EVERETT STEAMSHIP VS CA
damage to or in any connection with, goods in an amount
FACTS:
Private respondent imported 3 crates of bus spare parts marked as MARCO
C/No. 12, MARCO C/No. 13 and MARCO C/No. 14, from its supplier,
Maruman Trading Company, Ltd. (Maruman Trading), a foreign
corporation based in Inazawa, Aichi, Japan. The crates were shipped from
Nagoya, Japan to Manila on board "ADELFAEVERETTE," a vessel owned
by petitioner's principal, Everett Orient Lines. Upon arrival at the port of
Manila, it was discovered that the crate marked MARCO C/No. 14 was
missing. Private respondent claim upon petitioner for the value of the lost
cargo amounting to One Million Five Hundred Fifty Two Thousand Five
Hundred (Y1, 552,500.00) Yen, the amount shown in an Invoice No. MTM-
941, dated November 14, 1991. However, petitioner offered to pay only
One Hundred Thousand (Y100,000.00) Yen, the maximum amount
stipulated under Clause 18 of the covering bill of lading which limits the
liability of petitioner. Private respondent rejected the offer and thereafter
instituted a suit for collection. The trial court rendered a decision in favour
of the private respondents and this was affirmed by the Court of Appeals.
Thus, this instant petition.
ISSUES:
1. Is the petitioner liable for the actual value and not the maximum
value recoverable under the bill of lading?
2. Is private respondent, as consignee, who is not a signatory to the
bill of lading bound by the stipulations thereof?
ARGUMENTS:
1. The Petitioner is only liable for the maximum value recoverable
under the bill of lading.
Clause 18 of the covering bill of lading:
18. All claims for which the carrier may be liable shall be
adjusted and settled on the basis of the shipper's net
invoice cost plus freight and insurance premiums, if paid,
and in no event shall the carrier be liable for any loss of
possible profits or any consequential loss.
The carrier shall not be liable for any loss of or any
exceeding One Hundred thousand Yen in Japanese
Currency (Y100,000.00) or its equivalent in any other
currency per package or customary freight unit
(whichever is least) unless the value of the goods higher
than this amount is declared in writing by the shipper
before receipt of the goods by the carrier and inserted in
the Bill of Lading and extra freight is paid as required.
(Emphasis supplied)
Pertinent provisions that is applicable as to this case:
Art. 1749. A stipulation that the common carrier's liability is limited to the
value of the goods appearing in the bill of lading, unless the shipper or
owner declares a greater value, is binding.
Art. 1750. A contract fixing the sum that may be recovered by the owner or
shipper for the loss, destruction, or deterioration of the goods is valid, if it is
reasonable and just under the circumstances, and has been freely and fairly
agreed upon.
Pursuant to the afore-quoted provisions of law, it is required that the
stipulation limiting the common carrier's liability for loss must be
"reasonable and just under the circumstances, and has been freely and fairly
agreed upon."
The above stipulations are reasonable and just. In the bill of lading, the
carrier made it clear that its liability would only be up to One Hundred
Thousand (Y100,000.00) Yen. However, the shipper, Maruman Trading,
had the option to declare a higher valuation if the value of its cargo was
higher than the limited liability of the carrier. Considering that the shipper
did not declare a higher valuation, it had itself to blame for not complying
with the stipulations.
2. Private Respondents are still bound by the stipulations of the bill of
lading
In Sea-Land Service, Inc. vs. Intermediate Appellate Court (supra), it was
held that even if the consignee was not a signatory to the contract of
carriage between the shipper and the carrier, the consignee can still be
bound by the contract.
RULING:
The decision of the Court of Appeals is hereby REVERSED and SET
ASIDE.
In fine, the liability of petitioner for the loss of the cargo is limited to One
Hundred Thousand (Y100,000.00) Yen, pursuant to Clause 18 of the bill of
lading..
SUMMA INSURANCE VS CA
Facts:
S/S "Galleon Sapphire", a vessel owned by the National Galleon Shipping
Corporation (NGSC), arrived at Pier 3, South Harbor, Manila, carrying a
shipment consigned to the order of Caterpillar Far East Ltd. with Semirara
Coal Corporation (Semirara) as "notify party". The shipment, including a
bundle of PC 8 U blades, was covered by marine issued by petitioner and
Bill of Lading. The shipment was discharged from the vessel to the custody
of private respondent, formerly known as E. Razon, Inc., the exclusive
arrastre operator at the South Harbor. Accordingly, three good-order cargo
receipts were issued by NGSC, duly signed by the ship's checker and a
representative of private respondent.The forwarder, Sterling International
Brokerage Corporation, withdrew the shipment from the pier and loaded it
on the barge "Semirara 8104". The barge arrived at its port of destination,
Semirara Island, on Upon inspection, Semirara discovered that the bundle
of PC8U blades was missing at its warehouse.Private respondent issued a
short-landed certificate-stating that the bundle of PC8U blades was already
missing when it received the shipment from the NGSC vessel. Semirara
then filed with petitioner, private respondent and NGSC its claim for
P280,969.68, the alleged value of the lost bundle. Petitioner paid Semirara
the invoice value of the lost shipment. Semirara thereafter executed a
release of claim and subrogation receipt. Consequently, petitioner filed its
claims with NGSC and private respondent but it was unsuccessful.
Petitioner then filed a complaint against NGSC and private respondent for
collection of a sum of money, damages and attorney's fees. The trial court
rendered a decision absolving NGSC from any liability but finding private
respondent liable to petitioner. On appeal, the Court of Appeals modified
the decision of the trial court and reduced private respondent's liability.
Issue:
1. Whether or not the private respondent legally liable for the loss of
the shipment in question?
2. What is the extent of its liability
Ruling:
1. Yes, SC finds the Respondent liable for the loss. Petitioner was
subrogated to the rights of the consignee. The relationship between
the petitioner and the respondent is akin to that existing between
the consignee or owner of shipped goods and the common carrier,
or that between a depositor and a warehouseman. In the
performance of its obligations, an arrastre operator should observe
the same degree of diligence as that required of a common carrier
and a warehouseman as enunciated under Article 1733 of the Civil
Code and Section 3(8) of the Warehouse Receipts Law,
respectively. Being the custodian of the goods discharged from a
vessel, an arrastre operator's duty is to take good care of the goods
and to turn them over to the party entitled to their possession.
2. In the performance of its job, an arrastre operator is bound by the
management contract it had executed with the Bureau of Customs.
However, a management contract, which is a sort of a
stipulation pour autrui within the meaning of Article 1311 of the
Civil Code, is also binding on a consignee because it is
incorporated in the gate pass and delivery receipt which must be
presented by the consignee before delivery can be effected to .The
insurer, as successor-in-interest of the consignee, is likewise bound
by the management contract. Indeed, upon taking delivery of the
 cargo, a consignee (and necessarily its successor-in-interest) tacitly The Ship Captain ascribed the sinking to the entry of seawater through a
accepts the provisions of the management contract, including those hole in the hull caused by the vessel's collision with a partially submerged
which are intended to limit the liability of one of the contracting log.
parties, the arrastre operator.
On 15 July 1983 the consignee Coca-Cola Bottlers Philippines, Inc., Cebu
plant, filed a claim with respondent FELMAN for recovery of damages.
FELMAN denied the claim thus prompting the consignee to file an
insurance claim with PHILAMGEN which paid its claim of P755,250.00.
PHILAM INSURANCE VS CA
Claiming its right of subrogation PHILAMGEN sought recourse against
FACTS:
respondent FELMAN which disclaimed any liability for the loss.
Consequently, on 29 November 1983 PHILAMGEN sued the shipowner for
On 6 July 1983 Coca-Cola Bottlers Philippines, Inc. (Coca-Cola Bottlers),
sum of money and damages, alleging that the total loss of cargo was due to
loaded on board "MV Asilda," a vessel owned and operated by respondent
the vessel’s unseaworthiness as she was put to sea in an unstable condition.
Felman Shipping Lines (FELMAN), 7,500 cases of 1-liter Coca-Cola
FELMAN, on the other hand, filed a motion to dismiss contending that
softdrink bottles to be transported from Zamboanga City to Cebu City for
there was no right of subrogation in favor of PHILAMGEN since it had
consignee Coca-Cola Bottlers Philippines, Inc., Cebu. The shipment was
abandoned all its rights, interests and ownership over the vessel together
insured with petitioner Philippine American General Insurance Co., Inc.
with her freight and appurtenances for the purpose of limiting and
(PHILAMGEN)
extinguishing its liability under Art. 587 of the Code of Commerce.
In a joint statement, the Captain as well as the chief mate of the vessel
confirmed that the weather was fine when "MV Asilda" left the port of
The RTC dismissed PHILAMGEN’s complaint and appealed to the CA
Zamboanga at 8 p.m. on 6 July. The ship captain stated that around 4 a.m.
which remanded the case and denied its motion for reconsideration. The
of 7 July 1983 he was awakened by the officer on duty to inform him that
RTC then ruled that the vessel was seaworthy and even if assumed
the vessel had hit a floating log.
unseaworthy, PHILAMGEN still could not recover from FELMAN since
At that time he noticed that the weather had deteriorated with strong
Coca-Cola Bottlers had breached its implied warranty on the vessel’s
southeast winds inducing big waves. After 30 minutes, he observed that the
seaworthiness.
vessel was listing slightly to starboard and would not correct itself despite
On appeal, the CA ruled that the vessel was unseaworthy for being top-
the heavy rolling and pitching. He then ordered his crew to shift the cargo
heavy as 2,500 cases of Coca-Cola softdrinks bottles were improperly
from starboard to portside until the vessel was balanced. At about 7 a.m.,
stowed on deck. Even though the vessel possessed the necessary Coast
the master of the vessel stopped the engine because the vessel was listing
Guard certification indicating its seaworthiness with respect to the structure
dangerously to portside. He ordered his crew to shift the cargo back to
of the ship itself, it was not seaworthy with respect to the cargo. However, it
starboard (right). The shifting of cargo took about an hour after which he
denied the money claim of PHILAMGEN because of the implied breach of
rang the engine room to resume full speed.
warranty of seaworthiness by Coca-Cola Bottlers. Furthermore, the filing of
At around 8:45 a.m., the vessel suddenly listed to portside and before the
notice of abandonment had absolved FELMAN from liability under the
captain could decide on his next move, some of the cargo on deck were
limited liability rule.
thrown overboard and seawater entered the engine room and cargo holds of
the vessel. At that instance, the master of the vessel ordered his crew to
abandon ship.
ISSUES:
Shortly thereafter, "MV Asilda" capsized and sank in the waters of
Zamboanga del Norte bringing down her entire cargo with her including the
1. Whether MV Asilda was seaworthy when it left port of Zamboanga
subject 7,500 cases of 1-liter Coca-Cola softdrink bottles.
 2. Whether the limited liability under Article 587 of the Code of
Commerce should apply
RULING:
1. NO. The Supreme Court subscribe to the findings of the Elite
Adjusters and the Court of Appeals that the proximate cause of the
sinking of the MV Asilda was its being top-heavy. As according to
the report submitted by the Elite Adjusters, while the vessel may
not have been overloaded, the distribution or stowage of the cargo
on board was done in such a manner that the vessel was in top-
heavy condition at the time of its departure which rendered it
unstable and unseaworthy for that particular voyage. Furthermore,
MV Asilda was designed as a fishing vessel and was not designed
to carry a substantial amount or quantity of cargo in deck and from
the moment it was utilized to load heavy cargo, the vessel was
rendered unseaworthy for the purpose of carrying the type of cargo
and that the capsizing and sinking of the vessel was bound to
happen and an inevitable occurrence.
2. NO. The Supreme Court held that Article 587 of the Code of
Commerce is not applicable. The ship agent is liable for the
negligent acts of the captain in the care of the goods loaded on the
vessel. This liability, although can be limited through abandonment
of the vessel, its equipment and freightage, as provided in Art. 587,
there exceptional circumstances wherein the ship agent could still
be held answerable, as where the loss or injury was due to the fault
of the ship owner and the captain. The international rule is to the
effect that the right of abandonment of vessels, as a legal limitation
of a ship owner's liability, does not apply to cases where the injury
or average was occasioned by the ship owner's own fault. It must
be stressed at this point that Art. 587 speaks only of situations
where the fault or negligence is committed solely by the captain.
Where the ship owner is likewise to be blamed, Art. 587 will not
apply, and such situation will be covered by the provisions of the
Civil Code on common carrier. Under Art 1733 of the Civil Code,
"(c)ommon carriers, from the nature of their business and for
reasons of public policy, are bound to observe extraordinary
diligence in the vigilance over the goods and for the safety of the
passengers transported by them, according to all the circumstances
of each case . . ." In the event of loss of goods, common carriers
are presumed to have acted negligently. FELMAN, the ship owner,
was not able to rebut this presumption.
LOADSTAR SHIPPING VS CA
Facts: On November 19, 1984, loadstar received on board its M/V
“Cherokee” bales of lawanit hardwood, tilewood and Apitong Bolidenized
for shipment. The goods, amounting to P6,067, 178. Were insured for the
same amount with the Manila Insurance Company against various risks
including “Total Loss by Total Loss of the Vessel”. On November 20, 1984,
on its way to Manila from the port of Nasipit, Agusan Del Norte, the vessel,
along with its cargo, sank off Limasawa Island. As a result of the total loss
of its shipment, the consignee made a claim with loadstar which, however,
ignored the same. As the insurer, MIC paid to the insured in full settlement
of its claim, and the latter executed a subrogation receipt therefor. MIC
thereafter filed a complaint against loadstar alleging that the sinking of the
vessel was due to fault and negligence of loadstar and its employees.
In its answer, Loadstar denied any liability for the loss of the shipper’s
goods and claimed that the sinking of its vessel was due to force majeure.
The court a quo rendered judgment in favor of MIC., prompting loadstar to
elevate the matter to the Court of Appeals, which however, agreed with the
trial court and affirmed its decision in toto. On appeal, loadstar maintained
that the vessel was a private carrier because it was not issued a Certificate of
Public Convenience, it did not have a regular trip or schedule nor a fixed
route, and there was only “one shipper, one consignee for a special crago”.
Issue: Whether or not M/V Cherokee was a private carrier so as to exempt
it from the provisions covering Common Carrier?
Held: Loadstar is a common carrier.
The Court held that LOADSTAR is a common carrier. It is not necessary
that the carrier be issued a certificate of public convenience, and this public
character is not altered by the fact that the carriage of the goods in question
was periodic, occasional, episodic or unscheduled. Further, the bare fact
that the vessel was carrying a particular type of cargo for one shipper, which
appears to be purely co-incidental; it is no reason enough to convert the
vessel from a common to a private carrier, especially where, as in this case,
it was shown that the vessel was also carrying passengers.
Article 1732 also carefully avoids making any distinction between a person
or enterprise offering transportation service on a regular or scheduled basis
and one offering such service on an occasional, episodic or unscheduled
basis. Neither does Article 1732 distinguish between a carrier offering its
services to the "general public," i.e., the general community or population,
and one who offers services or solicits business only from a narrow segment
of the general population.
SARKIES TOURS VS CA
Facts:
On August 31, 1984, Fatima boarded petitioner’s bus from Manila to
Legazpi. Her belongings consisting of 3 bags were kept at the baggage
compartment of the bus, but during the stopover in Daet, it was discovered
that only one remained. The others might have dropped along the way.
Other passengers suggested having the route traced, but the driver ignored
it. Fatima immediately told the incident to her mother, who went to
petitioner’s office in Legazpi and later in Manila. Petitioner offered P1,000
for each bag, but she turned it down. Disapointed, she sought help from
Philtranco bus drivers and radio stations. One of the bags was recovered.
She was told by petitioner that a team is looking for the lost luggage. After
nine months of fruitless waiting, respondents filed a case to recover the lost
items, as well as moral and exemplary damages, attorney’s fees and
expenses of litigation. The trial court ruled in favor of respondents, which
decision was affirmed with modification by the Court of Appeals, deleting
moral and exemplary damages.
Issues:
(1) Whether petitioner is liable for the loss of the luggage
(2) Whether the damages sought should be recovered
Held:
(1) The cause of the loss in the case at bar was petitioner's negligence in not
ensuring that the doors of the baggage compartment of its bus were securely
fastened. As a result of this lack of care, almost all of the luggage was lost,
to the prejudice of the paying passengers.
(2) There is no dispute that of the three pieces of luggage of Fatima, only
one was recovered. Respondents had to shuttle between Bicol and Manila in
their efforts to be compensated for the loss. During the trial, Fatima and
Marisol had to travel from the United States just to be able to testify.
Expenses were also incurred in reconstituting their lost documents. Under
these circumstances, the Court agrees with the Court of Appeals in
awarding P30,000.00 for the lost items and P30,000.00 for the
transportation expenses, but disagrees with the deletion of the award of
moral and exemplary damages which, in view of the foregoing proven facts,
with negligence and bad faith on the fault of petitioner having been duly
established, should be granted to respondents in the amount of P20,000.00
and P5,000.00, respectively.
BACARRO VS CASTANO
Facts:
CASTAÑO boarded the jeep at Oroquieta bound for Jimenez, Misamis
Oriental. The jeep was filled to capacity, with 12 passengers in total. The
jeep was running quite fast and while it was approaching the Sumasap
bridge, there was a cargo truck who blew its horn, signaling its intent to
overtake.
The jeep gave way, by swerving to the right, but it did not change speed (40
km/hr). The cargo truck and the jeep were running side by side for a
distance of around 20 meters. The driver of the jeep was not able to return
the jeep to the proper lane and instead ran obliquely towards the canal until
it fell into the ditch. When the jeep was running on the side of the road, the
road was inclined a little and Castaño was pushed outward by the
passengers beside him such that he was clinging with his leg and half of his
body outside the jeep. The jeep then fell, breaking the leg of Castaño.
Castaño was rushed to St. Mary’s Hospital where he stayed for 2 months.
Because of the accident, his right leg is now shorter by 1 ½ inches
necessitating him to use specially made shoes. He complained that he was
not able to squat, kneel, nor sit for a long time because of his leg. He also
lost two fingers on his right hand and the remaining 3 fingers feels numb up
to this time.
Montefalcon’s defense hinged on his allegation that the accident was
because the cargo truck overtook the jeep so closely that in the process of
overtaking sideswiped the jeep, hitting the reserve tire placed at the left side
of the jeep. This caused the jeep to swerve and run into the ditch, falling
into the canal.
CFI decided in favor of Castaño and the CA affirmed.
Hence this petition.
Issue:
WON Montefalcon, the driver, is negligent? YES
WON only diligence of a good father of a family required of Montefalcon?
NO
WON the accident was a fortuitous event? NO
Held: CA decision AFFIRMED.
Ratio:
Montefalcon was negligent
 Had Montefalcon slackened the speed of the jeep at the time the
truck was overtaking it, instead of running side by side with the
cargo truck, there would have been no contact and accident. He
should have foreseen that at the speed he was running, the vehicles
were getting nearer the bridge and as the road was getting narrower
the truck would be too close to the jeep and would eventually
sideswiped it. Otherwise stated, he should have slackened his jeep
when he swerved it to the right to give way to the truck because the
two vehicles could not cross the bridge at the same time.
Exercise of extraordinary diligence required
There was a contract of carriage between the private respondent and the
herein petitioners in which case the Court of Appeals correctly applied
Articles 1733, 1755 and 1766 of the Civil Code which require the exercise
of extraordinary diligence on the part of petitioner Montefalcon.
o Art. 1733. Common carriers, from the nature of their
business and for reasons of public policy, are bound to
observe extraordinary diligence in the vigilance over the
goods and for the safety of the passengers transported by
them, according to all the circumstances of each case.
o Art. 1755. A common carrier is bound to carry the
passengers safely as far as human care and foresight can
provide, using the utmost diligence of very cautious
persons, with a due regard for all the circumstances.
o Art. 1766. In all matters not regulated by this Code, the
rights and obligations of common carriers shall be
governed by the Code of Commerce and by special laws.
Indeed, the hazards of modern transportation demand extraordinary
diligence. A common carrier is vested with public interest. Under the new
Civil Code, instead of being required to exercise mere ordinary diligence a
common carrier is exhorted to carry the passengers safely as far as human
care and foresight can provide “using the utmost diligence of very cautious
persons.” (Article 1755). Once a passenger in the course of travel is injured,
or does not reach his destination safely, the carrier and driver are presumed
to be at fault.
Accident was not a fortuitous event
The sideswiping of the jeepney by the cargo truck, was something which
could have been avoided considering the narrowness of the Sumasap Bridge
which was not wide enough to admit two vehicles. As found by the Court of
Appeals, Montefalcon contributed to the occurrence of the mishap.
 BALIWAG TRANSIT VS CA
FACTS:
At about 7:30pm, in Gapan, Nueva Ecija, the bus passengers saw a cargo
truck owned by A & J Trading (AJT) parked at the shoulder of the nat’l
highway. Its left rear portion jutted to the outer lane, the shoulder of the
road was too narrow to accommodate the whole truck. A kerosene lamp
appeared at the edge of the road as a warning device. The truck driver
(Recontique) & his helper (Escala) were then replacing a flat tire.
Bus driver Santiago was driving at an inordinately fast speed and failed to
notice the truck and the kerosene lamp at the edge of the road. Santiago's
passengers urged him to slow down but he ignored them. He even carried
animated conversations with his co-employees while driving. When the
danger of collision became imminent, the bus passengers shouted
"Babangga tayo!" Santiago stepped on the brake, but it was too late. His bus
rammed into the stalled cargo truck causing the instant death of Santiago
and Escala, and injury to several others, among which were Leticia and
Allan Garcia.
Leticia suffered a fracture and was confined for more than a month; she
underwent an operation for partial hip prosthesis. Her son Allan broke his
leg.
Spouses Garcia sued Baliwag Transit, Inc., AJT, and Recontique for
damages.
Baliwag, AJT, and Recontique disclaimed responsibility for the mishap.
o Baliwag alleged that the accident was caused solely by
the fault and negligence of AJT and its driver; that
Recontigue failed to place an EWD at the corner of the
disabled cargo truck to warn oncoming vehicles.
o AJT and Recontique alleged that the accident was due to
the negligence and reckless driving of the bus driver.
Trial court held that both defendants should be held liable— Baliwag for
failing to deliver the plaintiff and her son to their point of destination safely
in violation of their contractual relation while AJT and Recontique for
failure to provide its cargo truck with an EWD in violation of the Motor
Vehicle Law.
CA modified the TC's Decision by absolving AJT from liability
ISSUE:
1. Whether or not Baliwag is liable for the injuries suffered by Leticia
and Allan Garcia in the accident
2. Whether or not the amount of damages was proper
HELD & RATIO:
1. YES. As a common carrier, Baliwag breached its contract of
carriage when it failed to deliver its passengers, Leticia and Allan
Garcia to their destination safe and sound.
 A common carrier is bound to carry its passengers safely as far as
human care and foresight can provide, using the utmost diligence
of a very cautious person, with due regard for all the
circumstances. In a contract of carriage, it is presumed that the
common carrier was at fault or was negligent when a passenger
dies or is injured. Unless the presumption is rebutted, the court
need not even make an express finding of fault or negligence on
the part of the common carrier. This statutory presumption may
only be overcome by evidence that the carrier exercised
extraordinary diligence as prescribed in Articles 1733 and 1755 of
the Civil Code.
 The records are bereft of any proof to show that Baliwag exercised
extraordinary diligence. On the contrary, the
evidence demonstrates its driver's recklessness.
o Leticia testified that the bus was running at a very high
speed despite the drizzle and the darkness of the highway;
passengers pleaded for its driver to slow down, but their
plea was ignored.
o Leticia also revealed that the driver was smelling of
liquor. She could smell him as she was seated right behind
the driver.
o Another passenger testified that immediately before the
collision, the bus driver was conversing with a co-
employee.
o All these prove the bus driver's wanton disregard for the
physical safety of his passengers, which makes Baliwag
as a common carrier liable for damages under Article
1759 of the Civil Code:
 “This liability of the common carriers do not
cease upon proof that they exercised all the
 diligence of a good father of a family in the
selection or supervision of their employees.”
2. The award of moral damages is in accord with law. In a breach of
contract of carriage, moral damages are recoverable if the carrier,
through its agent, acted fraudulently or in bad faith.
 The evidence shows the gross negligence of the bus driver
which amounted to bad faith. Without doubt, Leticia and
Allan experienced physical suffering, mental anguish and
serious anxiety by reason of the accident.
DANGWA TRANSPORTATION VS CA
FACTS:
Private respondents filed a complaint for damages against petitioners for the
death of Pedrito Cudiamat as a result of a vehicular accident which occurred
on March 25, 1985 at Marivic, Sapid, Mankayan, Benguet. Petitioner
Theodore M. Lardizabal was driving a passenger bus belonging to petitioner
corporation in a reckless and imprudent manner and without due regard to
traffic rules and regulations and safety to persons and property, it ran over
its passenger, Pedrito Cudiamat. Petitioners alleged that they had observed
and continued to observe the extraordinary diligence and that it was the
victim’s own carelessness and negligence which gave rise to the subject
incident.
RTC pronounced that Pedrito Cudiamat was negligent, which negligence
was the proximate cause of his death. However, Court of Appeals set aside
the decision of the lower court, and ordered petitioners to pay private
respondents damages due to negligence.
ISSUE:
WON the CA erred in reversing the decision of the trial court and in finding
petitioners negligent and liable for the damages claimed.
HELD: CA Decision AFFIRMED
The testimonies of the witnesses show that that the bus was at full stop
when the victim boarded the same. They further confirm the conclusion that
the victim fell from the platform of the bus when it suddenly accelerated
forward and was run over by the rear right tires of the vehicle. Under such
circumstances, it cannot be said that the deceased was guilty of negligence.
It is not negligence per se, or as a matter of law, for one attempt to board a
train or streetcar which is moving slowly. An ordinarily prudent person
would have made the attempt board the moving conveyance under the same
or similar circumstances. The fact that passengers board and alight from
slowly moving vehicle is a matter of common experience both the driver
and conductor in this case could not have been unaware of such an ordinary
practice.
Common carriers, from the nature of their business and reasons of public
policy, are bound to observe extraordinary diligence for the safety of the
passengers transported by the according to all the circumstances of each
case. A common carrier is bound to carry the passengers safely as far as
human care and foresight can provide, using the utmost diligence very
cautious persons, with a due regard for all the circumstances.
It has also been repeatedly held that in an action based on a contract of
carriage, the court need not make an express finding of fault or negligence
on the part of the carrier in order to hold it responsible to pay the damages
sought by the passenger. By contract of carriage, the carrier assumes the
express obligation to transport the passenger to his destination safely and
observe extraordinary diligence with a due regard for all the circumstances,
and any injury that might be suffered by the passenger is right away
attributable to the fault or negligence of the carrier. This is an exception to
the general rule that negligence must be proved, and it is therefore
incumbent upon the carrier to prove that it has exercised extraordinary
diligence as prescribed in Articles 1733 and 1755 of the Civil Code.
 LA MALLORCA VS CA
Facts: Plaintiffs, husband and wife, together with their three minor
daughters (Milagros, 13 years old, Raquel, about 4 years old and Fe, 2 years
old) boarded the Pambusco at San Fernando Pampanga, bound for Anao,
Mexico, Pampanga. Such bus is owned and operated by the defendant.
They were carrying with them four pieces of baggage containing their
personal belonging. The conductor of the b us issued three tickets covering
the full fares of the plaintiff and their eldest child Milagros. No fare was
charged on Raquel and Fe, since both were below the height which fare is
charged in accordance with plaintiff’s rules and regulations.
After about an hour’s trip, the bus reached Anao where it stopped to allow
the passengers bound therefore, among whom were the plaintiffs and their
children to get off. Mariano Beltran, carrying some of their baggage was the
first to get down the bus, followed by his wife and children. Mariano led his
companion to a shaded spot on the left pedestrian side of the road about
four or five meters away from the vehicle. Afterwards, he returned to the
bus in controversy to get his paying, which he had left behind, but in so
doing, his daughter followed him unnoticed by his father. While said
Mariano Beltran was on he running board of the bus waiting for the
conductor to hand him his bayong which he left under one its seats near the
door, the bus, whose motor was not shut off while unloading suddenly
started moving forward, evidently to resume its trip, notwithstanding the
fact that the conductor was still attending to the baggage left behind by
Mariano Beltran. Incidentally, when the bus was again placed in a complete
stop, it had traveled about 10 meters from point where plaintiffs had gotten
off.
Sensing the bus was again in motion; Mariano immediately jumped form
the running board without getting his bayong from conductor. He landed on
the side of the road almost board in front of the shaded place where he left
his wife and his children. At that time, he saw people beginning to gather
around the body of a child lying prostrate on the ground, her skull crushed,
and without life. The child was none other than his daughter Raquel, who
was run over by the bus in which she rode earlier together her parent.
For the death of the said child, plaintiffs comment the suit against the
defendant to recover from the latter damages.
Issue: Whether or not the child was no longer the passenger of the bus
involved in the incident, and therefore, the contract of carriage was already
terminated?
Held: There can be no controversy that as far as the father is concerned,
when he returned to the bus for his bayong which was not unloaded, the
relation of passenger and carrier between him and the petitioner remained
subsisting. The relation of carrier and passenger does not necessarily cease
where the latter, after alighting from the car aids the carrier’s servant or
employee in removing his baggage from the car.
It is a rule that the relation of carrier and passenger does not cease the
moment the passenger alights from the carrier’s vehicle at a place selected
by the carrier at the point of destination but continues until the passenger
has had a reasonable time or a reasonable opportunity to leave the carrier’s
premises.
The father returned to the bus to get one of his baggages which was not
unloaded when they alighted from the bus. Raquel must have followed her
father. However, although the father was still on the running board of the
bus awaiting for the conductor to hand him the bag or bayong, the bus
started to run, so that even he had jumped down from the moving vehicle. It
was that this instance that the child, who must be near the bus, was run over
and killed. In the circumstances, it cannot be claimed that the carrier’s agent
had exercised the “utmost diligence” of a “very cautious person” required
by Article 1755 of the Civil Code to be observed by a common carrier in the
discharge of its obligation to transport safely its passengers. The driver,
although stopping the bus, nevertheless did not put off the engine. He
started to run the bus even before the conductor gave him the signal to go
and while the latter was still unloading part of the baggage of the passengers
Beltran and family. The presence of the said passengers near the bus was
not unreasonable and they are, therefore, to be considered still as passengers
of the carrier, entitled to the protection under their contract of carriage.
 LRTA VS NATIVIDAD
FACTS:
Navidad was drunk when he entered the boarding platform of the LRT. He
got into an altercation with the SG Escartin. They had a fistfight and
Navidad fell onto the tracks and was killed when a train came and ran over
him.
The Heirs of Navidad filed a complaint for damages against Escartin, the
train driver, (Roman) the LRTA, the Metro Transit Organization and
Prudent Security Agency (Prudent). The trial court found Prudent and
Escartin jointly and severally liable for damages to the heirs. The CA
exonerated Prudent and instead held the LRTA and the train driver Romero
jointly and severally liable as well as removing the award for compensatory
damages and replacing it with nominal damages.
The reasoning of the CA was that a contract of carriage already existed
between Navidad and LRTA (by virtue of his havA ing purchased train
tickets and the liability was caused by the mere fact of Navidad's death after
being hit by the train being managed by the LRTA and operated by Roman.
The CA also blamed LRTA for not having presented expert evidence
showing that the emergency brakes could not have stopped the train on
time.
ISSUES:
(1) Whether or not LRTA and/or Roman is liable for the death.
(2) Whether or not Escartin and/or Prudent are liable.
(3) Whether or not nominal damages may coexist with compensatory
damages.
HELD:
(1) Yes. The foundation of LRTA's liability is the contract of carriage and
its obligation to indemnify the victim arising from the breach of that
contract by reason of its failure to exercise the high diligence required of a
common carrier.
(2) Fault was not established. Liability will be based on Tort under Art.
2176 of the New Civil Code.
(3) No. It is an established rule that nominal damages cannot co-exist with
compensatory damages.
RATIO:
Liability of LRTA – Read Arts. 1755,1756, 1759 and 1763 of the New
Civil Code
A common carrier is required by these above statutory provisions to use
utmost diligence in carrying passengers with due regard for all
circumstances. This obligation exists not only during the course of the trip
but for so long as the passengers are within its premises where they ought to
be in pursuance to then contract of carriage.
Art. 1763 renders a common carrier liable for death of or injury to
passengers (a) through the negligence or wilful acts of its employees or (b)
on account of willful acts or negligence of other passengers or of strangers
if the common carrier’s employees through theexercise of due diligence
could have prevented or stopped the act or omission. In case of such death
or injury, a carrier is presumed to have been at fault or been negligent, and
by simple proof of injury, the passenger is relieved of the duty to still
establish the fault or negligence of the carrier or of its employees and the
burden shifts upon the carrier to prove that the injury is due to an
unforeseen event or to force majeure.
Liability of Security Agency – If Prudent is to be held liable, it would be
for a tort under Art. 2176 in conjunction with Art. 2180. Once the fault of
the employee Escartin is established, the employer, Prudent, would be held
liable on the presumption that it did not exercise the diligence of a good
father of the family in the selection and supervision of its employees.
Relationship between contractual and non-contractual breach – How
then must the liability of the common carrier, on the one hand, and an
independent contractor, on the other hand, be described? It would be
solidary. A contractual obligation can be breached by tort and when the
same act or omission causes the injury, one resulting in culpa
contractual and the other in culpa aquiliana, Article 2194 of the Civil Code
can well apply. In fine, a liability for tort may arise even under a contract,
where tort is that which breaches the contract. Stated differently, when an
act which constitutes a breach of ontract would have itself constituted the
source of a quasi-delictual liability had no contract existed between the
parties, the contract can be said to have been breached by tort, thereby
allowing the rules on tort to apply.
Nominal Damages - The award of nominal damages in addition to actual
damages is untenable. Nominal damages are adjudicated in order that a
right of the plaintiff, which has been violated or invaded by the defendant,
may be vindicated or recognized, and not for the purpose of indemnifying
the plaintiff for any loss suffered by him. It is an established rule that
nominal damages cannot co-exist with compensatory damages. The award
was deleted/\.
ABOITIZ SHIPPING VS CA
Facts:
Anacleto Viana boarded the vessel M/V Antonia owned by petitioner
Aboitiz Shipping Corp at the port at San Jose, Occidental Mindoro, bound
for Manila. The vessel arrived at Pier 4, North Harbor, Manila and was
taken over by Pioneer Stevedoring for the latter to unload the cargoes from
the said vessel pursuant to their Memorandum of Agreement. An hour after
the passengers and Viana had disembarked the vessel the crane operator
began its unloading operation. While the crane was being operated, Viana
who had already disembarked the vessel remembered that some of his
cargoes were still loaded there. He went back and while he was pointing to
the crew where his cargoes were, the crane hit him pinning him between the
side of the vessel and the crane resulting to his death. A complaint for
damages was filed against petitioner for breach of contract of carriage.
Petitioner contends that Viana ceased to be a passenger when he
disembarked the vessel and that consequently his presence there was no
longer reasonable. CA affirmed the trial court’s order holding Aboitiz
liable. Hence the petition.
Issue:
Whether or not petitioner is still responsible as a carrier to Viana after the
latter had already disembarked the vessel.
Ruling: YES.
The rule is that the relation of carrier and passenger continues until the
passenger has been landed at the port of destination and has left the vessel
owner’s dock or premises. Once created, the relationship will not ordinarily
terminate until the passenger has, after reaching his destination, safely
alighted from the carrier’s conveyance or had a reasonable opportunity to
leave the carrier’s premises. 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.
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 petitioner’s vessel. We
believe there exists such a justifiable cause. When the accident occurred, the
victim was in the act of unloading his cargoes, which he had every right to
do, from petitioner’s vessel. As earlier stated, a carrier is duty bound not
only to bring its passengers safely to their destination but also to afford
them a reasonable time to claim their baggage.
Consequently, under the foregoing circumstances, the victim Anacleto
Viana is still deemed a passenger of said carrier at the time of his tragic
death.
PESTANO VS SUMAYANG
Facts: Sumayang, accompanied by another person, was riding a motor
vehicle on a highway in Cebu. While turning left at a junction, Sumayang
was violently hit by a speeding bus driven by Pestano. Sumayang and his
companion died due to the accident. The heirs of Sumayang filed a civil
action against Pestano and Metro Cebu Bus Company, the owner of the Bus
driven by Pestano. A witness named Neis accounts that before Sumayang
turned left, the former had raised his left arm as a signal but was run over by
the bus and was thrown 14 meters away. Pestano alleges the victims were
negligent because 15-20 meters away, he had already blown the bus’ horn
and even blew it a second time when he got near but could only step on the
brake after the bus had hid the motor vehicle. RTC and CA held Pestano
liable and also held Metro Cebu Bus liable for negligence.
Issue: W/N Metro Cebu Bus may be held liable for the acts of Pestano
Held: There were factual findings that the bus had a defective speedometer
and the Company was held to have shown laxity in the conduct of its
operations and supervision of employees. Under Articles 2180 and 2176 of
the Civil Code, owners and managers are responsible for damages caused
by their employees. When an injury is caused by the negligence of a
servant or an employee, the master or employer is presumed to be negligent
either in the selection or in the supervision of that employee. This
presumption may be overcome only by satisfactorily showing that the
employer exercised the care and the diligence of a good father of a family in
the selection and the supervision of its employee. The CA said that allowing
Pestaño to ply his route with a defective speedometer showed laxity on the
part of Metro Cebu in the operation of its business and in the supervision of
its employees. The negligence alluded to here is in its supervision over its
driver, not in that which directly caused the accident. The fact that Pestaño
was able to use a bus with a faulty speedometer shows that Metro Cebu was
remiss in the supervision of its employees and in the proper care of its
vehicles. It had thus failed to conduct its business with the diligence
required by law.
MALLARI SR. VS CA
FACTS:
The passenger jeepney driven by Mallari Jr. and owned by Mallari Sr.
collided with the delivery van of Bulletin along the National Highway in
Brgy. San Pablo, Dinalupihan, Bataan. Mallari Jr. testified that he went to
the left lane of the highway and overtook a Fiera which had stopped on the
right lane. Before he passed by the Fiera, he saw the van of Bulletin coming
from the opposite direction. It was driven by one Felix Angeles. The
collision occurred after Mallari Jr. overtook the Fiera while negotiating a
curve in the highway. The impact caused the jeepney to turn around and fall
on its left side resulting in injuries to its passengers one of whom was Israel
Reyes who eventually died due to the gravity of his injuries.
Claudia Reyes, the widow of Israel Reyes, filed a complaint for damages
against Mallari Sr. and Mallari Jr., and also against Bulletin, its driver Felix
Angeles, and the N.V. Netherlands Insurance Co. The complaint alleged
that the collision which resulted in the death of Israel was caused by the
fault and negligence of both drivers of the passenger jeepney and the
Bulletin Isuzu delivery van.
ISSUE: WON Mallari Jr. and Mallari Sr. are liable for the death of Israel
HELD: Yes.
The collision occurred immediately after Mallari Jr. overtook a vehicle in
front of it while traversing a curve on the highway. This act of overtaking
was in clear violation of Sec. 41, pars. (a) and (b), of RA 4136 as amended,
otherwise known as The Land Transportation and Traffic Code. A driver
abandoning his proper lane for the purpose of overtaking another vehicle in
an ordinary situation has the duty to see to it that the road is clear and not to
proceed if he cannot do so in safety. When a motor vehicle is approaching
or rounding a curve, there is special necessity for keeping to the right side
of the road and the driver does not have the right to drive on the left hand
side relying upon having time to turn to the right if a car approaching from
the opposite direction comes into view.
Mallari Jr. already saw that the Bulletin delivery van was coming from the
opposite direction and failing to consider the speed thereof since it was still
dark at 5:00 o'clock in the morning mindlessly occupied the left lane and
overtook 2 vehicles in front of it at a curve in the highway. Clearly, the
proximate cause of the collision resulting in the death of Israel was the sole
negligence of the driver of the passenger jeepney, Mallari Jr., who
recklessly operated and drove his jeepney in a lane where overtaking was
not allowed by traffic rules. Under Art. 2185 of the Civil Code, unless there
is proof to the contrary, it is presumed that a person driving a motor vehicle
has been negligent if at the time of the mishap he was violating a traffic
regulation. Mallaris failed to present satisfactory evidence to overcome this
legal presumption.
The negligence and recklessness of the driver of the passenger jeepney is
binding against Mallari Sr., who admittedly was the owner of the passenger
jeepney engaged as a common carrier, considering the fact that in an action
based on contract of carriage, the court need not make an express finding of
fault or negligence on the part of the carrier in order to hold it responsible
for the payment of damages sought by the passenger. (See Arts. 1755, 1756
and 1759 for the rationale of common carrier’s liability.)
PILAPIL VS CA
FACTS:
Petitioner Pilapil, on board respondent’s bus was hit above his eye by a
stone hurled by an unidentified bystander. Respondent’s personnel lost no
time in bringing him to a hospital, but eventually petitioner partially lost his
left eye’s vision and sustained a permanent scar.
Thus, Petitioner lodged an action for recovery of damages before the Court
of First Instance of Camarines Sur which the latter granted. On appeal, the
Court of Appeals reversed said decision.
ISSUE:
Whether or not common carriers assume risks to passengers such as the
stoning in this case?
HELD:
In consideration of the right granted to it by the public to engage in the
business of transporting passengers and goods, a common carrier does not
give its consent to become an insurer of any and all risks to passengers and
goods. It merely undertakes to perform certain duties to the public as the
law imposes, and holds itself liable for any breach thereof.
While the law requires the highest degree of diligence from common
carriers in the safe transport of their passengers and creates a presumption
of negligence against them, it does not, however, make the carrier an insurer
of the absolute safety of its passengers.
Article 1763. A common carrier is responsible for injuries suffered by a
passenger on account of the wilful acts or negligence of other passengers or
of strangers, if the common carrier's employees through the exercise of the
diligence of a good father of a family could have prevented or stopped the
act or omission.
Clearly under the above provision, a tort committed by a stranger which
causes injury to a passenger does not accord the latter a cause of action
against the carrier. The negligence for which a common carrier is held
responsible is the negligent omission by the carrier's employees to prevent
the tort from being committed when the same could have been foreseen and
prevented by them. Further, under the same provision, it is to be noted that
when the violation of the contract is due to the willful acts of strangers, as
in the instant case, the degree of care essential to be exercised by the
common carrier for the protection of its passenger is only that of a good
father of a family.
 FORTUNE EXPRESS VS CA
FACTS:
On November 18, 1989, a bus of petitioner figured in an accident with a
jeepney in Kauswagan, Lanao del Norte, resulting in the death of several
passengers of the jeepney, including two Maranaos. Crisanto Generalao, a
volunteer field agent of the Constabulary Regional Security Unit, conducted
an investigation of the accident. He found that the owner of the jeepney was
a Maranao residing in Delabayan, Lanao del Norte and that certain
Maranaos were planning to take revenge on the petitioner by burning some
of its buses. Generalao went to see Diosdado Bravo, operations manager of
petitioner, and informed him about the plot of the Maranaos. Bravo assured
him that the necessary precautions to insure the safety of lives and property
would be taken.
Several days later, Atty. Caorong was on board a bus to Iligan when three
Maranaos went on board the vehicle. The leader of the group ordered the
passengers to leave the bus. Atty. Caorong later went back to get something
when he saw that the Maranaos were already pouring gasoline on the bus
and on the driver. Atty. Caorong pleaded for the life of the driver, after
which the driver jumped out of the vehicle.Caorong was shot to death as a
result.
RTC dismissed the complaint stating that Fortune was not negligent.
Disregarding the suggestion ofproviding its buses with security guards is
not an omission of petitioner’s duty. The evidence showed that the
assailants did not intend to harm the passengers. The death of Atty. Caorong
was an unexpected and unforeseen occurrence beyondpetitioner’s control.
CA REVERSED RTC’s ruling:Fortune is negligent. Despite the tip to
Manager Bravo of the devious plan by several Maranaos, management did
not do not take any safety precautions at all.One available safeguard that
could have absolved Fortunefrom liability was frisking of incoming
passengers en route to dangerous areas and bag inspection at the terminals,
which Fortune failed to do. The frisking system is not novel insensitive and
dangerous places. Many companies adopt this measure. Fortune did
“absolutely nothing”
ISSUE:
1. W/N Petitioner is liable for the death of Atty. Caorong by failing
totakenecessary precautions to ensure the safety of its passengers;
2. W/N the attack by the Maranaos constituted causo fortuito?
RULING:
Petitioner is liable.
Article 1763 holds common carriers liable for the injuries to passengers
caused by the wilful act of other passengers, if its employees failed to
exercise the diligence of a good father in preventing the act.
Despite the warning by the constabulary officer, petitioner did nothing to
protect the safety of its passengers. If petitioner took the necessary
precautions, they would have discovered the weapons and the large quantity
of gasoline the malefactors carried with them. A common carrier is liable
for failing to prevent hijacking by frisking passengers and inspecting
baggages.
Petitioner is solely liable for Atty. Caorong’s death. There was no
contributory negligence on the part of the victim, since all he did was
pleading for the life of the driver. His heroic effort was neither an act of
negligence or recklessness.
From the foregoing, it is evident that petitioner’s employees failed to
prevent the attack on one of petitioner’s buses because they did not exercise
the diligence of a good father of a family. Hence, petitioner should be held
liable for the death of Atty. Caorong.
Seizure of Petitioner’s Bus is not a Case of Force Majeure
Art. 1174 of the Civil Code defines a fortuitous event as an occurence
which could not be foreseen, is inevitable. To be considered as force
majeure, it is necessary that (1) the cause of the breach of the obligation
must be independent of the human will; (2) the event must be either
unforeseeable or unavoidable; (3) the occurence must be render it
impossible for the debtor to fulfill the obligation in a normal manner; and
(4) the obligor must be free of participation in, or aggravation of, the injury
to the creditor. The absence of any of the requisites mentioned above would
prevent the obligor from being excused from liability.
Thus, in Vasquez v. Court of Appeals, it was held that the common carrier
was liable for its failure to take the necessary precautions against an
approaching typhoon, of which it was warned, resulting in the loss of the
lives of several passengers. The event was forseeable, and, thus, the second
requisite mentioned above was not fulfilled. This ruling applies by analogy
to the present case. Despite the report of PC agent Generalao that the
Maranaos were going to attack its buses, petitioner took no steps to
safeguard the lives and properties of its passengers. The seizure of the bus
of the petitioner was foreseeable and, therefore, was not a fortuitous event
which would exempt petitioner from liabilty.
PAL VS CA
FACTS:
On 23 October 1988, Leovigildo A. Pantejo, then City Fiscal of Surigao
City, boarded a PAL plane in Manila and disembarked in Cebu City where
he was supposed to take his connecting flight to Surigao City. However,
due to typhoon Osang, the connecting flight to Surigao City was cancelled.
To accommodate the needs of its stranded passengers, PAL initially gave
out cash assistance of P 100.00 and, the next day, P200.00, for their
expected stay of 2 days in Cebu. Pantejo requested instead that he be
billeted in a hotel at the PAL’s expense because he did not have cash with
him at that time, but PAL refused. Thus, Pantejo was forced to seek and
accept the generosity of a co-passenger, an engineer named Andoni
Dumlao, and he shared a room with the latter at Sky View Hotel with the
promise to pay his share of the expenses upon reaching Surigao. On 25
October 1988 when the flight for Surigao was resumed, Pantejo came to
know that the hotel expenses of his co-passengers, one Superintendent
Ernesto Gonzales and a certain Mrs. Gloria Rocha, an Auditor of the
Philippine National Bank, were reimbursed by PAL. At this point, Pantejo
informed Oscar Jereza, PAL’s Manager for Departure Services at Mactan
Airport and who was in charge of cancelled flights, that he was going to sue
the airline for discriminating against him. It was only then that Jereza
offered to pay Pantejo P300.00 which, due to the ordeal and anguish he had
undergone, the latter declined.
Pantejo filed a suit for damages against PAL with the RTC of Surigao City
which, after trial, rendered judgment, ordering PAL to pay Pantejo P300.00
for actual damages, P150,000.00 as moral damages, P100,000.00 as
exemplary damages, P15,000.00 as attorney’s fees, and 6% interest from
the time of the filing of the complaint until said amounts shall have been
fully paid, plus costs of suit.
On appeal, the appellate court affirmed the decision of the court a quo, but
with the exclusion of the award of attorney’s fees and litigation expenses.
The Supreme Court affirmed the challenged judgment of Court of Appeals,
subject to the modification regarding the computation of the 6% legal rate
of interest on the monetary awards granted therein to Pantejo.
ISSUE:
Whether petitioner airlines acted in bad faith when it failed and refused to
provide hotel accommodations for respondent Pantejo or to reimburse him
for hotel expenses incurred by reason of the cancellation of its connecting
light to Surigao City due to force majeur.
HELD:
A contract to transport passengers is quite different in kind and degree from
any other contractual relation, and this is because of the relation which an
air carrier sustains with the public. Its business is mainly with the travelling
public. It invites people to avail of the comforts and advantages it offers.
The contract of air carriage, therefore, generates a relation attended with a
public duty. Neglect or malfeasance of the carrier’s employees naturally
could give ground for an action for damages.
The discriminatory act of PAL against Pantejo ineludibly makes the former
liable for moral damages under Article 21 in relation to Article 2219 (10) of
the Civil Code. As held in Alitalia Airways vs. CA, et al., such inattention
to and lack of care by the airline for the interest of its passengers who are
entitled to its utmost consideration, particularly as to their convenience,
amount to bad faith which entitles the passenger to the award of moral
damages.
Moral damages are emphatically not intended to enrich a plaintiff at the
expense of the defendant. They are awarded only to allow the former to
obtain means, diversion, or amusements that will serve to alleviate the
moral suffering he has undergone due to the defendant’s culpable action and
must, perforce, be proportional to the suffering inflicted. However,
substantial damages do not translate into excessive damages. Herein, except
for attorney’s fees and costs of suit, it will be noted that the Courts of
Appeals affirmed point by point the factual findings of the lower court upon
which the award of damages had been based.
The interest of 6% imposed by the court should be computed from the date
of rendition of judgment and not from the filing of the complaint.
The rule has been laid down in Eastern Shipping Lines, Inc. vs. Court of
Appeals, et. al. that “when an obligation, not constituting a loan or
forbearance of money, is breached, an interest on the amount of damages
awarded may be imposed at the discretion of the court at the rate of 6% per
annum. No interest, however, shall be adjudged on unliquidated claims or
damages except when or until the demand can be established with
reasonable certainty. Accordingly, where the demand is established with
reasonable certainty, the interest shall begin to run from the time the claim
is made judicially or extrajudicially (Art. 1169, Civil Code) but when such
certainty cannot be so reasonably established at the time the demand is
made, the interest shall begin to run only from the date the judgment of the
court is made (at which time the quantification of damages may be deemed
to have been reasonably ascertained). The actual base for the computation
of legal interest shall, in any case, be on the amount finally adjudged.” This
is because at the time of the filling of the complaint, the amount of the
damages to which Pantejo may be entitled remains unliquidated and not
known, until it is definitely ascertained, assessed and determined by the
court, and only after the presentation of proof thereon.
AIR FRANCE VS CARRASCOSO
FACTS:
Air France, through Philippine Airlines (PAL), issued Carrascoso a first-
class round trip ticket from Manila to Rome. From Manila to Bangkok, he
travelled in first class but in Bangkok, PAL manager forced him to vacate
his seat because there was a white man who the manager alleged had a
“better right” to the seat. Carrascoso refused to vacate his seat, but was later
convinced by some Filipino passengers to give up his seat.
Carrascoso filed a case for damages against Air France. The Court of First
Instance (CFI) of Manila ordered Air France to pay Carrascoso moral and
exemplary damages as well as the difference in fare between first class and
tourist class for the portion of the trip.
On appeal, the Court of Appeals slightly reduced the refund of the ticket,
but otherwise affirmed the CFI decision.
Petitioner Air France now claims that the first class ticket did not represent
the true and complete intent and agreement of the parties. It asserts that
Carrascoso knew that he did not have confirmed reservations for first class
though he had tourist class protection. Thus, the ticket was no guarantee
that he would have a first class seat since such would depend on the
availability of first class seats.
ISSUES:
1. Was Carrascoso was entitled to the first class seat? – YES.
2. Can he claim moral damages? – YES.
RATIO:
There is a contract of carriage between Air France and Carrascoso.
He is entitled to first-class seat by the mere fact that he paid for and was
issued a first-class ticket. Also, if, as petitioner claims, a first-class-ticket
holder is not entitled to a first-class seat, stability in the relations between
passenger and air carrier as well as the passenger’s security would be
adversely affected. Petitioner also failed to establish whether or not a prior
reservation was made by the white man, so he had no claim to the seat.
Carrascoso can claim moral damages.
Air France argues that Carrascoso’s action is based on breach of contract.
Thus, to authorize an award for moral damages, there must be an averment
of fraud or bad faith as per Art. 2220.
The Court established that:
 There was a contract
 The contract was breached when petitioner failed to furnish first
class transportation at Bangkok
 There was bad faith when petitioner’s employee compelled
Carrascoso to leave his first class seat, causing him mental anguish,
humiliation and wounded feelings resulting in moral damages.
Though there was no specific claim of bad faith in the complaint, inference
of bad faith may be drawn from the facts of the case. Also, during the trial,
evidence of bad faith was presented without objection from the petitioner.
Thus, the deficiency in the complaint was cured by evidence.
Petitioner’s contract with Carrascoso is attended with public duty. Though
based on breach of contract, the stress of Carrascoso’s action is put on
wrongful expulsion. Moreover, an act that breaks a contract is a tort. Thus,
being a violation of public duty, it is a quasi-delict.
The wrongful expulsion is independent of the breach. Two sources of
obligations are implicated in this case— contract and quasi-delict. Petitioner
is still be liable for moral damages.
CALALAS VS CA
Facts:
Private Respondent Eliza Saunga took a passenger jeepney owned and
operated by Petitioner Vicente Calalas. As the jeepney was already full, she
was just given an “extension seat”, a wooden stool, at the rear end of the
vehicle.
On the way, the jeepney stopped to let a passenger off. Since Sunga was
seated at the rear end, she gave way to the outgoing passenger. Just as she
was doing so, an Isuzu Elf Truck driven by Igclerio Verena and owned by
Francisco Salva, bumped to the left rear end of the jeepney. This incident
cause injury to Sunga.
She filed a compliant for damages against Calalas on the ground of breach
of contract of carriage. On the other hand, Calalas filed a third-party
complaint against Salva, the owner of the truck.
The Regional Trial Court (RTC) found Salva guilty and absolved Calalas
from liability holding that it was the truck owner who is responsible for the
accident based on quasi-delict.
However, on appeal to the Court of Appeals (CA), the appellate court
reversed the RTC’s decision, on the ground that Sunga’s cause of action
was based on a breach of contract of carriage and not on quasi-delict.
Hence, this appeal from Calalas.
ISSUE: Whether or not the negligence of the truck driver as the proximate
cause of the accident which negates petitioner’s liability?
RULING:
No.
First, the issue in this case is the liability under contract of carriage.
In this case, the petitioner failed to transport his passenger safely to his
destination as a common carrier in violation of Arts. 1733 and 1755 of the
New Civil Code.
Moreso, there is no basis that the ruling of the RTC binds Sunga. It is
immaterial that the proximate cause of the collision was the truck driver,
because the doctrine of proximate cause applies only to cases of quasi-
delict.
The doctrine of proximate cause is a device for imputing liability to a
person where there is no relation between him and another party. But in the
case at bar, there is a pre-existing relation between petitioner and
respondent in their contract of carriage. Hence, upon happening of the
accident, the presumption of negligence at once arose on Calalas’ part,
which makes him liable.
ACE HAULERS CORP VS CA
FACTS
A truck owned by the petitioner and driven by its employee, Jesus dela Cruz
collided with a passenger jeepney owned by Isabelito Rivera, driven by
Rodolfo Parma. A motorcycle was bumped and dragged by the jeepney and
the rider, Fidel Abiva was run over by the truck causing his death. Fidel
Abiva left behind a wife, respondent Ederlina Abiva and their three (3)
children. A criminal information for reckless imprudence was filed against
the two drivers before the RTC of Quezon City. When the criminal action
was pending, the private respondent filed a separate civil action against the
two drivers, as well as against the petitioner and Isabelito Rivera, the
owners of the vehicles involved in the accident. Petitioner filed a motion
to dismiss bringing to the trial courts attention the fact that a criminal
action was pending before another branch of the same court, and that
under the 1985 Rules on Criminal Procedure, the filing of an
independent civil action arising from a quasi-delict is no longer
allowed. The trial court dismissed the action for damages on the ground that
no civil action shall proceed independently of the criminal prosecution in a
case for reckless imprudence resulting in homicide. The Court of Appeals
reversed the decision of the trial court. While pre-trial proceedings were still
being set and reset upon motions of the parties, the RTC rendered judgment
and found both drivers guilty of reckless imprudence resulting in homicide
and ordered to pay the heirs of the deceased P50,000 as indemnification for
his death and P4,000 by way of actual damages. After the trial for civil case,
the Court granted the reliefs and remedies which in her complaint the
plaintiff prays for.
ISSUE/S
Whether or not in an action for damages arising from a vehicular accident
plaintiff may recover damages against the employer of the accused driver
both in the criminal case (delict) and the civil case for damages based on
quasi delict, but not recover twice for the same act
HELD
In Padua v. Robles, we held that Civil liability coexists with criminal
responsibility. In negligence cases, the offended party (or his heirs) has
the option between an action for enforcement of civil liability based on
culpa criminal under Article 100 of the Revised Penal Code and an
action for recovery of damages based on culpa aquiliana under Article
2176 of the Civil Code. x x x Article 2177 of the Civil Code, however,
precludes recovery of damages twice for the same negligent act or
omission.
Consequently, a separate civil action for damages lies against the
offender in a criminal act, whether or not he is criminally prosecuted
and found guilty or acquitted, provided that the offended party is not
allowed, if he is actually charged also criminally, to recover damages on
both scores, and would be entitled in such eventuality only to the bigger
award of the two, assuming the awards made in the two cases vary.
Hence, in this case, respondent Abiva shall have the choice which of the
awards to take, naturally expecting that she would opt to recover the greater
amount. It has not been shown that she has recovered on the award in the
criminal case, consequently, she can unquestionably recover from petitioner
in the civil case.
TAN VS NORTHWEST AIRLINES
Facts:
On May 31, 1994, Priscilla Tan and Connie Tan boarded a Northwest
Airlines plane in Chicago bound to the Philippines with a stop-over at
Detroit. Upon their arrival, they found out that their baggage was missing.
On June 3, they recovered the baggage and discovered that some were
destroyed and soiled. They filed an action for damages, claiming that they
suffered mental anguish, sleepless nights and great damage. Northwest
offered to reimburse the cost of repairs of the bags or purchase price of new
bags. The trial court awarded actual, moral and exemplary damages, and
also attorney’s fees. The Court of Appeals partially affirmed the decision by
deleting moral and exemplary damages. Hence, Tan filed this instant
petition.
Issue:
Whether respondent Airline is liable for moral and exemplary damages for
willful misconduct and breach of contract of carriage
Held:
We agree with the Court of Appeals that respondent was not guilty of
willful misconduct. "For willful misconduct to exist there must be a
showing that the acts complained of were impelled by an intention to
violate the law, or were in persistent disregard of one's rights. It must be
evidenced by a flagrantly or shamefully wrong or improper conduct."
Contrary to petitioner's contention, there was nothing in the conduct of
respondent which showed that they were motivated by malice or bad faith
in loading her baggages on another plane. Due to weight and balance
restrictions, as a safety measure, respondent airline had to transport the
baggages on a different flight, but with the same expected date and time of
arrival in the Philippines. It is admitted that respondent failed to deliver
petitioner's luggages on time. However, there was no showing of malice in
such failure. By its concern for safety, respondent had to ship the baggages
in another flight with the same date of arrival.
BALIWAG TRANSIT VS CA
FACTS:
George – was a paying passenger on a Baliwag bus who suffered multiple
serious physical injuries when he was thrown off said bus driven in a
careless and negligent manner by Leonardo Cruz, the bus driver, along
Brgy. Patubig, Marilao, Bulacan; as a result, he was confined in the hospital
for treatment, incurring medical expenses, which were borne by his parents
in the sum of about P200,000.00 plus other incidental expenses of
aboutP10,000.00George’s parents, Spouses Cailipan filed a complaint for
damages arising from breach of contract of carriage Baliwag Transit alleged
that the cause of the injuries sustained by George was solely attributable to
his own voluntary act in that, without warning and provocation, he suddenly
stood up from his seat and headed for the door of the bus as if in a daze,
opened it and jumped off while said bus was in motion, in spite of the
protestations by the driver and without the knowledge of the conductor a
third-Party Complaint against Fortune Insurance & Surety Company, Inc.,
on its third-party liability insurance in the amount of P50,000.00; Fortune
Insurance claimed limited liability, the coverage being subject to a Schedule
of Indemnities forming part of the insurance policy Fortune Insurance and
Baliwag filed Motions to Dismiss the complaint filed against them on the
ground that George, in consideration of the sum of P8,020.50 had executed
a “Release of Claims” Sotero opposed the motion to dismiss; he testified
that be is the father of George, who at the time of the incident was a student,
living with his parents and totally dependent on them for their support; that
the expenses for his hospitalization were shouldered by his parents; and that
they had not signed the “Release of Claims” RTC dismissed the complaint
(dismissal was predicated on George’s execution of Release of Claims)

ISSUE: what is the legal effect of the Release of Claims executed by

George

HELD: Since the suit is one for breach of contract of carriage, the Release
of Claims executed by him, as the injured party, discharging Fortune
Insurance and Baliwag from any and all liability is valid. He was then of
legal age, a graduating student of Agricultural Engineering, and had the
capacity to do acts with legal effect (Article 37 in relation to Article 402,
Civil Code). Thus, he could sue and be sued even without the assistance of
his parents.