' ( & % & ! ) * + ' , !   ""#$" #& !"#$%&$' ! " # $ % " # & ' ) ' * + , - # .  ! " !"##$%& ()#

$%&' ()&* !) ("" % $ * + , " # $  ! # $ % & ' & ( ) * % + ( & ,

 ! " # % & ' ( ) ! * ( % " + % , ! ! " # # " $ ! & ' ' ( ) ' !"#$$ &' ()*'+,'- &. !"# %&'# &(

F:

I :

R:

MIRASOL V DOLLAR (1929) ! " # $ & ' ' ( ) * + # ( # , - .  ! " ! # % & ' % ( " # ( ) * + , !" $%%& %'&(' )"& *%

F:

E:

Restatement requisites of presumption from Ynchausti: 1. There is a contract of carriage; 2. Goods were delivered in control/custody of carrier; 3. Goods were received in good condition; and 4. Goods were lost, damaged, deteriorated.

! & & ' ( # ) ( * " + * (  !

! " # $ & ' ( ) ' * " # + $ ( , &  ! # ! $ % & ' ' ( ) ( & * + !"#$% '()' '(% *##+, !"#" %&'&("% )* ! " # % # & ' ( ) ( * ' ( + # * !   "# %&'"& !(()*)+(, !"!#$%& (% )*+# ,(-. !"!#

%$F: I :

NEGLIGENCE occurred during carriage, there is a presumption of 30 negligence . Natural Disaster Act of public enemy Act/Commission of shipper Character of goods; defects in packaging Order of competent public authority

!"#

! " # $ % & ' ( ) + ( , # - ( ) ! .  ! " # % & % ! " ' ! ( ) ) " * (  !

 A. LIABILITY AND PRESUMPTION OF

G.R.: When loss, destruction or deterioration of goods

!"#$#%!& (!"

! " # % & # ' & " ( # ) % ( # * +  ! " # $

! " # # $ % ! $ ' ( ) * + $  ! " # $

Ship owned by NDC and managed by MCP as NDC’s agent figured in a collision near Japan. NDC argues that CA 65 should be applied, which removes liability from shipowner when the captain is found at fault.

The Government enlisted Ynchausti’s services to make two shipments of mineral oil on different dates. Both shipments were found to be short by one case, and this was noted in the bills of lading. WON Ynchausti is liable YES. See doctrine. The Court held that Ynchausti was not entitled to mandamus, because it had failed to refute the presumption that the loss had occurred due to its fault.

R:

Package of books in good condition when received by shipowner. Damaged when it got to Manila. WON carrier is liable YES. Court ruled that 1 st, since it was not proven that plaintiff signed the bill of lading, then the same would not bind it. Even if he did sign it, since the provisions limiting liability are contrary to public policy, then they are considered void. Since the goods were damaged within the trip, defendant shipowner had the burden of proof to show that the goods were damaged by circumstances which would exempt it from liability (ie accident, peril, acts of god, things beyond its control). Defendant failed to prove such circumstances. See doctrine.

B. EXEMPTION FROM LIABILITY

How to rebut presumption: 31 Proof of exercise of extraordinary diligence .

Requisites for the exemption 32 : 1. The natural disaster must be the proximate and sole cause of the loss, damage or deterioration; 2. Common carrier must exercise due diligence before, during and after the disaster; and 3. There must be no delay.

YNCHAUSTI V DEXTER (1920)

TAN CHIONG V INCHAUSTI (1912)

!"# %&#'()%!*+, !"-! !"# %&'' "()

!"#$%&! () *+&+,!-.! !"#$%"&

!""#$$%& &#% (! ()% !"##"$ !&''()'*+ ! " # $ % " ' ( ) * ) + , * - % ,  ! " ! $ % & " ' ' ( ' ( !"#$%"&' )* +))!, $-  !""# "%#&% '" (

30

 Art. 1734

()%*+, -+(

 ! " # $ % " ' % ( $ ! " # $ % & $  

F:

Lorcha owned by the defendant sank due to a storm. The defendant presented several circumstances in an attempt to prove that the loss was through force

I  :

R:

majeure . The circumstances were: 1. There was no way to move the lorcha to another location that was less exposed to the elements 2. The captain deployed did everything to prepare the lorcha for the storm 3. There was equal interest on the part of the defendant company to preserve the lorcha because it contained the goods of the defendant as well 4. Following the storm, the crew recovered what they could and immediately sold them in an effort to minimize the loss of the plaintiff WON the carrier is exempted from liability due to force majeure. YES. Court ruled that the defendant had done all that it could in order to avoid the loss and did not incur any liability.

ASIA LIGHTERAGE V CA (2003) !"# %&'(!) *(+,- &!- !"#$%&$' )*+,*

! " # $ % & ' $ % ! ) * + , - & , +  !

#$%&'#( !)'( *)#

!"!#$% ' ('))*!) +),! #$%&' ( )*!!*& !"##$%#&

F:

I :

R:

Petitioner is engaged in carrying goods by water. It claims that it is not a common carrier because it has no fixed and publicly known route, maintains no terminals, and issues no tickets. It points out that it is not obliged to carry indiscriminately for any person. It is not bound to carry goods unless it consents. In short, it does not hold out its services to the general public. WON the vessel is not a common carrier NO. Court held that Petitioner is a common carrier and petitioner’s defenses does not matter as Article 1732 does not make any distinctions ( see De Guzman)

MARTINI V MACONDRAY (1919) !"#$# &"# '"())#$ *+!""# %& '()" '*# ! " " # $ & ' ( ( ) * # " + # * &  ! "

$% &'!%( &$% )*(! 

!" $%& '$($)* !+ ,!- ! !#!$%&'() %! % !"#$%&'%#!% ") *+%,- !"#$% '( )*++#",-

!"# !"#$%& ()*+,( ,- ,)% !"##$%# $' $(

 ! " " # $ # % ' ( ! ' ' ( # " ) % ! # $ % & ' ( ) * ! % + & , #

Requisites for the exemption 33: 1. The act of the public enemy must be the proximate and sole cause of the loss, damage or deterioration; and 2. Common carrier must exercise due diligence before, during and after the disaster.

 ! " $ % & $ ' ( $ ) ' $ * + , - . ! " $ % $ & ' ( ' " ) $ * $ + ! " !" $% &'(&)!&* )&+,-! #$% &'(()%( *'+ ,%  !"#$ #&'(#" &) *!" + !"##$% "' ()*$ +, #% !"# !"#! !"% &#''(%' "#) !""# #"%&'%"#()

F:

I  :

R:

Goods were carried on deck and upon arrival it was found that they were damaged due to the effects of fresh and salt water (a peril of the sea). Shipper consented to have them on deck (took the risk) WON carrier is liable for the damage on the goods NO. Despite such consent, the carrier may still be held liable if the shipper was able to prove that the carrier had failed to observe due diligence in handling goods carried on deck. In this case, carrier was not negligent, as there was no allegation of negligence.

EASTERN SHIPPING V IAC (1987) ! " # $ " & ' ( ) * ( ' & " + $ # ! " $ % $ & ' ( $ ) " * + $ + & !  ! ! " $ % & % ' ( ) * + ) , ( - ' .  ! " $ % ! & ' ! ( " ' ) ( ! %  !  ! " # $ % & ( ) * ! + ( ! , " - . + ! " $ ! " % & ' ( ! ) " & *

Requisite for the exemption 34: The act/omission of the shipper or owner must be the proximate cause of the loss, damage or deterioration. If the the proximate cause of the loss, damage, or deterioration was that of the carrier and there was negligence on the part of the shipper or owner, damages are equitable reduced.

Requisites for the exemption 35: 1. The character of the goods or the faulty nature of the packaging must be the cause of the loss, damage or deterioration; and 2. Common carrier must exercise due diligence to forestall or lessen the loss.

!" $% &'()* (+)*,-

F: I  :

R:

The vessel caught fire and sank, resulting in the total loss of ship and cargo. WON the carrier is liable YES. See doctrine. Having failed to discharge the burden of proving that it had exercised the extraordinary diligence required by law, Eastern Shipping Lines cannot escape liability for the loss of the cargo

GOVERNMENT V YNCHAUSTI (1919) !"#$%&! () *+#,#*-!, !" $!!%& '()*$ ! " # $ % ' ( % ) % * + , - ' . (  ! " # % & ' ( & % & ) *  

F:

33

Government shipped tiles to its consignee in Iloilo, through Ynchausti. When it arrived, it was found that the tiles were damaged. Government filed an action

 Art. 1739  Art. 1741

34

I  :

R:

to recover. WON Ynchausti is liable NO. In their complaint, they did not dispute that the tiles were fragile or that it was loaded by Ynchausti properly. Ynchausti proved that the tiles were brittle and fragile and that they were delivered without any packing. It also proved that there was no negligence on its part by showing that the tiles were loaded and stowed in a diligent manner.

SOUTHERN LINES V CA (1962)  ! " $ % ! & ' ( $ ) * " $ + ( , + ! " # ! % " # & ! # ' % " ( ) & !   !"#$"%&'% )* %))+, ) ! #$%&'(

F:

I  :

R:

City of Iloilo ordered rice from NARIC. The rice was delivered through a ship owned by Southern Lines. Upon delivery and payment, it was discovered that there was a shortage of rice. Iloilo then filed for the recovery of the value of the undelivered rice. WON the carrier is liable for the shortage YES. In applying Arts. 361 and 362, the damage was not caused by the inherent nature/defect of the goods, but by petitioner’s own negligence (Southern Lines itself frankly admitted that the strings that tied the bags of rice were broken; some bags were with holes and plenty of rice were spilled inside the hull of the boat, and that the personnel of the boat collected no less than 26 sacks of rice which they had distributed among themselves.)

Requisites for the exemption 36: 1. Public authority had power to issue the order; and 2. Order was issued with legal process. GANZON V CA (1988) !"# %&!"'()!* +"' ,% !" $%" &'("' )*+$ !"#$ &!$ '()$* &( +, !"# %&# '(!)"%#'

!"#$"% !" '()'

!" $%& !"#$%!!

#$ %&'% (%

! " # % # # & ' ( & ) ( ' * + ' , ! " $ % & ' ( ) ) & *

 Additional reason: Robbery  37  Common carriers are responsible even for the acts of strangers/thieves/robbers BUT the duty of extraordinary diligence is reached where the goods are lost as a result of robbery attended by grave or irresistible threat, violence or force.

SUMMARY ON RULES ON EXEMPTING CIRCUMSTANCES: REQUISITES 1. The natural disaster must be the NATURAL DISASTER  ART. 1739 & 13740

 ACT OF ENEMY  ART. 1739

 ACT/OMISSION OF SHIPPER  ART. 1741

CHARACTER OF GOODS OR PACKAGING  ART. 1742 

ORDER OF COMPETENT  AUTHORITY  ART. 1743

proximate and sole cause of the loss, damage or deterioration; 2. Exercise of due diligence before, during and after the disaster; and 3. There must be no delay. 1. The act of public enemy must be the proximate cause of the loss, damage or deterioration; 2. Common carrier must exercise due diligence before, during and after the act of enemy. The act/omission must be the proximate cause of the loss, damage or deterioration. If proximate cause was that of the carrier and both were negligent, damages are equitably reduced. 1. The character of the goods or the faulty nature of the packaging must be the proximate cause of the loss, damage or deterioration; and 2. CC must exercise due diligence to forestall or lessen the loss. 1. Power to issue the order; and 2. Issued with legal process.

 ! " # $ % & ' # ( )

F:

I  :

R:

Ganzon’s employees ended up dumping the scrap iron that they were contracted to deliver to Manila into the ocean due to the intervention of the Acting Mayor of Mariveles. Shipper sued for damages. WON the carrier is liable. YES. The Court said that Ganzon cannot escape liability because (1) he failed to exercise EOD; and (2) he failed to prove that the loss was caused by the intervention of competent authority. The Court pointed out that since there was no showing that the Acting Mayor’s order was backed up by any power to issue the same, it wasn’t considered as an order by competent authority.

C. DURATION OF EXTRAORDINARY RESPONSIBILITY Instances when carrier has extraordinary responsibility: 1. From the time the goods are unconditionally placed in 38 the possession of, and received by the carrier  or its authorized agent (ability to exercise control and 39 possession)  for transportation; Test: If there is nothing remainds to be done by the shipper, then carrier has control and possession 2. During storage in a warehouse of the carrier at the place

37

38

 DE GUZMAN V CA CITING ART. 1745(6)

 Art. 1736

of destination; Until consignee has been advised of the arrival of the goods + reasonable opportunity to remove or dispose of 40 them 3. During temporary unloading or stored in transit (unless such storage is due to the exercise of the right to 41 stoppage in transitu) ; 4. Until actual or constructive delivery to consignee, a duly authorized agent, a person who has a right to receive, a 42 43 stipulated authority , or the shipper . Must be given reasonable time to remove goods. 5. The responsibility to provide safety to its passengers obligates it not only during the course of the trip but for so long as the passengers are within its premises and where they ought to be in pursuance to the contract of 44 carriage .

!"#$ &'()"*+(, +! -& !"#

F:

I : R:

Parties stipulated that: “The responsibility of the Carrier in any capacity shall altogether cease and the goods shall be considered to be delivered and at their own risk and expense in every respect when taken into the custody of customs or other authorities.” WON such stipulation is valid. YES. The Court found nothing therein that is contrary to morals or public policy that may justify their nullification.

SAMAR MINING V N. LLOYD (1984) ! " # $ # & ' ( ) ! * ( + , # + &  ! " # $ & ' ( ) ' * # + ( * , - ) ! !"# !%&'()*%! *+ ,** !" $%&' ()""&""*)' !"# %&&' ()*'&+ ,-&* !" !$% &"'()*'%% "+ ! " $ % & ' ( ) * + ( ! $ " , % -  ! " $ % ! & ' $ & " $

When extraordinary responsibility ceases (ordinary diligence is still required): 1. When shipper/owner made use of the right of stoppage

!"#$%&#'(" *+," +$ -!"#$ &!' () *#')"# !"# %&&'()

45

in transitu  ; 2. After the lapse of the reasonable time for the 46 acceptance by the authorized receiver .

F:

COMPANIA MARITIMA V INSURANCE CO (1964) ! " # % & ' ( & % & ! ) ' * + , #  ! " # $ ! % & % ' % ( ) # + ( , -

!"##$%# !"#$% ' ()"*%'(* +)% !"# %&''(&)#

I :

!" $!!%& '!(()*') !* !"#$% '(!)'*

! " # $ % " & ' ) * + * & & " , "  ! " # % & ' # ( ) * + , , ! ) ,

!"

 ! " ! $ % & ' ( ) * + , ! - + " % 

R:

A provision in their contract states: “This carrier, in making arrangements for any transshipping or forwarding vessels, or means of transportation not operated by this carrier, shall be considered solely the forwarding agent of the shipper and without any other responsibility whatsoever even though the freight for the whole transport has been collected by him.” WON the carrier is liable NO. Upon entering Manila, the carrier becomes the agent of the shipper and therefore is exempted from liability. See doctrine.

! " # $ # % # & ( " # ) * $ ( & * +  ! " # % & ' ' ( ' ' ) & " & * !""#$ &'$$($ )" )*( !"##$%# "'( ')*+$', !"#$%&' )* +" ,*&" +

! #$% &$'((%)* #$%+

!"

!"! #$ %&'( )'*+ ,$-*& !"#$ #&'# #&( ! " # $ % & ' ( ' * + , & - - " !  ! " # % ! & & ' ( & ) ! * + ( ( "  !"#$%&'"(!)*

F:

I  : R:

Macleod contracted Maritima to ship hemp from Davao to Boston. At Davao, Maritima placed the cargo into 2 leased lighters. While waiting for S.S. Bowline Knot, one of the barges sank. WON Maritima is liable YES. See doctrine. The court held that the Maritima is liable despite the fact that the hemp was not loaded to S.S. Bowline.

Class notes: Note that Lu Do and Samar Mining are examples of a limitation to the duration of extraordinary responsibility by virtue of contractual stipulations. APL V KLEPPER (1960) ! " # # % ! & ' ( & ) * + ' & , & #  ! " # $ ! % & % ' % ( ) # + ( , !"##"$ !&''()' *&+,+ !"#$ &'( &)$( &'( !""#$ &'( )*+"*#,-,"!"##$ &#"'() *! +,(

!"##$##%"& "() *&+ , !"!#$!%

! " # % # & ' ( ) " # % & % * " ' +  ! " # $ " & ' ( ) * ' ) + '

!"#$%"&"!' )*+,)##- !" $!%&'"($')*+,-. /! ! " # % & ' ' ( # ' ! ) ! " # %  ! " # $ % " & & ' ! ) * ! * + & !"#$%& ()% )*$ * #+, !" "$ %&'&()& "!&*+ !"#$%&# ()*+&,"-* #% !"# %&'()*)'+* ',

LU DO V BINAMIRA (1957)

 ! " # % & ' ( )

 ! # $ % & ' ( ! $ % ) * ( % + % $ % ! " $ % & ' % $ % ( ) * ! ( % $ (  ! " ! " " # $ & ' ( ) ' & * $ + ( ' ' (  ! # $ % & ' # $ ( ' $ )

F: I :

40 41

 Art. 1738  Art. 1737

42

43

 LU DO V BINAMIRA

 Art. 1737 and SAMAR MINING V N.LLOYD

44

45

 LRTA V NAVIDAD

 Art. 1737

' ( ) * ! " + , , #  ! "

R:

While the lift van was being unloaded by the Gantry crane operated by Delgado Brothers, Inc., it fell on the pier and its contents were spilled and scattered. WON APL is liable YES. Petitioner does not dispute its liability as common carrier, it however contends that the same cannot exceed $500. This was agreed to by the Court, stating that the limitation of liability in the Bill of Lading was valid.

a. Reasonable and just under the circumstances; (c.f.

EASTERN SHIPPING V CA (1994) !"# %&''&( %)**+#*,- !"#$ #& &'()*+) #,) !"#$%&%'" )%*%+",-" !" $%& '%!()&"$ *+ !""#$ &'$($ )*"+ (,- !"#$ !&$ '(!")*$+  ! " # % & " " # ' ( # " # ( ) * * ! # $ % & $ ' ( ) ( & $ * + + , !"#$%& () *+% !,--%- !"#$

!"# %&' ()**+'* ,-* !"#$%"&"! ()* )&

# & ' ( $ ) * + , + " - +  !

!"#$%&'"!#!('$ *$!(+ !"#$% #'( %)*+( ,- )

!"#$%&#'(" *+," -%!

!"#$% '((#)!'*(# +,-

!"# %#&'() #)!*!+#, !" $%&%'(% !)%*+

F:

2 fiber drums of riboflavin were shipped from Japan. Upon arrival, one drum contained spillages, while the rest of the contents were adulterated/fake.

EASTERN SHIPPING V BPI/MS INSURANCE (2014)  ! " ! $ % & " ' ( ) ' & $ ' % * ! " # $ " # & " $ ! ' ( ) ' * ) + ! !"#"$%&'% )%*+")%! ,!

#$%&' ()&&)*

Art. 1751) and b. Fairly and freely agreed upon. 2. Limitation of liability upon delay due to strikes or riots 50; 3. Limitation of liability to amount in the bill of lading, unless shipper declares a greater value and pays a 51 higher rate of freight ;

Exceptions to the limitation on liability 4. If the injury or loss was caused by the carrier’s own 52 negligence . Class note: - These rules are only applicable to land and air transport. HEACOCK V MACONDRAY (1921) !"#$# &$# !"$## '()* ! #$ !%&'()*%&#+!

! " # # $ % # & " # % ( # % & ) * %  ! # $ % & ' # ( ' ) * # $ + !"#$%#"!& %( &)" #** !" $%&' $()*"+,($&!

!"#$% "!'%( )% *)++, !" $%&'()* +,- "'./+ 

!"#"$%&$'#"! &$ )'* !"#$ "& '(#$&")('

! " # $ % # & ' & ) & * + , ! " - ,  ! " $ % & & ' " & ! " # $ & ' (  ! " # ! % % % & ! ' & % & ( ) * + ! # $ % % $ ! & ' ( ' ) *

! " # $ % % ' ( $ ) ! " # $ % ' ( ) ' ' ( % * # + , %  ! " # $

! " " # $ % ! & ' ( * + % , $ ! -  ! ! # $ % & $ # ! ' # ( ) * #

!"#$ $&'$ ()*)( +, -!"!#$%&$'

F:

Some of the steel coils shipped by Sumitomo with ESLI were not in good condition as evidenced by TOSBOC and RBOC jointly executed by ESLI and the arrastre stevedoring company ALI.

! " # $ % & ( ) $ * + & " ! , $ )  ! " $ " % $ ! & ' ( ' ) * ! " # " $ % $ " & ' & ) * + , - ! ! " # ! $ ! % & % ( " ) " * + , ,  ! !"#$"%&'() %+, %+&-. !"#"$% $'( !")*"!"$+  !" !"# %&''(#' !) &* &+

!""# %&'(&)*+,-

! " # $ % % ' ( $ % (  ! " " # $ & # ' ( ) $ # * ) + ! , ! " # !"#$% "'( )"*+ " ,-. !"# #%&" '( (#")*!&+

D.  AGREEMENT LIMITING LIABILITY

 ! " " # $ % & ' ( * # ! ' ! + , # ! " $ % & ' ( ) * + , & - . " ( '  

 ! " # $ % & ' # ( ) # $ + , ' & - #   ! " #

%&'("# )*"#% (+

! " # $ % & ' " # ( ) ! ' + , # ) - !   "#$ !& '(#)*

47 

Requisites for a valid limitation of diligence : 1. Must be in writing and signed by the shipper or owner; 2. Supported by a valuable consideration other than the service rendered by the common carrier; and 3. Reasonable, just and not contrary to public policy.

!"#$%&%' $" )*+,-! )!"#$%&

F:

Unreasonable, unjust or contrary to public policy 48: 1. Goods transported at risk of shipper; 2. Complete exoneration from liability for any loss, damage or deterioration; 3. Any level of diligence is dispensed with; 4. Diligence lower than ordinary diligence; 5. No responsibility for acts/omissions of employees; 6. Dispensed with or diminished liability for acts of thieves or robbers without grave/irresistible threat, violence or force; or 7. No liability for loss on account of defective condition of vehicle or equipment used in the contract of carriage.

R:

 Allowed stipulations: 1. Fixing of a sum that may be recovered if 49:

I :

47

 Art. 1744  Art. 1745

48

()* *+, *+#-.

!"

!"#$% "'% (')*+,("-#!"

The parties argue as to the valuation of the carrier’s liability for the lost Edmond clocks. The rationale: estoppel — that, having accepted the benefit of the lower rate, in common honesty, the shipper may not repudiate the conditions on which it was obtained.

SHEWARAM V PAL (1966)  ! # ! $ $ % & $ # ! ' ' ( ) * % + ! " ! " $ % ! & ' ! % ! " ( ) * + !"#$%& () )% *)++ ),  !""#$ $&'(()# *&)+) ! " # $ & ' ( " ) * + ) , + ! ! ! " # % " & # ' ( ) * + , # - !  ! !"#$%#"!&"'

F:

50 51

The liability, if any, for loss or damage to checked baggage or for delay in the delivery thereof is limited to its value and, unless the passenger declares in advance a higher valuation and pay an additional charge therefor, the value shall be conclusively deemed not to exceed P100.00 for each ticket. WON the carrier is exempt from liability.

 Art. 1748  Art. 1749

NO. The fact that those conditions are printed at the R:

back of the ticket stub in letters so small that they are hard to read would not warrant the presumption that the appellee was aware of those conditions such that he had "fairly and freely agreed" to those conditions. Passengers also do not sign the ticket.

I :

R:

ONG YIU V CA (1979)  ! # $ % & ' ! # & ( ) * ) & ) % + ! " # $ " ! " % & ( ) * + # +

does not provide for claiming of damages due to delay in the delivery. WON the Warsaw Convention is an exclusive list NO. See doctrine. It does not regulate, much less exempt, the carrier from liability for damages for violating the rights of its passengers under the contract of carriage, especially if wilfull misconduct on the part of the carrier's employees is found or established, which is clearly the case in point.

 ! " # $ $ % ' ! ( ) ! * + , - % , $ ! # $ % $ & & ' # ( ) * ) + # ! %   !"# %&'()* &+ !"# ', ! #$%&'((')* $)+ #%$ ! !"#$%&!$'#( &(&'#*$ !"# %&' !"#$%#"!&"'

F:

I  : R:

BAGGAGE LIABILITY ... The total liability of the Carrier for lost or damaged baggage of the passenger is LIMITED TO P100.00 for each ticket unless a passenger declares a higher valuation in excess of P100.00, but not in excess, however, of a total valuation of P1,000.00 and additional charges are paid pursuant to Carrier's tariffs. WON the carrier has limited liability. YES. Since the Petitioner did not declare a higher valuation on the luggage, he is therefore bound to be indemnified to a maximum of P100.00 only.

PAN AM V IAC (1988) ! " # $ % & ! ( ) * + ! # % % & ,  ! " # $ % & % ( ) * + , $ % - .

Note: Remember that under Art. 1165, if the carrier is in delay, it is responsible for any fortuitous event until it has effected the delivery. MAERSK V CA (1993) !"##"$ !&''()'* &') !"#$ !&#'()*+, *! ! " # $ & $ ' ( ) $ * + , ( - . ( /   !

!"#$%&'($ &* #$+,-$% !" $ %&'()*)( +$,'-

F:

 ! " # $ % & # " ' ( ) * ( 

F:

I  :

R:

Liability for loss, delay, or damage to baggage is limited as follows unless a higher value is declared in advance and additional charges are paid: (1) for most international travel (including domestic portions of international journeys) to approximately $9.07 per pound ($20.00 per kilo) for checked baggage and $400 per passenger for unchecked baggage. WON the limitation on liability is valid YES. Based on the conditions stipulated in the airline ticket, Pan Am’s liability is limited to $20 per kilo since Pangan did not declare a high value in advance nor did he pay for addtl charges

CATHAY PACIFIC V CA (1993) !"# %&'(&% !"#$%#&'"# )"%* #"& !"#$%&#  ! " ! $ % & ' ( ) " * + % % $ ) , ! " # $ % & ' & ) $ * ! !"#$%"&'# )*+ ,'&-%+!"# % &%''!(' )!%*)(  !"# %#&'() "! ("*+#' !" $% !&''(&)* $' &+  ! " ! $ % & ' ( ) * ' + , + ) & -  ! " # # % ! # & ! ' ( ! " ) ! ! " # $ " ! " % & ' " % ) * + , -  ! " $ % & ' ( ) * & " + & ! " # $ % & ' ! ( ! * & + # , ' -  ! " $ % & ' (

F:

Tomas (EVP of a company) was travelling to Jakarta from Hong Kong to attend a conference with the Director General of Trade of Indonesia. His checkedin luggage containing all his clothing and documents needed for the conference got delayed + he was rudely treated by the airline employees, so he sued for damages. Cathay contends that Tomas cannot sue for damages for the delay, since this case falls under the ambit of the Warsaw convention that

#$!%&'!()$ *+,$-

!"#$%% '( %)$*+,# *-!"#$%" "'()

I :

R:

Castillo ordered empty gel capsules from a supplier in Puerto Rico. For unknown reasons, the cargo was diverted to Richmond, Virginia, before being redirected to Oakland, CA, and then, finally, to the PH on 10 June 1977. Hence, there was a delay of over 2 months. WON Maersk is liable for the delay YES. The Court held that this delay entitled Castillo to damages. See doctrine. In this case, the bill of lading specified the delivery date, which Maersk was bound to observe.

Factors that would render the stipulation on limitation of liability ineffective: 1. Common carrier refuses to carry the goods 53; 2. Common carrier delays, without just cause, the 54 transportation of the goods ; 3. Common carrier changes the stipulated/usual route 55 Notes: The fact of absence of competitor in a line/route will be part of the test on reasonableness of stipulations limiting 56 liability . Notwithstanding limitation of liability, presumption of negligence will still hold.

53

 Art. 1746  Art. 1747

54 55

Id

E.  APPLICABLE LAW IN FOREIGN TRADE Law of country of port of destination shall govern the 57 liability of the common carrier .

F. RULES ON PASSENGER BAGGAGE LEGAL NATURE OF BAGGAGE

REQUIRED DILIGENCE  APPLICABLE RULES

HAND-CARRIED

CHECKED-IN

Necessary deposit, if such baggage is not in his personal custody or that of his employees58 Due diligence

Considered as “transportation of goods”

Arts. 1998, 2000 – 2003 (hotels, etc.)

Extraordinary diligence Arts. 1733 - 1753

SUMMARY OF DEFENSES OF A COMMON CARRIER (IN ORDER) Total exoneration from liability 1. Not a common carrier 2. Damage happened outside the duration of the contract of carriage 3. Presence of exempting circumstances 4. Exercise of extraordinary diligence

Nature of responsibility 60 1. Bound to carry passengers safely as far as human care and foresight can provide; 2. Using the utmost diligence of very cautious persons; and 3. With due regard for all the circumstances. Extent of responsibility: 1. Passengers; 2. Crew and complement61; 3. Strangers within its premises, when their presence was called for by the contract of carriage and known and 62 consented to by the carrier. Instances where carrier is liable 1. Defects in the parts of the vehicle63 2. Discoverable manufacturing defects64 Instances where carrier is not liable 1. Acts of strangers outside the carrier’s control or even 65 knowledge or could not have prevented 66 2. Sovereign acts 3. Negligence or abuse by unscrupulous passengers 67 ISAAC V A.L.AMMEN  ! # $ % % $ & # ! ' ' ( ) ' ( * ! " # % ! & ! ' ( ) * ) " + % , ! !"#$#

LANDINGIN V PANTRANCO (1970)  ! "  ! " " # $ % & ' " ! ) * % $ + , $ ! " ! # $ % ' ( $ ) !

Partial exoneration from liability 5. Stipulation limiting liability 6. Contributory negligence

 ! " # $ % $ & ' ( ) ' + , $ # ! ! " # $ & $ ' ( ) * ( $ +

F: I :

 A. NATURE AND EXTENT OF

R:

RESPONSIBILITY Principles governing the liability of the common carrier  59 1. The liability of a carrier is contractual and arises upon breach of its obligation, said breach occurring if it fails to exert extraordinary diligence according to all circumstances of each case; 2. A carrier is obliged to carry its passenger with the utmost diligence of a very cautious person, having due regard for all the circumstances; 3. A carrier is presumed to be at fault or to have acted negligently in case of death of, or injury to, passengers, it being its duty to prove that it exercised extraordinary diligence; and 4. It is not an insurer against all risks of travel.

LANDICHO V BTCO  ! # ! $ $ % & $ % ' ( ) * ! (  ! " # $ % & ' ( * + # & , ( ,  ! " ! # $ % & ! ( ( ) # % * % ! $ ! # $ % & ' # ( ) * ' & + # $ , !"#$%&'($ &!*+, -./$  !"#$%&'"!#!('$ !"#$%&!$' ")*# $" &+ !"# %& !'"()!*!+,!" ! " # # $ % & $ ' # ) * + , " - )  ! " " ! # $ " % ' ( ) * + ! " # $ % # & ' # % " ) * $ + , * -  ! " $ % & $ ' ( ) ( ! * ' + & ' ! " $ % & ' ! ( ) * & * ' ) & + '  ! " # $ % & ' ( ) ! % + , ! " ( - $   !"##"$ !"##$%#&

F:

60

 Art. 1753  Art. 1754

58

Petitioner fell off bus while trying to save chickens

 Art. 1755

 PAL V CA 62  SULPICIO V CA 63  LANDINGIN V PANTRANCO 64  NECESITO V PARAS 65  PILAPIL V CA 66  JAL V CA 61

57

Bus in steep Baguio road. Broken crossjoint. Dead. Inspected the day before. Unable to prove that they took into account all circumstances (negligence). WON PANTRANCO is liable YES. The rationale of the carrier’s liability is the fact that the “passenger has neither the choice nor control over the carrier in the selection and use of the equipment and appliances in use by the carrier

and suffered injuries. WON carrier is liable

I  :

F:

NO, HE WAS SLEEPY. The 3 requisites were not R:

met. Absent overt manifestations, a common carrier cannot be expected to know the mental/physical well-being of its passengers (whether or not the same are sleepy or dizzy, for example)—part of the responsibility for his safety falls upon the passenger himself as well.

I :

R:

NECESITO V PARAS (1958) !"# %&''(#') !"#$% '() *' #'+,-%- !" !"#$%&' )! *)"+*$ #, ! #$% &'()* +& ,#* ! " # $ % & ! ' ( ) $ + , $ - . / 0  ! " # $ % !    ! # $ % $ & ' ( ) ! * ' + ( , $ - ! " # $

"& $#! '$#()*+

!"# %&' "()*+,%*"-. !" $ %$&&'(& )(*$+),

JAL V CA (2005) ! " # % & ' ' # ( ) # * " & ' # +  ! " # " % & ' ( ( ) ! * + ! , (

 ! " # $ % ! & # ( # ) * + " * , ! - ! " # ! $ % & ! ( ) " ! " * + $ % "  

! " # ! " % & % ! ' # ( ) * + ' !  ! " $ % & ' ( & ) * + , ' &

! " # % & ' ( ) ! ) & ' * ' ( + !  ! " # $ % & ( ) % & " !"#$%&"'(

F: I  :

R:

Bus fell into the river because of the failure of its steering knuckles. WON carrier is liable YES. The rationale   for this rule is because the passenger has neither choice nor control over the carrier in the selection and use of its equipment and appliances. Having no privity with the maufacturer, the passenger has no remedy against him, but the carrier has. While it may be impractical to require to test the strength of each and every part of its vehicles before each trip, due regard for the carrier's obligation to the travelling public demands adequate periodical tests to determine the condition and strength of the vehicles.

 ! "  ! # $ % & ' % ! ' % ( ' $ ! )  ! # $ % & ' $ ( ! ) $

!"##$%#&' )*+$,"-$). !" $%&&' ()* %+, ()! " # # $ # % ' $ ( % ! ) * + * ,  ! # $ % ! ! & & ! ' ( ) * # ( ) + *  

!

!" $%& '())&*+&, !) !"# %" #&'!%("&#)* " ! !" !$ %&' ()*+',, *" !"#$%&'"!($) +, -(,%

! " $ % $ & ' ( " ) * + , - ) . !   ""#$" !"##$"%&'

F:

I :

PAL V CA (1981) !"# %&!' !( #)#*+,-#  !"# %!&'(! )*+*,#-.# 

! " # $ % & ( # ) " ! ! $ * + $ , !  ! " $ % & & ! " ' ( ) * + % !"!#"$% '( )*" +$", !" $%& '!()*&(&+$ ! " # $ % & ' ( ) & + # , % $ $ ' #  ! "

F: I  :

R:

Due to old age of pilot, plane overshot, causing severe injuries to co-pilot. WON PAL is liable YES. See doctrine. This must be so for any omission, lapse or neglect thereof will certainly result to the damage, prejudice, nay injuries and even death to all aboard the plane, passengers and crew members alike.

Respondents flew to Japan for a stop-over but they were denied shore passes due to an inconsistency in the passport, and were ordered to stay in the Airport Rest House overnight. Because of this incident, the respondents filed for damages against JAL for breach of contract. WON JAL is liable NO. It may be true that JAL has the duty to inspect whether its passengers have the necessary travel documents, however, such duty does not extend to checking the veracity of every entry in these documents.

B. DURATION OF RESPONSIBILITY  Jurisprudential basis: 1. During ingress68 and egress 69 2. Even after alighting from the vehicle until the passenger had a reasonable time or a reasonable opportunity to 70 leave the carrier's premises Test:  The primary factor to be considered is the existence of a reasonable cause as will justify the 71 presence of the victim on or near the vessel . 3. Even during stop-overs, until the passenger reaches the 72 port of destination .

SULPICIO V CA (1995)  ! # ! $ $ % & $ % ' ! ( ' ) $ & ! " # $ ! % & ' ( * # + % $ , - + %  ! " ! " # $ % & ( ) * ) *  $ ! " # $ % & ' &  $ ! " # # $ % & $ ' #

!"#$"% "#' ()*+"'*',

!"#$ &"#'( )(#*#$+#

! " # % " & & ' ( ) * + , - . /  ! # $ % & ' ( # & $ ) ! " # # $ " % & " ( ) * ( + , (   ! " # % & " ' ( " ) ( # ) & * + !"# %&''(#')

&!' ($ )$*+

!"#$!% '() # $)!"#$ &' #&()*"#) &'

R:

! " $ % & ' ( ) $ ! * + ! , , ! ! # $ % % & ' % ( & ( ) * % + ,  !

One of the stevedores hired by carrier to load and unload copra lost consciousness and eventually died of gas poisoning when he entered the room. WON carrier is liable. YES. It was not enough that Sulpicio’s EEs warned the stevedores not to enter because of the gas. Sulpicio’s employees should have been sufficiently instructed to see to it that the hatch of the barge was not opened by any unauthorized person and that it could not be easily opened by anyone. Precautionary measures also should have been observed by Sulpicio's employees to see to it that no one could enter until after they made sure that it was safe.

 DEL PRADO V MERALCO  CANGCO V MRR 70  LA MALLORCA V CA 71  ABOITIZ V CA 68 69

CANGCO V MRR

ABOITIZ V CA (1989) ! " # $ # & $ ' ( $ ) * ( + $ & $  ! " # $ % ! " # $ %

!"" $%& '()*+ ', "-% !"# "% &'! ()'* +! +

'$(( !)*

! " # $ % & & ( ) ) % * ) + , ( -  ! " # $ & " ' & ( ) * ( ( + , - +  ! "

!"#$%&"$'( *+",$%&*+  !"#$% #'( )*++(",(-

! " # $ % $ & $ ' ( ! * + ( " ! ' ! " # ! $ $ & # ' ( ) * $ * # + )  ! " #

!"#$ "&'() )("*!+,- !"# %&#'"()'"*(+ !"#$%& "%()*+$, #-./ !"# %&''(#')* !"#$%&'#!% ") *'+ ' !"#$%&#'("

DEL PRADO V MERALCO (1929)

!""!#$%&'$( $! *+,-+  !"# %&''(#')*

! " # % & ' ' ( # ' ) * + , ! - #  ! " # " % & " # ' ( & )

!"#$%&#&'

!"#$%&$ (%)#*+&, -." !"# "% &'(( "% )* !"#$% '()*"!)+* !"%, !"#$%&

F: I  : R:

Del Prado got on a moving motorcar and fell when the driver accelerated the same before he got his balance. WON MERALCO is liable YES. Meralco breached its obligations as a carrier, and as such, is liable for the injury suffered by the plaintiff. See Doctrine.

LA MALLORCA V CA (1966) !"# %#&'!()* )+ ,'%% !"# %&' (%))"&*"#

F:

I :

R:

! " # $ & " ' ( # ) $ # ) ' ' *  ! # $ # ! % & & ' ! !"##$%&$' ")*&!"# %&'( "!) *+&&,)&! " ! " # $ % & " ( ) ( * & ( % " + ! " ! # $ ! % ' ( $ ) ! # * + + ,  ! "  ! " " $ % & ' ( ) " ' * + % , " ! " # $ ! % " &

( ) $ * % " $ ! " )  ! "

!"#$% #'( )*++(",(- !"# !"% " &'"#()"*+'  !"#$ &' ( '$()&*(+,$ !""!#$%&'$( $!

Anacleto Viana, a passenger of an Aboitiz vessel, returned to the vessel to get his cargo. He was hit by a crane used for the unloading of cargo. Consequently, Anacleto died. WON carrier is liable YES. See doctrine. All persons who remain on the premises a reasonable time after leaving the conveyance are to be deemed passengers, and what is a reasonable time or a reasonable delay within this rule is to be determined from all the circumstances, and includes a reasonable time to see after his baggage and prepare for his departure. The carrier-passenger relationship is not terminated merely by the fact that the person transported has been carried to his destination if, for example, such person remains in the carrier's premises to claim his baggage

!"#$" &'" (#))*")+, !"#$%&#&'

F:

I  : R:

Beltran and family alighted from the bus and were now situated 5 meters from the vehicle. Mariano went back to get their bayong which they left inside. While waiting, the bus suddenly started to move and unfortunately ran over his daughter’s skull, killing her. WON the bus company is liable YES. See doctrine. Court held that they are still entitled to claim based on breach.

PAL V CA (1983) !"# %#&'!()* )+ ,'%% !"# %&' !"##$%&$' !"#$%#&'( &#$%* $+' !"##$% '"( )$$* !"#$%$ "' '(% )*+' * ! #$%&'()&'*( )(# +) ! !"#$ $&" '())*")+, - !"#$%"%&

F: I : R:

Pedro’s flight had to be diverted because of a storm. PAL left him hanging without food, accommodation, or transportation in a vicinity of armed conflict. WON PAL is liable. YES. See doctrine. It invites people to avail of the comforts and advantages it offers.

BATACLAN V MEDINA (1957) !"#! %&' (")*+)"(,"- !"#$"#% $"# ! " # $ % # " ! & ( ) ! * + ( & % ,  ! # ! $ % & ' ( ) * + $ )

C. PRESUMPTION OF NEGLIGENCE

! " # $ " & " ' # ( ) * + , ! - *  ! " $ % & ' ( ) * & ( + * $

!"#$% '()*% +,# *-* !"#$% '! !" $%& ! " " # $ # ! % & $ ( ) * ! + , # $  ! # $ % & ' ( ) % & ) ' % ! $

When presumption of negligence attaches 73 In case of death of or injuries to passengers.

! " # $ % ' ( ! $ ) ! * + , - # % !  ! " $ ! % & ' ( ) * + * , ! !"#$%& 

F: I  :

R:

The famous bus that turned turtle and caught fire. WON the bus company is liable YES. See doctrine.  This case shows that the responsibility to exercise EOD still continues even after the bus turned turtle. heir negligence was the proximate cause of the deaths. The fire resulting from the torch was not the proximate cause; it was merely a consequence of the accident, and an immediate cause. The trapped passengers needed help, and people came to help. The proximate cause of their deaths was the turning turtle of the bus, which resulted from negligent driving.

How to rebut presumption 1. Exercise of extraordinary diligence74 2. Force majeure/caso fortuito/fortuitous event + no 75 negligence on its part 3. Passenger’s own negligence 76

73

 Art. 1756  Id.

74

75

 BACHELOR EXPRESS V CA

 3-fold test to exonerate common carriers from liability 77 : 1. The common carrier makes sure that a passenger paces himself inside the vehicle; 2. The vehicle is operated carefully; and 3. Its mechanism is perfectly alright to avoid mishaps. Notes: rd Carrier may still file a 3   party complaint against another erring vehicle. The defense of “last clear chance” is not applicable, since this is a defense in contributory negligence between 2 vehicles.

! " # $ % " & ' $ ( ) # * , - % - & '  ! " $ % & ' ( % ) * + $ ' ( % !"#$#$%&"'( !""# !%&'(" )* +," -!"#$ #"&'

! " # # $ & ' ( ) * # + , - ' ,  ! " # % & " ! ' ( ) * + , ! ' - .

E. LIMITATION OF LIABILITY; VALIDITY OF STIPULATIONS Invalid stipulations 79: 1. Dispensing or diminishing of responsibility for the safety of passengers; Note that for goods, level of diligence may be decreased to ordinary diligence.

2. Limitation of liability caused by willful acts or gross negligence by carrier during gratuitous carriage.

D. FORCE MAJEURE Essential characteristics of a caso fortuito 78: 1. The cause of the unforeseen and unexpected occurrence, or of the failure of the debtor to comply with his obligation, must be independent of the human will; 2. It must be impossible to foresee the event which constitutes the caso fortuito, or if it can be foreseen, it must be impossible to avoid; 3. The occurrence must be such as to render it impossible for the debtor to fulfill his obligation in a normal manner; and 4. The obligor (debtor) must be free from any participation in the aggravation of the injury resulting to the creditor.

Effect of gratuitous carriage 80 Parties may stipulate the common carrier’s liability for negligence, but not for willful act or gross negligence.  A/N: I BELIEVE THAT ART. 1757 TALKS ABOUT LEVEL OF DLIGENCE WHILE  ART. 1758 TALKS ABOUT AMOU NT OF LIABILITY. THEREFORE, THE EXERCISE OF THE DILIGENCE REQUIRED UNDER ARTS. 1733 AND 1755 CAN NEVER BE REDUCED OR LIMITED.

F. RESPONSIBILITY FOR ACTS OF EMPLOYEES

G.R.: A passenger is entitled to protection from personal

BACHELOR EXPRESS V CA (1990) !" $%&'% ($% ) *$++$ ! #$%%&'% () *' !"#$"%"& (!)* #$+,$#!"# %&' "( )

!"#$%&$"%' )*)+$, &$ !"#$

#$&'' ()*+, $-. !

E:

! " # $ # & ' ( ) * ) # + , - + #  ! " # % & ' ( " ) % * " ( & #  ! " # # % & % ' ( " ) ( * " + , (  ! " # $ & ' $ ( ) !"#"$!%$& ()*+%$, )- !"# %&'("# %() !"#$%&'(!$) +',-.%, !"#$% '%()*+)%(',% 

A passenger stabbed a soldier while on the bus, causing passengers to panic. Two passengers  jumped out of the window and died. WON bus is liable YES. See doctrine. In the case at hand, it was found that the driver was running at a fast speed even after it had just come from a full stop and was not able to immediately stop when the passengers were panicking, plus, it was equipped with only a solitary door for a bus its size and loading capacity, in contravention of rules and regulations provided for under the Land Transportation and Traffic Code.

F: I  :

R:

violence by the carrier, it’s agents or employees EVEN IF they acted beyond the scope of their authority or in 81 violation of an order . Acts falling under force majeure (unforeseeable or unavoidable)

Notes: A common carrier cannot be absolved from liability by proving diligence in the selection and supervision of 82 employees nor by notices or signages . There is a difference between “scope of authority ” and “line of duty ”. The law covers actions even beyond the scope of authority. If the person was outside the line of duty during the mishap, the common carrier is absolved from liability (e.g. De Gillaco v MRR, where the court treated the security guard as a passenger.)

YOBIDO V CA (1997) ! " # % & ' ! ! " & ! ! " # ! (  ! " $ % & ' " $ ( ) ( ' * + ! " # $ % ' ( ) ' ! ' * ) + , -  ! " # $ % & ( # $ $ ( # ) *

79

 Arts. 1757 and 1758  Art. 1758 81  Art. 1759 80

77

 Id.

DE GILLACO V MRR (1955)

PILAPIL V CA (1989)

 ! # ! $ $ % & ' % ( ) $ % & * ) * ! " # % & ' ( & % " ) % * & +

! " # $ % ' " % $ ( ! ) % * + # ) ! " $ % ! % & ' % ! " $ ( ! ' ) !  !

! " # $ & ' " ( # ) * + , - # + ' )  ! " $ % & ' " ! ( ) ) * " ) + )

!" $%&%'()*( "+!, *! !!"# %&''()'* (# +,) 

! " # % & ' ( " # ) * ' + , - ) .  ! ! " $ % & & ' ( "

! " # $ ! " # $ % & ' " ! ' ) ! * + , " & ! " " # $ % # & " ! $ (

! " # $ % & # ' ( ' ) ' * + " - * " &  ! " $ % & ' ( $ ( ) $ " * ( ) + !

!"#$%#& $ ("#&)*(%+, ! #$ !%&'(&%!)%

!"# %&''(#' %)*+, -) !"#"" %! &'%! "

 ! " ! # $ % & & ( ) * + # & , - ) ! # $ % & ' $ ( ) * ) + & , - . )  

!"#$%&" !"( ()(#*+,( !" $%& '&()&& !"

!"# %&''(#' &) ()*+' !" $% &'! ()*$+,&!

!"#$ "&' '()(*$&!$ # !"#$%!& () $*+

! " # $ % & ( # ) % ! * " ! ! $ +  ! " # $ %

F: I  :

R:

Gillaco was shot by MRR’s guard because of a personal grudge. WON MRR can be held liable NO. See doctrine. MRR had no means to ascertain or anticipate that the two would meet, nor could it reasonably foresee every personal rancor that might exist between each one of its many employees and any one of the thousands of eventual passengers riding in its trains. The Court considered the guard

F: I :

R:

as a passenger during the time of the mishap. MARANAN V PEREZ (1967)  ! " " # $ % ! & $ ' ( ' * ! + & ,

F: I  :

R:

!"#$ &'()( *+,,-'./

Cab driver shot his passenger, while the latter was on board said cab. WON the cab company may be held liable. YES. Unlike in Gillaco, the killing of the passenger here took place in the course of duty of the guilty employee and when the employee was acting within the scope of his duties.

LRTA V NAVIDAD !" $%& '()&"*& +, )'!"#$%&!'() ! " # $ % & % ' ( ) & + , ' - ! . !   ""#$" &' (&) *($

 ! " " # $ % & ' ) " " * + + % $ , - ! " # ! ! $ & " ' ! " # $ % & ! !

 ! " # ! % ! & & ' " ( ' ) * + , - !

#$!%&'#()*+ ,*&-.

! " $ % & $ ' $ % & ( ! " " )  ! " $ ! % & " '

G. RESPONSIBILITY FOR ACTS OF STRANGERS AND CO-PASSENGERS

Some guy threw a stone at the bus Pilapil was riding and hit his eye. WON the bus is liable NO. See doctrine. The injuries of Pilapil was in no way due to any defect in the means of transport or in the method of transporting or to the negligent or willful acts of private respondent's employees, and therefore involving no issue of negligence in its duty. The injury arose wholly from causes created by strangers over which the carrier had no control or even knowledge or could not have prevented, the presumption is rebutted and the carrier is not and ought not to be held liable.

H. DUTY OF PASSENGER; EFFECT OF CONTRIBUTORY NEGLIGENCE Duty of passenger 84: To exercise ordinary diligence to avoid injury to him/herself. Effect of contributory negligence85: It does not bar recovery of damages but reduces the amount of such. Effect of passenger’s negligence as proximate cause of injury Common carrier shall be exonerated from liability. CANGCO V MRR !" $"!%&'()%"&* !+,-!"#$%#&

 ! " # $ % & ( ) * + & ) ! # , - . ! " # $ & ' # ( # ) * ! " + & + * !  ! !"!#$ &'$ () *+! $!'

G.R.: A common carrier is not liable for injuries inflicted by E:

Note: “Death” is included in the term “injuries”

!" $%& '(')$*% %+

! " # $ % & ( ) * % * + ) * , - .  ! " # $ & " ' ( )  ! " $ " %

83

strangers and co-passengers . Carrier’s employees could have prevented or stopped such acts/omissions with the exercise of ordinary diligence.

() *+!) ,()

!"#$%& (#%)*+),- *." !"#$%" '( )*+"'$

! " # $ % & ' ( % ' * * % ' & ( + ! " # $ % & ' ( !"#$%&'$(!)#*

ISAAC V A.L.AMNEN ! " # $ % ' ( ) * + # , - * ( + . )  ! " # $ " ! % & ! ( ) ! * % ) +  ! " # $ % ! # & ' ! ( ( ) + , ' " ( - ! " # $

& " ' & " & ( ! " # ) " * !

! " # $ " ! " % & ( ) % * + , ( -  ! " # % & ' ' ( ) '

84

 Art. 1761

DIFFERENCE BETWEEN CARRIAGE OF GOODS AND PASSENGERS GOODS PASSENGERS PRESUMPTION OF NEGLIGENCE In case of loss, damage or deterioration

In case of injury or death

LEVEL OF DILIGENE Greatest skill and foresight, according to all the circumstances of each case

As far as human care and foresight may provide, with the utmost diligence of very cautious persons, with due regard to all circumstances.

DURATION OF RESPONSIBILITY 1. From the time the goods are 1. During ingress unconditionally placed in the possession of, and received by 86 the carrier  or its authorized agent (ability to exercise control 87 and possession)  for transportation; Test: If there is nothing remainds to be done by the shipper, then carrier has control and possession 2. During storage in a warehouse of the carrier at the place of destination; until consignee has been advised of the arrival of the goods + reasonable opportunity to remove or dispose of them 3. During temporary unloading or stored in transit; 4. Until actual or constructive delivery to consignee, a duly authorized agent, a person who has a right to receive, a stipulated authority, or the shipper with reasonable time to remove goods.

and egress 2. Even after alighting from the vehicle until the passenger had a reasonable time or a reasonable opportunity to leave the carrier's premises Test: The primary factor to be considered is the existence of a reasonable cause as will justify the presence of the victim on or near the vessel. 3. Even during stopovers, until the passenger reaches the port of destination.

VALID STIPULATIONS As to diligence

As to diligence 1. Must be in writing; 2. Must have a separate

None

amount in the bill of lading, unless shipper declares a greater value; 2. Fixing of a sum that may

 A. IN GENERAL Damages recoverable (MENTAL) 1. Actual or compensatory 2. Moral damages 3. Exemplary damages 4. Nominal, Temperate, Liquidated damages

B.  ACTUAL OR COMPENSATORY How applied? Damages in cases under breach of contract of carriage shall be awarded in accordance with the provisions concerning damages. Article 2206 shall also apply to the death of a passenger caused by the breach of contract by a common 88 carrier . What forms part of actual damages? 1. Proven pecuniary losses 89; a. Loss of earning capacity 90 b. Loss of support; c. Medical and funeral expenses91. 2. For breach of contract of carriage: a. Good faith carrier : Natural and probable consequence of the breach + forseeable or reasonaby foreseen at the time of constitution of obligation; b. Bad faith carrier : All damages reasonable attributed to non-performance of obligation; 3. For quasi-delict ( Air France ): Natural and probable consequences of the act; 4. P50k for death; Formula for lost earning capacity 92 :

consideration; and 3. Must not be against public policy

As to liability 1. Limitation of liability to

be recovered if: a. Reasonable and just under the circumstances; and b. Fairly and freely agreed upon. 3. Limitation of liability upon delay due to strikes or riots

!"#$ !"#!$%&'$( !!" !

As to liability

!"#

Parties may stipulate the common carrier’s liability for negligence, but not for willful act or gross negligence.

!

!"#$

 Art. 1764  Art. 2199 90  Art. 2206 91

!

!!" !  !"# !" !"#$! !

 !""#$% !"#$%&

!"#$%$& !"#"!$%&

89

 Art. 1736

!

!"#$%$& !"#"$%&' !!"# !

88

86

! !

 CARIAGA V LTBCO

!

!"

! !"#$%&$& !

!"#

Main factors to be considered in awarding lost earning capacity 93: 1. The number of years on the basis of which the damages shall be computed; and 2. The rate at which the losses sustained should be fixed (average annual income; industry rate, etc.) Rules on documentary evidence for lost earning capacity G.R.:  Documentary evidence should be presented to substantiate the claim for damages. No need to present if deceased is: E: a. Self-employed, earning less than the minimum wage under current labor laws; or b. Employed as a daily wage worker earning less than the minimum wage under current labor laws. c. Testimonial evidence of the decedent’s payroll by competent officers of the corporation where the decedent was working with no timely objection to 94 such testimonies . Note: Only net earnings, not gross earnings, are to be considered that is, the total of the earnings less expenses necessary in the creation of such earnings or income and less living and 95 other incidental expenses .

PANAM V IAC Liability for loss, delay, or damage to baggage is limited as follows unless a higher value is declared in advance and additional charges are paid: (1) for most international travel (including domestic F: portions of international journeys) to approximately $9.07 per pound ($20.00 per kilo) for checked baggage and $400 per passenger for unchecked baggage. VILLA-REY V CA (1970) ! " # $ # & ' ( ) # ( * # + ' &  ! " # $ % & ' ( ) ( # + , & ' ( !"#$%&'() +," -#.%" !" $ %&'$( )*"+ $(, !"# %#&'()# *+ ,&%&- !" $%&&'( )! %**+,! ! " $ % & ' ( ) * + ( , ! " - ( ,  ! " # $ ! %

! " # % & ' ! ( ) * + & ' , & ) ! -  ! " # % & ' % ( ) * + ! " % , * !" $%&' &%($)

F:

Tuhog case. The Villa Rey bus figured in an accident in Pampanga where one of its paying passengers, Quintos, sustained injuries and later died.

PAL V CA (1990) !"# %&%'( !" $%&%'() "!* $(%+, ! "

! " # $ % & ' ( " * & + ' , - . /  ! # $ % & ' ( ) $ ' ! " # ! $ % & ' $ ( * + % , ! - !  ! " # $ " % &

96 

 A/N: NOTE THE DIFFERENCE IN THE RULINGS IN PAL V CA  AND VICTORY V GAMMAD AS REGARDS THE REQUIREMENT OF DOCUMENTARY PROOF. BOTH CASES ONLY HAD TESTIMONIAL EVIDENCE OF THE DECEDENT’S INCOME BUT ONLY PAL ALLOWED RECOVERY. TO RECONCILED SUCH CONFLICT, I ADDED PAL AS AN ADDITION TO THE EXCEPTIONS TO THE RULE ON THE REQUIREMENT OF DOCUMENTARY EVIDENCE AS PROOF OF  ACTUAL DAMAGES.

$!%$'%!"#()*

! " # # % & ' ( ) " *  ! # $ % & ' $ # ( ) * $ + $ , $ - + ! # $

()* )+ ,-$

!"#"$%&%'()*

F:

Son died in plane crash. Mom sued for damages.

VICTORY LINER V GAMMAD (2004)  ! " # $ ! % ' ! ( ! ) * + " ! , ! ! " # # % ! & ' ( ) * ) + , ( , !"#$ &'( ")(*($&+&,# ! #! #$% &!!'(')*

CARIAGA V LTBCO (1960) !"# %&'()#* +"%'" ', !"#$#

!"#"$%&' )* "+%",'"' !"#$%%&' !"#!'&") )* &'()* +#!, "- !"

! " # % # & ! " ' ( ! " # % # )  ! " # ! $

! " # $ % & ( ) * ) ! " + " , - ,  ! " # $ % # ' ( ) * + $ , ! - $ * ! ! " # % & ' ' # ( ) & * + , * - . & ! " #

%&!'()!*(+),-

!"#$ &' (''!'( $) &'  !"#$"% #$' ()*'

F:

!"#$%&'( *$!"+,$ !"# %&'!(#) *+,-. "& !" !"#$%&#'() +%!"$""& !"#$ &! !"# !'$# "#

The respondents’ wife/mother died when a Victory Liner bus bound for Tuguegarao from Manila was running at high speed and fell into a ravine in Nueva Vizcaya.

!"#$%&% ()& !*+,

F: I  :

R:

Bus bumped train and caused grave and irreparable injury to Ed Cariaga, a UST 4th year med student. WON bus company is liable for compensatory damages. YES. The Court ruled that aside from the medical and other expenses, the bus company should pay compensatory damages as to the possible future earnings of the victim.

C. MORAL DAMAGES When can moral damages be claimed? 1. Breach of contract of carriage with bad faith, fraud 97, or 98 malice 2. Mental anguish by descendants and ascendants of the deceased by reason of his/her death 99 3. Mishap attended by death of the passenger 100

93

Id.  PAL V CA 95 Id. 94

96

  “The payrolls of the companies and the decedent's income tax returns could, it is true, have constituted the best evidence of his salaries, but there is no rule disqualifying competent officers of the corporation from testifying on the compensation of the deceased as an officer of the same corporation, and in any event, no timely objection was made to their testimonies.”

97

 Art. 2220

98

99

 AIR FRANCE V GILLEGO

 Art. 2206 (3)

Different definitions of bad faith according to  jurisprudence: - A breach of a known duty through some motive of self101 interest or ill-will ; - Self-enrichment or fraternal interest, and not personal ill-will, may well have been the motive; but it is malice nevertheless 102; - Wanton disregard of rights and dignity as a human 103 being ; - Inattention and lack of care on the part of the carrier resulting in the failure of the passenger to be 104 accommodated in the class contracted for ; - Inattention to and lack of care for the interest of its passengers who are entitled to its utmost 105 consideration, particularly as to their convenience. - Overbooking exceeding 10% 106; FORES V MIRANDA (1959)  ! " ! $ $ % & ' " ( & ) ' * " ) (   ! " # $ % ! # & ' ! ( ( ) !"#$%& () * +!"*,- . ! #$% &'(#)*&# +( ,* ! !"#$% 

YES. The court awarded moral damages mostly on R:

the basis of the petitioner’s status as a senator of the Philippines (he was Senate President Pro Tempore) and the accompanying expectations of people occupying such an esteemed position.

ORTIGAS V LUFTHANSA (1975)  ! " # $ % & ' & ) ! * + , & # - ! " # % " & ' (  

F: I :

R:

Despite having first class tickets, plaintiff was shoved to economy in order to accommodate a Belgian. WON there was bad faith YES. The court awarded moral damages because of the bad faith of the carrier and exemplary damages in order to serve as a deterrent against racial discrimination and indifference over the plight of airline passengers.

PAL V MIANO (1995) ! " # % " & ' ( ) * + ' ! , + *  ! " # $ % # & $ # ' ( ! * !"#$!%&!' !"#$#%& ()" * "+,! #$% &$'() *+%,!"# %&' (&))*! +# ,-

!"#$!%& () $#") *!

!"#$%!"#$%& () *!%+, +-& !"#$%#!%#&

AIR FRANCE V CARRASCOSO (1876)

!"#$!%&! 

 ! " # $ % & ' $ # $ ) * ) " ! # + % ! # $ % & ' ' ( ! ) ( * & ! + ! " # # $ % # $ ' ( ! ) * + # " ! +  ! " # % & ' ( ) * & + ) , ) * " ! " !"#$%&' !&)&%#*&+&,, !"#$ &'" "#&" !"#$%& ()# *+,("$*( !"# "%&' () " *'+*, 

F:

I  :

R:

Carrascoso bought a “first class” airplane ticket from Manila to Rome from Air France. However, in his flight from Manila to Bangkok, he was forced to vacate his seat by the manager of the airline because a “white man” had a “better right” to the first class seat. WON moral damages are in order YES. The acts of petitioner’s employee in forcing respondent to vacate constituted the breach of the contract, attended with evident bad faith. Therefore the contention of petitioner that there was no bad faith fails: though bad faith was not alleged expressly, it may be implied from the airline’s actions.

UNITED AIRLINES V CA (2001) !"#$#%&" (!)*+,-&#$.

 ! # $ % $ & # ' ( & ) #$ #% &'$ 

!"#$%!!&'() +!#, (!-  !"#!!$ !"#!

! " # $ % & ' ( ' & & ' * % + ' ( , -  ! # $ % % & ! ' $ & (  ! " # $ % & & # ( ! ) * ! + & , -

CATHAY PACIFIC V VASQUEZ (2003) !"#$% '$!$()* !"#$%&'(#$ *!+, ' -" !"#$ ! " $ ! % & ' ( $ & ! " $ ( ' ' ) !   "# %!& '()& *# !"#$%"!&'(" *+ *+,-&!"#$ &'#(# )'# !"##$%# $' ()$*+, -.  !"#$% '" (#% !#)*+ ' ! ! " # $ # & " # ' ( ) " * + $ # ) ! " # $ % ' ( # ) $ % $ * # ) + !   ! # ! $ $ % & ' % ( )

AIR FRANCE V GILLEGO (2010) ! " # $ % ' $ ! $ ( ) * + , - # ) !   " # % & " % ' ( ) ! " # % & !"##$"%& !"(&( )*(+ !"#$ &"'& &"( )*('+" 

LOPEZ V PANAM (1966) !"" $"%&'&(&)' )% *+ ! #$%&' $()*+ 

F: I  :

Petitioners had to travel in economy as opposed to first class because Pan Am messed up their reservations. WON there was bad faith

 AIR FRANCE V CARRASCOSO  LOPEZ V PAN AM 103  ORTIGAS V LUFTHANSA 101 102

104

 Id

105

 AIR FRANCE V GILLEGO

!"# !"%&'% "%( ()*+, !"#$!%& ()*+"(,+- ," !"#! !"% &'% (%)*&') !"#$ &'($) !"#$%$&'()&* ," -.)/  !"#$%& () *"+ ,"$-./

! " # $ # % & " ( # % ) ) # * + # %  ! " $ % & ' ! # $ % & ' & ( ) * + , & $ -

!"#$%& %#()*+,- ./*( !"

$ % & ' % ( $ ) & * + , ( ' "  !

!"#!" $%& '() *+*&, %$ !"#$% '$!$()*+

D. EXEMPLARY DAMAGES When can exemplary damages be awarded? 1. By way of example or correction for the public good, in addition to actual, moral, temperate, or liquidated 107 damages ; 2. In breach of contract of carriage, if carrier or agent acted in a wanton, fraudulent, reckless, oppressive or 108 malevolent manner . MECENAS V CA (1989) !"!#$%&'( *&#&+!, &'! #!$%&'!# () *+, !"#"$ $&' () *+,-"( !"# %&'(!) !& (#)"*+ ! ! " # $ % & ' ( ) + # $ + & , , ' ! " # $ $ % ' ( $ ( ) ( * " + , - "  ! ! " # % & ' # ( ) * ( ' % ( + , %  ! ! " # $ % & % ! & " # $ ( ! !"#$"%!&$' )* +$%$**!"#$ &'&("$# $)*+ !"#$%&'()*

Rationale for requiring EOD and the creation of presumption of negligence: The law seeks to R:

Note: Nominal and temperate damages cannot be awarded with actual damages. ALITALIA V IAC (1990) !"# %"&'(# )*+& (,-"  !"#$% '() *+%"#$%  ! " # $ & ' ( ) * " + $ & , - ) . ! " # ! $ # & ' ( ! ) * ! + # , !  ! " # ! " ! " # $ % ' ( # ) * + , # - # . '  ! # $ $ % & ' # ( & ) * + ) ! !"#$!%& (%#%)*+,

SALUDO V CA (1992) !"#$!%& (%#%)*+ %,* !"#$%"!&'(" *+"!" !"#$ &'()*+ ,-! .$$'  !"#$ &'( ()$ *+"'#( ! " $ % & ' % ( % ) ) * & + ) , '  !

 ! " " # " " $ # % & ( ) * ! $ ! + # ! # $ % & ' ( $ ) * * + * , $ !"#$%&'"() (+ ',& !"#$% '!!"$()*+ %" !"# !"#!$%&'()!*& ,- '.* !"#

%$F:

compel them to control their employees, to tame their reckless instincts and to force them to take adequate care of human beings and their property.

E. NOMINAL, TEMPERATE AND

R:

LIQUIDATED When are nominal damages awarded? 1. For the vindication/recognition of a violated or invaded 109 right ; 2. In every obligation arising from any source enumerated in Article 1157, or in every case where any property right 110 has been invaded ; 3. Where some injury has been done but the amount of which the evidence fails to show actual, substantial or 111 specific damages , the assessment of damages being left to the discretion of the court according to the 112 circumstances of the case .

!"#$!%& (%#%)*+ %,* !"#$%"!&'(" *+ ,$  ! " # $  ! " #

111 112

113

 SAVELLANO V NORTHWEST  SALUDO V CA

 Art. 2224

'()(*"+

!"#" %&'!( )' &*+" #!"#$%!& ()*+ %,!

 ! " " # $ % % $ " ' ( ' ) $ % ( * ! " " $ % & ' ( ) $ * ! * + ) , (  

!"#$%& %()*+, *+%" ( !!"#

%$%'( )(*(+,

%$!"#!$%&'()!*&+

R:

 Art. 2229  Art. 2232 109  Art. 2221 110  Art. 2222

%&'%(!)(*!" +, % !"#$%$#

!"#$%&' )&# $*+,-) + ! #$%& '()(*+# ,#

When are liquidated damages awarded? 114 When agreed upon by the parties .

108

Remains of mother shipped to Mexico City. The records reveal that petitioners, particularly Maria and Saturnino, were agonized for nearly five hours, over the possibility of losing their mother's mortal remains, unattended to and without any assurance from the employees of TWA that they were doing anything about the situation. This is not to say that petitioners were to be regaled with extra special attention. They were, however, entitled to the understanding and humane consideration called for by and commensurate with the extraordinary diligence required of common carriers, and not the cold insensitivity to their predicament.

SAVELLANO V NORTHWEST (2003)

When are temperate damages awarded? More than nominal but less than actual damages, awarded when the court finds that some pecuniary loss has been 113 suffered but amount cannot be provided with certainty .

107

#$%&' () '*)+, (*! 

In the present case, we must consider that petitioners suffered the inconveniences of having to wake up early after a bad night and having to miss breakfast; as well as the fact that they were business class passengers. They paid more for better service; thus, rushing them and making them miss their small comforts was not a trivial thing. We also consider their social and official status. Victorino Savellano was a former mayor, RTC judge and chairman of the COMELEC. Virginia B. Savellano was the president of five rural banks, and Deogracias Savellano was then the incumbent vice governor of Ilocos Sur.

SUMMARY OF DAMAGES: WHEN ALLOWED  ACTUAL 1. Proven pecuniary losses ; a. Loss of earning capacity 116; b. Loss of support; c. Medical and funeral expenses117. 2. For breach of contract of carriage: a. Good faith carrier: Natural and probable consequence of the breach + forseeable or reasonaby foreseen at the time of constitution of obligation; b.Bad faith carrier : All damages reasonable attributed to non-performance of obligation;  3. For quasi-delict : Natural and probable consequences of the act; 4. P50k for fact of death; MORAL 1. Breach of contract of carriage with bad faith, fraud 118, or 119 malice 2. Mental anguish by descendants and ascendants of the 120 deceased by reason of his/her death 121 3. Death by the passenger EXEMPLARY  1. By way of example or correction for the public good, in addition to actual, moral, temperate, or liquidated damages122; 2. In breach of contract of carriage, if carrier or agent acted in a wanton, fraudulent, reckless, oppressive or malevolent manner NOMINAL 1. For the vindication or recognition of a violated or 123 invaded right ; 2. In every obligation arising from any source enumerated in Article 1157, or in every case where any property right 124 has been invaded ; 3. Where some injury has been done but the amount of which the evidence fails to show actual, substantial or 125 specific damages , the assessment of damages being left to the discretion of the court according to the 126 circumstances of the case . TEMPERATE More than nominal but less than actual damages, awarded when the court finds that some pecuniary loss has been suffered but amount cannot be provided with certainty. LIQUIDATED When agreed upon by the parties.

115 116

 Art. 2199  Art. 2206

117

118

 CARIAGA V LTBCO

 Art. 2220

119

120

 AIR FRANCE V GILLEGO

 Art. 2206 (3)

121

122

Elements: 127  1. Object : Mercandise or any article of commerce; & 2. The carrier is a merchant or is habitually engaged in transportation for the public.

Class notes:

Contracts within this scope : Commercial contracts Other contracts: Civil contracts

Class notes: The Civil Code did not expressly repeal the Code of Commerce provisions on overland transportation. Code of Commerce provisions are merely suppletory. - E.g. Bill of lading is still under the Code of Commerce.

Class notes: In the Civil Code, there is no more distinction between commercial and civil but private or common carriers.

 A. BILL OF LADING What is a bill of lading? It may be defined as 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. It comprehends all methods of transportation.

The shipper as well as the carrier of merchandise or goods may mutually demand that a bill of lading be made, stating: 1. The name, surname and residence of the shipper. 2. The name, surname and residence of the carrier. 3. The name, surname and residence of the person to

 CATHAY PACIFIC V VASQUEZ

 Art. 2229 123  Art. 2221 124  Art. 2222 125

 SAVELLANO V NORTHWEST

127

 Art. 349 (Code of Commerce)

4. 5. 6. 7. 8. 9.

whom or to whose order the goods are to be sent or whether they are to be delivered to the bearer of said bill. The description of the goods, with a statement of their kind, of their weight, and of the external marks or signs of the packages in which they are contained. The cost of transportation. The date on which shipment is made. The place of delivery to the carrier. The place and the time at which delivery to the consignee shall be made. The indemnity to be paid by the carrier in case of delay, if there should be any agreement on this matter.

For railroads or transportation suject to rate and time schedules, the following are the minimum contents 129: Cost, time and special conditions of the carriage.

Types of bills of lading

DEFINITION NEGOTIABLE

NON-NEGO CLEAN FOUL SPENT

THROUGH

ON-BOARD

RECEIVED FOR SHIPMENT CUSTODY

PORT

Goods will be delivered to the bearer, or to the order of any person named in such document. Goods to be delivered to a specified person. Does not indicate any defect in the goods Indicates that the goods covered by it are in bad condition. Covers goods that have already been delivered by the CC without a surrender of a signed copy of the B/L. Issued by the CC who is obliged to use the facilities of other carriers as well as his own facilities for the purpose of transporting the goods from the city of the seller to the city of the buyer, which B/L is honored by the subsequent interested carriers who do not issue their own ladings. States that the goods have been received on board the vessels which is to carry the goods. States that the goods have been received for shipment; issued when conditions are not normal and there is an insufficiency of shipping space. Issued by the CC to whom the goods have been delivered for shipment but the steamer indicated in the B/L which is to carry the goods has not yet reached the port where the goods are held for shipment. issued by the CC when the goods to be shipped are already in the port where the goods are held for shipment

Functions of a Bill of Lading Contract - Form of legal evidence between the shipper and the carrier130. Receipt Symbol (e.g. Document of title)

B. REFUSAL TO TRANSPORT

G.R: Common carrier is duty bound to accept cargo E:

without discrimination. If discrimination is reasonable and necessary.

 Accepted instances for refusal to transport 1. Goods are dangerous objects or substances; 2. Goods are unfit for transportation; 3. Acceptance will result in overloading; 4. Goods are contraband/illegal; 5. Goods are injurious to health; 6. Goods will be exposed to untoward danger; 7. Goods like livestock will be exposed to disease; 8. Strike; 9. Failure to tender goods on time. Carriers may refuse packages which appear unfit for transportation; and if the carriage is to be made by railway, and the shipment is insisted upon, the company shall transport them, being exempt from all responsibility if its 131 objections, is made to appear in the bill of lading .

C. DOUBTFUL DECLARATION OF CONTENTS  Ability to inspect contents of a doubtful package132  If by reason of well-founded suspicion of falsity in the declaration as to the contents of a package the carrier should decide to examine it, he shall proceed with his investigation in the presence of: - Witnesses, with the shipper or consignee in attendance; or - Before a notary, who shall prepare a memorandum of the result of the investigation, for such purposes as may be proper.

D. NO BILL OF LADING Class note: The Civil code and other related laws will govern in the absence of a bill of lading.

130 131

 Art. 353 (Code of Commerce)  Art. 356 (Code of Commerce)

- Upon receipt (upon general inspection)

 A.  WHEN IT COMMENCES From the moment he/she receives the merchandise 133 personally or through an agent .

B. ROUTE

G.R.: Carrier must follow the route stipulated (or else shall E:

Failure to file a claim within 24 hours bars the filing of the suit. Rationale: Fresh memory of employees; to maintain the condition of the goods.

Similar to the rules in the Civil Code regarding stipulated damages.

be liable for losses + payment of damages) 134 Force majeure requires the change in route

C. CARE OF GOODS The Civil Code has clearer definitions on the level of diligence required of common carriers.

D. DELIVERY

G.R.: Same condition when they were received CODE OF COMMERCE COGSA File claim for apparent loss: upon receipt File claim within 24 hours File claim within 3 days from from delivery delivery Filing of the claim is Not mandatory mandatory; Condition precedent for filing of action for damages Prescriptive period: 10 yrs Prescriptive period: 1 year (contract), 6 yrs (no from discharge of goods contract) Jurisprudence is clear that the prescriptive period applies only if the goods were actually delivered.

G.R.: To consignee

Types of delay: - Excusable : Suspends the delivery. - Inexcusable:  The following are the consequences: o Carrier is liable even for fortuitous events; o Stipulations limiting liability are inoperative; o Carrier is liable for damages due to delay; o Consignee may exercise right to abandon.

B. RIGHT TO ABANDON When may the consignee abandon the goods? 1. In case of partial non-delivery, where the consignee proves that he cannot make use of the goods capable of 135 delivery independently of those not delivered ; 2. Goods are rendered useless for sale and consumption 136 for the purposes for which they are properly destined ; or 3. Delay through carrier’s fault 137. Note: The right to abandon must be exercised after the happening of the cause but before the arrival of the goods.

C. RIGHT TO CHANGE CONSIGNMENT The shipper may exercise this right by delivering a novated 138 bill of lading, without changing the destination .

G.R.: Stipulated amount or actual damages D. OBLIGATION TO PAY TRANSPORTATION CHARGES  A. RIGHT TO DAMAGES

In case of failure of the shipper, owner or consignee to pay for such charges, the CC has the power to sell such freight, goods, or luggage at public auction following the procedure under the law

Consignee must claim against the carrier the damage or average within 24 hours from: - Upon opening (if internal damage); or

135

 Art. 336 (Code of Commerce)  Art. 365 (Code of Commerce) 137  Art. 371 (Code of Commerce) 136

133

 Art. 355 (Code of Commerce)

E. OBLIGATION TO RETURN BILL OF LADING After the contract of transportation has been complied with, the B/L shall be returned to the issuing CC in exchange for the goods transported which are delivered to the shipper or consignee. Effect:  The respective obligations and actions of the parties against each other shall be considered canceled.

Also applicable to contractors or agents contracted to act 139 for the owner, shipper or consignee .

 Jurisdiction 140 RTCs and MeTC (300k/400k) have jurisdiction over admiralty and maritime cases INTERNATIONAL HARVESTER V ARAGON (1949)  ! " # $ % ! & ' ( * ! + , - % $ + " ! " # ! $ % $ ' ( ) * + + ! " # $ % $ ! & ( ) * % # " ( % + $  !

#$%&'(') *+),- +) !"#$ &' #$('&()*+,$- !" $%&'( !) !"!#$%&'()

! " # % # ! # & ' ( ) * ! ( + ) , "  ! " # ! $ & $ ' & " ( !"#$%&!$ () *&%($(*+  !"#"$!% '$ ()" ! " # $ % & ' ) * ' ' % + , - ' .  !

#$%&'(#& )*+!+ !"#$%& "!( )*"%")#&% !" $%& '!($)*'$+ ! " # $ " # & ' " ( ' ) * ( $ ) ! " # $ ! % & % ( ) * ) $ ! " ! *  ! ! " # $ % & " ( # ) * ) # % + % *  ! # $ % & ' % ( # ) * & +

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Petitioner filed a case against the ship agent for the payment of the amount of lost cargo in the MTC. WON MTC had jurisdiction NO. Since the basis of the liability of the petitioner is the contract of carriage by sea as evidenced by the Bill of Lading, admiralty has jurisdiction over this case. And as stated in Par. 4 Sec. 56 Act. 136 of the Philippine Commission and Sec. 44 (d) of RA 296, it is with the CFI that cases of admiralty shall be settled.

 A. MEANING What is a “vessel”?

For Code of Commerce:  Those engaged in maritime commerce or commerce by sea, whether in foreign or coastwise trade. ( we use this definition ) For registration under Admin Code: Every sort of boat, craft, or other artificial contrivance used, or capable of being used, as a means of transportation on water.

The following are examples of vessels: - Merchant ships - Launches - Lorchas - Those engaged in transport of passengers and freight

The following are not vessels: - Mere accessory by nature to another vessel - For pleasure only (e.g. yacht) - Warships, patrol vessels, pontoons, health service, harbor police vessels, floating storehouses, coast guard vesels, fishing vessels, towboats. - Those of minor nature and not engaged in maritime commerce

!"#$%&%"#' &) *)#+,"!"#"

F:

& ' ( ) * + + ( , " - .  !

!"#$%&'( *"++!"# %& '!##!"# !()*)!" $% ! " # $ % $ ! & ( ) ! ! & # ( & " *  ! # $ % % $ & ' ( ) ) ! " # $ % ' ( ) # ) ' * + ( , + -  ! " $ % & ' $ ( ) " $ * * + , ! " # $ % ' $ ( ( $ ) ( ! * + ,  ! " # $ " & ' ( $ ) & $ ) ! " # $ % & $ ' ) * + , $ - . # .  ! # $ % & $ ' $ ( ) & ' !"#$%&"&$ (!")%*+ +* !"#

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In a case for damages against owner/operator of a motor boat, defendant filed a demurrer on the ground that the complaint did not state that plaintiff observed the condition precedent required under the Code of Commerce in cases of collision (file a protest within 24 hours from accident). WON the Code of Commerce is applicable to small boats NO. The court held that the CoC is not applicable in the case at bar because what is involved here is a boat not within the purview of said provision.

%&!'()(# *+

!"#$%!&'

I :

LOPEZ V DURUELO (1928)  ! " # $ & ' ( ) * + , * - ) * . ! " # $ "

! " # $ % & ' ( * + $ " ' " , " %  ! " # % & ' ( ) # * & " * + # , '  

R:

The lorchas were mortgaged by Ponzo to Pauco and then by Pauco to PNB but was only registered with the customs on 1929. On 1928, a suit filed by Yu against Pauco attached the lorchas and recorded with the customs. They are now asserting their rights over the lorchas. WON PNB has superior right over Yu YES. See doctrine. This is to protect persons who deal with a vessel on the strength of the record title. However , the attendant circumstances of this case rendered the mortgagee’s title superior to the  judgment creditor’s title, even if the latter’s execution on the property subject of the mortgage was registered with customs at an earlier date, because the reason for the delay in recording the mortgage with customs was beyond the control of the mortgagee; thus, his registration of the mortgage with the register of deeds, recorded way earlier than the execution’s recording with customs, gave him superior title to that of the judgment creditor.

RUBISO V RIVERA (1917) !"# %#&'()(!# *+ %#, !"#$%#!&' !' #)*

!"#$%&!'(

!" $%& '()*%+,& !" +

!"##"$% '#

!"#"$$%&' %!) *!)*$+!"#$%&! (" )*+!* ,-$ ! ! " # % & ' ( " ) * # ' + * ' , - "  ! " $ % & ' ( $ % ) * ! % ) * ( +

B. NATURE AND ACQUISITION OF May be acquired through: - Intellectual creation; - Donation; - Succession; - Consequence of certain contracts, by tradition; - Prescription

C. REGISTRATION; CERTIFICATES ISSUED; DISTINCTIONS

 ! " ! # $ % & ! ( ) ! # * + # ) , ! # $ % & ' ( ) ! * + ) , - .  

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Jan. 4 - Sy sold boat to Rivera; Jan. 23 - case filed by Rubiso against Sy and boat was levied upon and bought by Rubiso in public sale; Jan. 27 - certificate of sale issued to Rubiso and recorded in the office of the Collector of Customs; Mar. 14 – Rubiso’s sale registered; Mar. 17 - Rivera sale registered. WON Rubiso has better right over the boat.

  YES. See doctrine

Where registered? With the MARINA141 Registration v. CPC Former is for ownership purposes, CPC is for regulation.

D. SIGNIFICANCE OF REGISTRATION OF TRANSACTIONS AFFECTING VESSELS ARROYO V YU (1930) !"#$%&%'( "* +'((',(!

!"#$!%"%& (!" )$$% (!

#$%&'()& *'% #$%&$$' %($

 A. SHIPOWNERS AND SHIP AGENTS

Ship agents:

A ship agent is the person entrusted with provisioning/representing the vessel in the port in which it may be found.

Co-ownership of vessels If 2 or more persons should be part owners of a merchant Bessel, a partnership shall be presumed. STANDARD OIL V CASTELO (1921) !"# %"&'()*#+ (+,&*-!"#$ &'( )'(*#$ +,!- 

 ! " # % & ' ( ) " * + , - . / ! " #

!"#$%"& ()*"+,(- .#/! # $%&#'( )*#! *#+  ! " # % " & % ' % & ( ! ) * + % , , ! " $ % & ' " ( $ )

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Shipper contracted Castelo to deliver cases of petroleum. They were placed on deck. Storm came and they needed to jettison such cargo. Now Standard Oil is suing Castelo for the value of the lost cargo. Castelo contends that the ship captain must be liable for his failure to proceed with the liquidation, in accordance with the Code of Commerce. WON the shipper can sue the owner directly YES. The evident intention of the Code is to place the primary liability upon the person who has actual control over the conduct of the voyage AND who has most capital embarked in the venture, namely, the owner of the ship, leaving him to obtain recourse, as it is very easy to do, from other individuals who have been drawn into the venture as shippers.

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!% &!''#(&#)

Chinaman’s money amounting to P450 “disappeared” in the banca. WON the shipowner is liable. YES. First, the Court clarified that small boats also fall under the definition of “vessels”. Then they applied the doctrine above, citing that the rationale for such is that the Captain/Master is the agent and subordinate of the shipowner; that the shippers and passengers placed their trust on the shipowner; and that the captain/master profits with the shipowner.

MANILA STEAMSHIP V ABDULHAMAN (1956) ! " # $ % & ' ( ) ! + ' , ! " # $  ! " # $ % & ! ( # ) * + * , , !"#$!% '() *+% #,*-

!" $%& '()$(*+ ,(-$

 ! " # $ & ' ( ) * + , - . / ' ( ! " # $ % $ ! & ( ) ! % * ! % * $  ! " ! " # $ % & $ ( ) # * + , - . / $ ! # $ % # & ' ( ) * + , - % * # &  ! " !"# %& '!!&('")&*# + !"#$%&'!( $* +,!

! " # $ % ! ' ( ) $ * ) + , - +  !

#$%&' (&%)$*+,--.

! " # $ % & ' ( " ) +  ! " # # ! % & ! ' ( ) " & # % * ! " !"#$"%& %( #)%*")%+, !"# %#&%#'#(!)!*+# ,!

Responsibilities of Ship Agents 1. To trade and represent the ownership of the vessel, and may, in hiw own name and in such capacity, take judicial and extrajudicial steps in matters relating to commerce; 2. To discharge the duties of captain of the vessel (but must be qualified to do so); 3. To contract in the name of the owners, who shall be bound in all that refer to repairs, details of equipment, armament, provisions of food and fuel, and freight of the vessel, and, in general, in all that relate to the requirements of navigation; 4. To order a new voyage, or make contracts for a new charter, or insure the vessel; - But needs authorization, otherwise, he shall be subsidiarily liable. 5. To account for the results of each voyage; 6. To indemnify the captain for expenses incurred; 7. To discharge the captain and memebers of the crew whose contracts are for an indefinite period. 8. To indemnify the captain in case of voluntary sale of the vessel. Liabilities of Shipowners and Ship agents 1. Acts of the captain; 2. Contracts entered into by the captain to repair, equip, and provision the vessel; 3. Indemnities in favor of 3rd persons which may arise from the captain’s conduct; 4. Damages to 3rd persons for torts committed by the captain EXCEPT for collisions; 5. Damages in case of collisions due to fault, negligence, or want of skill of captain, sailing mate, or any member of the complement.

!"# %&'#()

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2 negligent vessels collided at sea, killing 9 pasengers. WON the shipowners are liable YES. By making the vessels solidarily liable, the law emphasizes the direct nature of the responsibilities on account of the collision incurred by the shipowner under maritime law, as distinguished from civil and mercantile law in general. This direct responsibility is recognized in Art 618 of the same code under which the captain shall be civilly liable to the ship agent, and the latter is the one liable to third persons.

WING KEE COMPRADORING CO V BARK “MONONGHAELA” (1923) ! " ! # $ & ' ! ( ) * + # & " !  ! ! " # % & ' ' ( ) & * ( + , ! " # $ % & # ' ( ' ) ' * + $ - ! # - !   "#

#% !&#'()* +,- % !

!"# %&'# &( %&))#*%# !" $!"!#$ &' !()  ! " # $ % & ( ) # $ * ) + # ! * # $ ! " $ % & ' ( ) % & & * ! " # $ % & ! ( ) ! $ * + , - . ( ,  ! " # ! % & ' ( ) * + , ) & ( - #

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Admiral Line, as agent for Bark, were the addressee of bills for goods sent to Bark by Wing Kee. Admiral Line placed a notice in Manila Bulletin re: cessation of agency. Now they assert that since the agency has expired, then they can no longer be liable. WON Admiral Line is still liable to Wing Kee

YES, BUT ONLY FOR OBLIGATIONS PRIOR TO CESSATION OF AGENCY. See doctrine. The rule, R:

again stated, is that the seller may pursue either the ship’s owners or the agent, and the agent may choose to be reimbursed later by the ship’s owners.

NADECO V CA (1988) YU CON V IPIL (1916) !"# %"&'()*#+ &% ,&- !"# %&' ()# *+(, &% !"# %&'!&() &)* !"# !"#$ &'(#) *+ '",(-

! " # % & # ' ! ( # ) # ' ! " * +  ! " !"#$% !' ()$ *$++$,-

"$ %&' ()* +$ *"$  !" $!%&$' () (*'

!"#$$%&! ()* +,)%&! !" $%& '()*!

! " # $ % & ' " ! ( ) + , - ! . /  ! "

$!%%&% '()

! " # " $ % & ( ) ) " & * ( + % ! ,  ! # $ % & % ' ( ) ! * ! " # $ % & # ( ) * + & , " - * . $  ! " # $ # % & ( ! ) * + % * , ) (  !  ! " ! # $ % & & ( ) * + $ ) , * -  ! " # % " & ' ( ! ) ! " # !"#!$# &' #(! )*+,! !" $%& '&((&)* +$(

!"#!$"%& ()*+$*)(,) 

F:

!"#$%&!'( *'+ (,! -.!"#$%&

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NDC owned the ship (MCP as agent through a MOA) that collided with a japanese ship en route to Manila. DISC (insurer) is now claiming damages against both NDC and MCP. WON MCP, as an agent, is solidarily liable with NDC YES. First, the court held that the term “agent” is broad enough to include the concept of Ship-Agent in Maritime Law. MCP was even conferred all the powers of the owner of the vessel, including the power to contract in the name of NDC. Then they extracted the doctrine out of jurisprudence and the Code of Commerce (that didn’t expressly declare the liability of agents for loss/destruction of goods due to collision).

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The owner was asserting that he should be excused from liability because he exercised diligence in the selection and supervision of the employees. WON he can be excused from liability NO. To admit the defense of due diligence of a bonus pater familias in the selection and vigilance of the officers and crew as an exemption would render nugatory the solidary liability established by Art 827. Shipowners would be able to escape liability in practically every case, since the qualifications and licensing of ship masters and officers are determined by the State. To compel the parties to look to the crew for indemnity and redress would be an illusory remedy, for almost always the members of the crew are mere wage earners. The only limitation is abandonment of vessel ( See doctrine).

YANGCO V LASERNA (1941)  ! " ! # $ % # & ' # (  ! " " # $ % & ( ) ! # # * ! & % & ! " # $ # % &  ! # $ % & ' ( ) * + ' + ! , * ) -  ! " # % & ' & ( ) ( * " % ( &

Concept: Also known as the real and hypothecary nature of

! " # % & ' & ( ) * & * & # ) * ! " # % & # ' ( ) ( * " + * ( ) ,  !

the liability of the shipowner and agent.

General rule142 : The liability of the shipowner and ship agent is limited to the amount of interest in the said vessel This includes the following: 1. Value of the vessel itself; 2. Equipments; 3. Freightage; 4. Insurance proceeds. Exceptions to the DLL 1. Claims under the Workmen’s Compensation Act 143; 2. Injury or damage due to shipowner or the concurring 144 negligence of the shipowner and the captain ; 3. The vessel is insured 145; 4. Expenses for repair on vessel completed before loss 146; 5. In case there is no total loss and the vessel is not 147 abandoned ; 6. Collision between 2 negligent vessels. MANILA STEAMSHIP V ABDULHAMAN !"# %&'#(! )&*+&)&!,  !" $%&'!()*+$,-.*)/$

!" $%%$&$' ()*+,$!" !" $%& '()$(*+ 

! " # % & ' ! ( ) * # & + , ) - )  ! " # % & ' ( & % & ! ) " * & + ! + !"# %&#'() *"%%"( *& !!"#!$ &#'()$# *+ !"#$ #&' ()*+,("-#!)  !"#$%& () !"#$%$!& !"##$%!$&

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A ship, which was allowed by the captain to be overbooked, sank. The shipowner then asked the court to allow it to abandon the vessel and all his interest therein. WON the shipowner may abandon the vessel YES. See doctrine. The purpose of the principle of limited liability is to encourage people to invest in shipbuilding and maritime commerce despite the highly precarious nature of each transaction. Another reason for its existence is that it protects the shipowner or agent from being ruined by the negligence or illicit acts of the ship’s captain. The limited liability of shipowners and agents is in sharp contrast to the general principles of civil law wherein the owner is responsible to the whole extent of the damage caused and not just to his interest in the vessel or transaction.

! " $ % & ' ( ) * ' & ) + & , ! $  ! " # $ & ' " ( # ) * + # , -  ! !"#$% '( )*)+,'+-.+%  !" $%& '&((&) *+,

! " # $ ! % ' # ! ( ) * + , " # + (  ! " # % & ' ( ) * + , ) - . # #  ! !"#$%&"! () "*+,( -) ! #$%& '$ ()*+ #,

!"#$%&#' %)*+"$%+,-

!"# %&'( )* +%',' (- 

ABUEG V SAN DIEGO (1946) !" $% $&&!'(%) !* &+!"#$%&'(# *$+#, -.# ! " # $ % & ' ( ) + " % , & ' ) - . /  ! "

$%&' (& )*+& ,-

! " # $ % & ' ( ) % * % , % & - . %  ! # $ % & ' ( ) * + ! , ! " # $ % " ' ( ) % ! * + ) # ( "  ! " # % & ' ( ) * ) + !"#$%&!' )&'* "'*+, !"#$%&%#'& #) *+,

!" $% &$''"(&" )"*+* ! " # ! $ % & " ( ) * ) # + " # + $  ! " # $

!"#"$ !&'( &) *+( !&

 YANGCO V LASERNA  ABUEG V SAN DIEGO 144  ABOITIZ V GAFLAC 145  CHUA YEK HONG V IAC 146  GOVERNMENT V INSULAR MARITIME 142 143

! " ! # % & ' ( ! ) ( % * ) + !  ! " $ % & " $ ' ( ' " ) * $

! " # $ % ! & ' ( " ) # % ( ) $ + #  ! "

$%&'(")*+

!"#$%&'()*"& (!) ,*-! #$%!! &''!( 

Two vessels, the M/V San Diego and the M/S/

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Bartolome sank during a typhoon while they were engaged in fishing operations. Some of the crew members died, so their relatives filed for compensation for the employers. WON the ship owners may escape liability by abandoning the vessel. NO. It is not the liability for the damage or loss of the cargo or injury to, or death of, a passenger by or through the misconduct of the captain or master of the ship; nor the liability for the loss of the ship as result of collision; nor the responsibility for wages of the crew, but a liability created by a statute to compensate employees and laborers in cases of injury received by or inflicted upon them, while engaged in the performance of their work or employment, or the heirs and dependents and laborers and employees in the event of death caused by their employment. Such compensation has nothing to do with the provisions of the Code of Commerce regarding maritime commerce.

Under the PCG; Must be: 1. Filipino; 2. With legal capacity to contract; 3. With skill, capacity, and qualifications necessary to command a vessel; and 4. Must not be disqualified to discharge such duties.

 3 distinct roles of a master/captain 148: 1. General agent of the shipowner; 2. Commander and technical director of the vessel; 3. Representative of the country under whose flag he navigates. INTER ORIENT V NLRC (1994) !" !$% &'(!')* )+ &" !!"##$% #'$

! " # $ % & ' & ( $ ) ( ' % $ ) ' &  !

#$%$&'#'%( )* (+'

!"##"

%$ABOITIZ SHIPPING V GENERAL ACCIDENT FIRE AND LIFE ASSURANCE CORP (1993)

! " $ % & ' & ( ! ) & ' * + $ +  !

#! $%& '())#*+&, (!

!"# %#&&#' !"(! )& !"# %&'! (%)&*!+,!

! " # % & ' & ! # ( % & ) * & % & !  ! ! " # $ & ' $ ( ) ' * + , , # -

!"#"$%&%'( *% " +,%- ! #$%& '()* &+# ,( - !

! " # $ & " # ' # ( ) * $ * + &  ! " # % & ' ( & ' ) * %

!"#$ #$& '(&)*#"'+ *!" $%&'&%()*+,! ,-

!"#$%#"!&" (! )*" +,!" $% "&' ('))'*

!"# %#&&#' ()*+,- %. !"#

%$!"#$% !% '($#)*

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Aboitiz owned and operated the ill-fated "M/V P. ABOITIZ," a common carrier which sank on a voyage from Hongkong to the Philippines. They are invoking the limited liability rule. WON the Limited Liability Rule arising out of the real and hypothecary nature of maritime law is applicable. YES. Court held that the cause of the sinking of the vessel was because of unseaworthiness due to the failure of the crew and the master to exercise extraordinary diligence, not the shipowner’s negligence.

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Under the Code of Commerce: 1. Right to repurchase and redeem the vessel by a coowner in case of sales made to strangers (within 90 days from inscription of sale) 2. Owners have preference for the charter of the vessel. 3. Right of co-owners to elect the manager who will represent them as ship agent. 4. Right of ship agent to discharge of duties of captain. 5. Right to demand profit from ship agent.

B. CAPTAINS AND MASTER

Captain: Governs vessels navigating the high seas or ships of large dimensions and importance Master: Commands smaller ships

"' ($)) "' *+$ 

! " # $ % & ( # % ) $ * " ! ! $ +  ! " # $ & ' ( ) & # ! * +

Capt. Tayong assumed command of a vessel set for South Africa. The ship he was in command of was old, and had leaks. On a stopover in Singapore, he elected to wait for the supplies in order to plug the leaks. As a result, he got to South Africa behind schedule, and he was repatriated by his employer and dismissed. He filed an illegal dismissal complaint. WON he was illegally dismissed. YES. See doctrine. Captain Tayong was NOT guilty of arbitrary, capricious or grossly insubordinate behavior. He did not perform acts inimical to petitioners’ interest, and thus his dismissal was unwarranted. A ship captain must be accorded a reasonable measure of discretionary authority to decide what the safety of the ship and of its crew requires on a particular voyage, being in command of the vessel.

Prohibited under the Code of Commerce: 1. Must not enter into separate transactions for his account; 2. Must not fail to perform a voyage after making an agreement; 3. To not be substituted by another person;

4. Must not contract loans on respondentia secured by the

Gross or General

cargo; and 5. Not borrow money on the hull, engine, rigging or tackle of the vessel.

Definition

C. OTHER OFFICERS AND CREW

Includes all the damages and expenses that are deliberately caused in order to save the vessel, its cargo, or both at the 152 same time, from a real and known risk . Being for the common benefit, these are borne by the owners of the 153 articles saved .

Essential requisites 154: 1. There must be a common danger. a. This means that both the ship and the cargo are D. SUPERCARGOES

Supercargo : Representative of the shipper/consignee on board. Sailing mate: Second chief of the vessel; takes care in place of the captain.

2.  A.  AVERAGES

3. 4.

What constitutes an average? 1. Expenses, which must be: a. Extraordinary/accidental b. Incurred during the voyage c. Incurred in order to preserve the vessel, the cargo, or both 2. Damages or deteriorations, which must: a. Have been suffered from the time the vessel puts to sea from the port of departure until it casts anchor in the port of destination, or b. Have been suffered by the merchandise from the time they are loaded in the port of shipment until they are unloaded in the port of their consignment  Simple or Particular

MAGSAYSAY V AGAN (1955) ! #$%&'(')$( )* +*,- !"#!$%!% '( )! * ! " # " $ % & % ( " $ % ! " ) * " "   ! " # $ % &

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Definition Includes all expenses and damages caused to the vessel or cargo that have not inured to the common benefit of the 149 persons interested in the cargo . These averages are borne by the owner of the property that gave rise to the 150 expenses .

Effects Owner of the goods that gave rise to the expense shall bear the average151.

subject to the same danger, whether during the voyage or the port for loading/unloading. b. This danger must arise from accidents of the sea, dispositions of the authority, or faults of men, provided that the circumstances producing the peril should be certain and imminent or may rationally be said to be certain and imminent. c. This means that expenses incurred against a distant peril are not included. Part of the vessel or of the cargo are sacrificed deliberately for their common safety. Expenses or damages caused follows the successful saving of the vessel and cargo. Expenses or damages should have been incurred after taking proper legal steps and authority.

Ship ran aground/got stuck in the mouth of the Cagayan River. Carrier incurred expenses to have the vessel refloated. It then requested the shippers to pay their contribution to the general average. WON the expenses are considered general average NO. See doctrine. The evidence does not disclose that the expenses were incurred to save vessel and cargo from a common danger. The vessel ran aground in fine weather and in a shallow portion of the river. This shows that there was no imminent danger. At the very least, there was a distant peril which did not need immediate action.

Effects All persons having interest in the vessel and cargo shall contribute 155. The insurers and lenders on bottomry and respondentia 156 shall likewise contribute.

152 153 149 150

 Art. 809 (Code of Commerce)  Art. 810 (Code of Commerce)

 Art. 811 (Code of Commerce)  Art. 812 (Code of Commerce)

154

155

 MAGSAYSAY V AGAN CITING TOLENTINO’S COMMENTARIES

 Art. 812 (Code of Commerce)

Jettison Casting overboard of cargo.

Rules: 1. Those on deck (those interfering with the navigation; heaviest with least value)

2. Those on hold (greatest weight and smallest value) Jason clauses The right to contribution in the general average shall not be affected though the event that gave rise to the sacrifice or expenditure may have been due to the fault of one of the parties.

DEFINITION

LIABILITY

PARTICULAR AVERAGE

GROSS AVERAGE

Damages or expenses caused to the vessel or cargo that did not inure to the common benefit and borne by the respective owners. Owner of the goods which gave rise to the expense shall bear this average.

Damages or expenses deliberately caused in order to save the vessel, its cargo or both from real and known risks.

INTERESTS INVOLVED SHARE IN DAMAGE

Only 1 interest

RIGHT TO RECOVERY

No reimbursement

100% share

All persons having an interest in the vessel and the cargo therein at the time of the occurrence of the average shall contribute to satisfy this average. The insurers and lenders on bottomry and respondentia shall likewise contribute. Several interests In proportion to the value of the owner’s property saved. There may be reimbursements.

B.  ARRIVAL UNDER STRESS

1. Lack of provisions; 2. Well-founded fear of seizure, privateers or pirates; or 3. By reason of any accident in the sea disabling it to navigate.

The following are unlawful arrivals: 1. If the lack of provisions should arise from the failure to take the necessary provisions for the voyage according to

usage and customs, or if they should have been rendered useless or lost through bad stowage or negligence in their care. 2. If the risk of enemies, privateers, or pirates  should not have been well known, manifest, and based on positive and provable facts. 3. If the defect of the vessel should have arisen from the fact that it was not repaired, rigged, equipped, and prepared in a manner suitable for the voyage, or from some erroneous order of the captain. 4. When malice, negligence, want of foresight, or lack of skill on the part of the captain exists in the act causing the damage.

Role of the captain during arrivals under stress - The captain shall assemble the officers and shall summon the persons interested in the cargo who may be present, and who may attend the meeting without the right to vote; - If, after examining the circumstances of the case, the reason should be considered well-founded, the arrival at the nearest and most convenient port shall be agreed upon, drafting and entering the proper minutes, which shall be signed by all, in the log book. - The captain shall have the deciding vote, and the persons interested in the cargo, may make the objections and protests they may deem proper, which shall be entered in the minutes in order that they may make use thereof in the manner they may consider advisable. Rules on repairs of vessel If it should be necessary to unload cargo to effect repairs, the captain must: - Request authorization from the competent judge or court (Philippine consul for foreign ports) for the removal; and - Carry it out with the knowledge of the person interested in the cargo, or his representative, should there be any.

Arrival under stress: - Shall always be for the account of the shipowner or agent o But they shall not be liable for the damages which may be caused the shippers by reason of the arrival provided the latter is legitimate. Otherwise, the ship agent and the captain shall be jointly liable.

Repair of vessel: - If the repair was for the vessel alone, the expenses shall be for the account of the ship agent or owner. - If the repair was to avoid damage to cargo, epenses shall be chargeable against the owners of the merchandise for whose benefit the act was performed.

- If the unloading should take place for both reasons, the expenses shall be divided proportionately between the value of the vessel and that of the cargo.

General responsibilities Custody and preservation of the cargo which has been unloaded, except in cases of force majeure. - If the entire cargo or part thereof should appear to be damaged, or there should be imminent danger of its being damaged, the captain may request the competent judge/court/consul the sale of all or of part of the former o The judge/court/consul shall authorize it, after an examination and declaration of experts, advertisements, and other formalities required by the case, and an entry in the book, in accordance with the provisions of Article 624. To justify the legality of his conduct, under the penalty of answering to the shipper for the price the merchandise would have brought if they had arrived in good condition at the port of destination.  Special responsibilities The captain shall be responsible for the damages caused by his delay, if after the cause of the arrival under stress has ceased, he should not continue the voyage. - If the cause of arrival should have been the fear of enemies, privateers, or pirates, a deliberation and resolution in a meeting of the officers of the vessel and persons interested in the cargo who may be present, in accordance with the provisions contained in Article 819, shall precede the departure

C. COLLISIONS

Collision: The impact of 2 moving vessels Allision: The striking of a moving vessel against one that is stationary, or a vessel and other floating, though non-navigable objects

Class Note: Both instances are contemplated under the code.

CLASSES FORTUITOUS

CULPABLE

EFFECTS Each vessel and its cargo shall bear its own damages. The injury shall be classifed as a particular average. If due to fault, negligence or lack of skill of ship officers: The owner of the vessel at fault shall indemnify the losses and damages suffered If collision is imputable to both: Each shall bear its own damage •

rd

If collision to another was caused by a 3 vessel: the owner of the third vessel shall indemnify the losses and damages caused, the captain thereof being civilly liable to said owner. If the cause cannot be determined, use the provisions on culpable causes

! " # $ % & # ' ( ' ) ' * + " - . ) /  ! " # $ % & ( ) * ( * + $ ( * + $  ! !"##"$ &'()' '*+ ,-#!"#!$ &'"!()**+ ,-!

! " # $ " % & ( ) * + , & - . / !   "#

•

INSCRUTABLE FAULT

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A. URRUTIA & CO V BACO RIVER PLANTATION (1913)

Collision between “Don Carlos” and “Yotai Maru”. Insurance companies wanted to recover the amount they paid to the consignees of the cargo. Who is liable for the damage? “DON CARLOS”. Court held “Don Carlos” is liable for the following reasons: (1) there was already a previous decision holding them liable hence, res  judicata  applies; (2) it was negligent considering three important factors: (a) failure to turn right, (b) no proper look-out, and (c) no captain.

! " # $ % & ' ' ) ' * % + % , % - ! " $ % " & ' ( ) & * + , & - . & 

RULES ON COLLISION

!" $%&&!'!%" $(')' (! #$ #%& '()*&+ $,

!"##$% '( )*+ ,-.+ # !

# $ % & & ' ( ' % ) * + , - + +  !

 ! ! " # $ % ' # ! ! # ( $ ) * $ ! ! " #

!"#$%&!'()* ($

%&''&#( )*& , - , ( *  ! " " $ % ! " % & ' ( % ! ! % ) *

 ! " # % & ' ( ) % * % & + , * &  ! " $ % & " ' ' ( " % & ! " # ! $ " & $ ' ( ) " $ * # ' +  ! " # % & ! ' ' " ( " ! ) *

! " # $ & ' ( ) ! " * ! + ) $ $ )  ! " $ % & % " " ' $ ( ) * % ) ! " # % ! " # & ' ( ) ) % * # + ! " # % & ' ( ) * + # * , ! "  ! ! " # $ & ! ' $ & ( $ ) * + , -   ! "  ! " # # $ % $ " &  

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A steamer which was sailing erratically collided with a sailing vessel (schooner). The latter didn’t avoid the steamer until just before actual contact, resulting to the sinking of the steamer and the deaths of 8 persons. The steamer’s owner sued the schooner owner. WON the steamer is at fault YES. See doctrine. The Court upheld the TC’s findings that the Steamer had been handled in a grossly negligent manner. It was sailing erratically and didn’t even have a proper watch on board.

GOVERNMENT V PHILIPPINE STEAMSHIP (1923)  ! " # $ % & ' $ # $ ) * ) ' " + ' ) ! " # % ! & ' # ( ) * & % + !"# %&!# '( !"# )*+' !"#$ &'((') *+','-'! " # % # & ' ( & # % ) # * % ! "  ! # $ % & ' ( & ) ! * $ & ! ' ! !"# %&!'%()' *#++#, !" $% $&&'()*$!+(

! " # $ % & ' ( * + # ! , $ - # .  !

#$%&' (!&&!) *+,,-!

! " $ % & $ & ' '  ! " # $ & ' ( & ) ! * + ' , - . ! ! !"#$%&#'(')'*+,

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2 vessels collided, the first vessel being negligent for not veering to the proper direction. WON both vessels are liable for the damage.

  YES. See doctrine.

ONE VESSEL AT FAULT BOTH VESSELS  AT FAULT VESSEL AT FAULT NOT KNOWN THIRD VESSEL IN FAULT FORTUITOUS EVENT VESSEL STRIKES STATIONARY OBJECT

Vessel at fault is liable for damages .

Each to bear his own loss. Shippers may go after either 159 shipowners/agents . Third vessel is liable for losses and 160 damages . No liability. Doctrine of res ipsa loquitur.

D. SHIPWRECKS Notes:

Shipwreck : A ship that has received injuries rendering her incapable of navigation; or Loss of a vessel at sea, either by being swallowed up by the waves, by running against another vessel or thing at sea, or on the coast. 161 Salvage : The service which 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 and secure. May also mean the compensation given from the act of salvaging.

SMITH, BELL AND CO V CA (1991) ! " $ % & ' ( $ ) * + ) , - . / 0  ! " # $ & ' ( " ) * + " & , - . & ,   ! " # ! % & ' # ( # ) ) # * ) &  ! # $ ! % & ' ( ) * ! + + % , % ! ! " ! " # % & ' ( ! ( ' ) * % " ( + ! # $ $ % ! & ' $ $ ( ) ' ' # *  ! !"#$% #'(%$)$*$)+, '! #$%&'%$#($ )# *+$

!"#$% '$(($)* +" ,)( !

#$ %&&%'( )*%+ #(*

!"#$ &"'()'"&*" +, - !"#$%& () *+#, ! " # $ % & # ' ( ' ) ' * +   ! " # % & ' ( ) * % % ( ! %

158

 Art. 826 (Code of Commerce)  Art. 827 (Code of Commerce) 160  Art. 831 (Code of Commerce) 159

Rules on losses and detoriartion G.R: In shipwreck, each owner (vessel/cargo) shall bear his own losses, such as those arising from force majeure E: Captain shall be liable to the ship agent/shippers in case the wreck or stranding is due to the (1) malice, negligence, or slack of skill of the captain, or (2) because the vessel put to sea was insufficiently repaired and equipped. Rules on payment of expenses of salvage Goods saved from the wreck shall be specially bound for the payment of the expenses of the respective salvage - The amount thereof must be paid by the owners of the former before they are delivered to them, - Such payment has preference over any other obligation if the merchandise should be sold. Rules on salvaging during convoys - If any of them should be wrecked, the cargo saved shall be distributed among the rest in proportion to the amount which each one is able to take. - If any captain should refuse, without sufficient cause, to receive what may correspond to him, the captain of the wrecked vessel shall enter a protest against him, before two sea officials, of the losses and damages resulting therefrom, ratifying the protest within twenty-four hours after arrival at the first port, and including it in the proceedings he must institute in accordance with the provisions contained in Article 612. - If it is not possible to transfer to the other vessels the entire cargo of the vessel wrecked, the goods of the highest value and smallest volume shall be saved first, the designation thereof to be made by the captain with the concurrence of the officers of his vessel

Rules on salvaging cargo

Beyond control of crew/captain - Any person saving such cargo or assisting in saving a vessel shall be rewarded.

Within control of crew/captain - No person without the consent of the captain shall take from the sea any cargo. Responsibility of salvagers To convey and deliver such vessel or merchandise, as soon as possible, to the Collector of Customs, if the port has a collector, and otherwise to the provincial treasurer or municipal mayor. Right of owner of the salvaged cargo The right to the delivery of the vessel or things saved shall accrue only upon payment/giving of a bond to secure the expenses and the proper reward. The amount and sufficiency of the bond, in the absence of agreement, shall be determined by the Collector of

Customs or by the Judge of the Court of First Instance of the province in which the things saved may be found.

Role of Collecter of Customs/Prov. Treasurer/Mayor To order: a. That the things saved be safeguard and inventoried. b. The sale at public auction of the things saved which may be in danger of immediate loss or of those whose conservation is evidently prejudicial to the interests of the owner, when no objection is made to such sale. c. The advertisement within the thirty days subsequent to the salvage, in one of the local newspapers or in the nearest newspaper published, of all the details of the disaster, with a statement of the mark and number of the effects requesting all interested persons to make their claims. Upon claiming by the owners, such authorities shall order their delivery to such owner or his representative, provided that there is no controversy over their value, and a bond is given by the owner or his representative to secure the payment of the expenses and the proper reward. Otherwise, the delivery shall nor be made until the matter is decided by the CFI of the province. If no claim is presented in the 3 months subsequent to the publication of the advertisement prescribed in sub-section (c) of Section 5, the things save shall be sold at public auction, and their proceeds, after deducting the expenses and the proper reward shall be deposited in the insular treasury. If 3 years shall pass without anyone claiming it, ! of the deposit shall be adjudged to him who saved the things, and the other half to the insular government. Who has no right to a reward a. The crew of the vessel shipwrecked or which was is danger of shipwreck; b. He who shall have commenced the salvage in spite of opposition of the captain or his representative; and c. He who shall have failed to comply with the provisions of Section three.  Agreements as to value of salvage - If, during the danger, an agreement is entered into concerning the amount of the reward for salvage or assistance, its validity may be impugned because it is excessive, and it may be required to be reduced to an amount proportionate to the circumstances. - In a case coming under the last preceding section, as well as in the absence of an agreement, the reward for salvage or assistance shall be fixed by the Court of First Instance of the province where the things salvaged are found, taking into account principally the expenditures made to recover or save the vessel or the cargo or both, the zeal demonstrated, the time employed, the services rendered, the excessive express occasioned the number of persons who aided, the danger to which they and their vessels were exposed as well as that which menaced the things recovered or salvaged, and the value of such things after deducting the expenses.

Other rules - From the proceeds of the sale of the things saved shall be deducted, first, the expenses of their custody, conservation, advertisement, and auction, as well as whatever taxes or duties they should pay for their entrance; then there shall be deducted the expenses of salvage; and from the net amount remaining shall be taken the reward for the salvage or assistance which shall not exceed fifty per cent of such amount remaining. - If in the salvage or in the rendering of assistance different persons shall have intervened the reward shall be divided between them in proportion to the services which each one may have rendered, and, in case of doubt, in equal parts. Those who, in order to save persons, shall have been exposed to the same dangers shall also have a right to participation in the reward. - If a vessel or its cargo shall have been assisted or saved, entirely or partially, by another vessel, the reward for salvage or for assistance shall be divided between the owner, the captain, and the remainder of the crew of the latter vessel, so as to give the owner a half, the captain a fourth, and all the remainder of the crew the other fourth of the reward, in proportion to their respective salaries, in the absence of an agreement to the contrary. The express of salvage, as well as the reward for salvage or assistance, shall be a charge on the things salvaged on their value. Elements for a valid salvage claim 162 : 1. There was a marine peril; 2. The service voluntarily rendered when not required as an existing duty or from a special contract; and 3. Success, in whole or in part, or that the service rendered contributed to such success. Elements of a derelict vessel163: 1. Abandonment of the vessel by its captain and crew; and 2. Lack of intention to return.

R:

  YES. See doctrine.

ERLANGER & GALINGER V SWEDISH EAST ASIATIC (1916) !"# %&#'!()* +"#!"#, !" $!% & '&"%()*+&" ! " # $ & ' ( # ) ! * & + , - #  ! # $ % & ' ( ) * + & ' $ !"#$"%& (&)&*(! !"#$ &'( )#$*&'&#$ + ! !#$ !"#$ !&$ '()*(+$ '$,!"#$% '($ )$(*+(,$-.

! " # $ % & ' ( ) * " & ( ' * ' &  ! " $ % & ' & ( ) * " + & !"#$%& ()$)*+ ,& -,+  !" $%& '()"*)'+& !, !"#$%"& &()"*% !" $% $ "&'()&"$*+!) !"# !"#$% #' (%)!$# !

# $ % & ' & ( ) * & ( + , -  ! " # $%&'()*+!"# !"#$"!"$% '#$ '( '# !"#$%&'&"( (* ! " # % & # ' ( " ) * * & # + ' , &  ! "

! " # $ % & # ' ) * & ! + " # , $  ! # $ % & ' ( ! ) * + , $ # !"#!$%$&'!' #) '*+! !"#$ &'( )*+)$*,-.

! " # $ % ' " % ( ! ( ) * + " , -  ! " $ % ! & $ % ' ( ! % ) * + , -   ! " $ " % & ' ! ( & & ) * & + , &  ! # $ % & ' ( ) # $ ) * + , #  ! " # $ % & ! ( ! ) * + ! ) , - ! " $ % " & ' ( % $

!"#$"!"$% '(" ")*"#+ !"

$"!% !" $%& ' ('"!"

!"# %&' #'()#*+

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Ship was abandoned in the middle of the sea. E&G went to the rescue. Upon salvaging the ship and goods, E&G and the owner agreed on the valuation. WON remuneration was proper YES. Court held that there was indeed abandonment on the part of Nippon crewmembers, which served as the basis that the Salvage Law applies. The Court also had to take into account the meritorious service of E&G, along with equity and  justice in placing a value on how much they can recover since jurisprudence allows for the flexibility on how much can be recovered after a successful salvage.

ATLANTIC GULF V UCHIDA KISEN KAISHA (1921)  ! " # % & ' ( ) * ) + , - ! . + ! # $ % & ' ( ) * + ( , , ' -

G. URRUTIA V PASIG STEAMER AND LIGHTER (1912)

!"#$%%&'()! +, -'./&!""

! " # $ % " ' ( ! " $ % ) * ) + , -  ! " $ % & $ ' % ( ) * ) + ! ( ) " ! " # $ " % & ! & ( $ ) * & ! + , -  ! " $ % & % ' ( % ) " % * + ) , % !"#$%"!&'()% +$" ')

!"# %%& '() *+! ,%

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!"#$"%& (&)*+),&- ./ !"#$%& (& )#" ! " # ! " # $ % &

($) *+% ,&%#- !"# %&' ()*+',

! " # % & ' ( ) * ) + + ) , - (  ! " # % & ' ( ) # ( * & + , & - (  !

 ! " # % & ' ( ) * + , - + ! *  ! "

I :

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! " # $ ! % ' ( ) * + + , - , * ( %    ! " # $

F:

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While a storm was raging, a merchant vessel helped a distressed steamship. Merchant vessel then asked for remuneration, which the steamship refused to pay. WON remuneration was proper.

 Id. citing The Mayflower v The Sabine

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Defendant’s ship sank, they asked Plaintiff to salvage their ship. Due to disagreements on how much should be paid to Plaintiff as salvage price, Plaintiff went to the CFI. WON Plaintiff should be given a higher amount YES. Section 10 of Act No. 2616 prescribes the rule for determining the reward for salvage as follows: In a case coming under the last preceding section as well as in the absence of an agreement, the reward for salvage or assistance shall be fixed by the Court of First Instance of the province where the things salvage are found, taking into account principally the expenditures made to recover or save the vessel or the cargo or both, the zeal demonstrated, the time employed, the services rendered, the excessive expenses occasioned, the number of persons who aided, the danger to which they and their vessels were exposed, as well as that which menaced the

things recovered or salvaged, and the value of such things after deducting the expenses. BARRIOS V GO THONG (1963) ! " # ! % & ' ( ) * # + + # , - '  ! # $ % & ' ( % ! ) % * + ! " # $ $ % & ( ) " % % * % & $ + #  ! ! " # $ # % ! & # (

&

! " # $ % & ' ( ) * " & , " - ) " . !   "# %&' ()' !"#$"%&'

! " $ % & $ ' !  $ ! " # $ % & ! $

"( $")&*+, !"#$ &'( !"##"$% '( ')"

!"#$% !' ()$ (!"*#+

Types of affreightment as to time Time charter: Determined no. of days/month Voyage charter: Either outgoing or return, or round trip  As to freightage For a fixed amount for the whole cargo For a fixed rate per ton For so much per month COASTWISE LIGHTERAGE V CA (1995) ! " # $ % " ' ( ) * ( " ) ' * + ,  ! " # $ % #  # ! " # $ % & $ & $

! " # $ % & ' ( ) ( + , - ! # . !  ! # $ % & ' ' ( ) * ) + ' , ) !"# %&'(#)*+!,&)-

!"#$ &'( )($$(* +,&'  !"# %&' ()%(*) +', !"#$%"& ()" $*+", -,! #$% &'%() !*+(, !- 

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MV Henry towed MV Don Alfredo after intercepting its SOS signal. The captain is now demanding compensation because according to him, he engaged in the salvage of the vessel and is therefore entitled to more than P100,000. WON the captain of MV Henry deserves remuneration

! " # # " $ & ' ( ) $ " * " $ + , -  ! # $ % & ' ( ) * # & + !"#$%&'$()"( +,(("((!"#$

! " # $ % & ! $ " ( & ( ( % ) * + ,  ! " # $ !   #  ! " # % & ' ( & !"#$% !' ()$ *$++$, !"#$"$ &#'( )' #!! ) ! !"# #%&'( ") *&+, -) !"# %!& !'()&#

!"##$##%"&' )"**+&,

  NO. See both doctrines.

 A. CHARTER PARTIES I :

the agent of the vessel binds himself to transport merchandise or persons for a fixed price. It is also a lease of the whole or a portion of the vessel for the transportation of 164 goods or person from one port to another .

R:

!

 ! " # " ! % & ' ! ( & ) " ) *

! " # % " & ' ( ) # ) # ! ( & * #  ! # $ % & ' ( ) * ' +

F:

Charter party  is a contract by virtue of which the owner or

&"''(#) (#)

! " # $ % " & $ ' ! & ' & ) * + )  !   "#$"$"%

!

Insurer sought to recover the amount it paid to the consignee due to the total loss of cargo (molasses) of the latter from Coastwise (shipowner). Coastwise denies liability claiming that it was turned into a private carrier by the contract of affreightment it had with Pag-asa. WON the vessel was a common carrier. YES. The Court held that Coastwise remained a common carrier because a contract of affreightment does not convert a common carrier to a private carrier (unlike a demise/bareboat charter).

CALTEX PHILIPPINES V SULPICIO LINES (1999) !" $%& '%()$&) !* ( !"#$%&!$ "(

 ! " " # $ % & ' ( ) $ * ( + - ' % . ' 

!"#$"% '("

!"#$%&'() #' $%!!(!!!"# "% &'( )'!* +)

 As to extent of vessel hired: Total: Whole vessel is chartered, including the command, possession and control over navigation. Partial: Only a part of the vessel is chartered

! " # $ % ' ! % ( ) $ * ! + , - $  !

! " # $ % & # ' ( ' ) ' * ' " # % , ! " # $ % & ' ( ) % $ & + ! # + '  ! ! " # $ % & ' ( ) * , " ( - " . ) ,  ! " ! " $ % & " ! ! & " ' ( !"#$"!"%& %( %)"*+ , !"#$%# '% "!#(!)* $+  !"# %"&'(

 As to control:

Caltex shipped its fuel cargo aboard MT Vector via a voyage charter party. Said vessel collided with MV

Demise/Bareboat: The charterer mans the vessel with his

Affreightment :

own people and becomes the owner pro hac vice. The owner of the vessel completely and exclusively relinquishes possession, command and navigation to the charterer. The owner of the vessel leases part or all of its space to haul goods for others. The owner retains possession, command and navigation of the ship.

Dona

 PPI V CA

Paz, resulting to the death of almost all its crews and passengers. Sulpicio, owner of the passenger ship, wants to hold Caltex liable for the accident as well, for the latter’s alleged negligence in choosing to ship its cargo through an unseaworthy ship. WON the vessel was acting as a common carrier. YES. Court held that Caltex was under no obligation to ensure the seaworthiness of the vessel because their contract was a mere voyage charter, which did not transform the vessel from a common to a private carrier; as such, it was incumbent upon the vessel to impliedly warrant its seaworthiness, and Caltex had                !

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164

#$% !"#$%& ()*

B. LOANS ON BOTTOMRY AND RESPONDENTIA A contract in the nature of a mortgage, by which the shipowner borrows money for the use, equipment or repair of the vessel, and for a definite term, pledges the ship (or its keel and bottom) as a security for its repayment. If the ship is lost in the course of a voyage, or during the limited time, by any of the perils enumerated in the contract, then the lender shall also lose his money.

A loan made on the goods laden on board the ship, and which are to be sold or exchanged in the course of the voyage the borrower’s personal responsibility being deemed the principal security for the performance of the contract. Even though the ship perishes, the lender must be paid his principal and interest, provided that the goods are saved.

BOTTOMRY DEFINITION

WHO MAY CONTRACT

NATURE OF THE CONTRACTS

COMMON ELEMENTS FORMS

RESPONDENTIA

Loan made by Loan taken on shipowner or ship security of the cargo agent guaranteed laden on a vessel by vessel itself and and repayable upon repayable upon safe arrival of cargo arrival of vessel at at destination. destination Shipowner or agent. Only the owner of Captain, if outside the cargo. the residence of former. 1. Delivery is necessary for the perfection of the contract. 2. Contract only produces obligation on the borrower. 3. The lender runs known risks. 1. Exposure of security to marine peril. 2. Obligation of the debtor conditioned upon safe arrival of the security. 1. Public instrument 2. Policy signed by the contracting parties and the broker taking part therein 3. Private instrument

BOT / RES MUTUUM Last lender has preference over first ones Required to be paid only upon safe arrival No limit on interest Security is limited to vessel/goods Purpose : For repair, use of purchase of equipment

A loan in which under any condition whatever, the repayment of the sum loaned and of the premium stipulated depends upon the safe arrival in port of the goods on which it is made, or of the price they may receive in case of accident, shall be considered a loan on bottomry or respondentia. Loan on bottomry or respondentia is a real, unilateral, aleatory contract where: - Delivery of the amount loaned is necessary for the perfection of the contract; - Although there are reciprocal benefits, the contract produces obligations only for 1 party, the borrower, who must return the amount borrowed plus premium; and - The lender really runs known risks Loan on bottomry or respondentia, unlike ordinary loan, is not subject to the provisions of the Usury Law - There is no limit as to the rate of the intrest in view of the fact that there are different classes and various accidents to which maritime voyages are exposed.

First lender has right of preference Must be paid absolutely Subject to usury law May be any real/personal property For any purpose.

 A. CONTENTS What is written in a bill of lading 166 1. The name, registry, and tonnage of the vessel. 2. The name of the captain and his domicile. 3. The port of loading and that of unloading. 4. The name of the shipper. 5. The name of the consignee, if the bill of lading is issued in the name of a specified person. 6. The quantity, quality, number of packages and marks of the merchandise. 7. The freightage and the primage stipulated. How the bill of lading is created 167  4 true copies of the original bill of lading shall be made - All of them shall be signed by the captain and the shipper. - The shipper shall keep one and send another to the consignee; the captain shall take two, one for himself and another for the ship agent. There may also be drawn up as many copies of the bill of lading as may be considered necessary by the person interested; but when they are issued to order or to bearer, they shall be stated in all the copies, be they the first four or the subsequent ones, the destination of each one, stating whether it is for the agent, for the captain, for the shipper, or for the consignee. If the copy sent to the latter should have a duplicate, this circumstance and the fact that it is not valid except in default of the first one must be stated therein.

166

 Art. 706 (Code of Commerce)

Other rules Article 713 . If before the delivery of the cargo a new bill of lading should be demanded of the captain, on the allegation that the failure to present the previous ones is due to their loss or to any other just cause, he shall be obliged to issue it, provided that security for the value of the cargo is given to his satisfaction, but without changing the consignment, and stating therein the circumstances prescribed in the last paragraph of Article 707, under penalty, should he not so state, of being held liable for said cargo if improperly delivered through his fault. Article 714. If before the vessel puts to sea the captain should die or should cease to hold his position through any cause, the shippers shall have the right to demand of the new captain the ratification of the first bills of lading, and the latter must do so, provided that all the copies previously issued be presented or returned to him, and it should appear from all examination of the cargo that they are correct. Form of bill of lading 168 The bill must be in writing and signed within 24 hours after the cargo has been received on board. Otherwise, the shipper may demand (1) the unloading of the goods at the captain’s expense and (2) the payment of the losses and damages suffered by the captain’s refusal to sign the bill.

MAGELLAN MFG V CA (1991) ! " ! $ % & ' $ ( ) ' * ! " # ! ! " % & ! ' ( ) * # ! ' + ,  ! # $

! " # % & ' ' ( # ) # * & + ! "  ! # $ % ! & ' ! ( ) ) * # + , %&'()%*+ ,'&-' ! " ! $ % & $ ' ( ( % ) * + , - ! " $ % & " ' " ( ) * * + , - . '  !

!"#!$%&'$#( "* +',*" !"#

!" $%& '(()*+',() -$!   "#!$ #! $!&'( "#! !"## %& '%()

F:

I: R:

CCL purchased anahaw fans from MMMC and issued a letter of credit that they should procure an on-board BOL and there should be no transshipment. CCL refused the anahaw delivery because MMMC violated the 2 conditions. The shipper they contracted changed vessels in HK before going to Japan. But this was stated in the BOL and MMMC knows about it. In effect, they consented to its transshipment even if the letter of credit specifically said not to transship. The BOL they received was only a received for shipment BOL. Buyers want an on- board BOL because it signifies that cargo is on the ship and is good to go. Rather than ask for an on-board BOL MMMC just got a certification that the cargo is already on board. WON

  YES. Ratio

B. PROBATIVE VALUE

Article 709 . A bill of lading drawn up in accordance with the provisions of this title shall be proof as between all those interested in the cargo and between the latter and the insurers, proof to the contrary being reserved for the latter. Article 710.   If the bills of lading do not agree, and no change or erasure can be observed in any of them, those possessed by the shipper or consignee signed by the captain shall be proof against the captain or ship agent in favor of the consignee or shipper; and those possessed by the captain or ship agent signed by the shipper shall be proof against the shipper or consignee in favor of the captain or ship agent.

Notes: Under Art 709, the bill of lading properly drawn shall be proof between the parties of their agreements. Art 710 governs the case where the bill of lading does not agree, and no change or erasure can be observed in any of them. In case of conflict in the provisions of the charter party and the bill of lading, even when both appear unaltered, the contents of the bill of lading prevail. Issuance of bill of lading is not proof of loading of goods.

 A. NATURE OF CONTRACTS B. OBLIGATIONS OF PASSENGERS C. RIGHTS OF PASSENGERS  Suspension Right to refund fare and to recover losses and damages - If it is suspended due to exclusive fault of captain and ship agent Right to return of fare - If suspension is ude to FM or other cause independent of captain and ship agent Interruption Passengers shall pay fare only in proportion to distance covered (without recovery of losses) - If interruption of voyage is due to FM Proprotional fare with a right to indemnity - If interruption caused by captain only No duty to pay increase in fare - If interruption was due to disability of vessel and passenger agrees to await repairs - His living expense is for his own account Delay Right to remain on board and furnished with food by the vessel If the delay is more than 10 days: Right for return of fare.

If delay due to fault of captain/ship agent: Return of fare and indemnity for damages.

F.H. STEVENS V NORDEUTSCHER (1962) ! " # % & ' & ( ) * % ! " # + ,  ! " # $ & ' ( # ) ' ! * '

SWEET LINES V CA (1983) Ship by-passed Catbalogan, going directly to F: Tacloban. Distressed passengers ha to take a ferry from TAC to CAT. They sued for breach of contract. WON Sweet lines may be relieved from liabiliy due I  : to force majeure / limitation of liability. NO. Court held that there was no force majeure that could have prevented them of going to CAT. Also, the fine print at the back did not relieve them of any responsibility. If at most, it gave them an opportunity R: to make bawi by either finding another way to transport them to the destination or by refunding the ticket. TRANS-ASIA SHIPPING V CA (1996) 1 of vessel’s engine conked out in the open sea so passenger requested to return to their point of origin. After 1 day, he boarded another vessel of the F: defendant. Consequently, he arrived 1 date late from his expected arrival and now suing for damages. WON the carrier is liable for damages I  : YES FOR MORAL. SC held that there was no delay in the commencement of the contracted voyage. If any delay was incurred, it was after the R: commencement of such voyage, and the reason why passenger arrived late was due to his decision to disembark and board another vessel.

When applicable? Art. 1766 provides for the hierarchy: - Civil Code - Code of Commerce - COGSA as a special law In cases of invokation of immunities due to force majeure, stipulations limiting liability, prescriptive periods. Pertinent provisions - Prima facie evidence of receipt - Procedure in case of loss/damage - Limitation on liability ($500/package) - Notice requirements - Prescriptive period ANG V AMERICAN STEAMSHIP (1967) ! " # $ $ % ' # ( ) * + , " - ) * $  ! # $ % & ! % $ ' ( ) * + , + ( ' !"#$%"&' )* )## +), !"#$ &' ()$ *)+,,$! " # % & ' # ' ( ) " * ) ' * + ,  ! " # $ ! % ' ( $ ) !  ! " # $ % & ' ( $ # * + ' , - + #  ! " # $ % & ' ) * ! + % ) + ! , "   !"# ! " # $ # & " # $ # ! ' ( ) * + #  ! " " ! $ % & ! ' ( " 

! " # $ % " & ' ) * ) + " , & * -  !

#$%&'() '% *

!"#$%&"'%()*

! " # $ % $ & ' ( % * " + , $ # , -  ! ! " # $ % & $ ( % ) * %  " ! " # $

!"#$%&' )*& %*+, #"-!"#$

!&'( )*#

! " # $ " # # % & ( ) * + % * % ,  ! " # $ %

171

registered luggage or any goods during air carraige . a. “During air carriage” = While goods are in charge of the carrier. 3. Carrier is liable for damage occasioned by delay in 172 carriage .

Warsaw Convention Convention on the unification of certain rules relating to international carriage by air. Purpose:   To protect emerging air transportation industry and to secure the uniformity of recovery by passengers.

 A. CONSTITUTIONALITY SANTOS V NORTHWEST (1992)

NORTHWEST V CUENCA (1965) !"# %&'(&% )*+,#+!-*! #$ !$% &$!'%(%)%*  ! " $ % & ' ( ) * + $ ' * ) , ! " $ % & ' ( % ) * & + , * - * $ %   ! "  ! " # % ! # # " & # ' ! ( ) & * ! " # " % & ' " ! ( ) * !"#"$%&'

ALITALIA V IAC (1990) !"# %&'(&% )*+,#+!-*! #$%&'&( )&!*&+ ,$ ! " # % & ' ' ( # ' & ) & ( * + # ,  ! # $ % ! & ' ( ) $ * + , + $ - ,

! " # % & ' ! ( ) * # & + ( # , -  ! ! # $ ! % & ' % # ( ) ! * + , ! ! " # " % & ' ( # & ( ) # " * ( # +  ! " # # $ & ' ! " # $ " ! & ' " !"#$!% '()*#"$!'+#, !"#$# &' ( )#*#''&!+ 

! " # $ " & ' $ ( ) * & + , ( # -  ! "

$!% &!'(!&!")* !+  !"#

!"#"$% '( )"*(%! +, !"# %"&'(& !"#$%&'($) !" $% &'() *+,-'./ !

!"#"$%&'() +,+-../ 0! ! " # $ & ' ( ) # ) " * + , ) !  ! # $ ! $ % & % ' $ ( )

!"# % !"#&%' %() "#

! #$% &'() '%* $!

 ! " " # $ % ! & " ' ) * + , + , ' ! " # % & ' ( ) * % + , '

!"#$"% '( )*" +,!"-

! " # $ % & $ ( ) * + % , - . / # &  ! " ! $ % % & ' ( " ) & % " *

!" $%&"!'()(' *% +(

!"#$%&'($)*+ %- +". ! " # % & ' & ( # ) * + * ) ' ) , ! " # $ % ' ! ( ) * + , , , - $  ! " # !"#$%&'!() )+ ,$'-#'

!"# %&'(# )* +#,!-.' !"#$ &'('&&') !# "$

 ! " # $ % ' ( % ) # * ! + + , # +  ! " # $ % & ( $ # ) $ % # ) *

!"# %&'(&% )*+,#+!-*! #! $ %&#'

!"#$% !" $%& '()*!+(',-./ 

!"#$%$&%#' ") $!"!#$% '$#() *) (+! !"#$%&#' )'*#$+&#$,+  !"#! %& #''()*+* !"#$!% '(")*+),!)-./ !"#$ #$ &'()*$' !"' ! " # # $ % # $ ' ( % ) " ( ( * + ! " # $ & ! & ' ( # ) * ! ' & & +  ! ! " # # $ % & $ ' ) " * + , - , .  ! # $ % & ! ' ( ' ) * + * ,  

B.  WHEN APPLICABLE169 Only when both parties are signatories to the Convention

The transportation must be: 1. International transportation; 2. Air transportation; and 3. Carriage of passengers, baggage or goods. When is there international transportation: - When situated within the territories of 2 High Contracting parties, regardless of whether or not there is a break in the transportation; - When situated within the territory of a High Contracting party, if there is an agreed stopping place within a territory subject to the sovereignty of another power, though not a signatory. (roundtrip)

C. LIABILITIES UNDER THE CONVENTION

1. Carrier is liable for damage sustained in the even of the death or injury of a passenger, if it happens on boarding, 170 while inside the plane or disembarkation . 2. Carrier is liable for any loss, damage or destruction of

Class notes: Overbooking and downgrading are not mentioned but may also be grounds for liability.

D. LIMITATIONS ON LIABILITY 173

1. Limitation per passenger: $100,000 2. Limitation per KG of checked-in luggage: $20 a. Unless special declaration + payment of supplementary sum 3. Hand-carried baggage per passenger: $1,000 4. Goods to be shipped per KG: $20

Note: The carrier need not stipulate the limitations in the convention.

E.  WHEN LIMITATIONS UNAVAILABLE

1. Any stipulation relieving the carrier from liability or fixing 174

a lower limit shall be null and void . 2. Damage caused by willful misconduct or default on the 175 carrier’s part . 3. Damage caused by any agent of the carrir acting within 176 the scope of employment . 4. When carrier allowed the passenger to board without a

171

 Article 18 WARSAW  Article 19 WARSAW 173  Article 22 WARAW 174  Article 23 WARSAW 175  Article 25(1) WARSAW 172

169

 Article 1 WARSAW

177

Prescriptive periods179 2 years from: - Date of arrival at the destination; - Date of expected arrival; or - Date on which the transportation stopped.

ticket .

F. CONDITIONS ON IMPOSITION OF LIABILITY SANTOS V NORTHWEST  ! " # ! % & ' ( " ) * + ! ) , - * . ! # $ % & ' % ( ) ' # $ % & '    ! " # $ % & % & ( ) $ " ) * + , $ ! "

$% "&'()!)* +,( - !

! " # $ % & ' ) $ ! * + , ' ' # '  ! " $ % & ' ( ) ( % & * + & ' !"#"$%$"&'( *($%+!"(!"# %& '!" ()*+)( !"#$%#&'"#(

 Jurisdiction 180 1. Carrier’s residence 2. Carrier’s principal place of business. 3. Carrier has an establishment where contract was made 4. At the place of destination

LUNA V CA (1992) !"# %&'(&% )*+,#+!-*! #$ !%& '! !"#$%&'(! !*%+!,-.'/! #$ %&'( !"#$%&%'%($ * +,(*!- 

LHUILLIER V BRITISH AIRWAYS (2010)  ! " # $ % & $ ' ( $ ) *

PAL V SAVILLO (2008) ! " # % & ' & ( # ) ) * ' + , * - *  ! # $ % & ' $ ( ) ( * + # $ % $ ! " # $ % & ' ( " # $ % & $ " * + ! " # $ % & '  #  ! " # $ & ' ' ( ) * + , ! " # $ "   ! " # $ % ' " # ( ) * % ' ! + ) ! " # ! " % & # ' !"# %&&"'() #" *"%+)

! #$% &#'() *$ +*,&%

! " # % " & ! # ' ( # " ) * ! + ,  ! " # % & ' ! ( ! ) ) * ) )

! " # $ " % & ' ( ) *  $ ! " # $ % & ' % $ ) $ # % * ! " + , ! " # $ # & ' # !" $% &'(!')*+'(,%& !"#$ &'( )*&+), !"#"$%& ()"( *+% ,-" !"# %&& %& '!()!*+

 Summary of Rights 1. Right to be provided with accurate information before purchase a. Full, fair, and clear disclosure of services offered b. Clear and non-misleading ads c. No fraudulent sales promotion practices 2. Right to receive full value of service purchased a. Right to transportation and baggage conveyance b. Right to be processed for check-in c. Right to board aircraft for the purpose of flight 3. Right to compensation a. In case of cancellation b. In case of flight delay c. In case of delayed, lost and damaged baggage d. In case of death or injury e. Immediate payment of compensation

! " # $ % & ( ) $ * + $ ) , - . / "  ! " # $ ! ! 

UNITED AIRLINES V UY (1999) !"# %&'(! )*+!*,-'*+ !"#

%"&'""( )*+

! " # " $ % ' ( " ) " * * % + $ %  ! " # % & ' ' & ' ( & ) *

!"# %&' &()*+*,%*-. !"##$%$& #%() *+$ ! " # $ % & ! ! ' ( * + , ' - % .  ! " ! # % & ' ( ! ) * " + * )

!"#$%#&'"#( *+'!+  ! " # $ % " & ' # $ & ) * + , - # !   "#$ &' (# )*+,",- .! !"# %&'&( %)*#

!"#$"%&' )*+ ," -$.%!"#$%&

#(

!"#$ &'($)*

Notice of Claim Complaint is a condition precedent for an action against the carrier, otherwise, barred EXCEPT in case of fraud on the part of the carrier 178.

WHEN COMPLAINT MUST BE MADE DAMAGE TO LUGGAGE DAMAGE TO GOODS DELAY OF LUGGAGE/GOODS

177

 Article 3 WARSAW

3 days from receipt 7 days from receipt 14 days from receipt

References and

Special thanks Special thanks to: A2015 Reviewers

179

 Article 29 WARSAW