Professional Documents
Culture Documents
Court of Appeals
In construing Act 98 for the alleged violation, the test is whether the
refusal of YSC to carry the explosives without qualification or conditions may
have the effect of subjecting any person or locality or the traffic is such
explosives to an unduly unreasonable or unnecessary prejudice or
discrimination. Common carriers in this jurisdiction cannot lawfully decline to
accept a particular class of goods unless it appears that for some sufficient
reason the discrimination for such is reasonable and necessary. YSC has not
met those conditions.
The nature of the business of a common carrier as a public
employment is such that it is within the power of the State to impose such
just regulations in the interest of the public as the legislator may deem
proper.
US vs. Quinahon
There is no pretense that it actually cost more to handle the rice for
the province than it did for the merchants with whom the special contracts
were made. There was a clear discrimination against the province which is
prohibited by the law. It is however not believed that the law prohibits
common carriers from making special rates for the handling and transporting
of merchandise, when the same are made for the purpose of increasing their
business and to manage their important interests upon the same principles
which are regarded as sound and adopted in other trades and pursuits.
Absolute equality is not required in all cases. It is only unjust, undue and
unreasonable discrimination which the law forbids. The law of equality is in
force only where the services performed in the different cases are
substantially the same and the circumstances and conditions are similar.
Loadstar submits that the vessel was a private carrier because it was
not issued a CPC; it did not have a regular trip or schedule nor a fixed route;
and there was only “one shipper, one consignee for a special cargo.”
The SC held that Loadstar is a common carrier. It is not necessary that
the carrier be issued a CPC, and this character is not altered by the fact that
the carriage of the goods in question was periodic, occasional, episodic or
unscheduled.
The NCC provisions on common carriers should not apply where the
common carrier is not acting as such but as a private carrier. Under American
Jurisprudence, a common carrier undertaking to carry a special cargo or
chartered to a special person only becomes a private carrier. As a private
carrier, a stipulation exempting the owner from liability for the negligence of
its agent is valid.
The stipulation in the charter party absolving the owner from liability
for loss due to the negligence of its agent would be void only if strict public
policy governing common carrier is applied. Such policy has no force where
the public at large is not involved, as in the case of a ship totally chartered
for the use of a single party. The stipulation exempting the owner from
liability for negligence of its agent is not against public policy and is deemed
valid. Recovery can’t be had, for loss or damage to the cargo against
shipowners, unless the same is due to personal acts or negligence of said
owner or its managers, as distinguished from agents or employees.
In the instant case, it is undisputed that VSI did not offer its services to
the general public. It carried passengers or goods only for those it chose
under a special contract of charter party. It is a private carrier that renders
tramping service and as such, does not transport cargo or shipment for the
general public. Its services are available only to specific persons who enter
into a special contract of charter party with its owner. Consequently, the
rights and obligations of VSI and NSC, including their respective liability for
damage to the cargo, are determined primarily by stipulations in their
contracts of private carriage or charter party.
Unlike in a contract involving a common carrier, private carriage does
not involve the general public. Hence, the stringent provisions of the Civil
Code on common carriers protecting the general public cannot justifiably be
applied to a ship transporting commercial goods as a private carrier.
1) The law of the country to which the goods are to be transported governs
the liability of the common carrier in case of their loss, destruction or
deterioration. As the cargoes in question were transported from Japan to the
Philippines, the liability of Petitioner Carrier is governed primarily by the Civil
Code. However, in all matters not regulated by said Code, the rights and
obligations of common carrier shall be governed by the Code of Commerce
and by special laws. Thus, the Carriage of Goods by Sea Act, a special law, is
suppletory to the provisions of the Civil Code.
(2) Under the Civil Code, common carriers, from the nature of their business
and for reasons of public policy, are bound to observe extraordinary diligence
in the vigilance over goods, according to all the circumstances of each case.
Common carriers are responsible for the loss, destruction, or deterioration of
the goods unless the same is due to any of the following causes only:
(1) Flood, storm, earthquake, lightning or other natural disaster or
calamity;
Petitioner Carrier claims that the loss of the vessel by fire exempts it
from liability under the phrase "natural disaster or calamity.” However, the
Court said that fire may not be considered a natural disaster or calamity. This
must be so as it arises almost invariably from some act of man or by human
means. It does not fall within the category of an act of God unless caused by
lightning or by other natural disaster or calamity. It may even be caused by
the actual fault or privity of the carrier.
As the peril of the fire is not comprehended within the exception in
Article 1734, supra, Article 1735 of the Civil Code provides that all cases than
those mention in Article 1734, the common carrier shall be presumed to have
been at fault or to have acted negligently, unless it proves that it has
observed the extraordinary diligence required by law.
And even if fire were to be considered a "natural disaster" within the
meaning of Article 1734 of the Civil Code, it is required under Article 1739 of
the same Code that the "natural disaster" must have been the "proximate
and only cause of the loss," and that the carrier has "exercised due diligence
to prevent or minimize the loss before, during or after the occurrence of the
disaster.” This Petitioner Carrier has also failed to establish satisfactorily.
The prevailing doctrine in common carriers make the owner liable for
consequences having from the operations of the carrier even though the
specific vehicle involved may have been transferred to another person. This
doctrine rests upon the principle in dealing with vehicles registered under
Public Service Law, the public has the right to assume that the registered
owner is the actual or lawful owner thereof. It would be very difficult and
often impossible as a practical matter, for members of the general public to
enforce the rights of action that they may have for injuries inflicted by the
vehicles being negligently operated if they should be required to prove who
the actual owner is. The registered owner is not allowed to deny liability by
proving the identity of the alleged transferee. Thus, contrary to petitioner’s
claim, private respondents are not required to go beyond the vehicle’s
certificate of registration to ascertain the owner of the carrier.
Art. 2194. The responsibility of two or more persons who are liable for
a quasi-delict is solidary.
Since the employer's liability is primary, direct and solidary, its only
recourse if the judgment for damages is satisfied by it is to recover what it
has paid from its employee who committed the fault or negligence which
gave rise to the action based on quasi-delict. Article 2181 of the Civil Code
provides:
Art. 2181. Whoever pays for the damage caused by his dependents or
employees may recover from the latter what he has paid or delivered in
satisfaction of the claim.
Although SANTOS, as the kabit was the true owner as against VIDAD,
the latter, as the registered owner/operator and grantee of the franchise, is
directly and primarily responsible and liable for the damages caused to
SIBUG, the injured party, as a consequence of the negligent or careless
operation of the vehicle. This ruling is based on the principle that the
operator of record is considered the operator of the vehicle in contemplation
of law as regards the public and third persons even if the vehicle involved in
the accident had been sold to another where such sale had not been
approved by the then Public Service Commission.
The ruling in Lita Enterprises Inc. vs. IAC is upheld. The defect of in existence
of a contract is permanent and cannot be cured by ratification or by
prescription. The mere lapse of time cannot give efficacy to contracts that
are null and void.
The features which characterize the boundary system are not sufficient to
withdraw the relationship between the parties from that of employer and
employee. The owner continued to be the operator of the vehicle in legal
contemplation and as such, he is responsible for the consequences incident
to its operation. To exempt from liability the owner of a public vehicle who
operates it under the “boundary system” on the ground that he is a mere
lessor would be not only to abet flagrant violations of the Public Service Law
but also to place the riding public at the mercy of reckless and irresponsible
drivers.
Ganzon vs. CA
Petitioner Ganzon failed to show that the loss of the scrap iron due to
any cause enumerated in Art. 1734. The order of the acting Mayor did not
constitute valid authority for petitioner to carry out. In any case, the
intervention of the municipal officials was not of a character that would
render impossible the fulfillment by the carrier of its obligation. The
petitioner was not duly bound to obey the illegal order to dump into the sea
the scrap of iron. Moreover, there is absence of sufficient proof that the
issuance of the same order was attended with such force or intimidation as to
completely overpower the will of the petitioner’s employees.
By the delivery made during Dec. 1, 1956, the scraps were
unconditionally placed in the possession and control of the common carrier,
and upon their receipt by the carrier of transportation, the contract of
carriage was deemed perfected. Consequently, Ganzon’s extraordinary
responsibility for the loss, destruction or deterioration of the goods
commenced. According to Art 1738, such extraordinary responsibility would
cease only upon the delivery by the carrier to the consignee or persons with
right to receive them. The fact that part of the shipment had not been loaded
on board did not impair the contract of transportation as the goods remained
in the custody & control of the carrier.
The heavy seas and rains referred to in the master’s report were not
caso fortuito but normal occurrences that an ocean-going vessel, particularly
in the month of September which, in our area, is a month of rains and heavy
seas would encounter as a matter of routine. They are not unforeseen nor
unforeseeable. These are conditions that ocean-going vessels would
encounter and provide for, in the ordinary course of a voyage. That rain water
(not sea water) found its way into the holds of the Jupri Venture is a clear
indication that care and foresight did not attend the closing of the ship's
hatches so that rain water would not find its way into the cargo holds of the
ship.
Since the carrier has failed to establish any caso fortuito, the
presumption by law of fault or negligence on the part of the carrier applies;
and the carrier must present evidence that it has observed the extraordinary
diligence required by Article 1733 of the Civil Code in order to escape liability
for damage or destruction to the goods that it had admittedly carried in this
case. No such evidence exists of record. Thus, the carrier cannot escape
liability.
Sarkies Tours Phils vs. Court of Appeals
Under the Civil Code, 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 transported by them, and this
liability lasts from the time the goods are unconditionally placed in the
possession of, and received by the carrier for transportation until the same
are delivered, actually or constructively, by the carrier to the person who has
a right to receive them, unless the loss is due to any of the excepted causes
under Article 1734 thereof.
Where the common carrier accepted its passenger's baggage for
transportation and even had it placed in the vehicle by its own employee, its
failure to collect the freight charge is the common carrier's own lookout. It is
responsible for the consequent loss of the baggage. In the instant case,
defendant appellant's employee even helped Fatima Minerva Fortades and
her brother load the luggages/baggages in the bus' baggage compartment,
without asking that they be weighed, declared, receipted or paid for. Neither
was this required of the other passengers.
The explosion of the new tire is not a fortuitous event. There are
human factors involved in the situation. The fact that the tire was new did not
imply that it was entirely free from manufacturing defects or that it was
properly mounted on the vehicle. Neither may the fact that the tire bought
and used is of a brand name noted for quality, resulting in the conclusion that
it could not explode within five day’s use. It is settled that an accident caused
either by defects in the automobile or through the negligence of its driver is
not a caso fortuito. Moreover, a common carrier may not be absolved from
liability in case of force majeure. A common carrier must still prove that it
was not negligent in causing the death or injury resulting from the accident.
Thus, having failed to overthrow the presumption of negligence with clear
and convincing evidence, petitioners are hereby held liable for damages.
The receipt of goods by the carrier has been said to lie at the
foundation of the contract to carry and deliver, and if actually no goods are
received there can be no such contract. The liability and responsibility of the
carrier under a contract for the carriage of goods commence on their actual
delivery to, or receipt by, the carrier or an authorized agent and delivery to a
lighter in charge of a vessel for shipment on the vessel, where it is the
custom to deliver in that way, is a good delivery and binds the vessel
receiving the freight, the liability commencing at the time of delivery to the
lighter and, similarly, where there is a contract to carry goods from one port
to another, and they cannot be loaded directly on the vessel and lighters are
sent by the vessel to bring the goods to it, the lighters are for the time its
substitutes, so that the bill of landing is applicable to the goods as soon as
they are placed on the lighters.
Lu Do vs. Binamira
While delivery of the cargo to the consignee, or to the person who has
a right to receive them, contemplated in Article 1736, because in such case
the goods are still in the hands of the Government and the owner cannot
exercise dominion over them, we believe however that the parties may agree
to limit the liability of the carrier considering that the goods have still to
through the inspection of the customs authorities before they are actually
turned over to the consignee. This is a situation where we may say that the
carrier losses control of the goods because of a custom regulation and it is
unfair that it be made responsible for what may happen during the
interregnum.
With regard to the contention of the carrier that COGSA should control
in this case, the same is of as moment. Art. 1763 of the New Civil Code
provides that “the laws of the country to which the goods are transported
shall govern the liability of the common carrier in case of loss, destruction
and deterioration.” This means that the law of the Philippines on the New
Civil Code. Under 1766 of NCC, “in all matter not regulated by this Code, the
rights and obligations of common carriers shall be governed by the Code of
Commerce and by Special Laws.” Art. 1736-1738, NCC governs said rights
and obligations. Therefore, although Sec 4(5) of COGSA states that the
carrier shall not be liable in an amount exceeding $500 per package unless
the value of the goods had been declared by the shipper and asserted in the
bill of lading, said section is merely supplementary to the provisions of the
New Civil Code.
The court a quo held that the delivery of the shipment in question to the
warehouse of the Bureau of Customs is not the delivery contemplated by
Article 1736; and since the burning of the warehouse occurred before actual
or constructive delivery of the goods to the appellees, the loss is chargeable
against the appellant.
It should be pointed out, however, that in the bills of lading issued for
the cargoes in question, the parties agreed to limit the responsibility of the
carrier for the loss or damage that may be caused to the shipment therein
the following stipulation:
Clause 14. Carrier shall not be responsible for loss or damage to shipments
billed 'owner's risk' unless such loss or damage is due to negligence of
carrier. Nor shall carrier be responsible for loss or damage caused by force
majeure, dangers or accidents of the sea or other waters; war; public
enemies; . . . fire . ...
Appellees would contend that the above stipulation does not bind them
because it was printed in fine letters on the back-of the bills of lading; and
that they did not sign the same. This argument overlooks the pronouncement
of this Court in Ong Yiu vs. Court of Appeals, where the same issue was
resolved in this wise:
“While it may be true that petitioner had not signed the plane ticket,
he is nevertheless bound by the provisions thereof. 'Such provisions have
been held to be a part of the contract of carriage, and valid and binding upon
the passenger regardless of the latter's lack of knowledge or assent to the
regulation'. It is what is known as a contract of 'adhesion', in regards which it
has been said that contracts of adhesion wherein one party imposes a ready
made form of contract on the other, as the plane ticket in the case at bar, are
contracts not entirely prohibited. The one who adheres to the contract is in
reality free to reject it entirely; if he adheres, he gives his consent."
Macam vs. CA
While it is true that common carriers are not obligated by law to carry
and to deliver merchandise, and persons are not vested with the right to
prompt delivery, unless such common carriers previously assume the
obligation to deliver at a given date or time, delivery of shipment or cargo
should at least be made within a reasonable time.
While there was no special contract entered into by the parties
indicating the date of arrival of the subject shipment, petitioner nevertheless,
was very well aware of the specific date when the goods were expected to
arrive as indicated in the bill of lading itself. In this regard, there arises no
need to execute another contract for the purpose as it would be a mere
superfluity. In the case before us, we find that a delay in the delivery of the
goods spanning a period of two months and seven days falls was beyond the
realm of reasonableness.
Limiting the common carrier’s liability for loss or damage from any
cause or for any reason for less than 1/8 the actual value of the goods is
unconscionable and therefore against public policy. A common carrier cannot
lawfully stipulate for exemption from liability, unless such exemption is just
and reasonable and the contract is freely and fairly made.
It can not be said that a contract has been entered into between a
passenger and the common carrier, embodying the conditions as printed at
the back of the ticket. The fact that those conditions are printed at the back
of the ticket stub in letters so small that they are hard to read would not
warrant the presumption that the passenger was aware of those conditions
such that he had "fairly and freely agreed" to those conditions. The
passenger is considered not having agreed to the stipulation on the ticket, as
manifested by the fact that he did not sign the ticket.
While it may be true that the passenger had not signed the plane
ticket, he is nevertheless bound by the provisions thereof. "Such provisions
have been held to be a part of the contract of carriage, and valid and binding
upon the passenger regardless of the latter's lack of knowledge or assent to
the regulation". It is what is known as a contract of "adhesion", in regards
which it has been said that contracts of adhesion wherein one party imposes
a ready made form of contract on the other, as the plane ticket in the case at
bar, are contracts not entirely prohibited. The one who adheres to the
contract is in reality free to reject it entirely; if he adheres, he gives his
consent. A contract limiting liability upon an agreed valuation does not offend
against the policy of the law forbidding one from contracting against his own
negligence.
Basic is the rule that a stipulation limiting the liability of the carrier to
the value of the goods appearing in the bill of lading, unless the shipper or
owner declares a greater value, is binding. Furthermore, 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 fairly and freely agreed upon.
In this case, the award based on the alleged market value of the goods
is erroneous. It is provided in a clause in the BOL that its liability is limited to
US$2.00/kilo. The consignee also admits in the memorandum that the value
of the goods does not appear in the bill of lading. Hence, the stipulation on
the carrier’s limited liability applies.
In the bill of lading, the carrier made it clear that all claims for which it
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. Its liability would only be up to One Hundred Thousand (Y100,000.00)
Yen. However, the shipper, 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.
The commercial Invoice does not in itself sufficiently and convincingly
show that the common carrier has knowledge of the value of the cargo as
contended by the shipper.
British Airways vs. CA
Under Art. 2220 of the Civil Code, moral damages are justly due in
breaches of contract where the defendant acted fraudulently or in bad faith.
Both the Trial Court and the Appellate Court found that there was bad faith
on the part of petitioner in that:
The facts show that the private respondent actually refused to register
the attache case and chose to take it with him despite having been ordered
by the PANAM agent to check it in. In attempting to avoid registering the
luggage by going back to the line, private respondent manifested a disregard
of airline rules on allowable handcarried baggages. Prudence of a reasonably
careful person also dictates that cash and jewelry should be removed from
checked-in-luggage and placed in one's pockets or in a handcarried Manila-
paper or plastic envelope.
Mecenas vs. CA
The record shows that the "Don Juan" sank within ten (10) to fifteen
(15) minutes after initial contact with the "Tacloban City. While the failure of
Capt. Santisteban to supervise his officers and crew in the process of
abandoning the ship and his failure to avail of measures to prevent the too
rapid sinking of his vessel after collision, did not cause the collision by
themselves, such failures doubtless contributed materially to the consequent
loss of life and, moreover, were indicative of the kind and level of diligence
exercised by Capt. Santisteban in respect of his vessel and his officers and
men prior to actual contact between the two (2) vessels. The officer-on-watch
in the "Don Juan" admitted that he had failed to inform Capt. Santisteban not
only of the "imminent danger of collision" but even of "the actual collision
itself " There is also evidence that the "Don Juan" was carrying more
passengers than she had been certified as allowed to carry.
The Duty to exercise due diligence includes the duty to take passengers or
cargoes that are within the carrying capacity of the vessel. (Same Ruling with
Mecenas)
The principle about "the last clear" chance, would call for application in
a suit between the owners and drivers of the two colliding vehicles. It does
not arise where a passenger demands responsibility from the carrier to
enforce its contractual obligations. For it would be inequitable to exempt the
negligent driver of the jeepney and its owners on the ground that the other
driver was likewise guilty of negligence."
It is the rule under the substantial factor test that if the actor's conduct
is a substantial factor in bringing about harm to another, the fact that the
actor neither foresaw nor should have foreseen the extent of the harm or the
manner in which it occurred does not prevent him from being liable. The bus
driver's conduct is not a substantial factor in bringing about harm to the
passengers of the jeepney. It cannot be said that the bus was travelling at a
fast speed when the accident occurred because the speed of 80 to 90
kilometers per hour, assuming such calculation to be correct, is yet within the
speed limit allowed in highways.
Bustamante vs. CA
The doctrine, stated broadly, is that the negligence of the plaintiff does
not preclude a recovery for the negligence of the defendant where it appears
that the defendant, by exercising reasonable care and prudence, might have
avoided injurious consequences to the plaintiff notwithstanding the plaintiff's
negligence. In other words, the doctrine of last clear chance means that even
though a person's own acts may have placed him in a position of peril, and an
injury results, the injured person is entitled to recovery. As the doctrine is
usually stated, a person who has the last clear chance or opportunity of
avoiding an accident, notwithstanding the negligent acts of his opponent or
that of a third person imputed to the opponent is considered in law solely
responsible for the consequences of the accident.
Res ipsa loquitur is a doctrine which states thus: "Where the thing
which causes injury is shown to be under the management of the defendant,
and the accident is such as in the ordinary course of things does not happen
if those who have the management use proper care, it affords reasonable
evidence, in the absence of an explanation by the defendant, that the
accident arose from want of care. The doctrine of Res ipsa loquitur as a rule
of evidence is peculiar to the law of negligence which recognizes that prima
facie negligence may be established without direct proof and furnishes a
substitute for specific proof of negligence. The doctrine can be invoked when
and only when, under the circumstances involved, direct evidence is absent
and not readily available.
Whether the cargo truck was parked along the road or on half the
shoulder of the right side of the road would be of no moment taking into
account the warning device consisting of the lighted kerosene lamp placed
three or four meters from the back of the truck. But despite this warning
which we rule as sufficient, the Isuzu truck driven by Daniel Serrano, an
employee of the private respondent, still bumped the rear of the parked
cargo truck. As a direct consequence of such accident the petitioner
sustained injuries on his left forearm and left foot. It is clear therefore that
the absence or want of care of Daniel Serrano has been established by clear
and convincing evidence. It follows that the doctrine of Res ipsa loquitur is
inapplicable, making the employer of the driver liable for the negligence of
his employee.
La Mallorca vs. CA
The liability of the carrier for the child, who was already led by the
father to a place about 5 meters away from the bus for her safety under the
contract of carriage, persists. 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.
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.
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. Even if he
had already disembarked an hour earlier, his presence in petitioner's
premises was not without cause. The victim had to claim his baggage which
was possible only one hour after the vessel arrived since it was admittedly
standard procedure in the case of petitioner's vessels that the unloading
operations shall start only after that time.
Bayasen vs. CA
It is a well known physical tact that cars may skid on greasy or slippery roads,
as in the instant case, without fault on account of the manner of handling the
car. Skidding means partial or complete loss of control of the car under
circumstances not necessarily implying negligence. It may occur without
fault.
Under the particular circumstances of the instant case, the petitioner- driver
who skidded could not be regarded as negligent, the skidding being an
unforeseen event, so that the petitioner had a valid excuse for his departure
from his regular course.
Cervantes vs. CA
Since the PAL agents are not privy to the said Agreement and petitioner knew
that a written request to the legal counsel of PAL was necessary, he cannot
use what the PAL agents did to his advantage. The said agents, acted without
authority when they confirmed the flights of the petitioner. Under Article
1989 of the New Civil Code, the acts of an agent beyond the scope of his
authority do not bind the principal, unless the latter ratifies the same
expressly or impliedly. Furthermore, when the third person (herein petitioner)
knows that the agent was acting beyond his power or authority, the principal
cannot be held liable for the acts of the agent. If the said third person is
aware of such limits of authority, he is to blame, and is not entitled to recover
damages from the agent, unless the latter undertook to secure the principal's
ratification.
Calalas vs. CA
The basis of the common carrier's liability under NCC for assaults on
passengers committed by its drivers rests either on (1) the doctrine of
respondeat superior or (2) the principle that it is the carrier's implied duty to
transport the passenger safely.
Under the first, which is the minority view, the carrier is liable only
when the act of the employee is within the scope of his authority and duty. It
is not sufficient that the act be within the course of employment only. Under
the second view, upheld by the majority and also by the later cases, it is
enough that the assault happens within the course of the employee's duty. It
is no defense for the carrier that the act was done in excess of authority or in
disobedience of the carrier's orders. The carrier's liability here is absolute in
the sense that it practically secures the passengers from assaults committed
by its own employees. Art. 1759, evidently follows the rule based on the
second view.
Accordingly, it is the carrier's strict obligation to select its drivers and
similar employees with due regard not only to their technical competence
and physical ability, but also, no less important, to their total personality,
including their patterns of behavior, moral fibers, and social attitude.
PNR vs. CA
The running amuck of the passenger was the proximate cause of the
incident as it triggered off a commotion and panic among the passengers
such that the passengers started running to the sole exit shoving each other
resulting in the falling off the bus by passengers Beter and Rautraut causing
them fatal injuries. The sudden act of the passenger who stabbed another
passenger in the bus is within the context of force majeure. However, in order
that a common carrier may be absolved from liability in case of force
majeure, it is not enough that the accident was caused by force majeure. The
common carrier must still prove that it was not negligent in causing the
injuries resulting from such accident. In this case, Bachelor was negligent.
Considering the factual findings of the Court of Appeals-the bus driver
did not immediately stop the bus at the height of the commotion; the bus
was speeding from a full stop; the victims fell from the bus door when it was
opened or gave way while the bus was still running; the conductor panicked
and blew his whistle after people had already fallen off the bus; and the bus
was not properly equipped with doors in accordance with law.
The income which deceased could earn if he should finish the medical
course and pass the corresponding board examinations must be deemed to
be within the same category provided for by Art. 2201 of the Civil Code,
which are those that are the natural and probable consequences of the
breach and which the parties had foreseen or could have reasonably foreseen
at the time the obligation was constituted.
LTB could not be held liable to pay moral damages under Article 2220 of the
Civil Code on account of breach of its contract of carriage because it did not
act fraudulently or in bad faith. LTB had exercised due diligence in the
selection and supervision of its employees like the drivers of its buses in
connection with the discharge of their duties and so it must be considered an
obligor in good faith.
Life expectancy is, not only relevant, but, also, an important element in
fixing the amount recoverable by private respondents herein. Although it is
not the sole element determinative of said amount, no cogent reason has
been given to warrant its disregard and the adoption, in the case at bar, of a
purely arbitrary standard, such as a four-year rule.
When the liability of common carrier had been fixed at a minimal rate
of only of P2,184.00 a year, which is the annual salary of deceased at the
time of his death, as a young "training assistant" and when the deceased’s
potentiality and capacity to increase his future income was not considered
said liability may be enforced upon finality of the decision.
While under the law, employers are made responsible for the damages
caused by their employees acting within the scope of their assigned task,
plaintiff, in the present case, does not maintain his action against all the
persons who might be liable for the damages caused but on an alleged
breach of contract of carriage and against the defendant employer alone.
However, the defendant taxicab company has not committed any criminal
offense resulting in physical injuries against the plaintiff. The one that
committed the offense against plaintiff is the driver of defendant's taxicab
but he was not made party defendant to the case. Therefore, plaintiff is not
entitled to compensation for moral damages as his case does not come
within the exception of paragraph 1 of Article 2219 of the Civil Code.
The present case does not come under any of the exceptions
enumerated in Article 2208 of the Civil Code, specially of paragraph 2
thereof, because defendant's failure to meet its responsibility was not the
cause that compelled the plaintiff to litigate or to incur expenses to protect
his interests. The present action was instituted because plaintiff demanded
an exorbitant amount for moral damages and naturally the defendant did not
and could not yield to such demand. This is neither a case that comes under
paragraph 11 of said Article because the Lower Court did not deem it just and
equitable to award any amount for attorney's fees, on which point this Court
agrees.
Armovit vs. CA
Held: 1. Yes. Article 1732 makes no distinction between one whose principal
business activity is the carrying of persons or goods or both, and one who
does such carrying only as an ancillary activity (in local Idiom as "a sideline").
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.
The Court of Appeals referred to the fact that private respondent held
no certificate of public convenience. A certificate of public convenience is not
a requisite for the incurring of liability. That liability arises the moment a
person or firm acts as a common carrier, without regard to whether or not
such carrier has also complied with the requirements of the applicable
regulatory statute and implementing regulations and has been granted a
certificate of public convenience or other franchise. To exempt private
respondent from the liabilities of a common carrier because he has not
secured the necessary certificate of public convenience, would be offensive
to sound public policy; that would be to reward private respondent precisely
for failing to comply with applicable statutory requirements.
2. No. Article 1734 establishes the general rule that common carriers are
responsible for the loss, destruction or deterioration of the goods which they
carry, "unless the same is due to any of the following causes only:
(1) Flood, storm, earthquake, lightning or other natural disaster or calamity;
(2) Act of the public enemy in war, whether international or civil;
(3) Act or omission of the shipper or owner of the goods;
(4) The character-of the goods or defects in the packing or-in the containers;
and
(5) Order or act of competent public authority.
The hijacking of the carrier's truck does not fall within any of the five
categories of exempting causes listed in Article 1734. It would follow,
therefore, that the hijacking of the carrier's vehicle must be dealt with under
the provisions of Article 1735, in other words, that the private respondent as
common carrier is presumed to have been at fault or to have acted
negligently. This presumption, however, may be overthrown by proof of
extraordinary diligence on the part of private respondent. Petitioner argues
that in the circumstances of this case, private respondent should have hired a
security guard presumably to ride with the truck carrying the 600 cartons of
Liberty filled milk. We do not believe, however, that in the instant case, the
standard of extraordinary diligence required private respondent to retain a
security guard to ride with the truck and to engage brigands in a firelight at
the risk of his own life and the lives of the driver and his helper.
In the instant case, armed men held up the second truck owned by
private respondent which carried petitioner's cargo. Accused acted with
grave, if not irresistible, threat, violence or force. In these circumstances, we
hold that the occurrence of the loss must reasonably be regarded as quite
beyond the control of the common carrier and properly regarded as a
fortuitous event. It is necessary to recall that even common carriers are not
made absolute insurers against all risks of travel and of transport of goods,
and are not held liable for acts or events which cannot be foreseen or are
inevitable, provided that they shall have complied with the rigorous standard
of extraordinary diligence.
Facts: PPI purchased from Mitsubishi metric tons of Urea fertilizer which the
latter shipped aboard the cargo vessel owned by KKKK from US to La Union.
Prior to its voyage, a time charter-party on the vessel was entered into
between Mitsubishi as shipper/charterer and KKKK as shipowner, in Tokyo,
Japan. Before loading the fertilizer aboard the vessel, they were all
presumably inspected by the charterer's representative and found fit to take
a load of urea. After the Urea fertilizer was loaded in bulk by stevedores hired
by and under the supervision of the shipper, the steel hatches were closed
with heavy iron lids, covered with three layers of tarpaulin, then tied with
steel bonds. The hatches remained closed and tightly sealed throughout the
entire voyage.
A private marine and cargo surveyor, Cargo Superintendents Company
Inc. (CSCI), was hired by PPI to determine the "outturn" of the cargo shipped.
The survey report submitted revealed a shortage in the cargo and that a
portion of the Urea fertilizer approximating was contaminated with dirt.
PPI sent a claim letter to Soriamont Steamship Agencies (SSA), the
resident agent of the carrier, KKKK, for the cost of the shortage in the and the
diminution in value of that portion contaminated with dirt. SSA explained that
they did not respond to the consignee's claim because it was not a formal
claim, and that they had nothing to do with the discharge of the shipment.
PPI filed an action for damages. The defendant carrier argued that the
strict public policy governing common carriers does not apply to them
because they have become private carriers by reason of the provisions of the
charter-party. RTC ruled in favor of plaintiff, stating that “common carriers
are presumed negligent, all that a shipper has to do in a suit to recover for
loss or damage is to show receipt by the carrier of the goods and to delivery
by it of less than what it received. After that, the burden of proving that the
loss or damage was due to any of the causes which exempt him from liability
is shifted to the carrier, common or private he may be. Even if the provisions
of the charter-party are deemed valid, and the defendants considered private
carriers, it was still incumbent upon them to prove that the shortage or
contamination sustained by the cargo is attributable to the fault or
negligence on the part of the shipper or consignee in the loading, stowing,
trimming and discharge of the cargo. This they failed to do.” CA reversed the
decision, relying on the 1968 case of Home Insurance Co. v. American
Steamship Agencies, Inc., it ruled that the cargo vessel M/V "Sun Plum"
owned by private respondent KKKK was a private carrier and not a common
carrier by reason of the time charterer-party. Accordingly, the Civil Code
provisions on common carriers which set forth a presumption of negligence
do not find application in the case at bar.
Held: 1.) Not necessarily. It is not disputed that respondent carrier, in the
ordinary course of business, operates as a common carrier, transporting
goods indiscriminately for all persons. When petitioner chartered the vessel
M/V "Sun Plum", the ship captain, its officers and compliment were under the
employ of the shipowner and therefore continued to be under its direct
supervision and control. Hardly then can the charterer be charged, a stranger
to the crew and to the ship, with the duty of caring for his cargo when the
charterer did not have any control of the means in doing so. This is evident in
the present case considering that the steering of the ship, the manning of the
decks, the determination of the course of the voyage and other technical
incidents of maritime navigation were all consigned to the officers and crew
who were screened, chosen and hired by the shipowner. It is therefore
imperative that a public carrier shall remain as such, notwithstanding the
charter of the whole or portion of a vessel by one or more persons, provided
the charter is limited to the ship only, as in the case of a time-charter or
voyage-charter. It is only when the charter includes both the vessel and its
crew, that a common carrier becomes private, at least insofar as the
particular voyage covering the charter-party is concerned. Indubitably, a
shipowner in a time or voyage charter retains possession and control of the
ship, although her holds may, for the moment, be the property of the
charterer.
Respondent carrier's heavy reliance on the case of Home Insurance Co.
v. American Steamship Agencies, is misplaced for the reason that the meat of
the controversy therein was the validity of a stipulation in the charter-party
exempting the shipowners from liability for loss due to the negligence of its
agent, and not the effects of a special charter on common carriers. At any
rate, the rule in the United States that a ship chartered by a single shipper to
carry special cargo is not a common carrier, does not find application in our
jurisdiction, for we have observed that the growing concern for safety in the
transportation of passengers and /or carriage of goods by sea requires a
more exacting interpretation of admiralty laws, more particularly, the rules
governing common carriers.
Facts: The board of Yangco Steamship Co. adopted a resolution which was
ratified by the stockholders declaring classes of merchandise which are not to
be carried by the vessels of the company and prohibiting the employees to
carry dynamite, powder or other explosives. The Collector of Customs
suspended the issuance of clearances for the vessels unless they carry the
explosives. Fisher, a stockholder of YSC, filed a petition for prohibition.
Issue: Whether or not the refusal of the board of YFC to accept for carriage
"dynamite, powder or other explosives" from any and all shippers who may
offer such explosives for carriage can be held to be a lawful act.
Held: No. In construing Act 98 for the alleged violation, the test is whether
the refusal of YSC to carry the explosives without qualification or conditions
may have the effect of subjecting any person or locality or the traffic is such
explosives to an unduly unreasonable or unnecessary prejudice or
discrimination. Common carriers in this jurisdiction cannot lawfully decline to
accept a particular class of goods unless it appears that for some sufficient
reason the discrimination for such is reasonable and necessary. YSC has not
met those conditions.
The nature of the business of a common carrier as a public
employment is such that it is within the power of the State to impose such
just regulations in the interest of the public as the legislator may deem
proper.
US vs. QUINAHON
Facts: Defendants were charged for violation of Act 98, when they unloaded
in the port of Currimao 5,986 sacks of rice belonging to Ilocos Norte Provincial
Government from Manila, and charged the provincial treasurer 10 centavos
for each sack instead of 6 centavos which they have been regularly charging
for the unloading of the same kind of merchandise and under virtually the
same circumstances and conditions. They were convicted, hence they
appealed to the higher court.
Held: Yes. There is no pretense that it actually cost more to handle the rice
for the province than it did for the merchants with whom the special
contracts were made. There was a clear discrimination against the province
which is prohibited by the law. It is however not believed that the law
prohibits common carriers from making special rates for the handling and
transporting of merchandise, when the same are made for the purpose of
increasing their business and to manage their important interests upon the
same principles which are regarded as sound and adopted in other trades
and pursuits. Absolute equality is not required in all cases. It is only unjust,
undue and unreasonable discrimination which the law forbids. The law of
equality is in force only where the services performed in the different cases
are substantially the same and the circumstances and conditions are similar.
Held: No. Loadstar submits that the vessel was a private carrier because it
was not issued a CPC; it did not have a regular trip or schedule nor a fixed
route; and there was only “one shipper, one consignee for a special cargo.”
The SC held that Loadstar is a common carrier. It is not necessary that
the carrier be issued a CPC, and this character is not altered by the fact that
the carriage of the goods in question was periodic, occasional, episodic or
unscheduled.
In support of its position Loadstar relied on the 1968 case of Home
Insurance Co. v. American Steamship Agencies, where the Court held that a
common carrier transporting special cargo or chartering the vessel to a
special person becomes a private carrier that is not subject to the provisions
of the Civil Code.
This case however is not applicable in the case at bar for the simple
reason that the actual settings are different. The records do not disclose that
the M/V Cherokee, on the date in question, undertook to carry a special cargo
or was chartered to a special person only. There was no charter party. The
bills of lading failed to show any special arrangement, but only a general
provision to the effect that the M/V Cherokee was a general cargo carrier.
Further, the bare fact that the vessel was carrying a particular type of cargo
for one shipper, which appears to be purely coincidental, is not reason
enough to convert the vessel from a common carrier to a private carrier,
especially where, as in this case, it was shown that the vessel was also
carrying passengers.
Under the facts and circumstances obtaining in this case, Loadstar fits
the definition of a common carrier under Article 1732 of the NCC. The
doctrine enunciated in the case of De Guzman v. CA was also mentioned. CA
decision is hereby affirmed.
FIRST PHILIPPINE INDUSTRIAL CORPORATION vs. COURT OF APPEALS
Issue: Whether or not petitioner is liable to pay a local tax based on gross
receipts since it is not a common carrier.
Held: No. Based on Article 1732 NCC, there is no doubt that petitioner is a
common carrier. It is engaged in the business of transporting or carrying
goods, i.e. petroleum products, for hire as a public employment. It
undertakes to carry for all persons indifferently, that is, to all persons who
choose to employ its services, and transports the goods by land and for
compensation. The fact that petitioner has a limited clientele does not
exclude it from the definition of a common carrier. (De Guzman Ruling
upheld)
Respondent’s argument that the term “common carrier” as used in
Section 133(j) of the Local Government Code refers only to common carriers
transporting goods and passengers through moving vehicles or vessels either
by land, sea or water is erroneous. The definition of “common carriers” in
NCC makes no distinction as to the means of transporting as long as it is by
land, water or air. It does not provide that the transporting of the passengers
or goods should be by motor vehicle.
It is clear that the legislative intent in excluding from the taxing power
of the local government unit the imposition of business tax against common
carriers is to prevent a duplication of the so-called "common carrier's tax."
Petitioner is already paying 3% common carrier's tax on its gross
sales/earnings under the National Internal Revenue Code. To tax petitioner
again on its gross receipts in its transportation of petroleum business would
defeat the purpose of the Local Government Code.
Held: No. The NCC provisions on common carriers should not apply where
the common carrier is not acting as such but as a private carrier. Under
American Jurisprudence, a common carrier undertaking to carry a special
cargo or chartered to a special person only becomes a private carrier. As a
private carrier, a stipulation exempting the owner from liability for the
negligence of its agent is valid.
The stipulation in the charter party absolving the owner from liability
for loss due to the negligence of its agent would be void only if strict public
policy governing common carrier is applied. Such policy has no force where
the public at large is not involved, as in the case of a ship totally chartered
for the use of a single party. The stipulation exempting the owner from
liability for negligence of its agent is not against public policy and is deemed
valid. Recovery can’t be had, for loss or damage to the cargo against
shipowners, unless the same is due to personal acts or negligence of said
owner or its managers, as distinguished from agents or employees.
Facts: PANTRANCO offers PUB service for passengers and freight. It operates
passenger buses from Metro Manila to Bicol Region and Eastern Samar. On
March 27,1980 it requested MARINA for authority to lease/purchase a vessel
for its project to operate a ferryboat service from Matnog,Sorsogon and
Allen,Samar that will provide service to company buses and freight trucks
that have to cross San Bernardo Strait.This was not given due course because
the Matnog-Allen run is adequately serviced by Cardinal Shipping Corp. and
Epitacio San Pablo and market conditions in the proposed route cannot
support the entry of additional tonnage. PANTRANCO nevertheless acquired
the vessel. It wrote the Chairman of the Board of Transportation (BOT), that it
proposes to operate a ferry service to carry its passenger buses and freight
trucks between Allen and Matnog in connection with its trips to Tacloban City.
PANTRANCO claims that it can operate a ferry service in connection with its
franchise for bus operation in the highway from Pasay City to Tacloban City
for the purpose of continuing the highway, which is interrupted by a small
body of water, the said proposed ferry operation is merely a necessary and
incidental service to its main service and obligation of transporting its
passengers from Pasay City to Tacloban City. Such being the case there is no
need to obtain a separate certificate for public convenience to operate a ferry
service. The BOT granted authority to PANTRANCO to operate a private ferry
boat service, to which the petitioners opposed.
Facts: On July 17, 1974, plaintiff NSC as charterer and defendant VSI as
owner, entered into a Contract of Voyage Charter Hire whereby NSC hired
VSI’s vessel, the MV ‘VLASONS I’ to make one voyage to load steel products
at Iligan City and discharge them at North Harbor Manila.
When the vessel’s 3 hatches containing the shipment were opened by
plaintiff’s agents, nearly all the skids of tinplates and hot rolled sheets were
allegedly found to be wet and rusty. The cargo was discharged and unloaded
by stevedores hired by the plaintiff.
Plaintiff filed with the defendant its claim for damages suffered due to
the downgrading of the damaged tinplates in the amount of P941,145.18 but
defendant refused and failed to pay. RTC ruled against the plaintiff, stating
that the vessel was seaworthy and that there is no proof of willful negligence
of the vessel's officers. This was affirmed by CA but modified the award of
damages, hence the appeal.
(b) DOTC Department Order No.92-587, dated March 30, 1992, defining the
policy framework on the regulation of transport services;
Among the salient provisions of which include: “In determining public need,
the presumption of need for a service shall be deemed in favor of the
applicant. The burden of proving that there is no need for a proposed service
shall be with the oppositor(s).”
(c) DOTC Memorandum dated October 8, 1992, laying down rules and
procedures to implement Department Order No. 92-587;
(e) LTFRB Order dated March 24, 1994 in Case No. 94-3112.
Petitioner KMU filed a petition before the LTFRB opposing the upward
adjustment of bus fares. LTFRB dismissed the petition hence the present one.
Held: While the authority of the DOTC and the LTFRB to issue administrative
orders to regulate the transport sector is recognized, the Court found that
they committed grave abuse of discretion in issuing DOTC Department Order
No. 92-587 and LTFRB Memorandum Circular No. 92-009 promulgating the
implementing guidelines on DOTC Department Order No. 92-587, the said
administrative issuances being amendatory and violative of the Public
Service Act and the Rules of Court.
Fare Range Scheme: The 20% fare increase imposed by PBOAP without
the benefit of a petition and a public hearing is null and void and of no force
and effect.
Presumed Public Need: A CPC is an authorization granted by the LTFRB
for the operation of land transportation services for public use as required by
law. Pursuant to Section 16(a) of the Public Service Act, as amended, the
following requirements must be met before a CPC may be granted, to wit: (i)
the applicant must be a citizen of the Philippines, or a corporation or co-
partnership, association or joint-stock company constituted and organized
under the laws of the Philippines, at least 60 % of its stock or paid-up capital
must belong entirely to citizens of the Philippines; (ii) the applicant must be
financially capable of undertaking the proposed service and meeting the
responsibilities incident to its operation; and (iii) the applicant must prove
that the operation of the public service proposed and the authorization to do
business will promote the public interest in a proper and suitable manner. It
is understood that there must be proper notice and hearing before the PSC
can exercise its power to issue a CPC.
While adopting the foregoing requisites for the issuance of a CPC,
LTFRB Memorandum Circular No. 92-009, Part IV, provides for yet
incongruous and contradictory policy guideline on the issuance of a CPC. The
guidelines states:
Facts: DOTC planned to construct a light railway transit line along EDSA
referred to as EDSA Light Rail Transit III (EDSA LRT III). Then President
Aquino, signed into law the Build-Operate-Transfer (BOT) Law. After
prequalifying the bidders for the construction of the said transit, it was found
that out of all the applicants, only the EDSA LRT Consortium met the
requirements. DOTC and respondent EDSA LRT Corporation, Ltd. (a private
corporation organized under the laws of HongKong) in substitution of the
EDSA LRT Consortium, entered into an "Agreement to Build, Lease and
Transfer a Light Rail Transit System for EDSA" under the terms of the BOT
Law.
DOTC sought the approval of the President but the same was denied.
Thus, DOTC, represented by Secretary Garcia, and private respondent
entered into a supplemental agreement—“Revised and Restated Agreement
to Build, Lease and Transfer a Light Rail Transit System for EDSA" so as to
clarify their respective rights and responsibilities and to submit Supplemental
Agreement to the President.
Petitioners, in their capacity as Senators and taxpayers, question the
constitutionality of the two agreements between DOTC and private
respondent. They contend that it grants EDSA LRT Corp., Ltd., a foreign
corporation, the ownership of EDSA LRT III which is a public utility. Secretary
Garcia and private respondent on the other hand, contend that the
nationality requirement for public utilities mandated by the Constitution does
not apply to private respondent.
Issue: Does the fact that EDSA LRT Corporation, Ltd., a foreign corporation,
own the facilities and equipment of the LRT III mean it also own the LRT III as
a public utility?
Held: No. What private respondent owns are the rail tracks, rolling stocks like
the coaches, rail stations, terminals and the power plant, not a public utility.
While a franchise is needed to operate these facilities to serve the public,
they do not by themselves constitute a public utility. As ruled in Iloilo Ice &
Cold Storage Co. v. Public Service Board, what constitutes a public utility is
not their ownership but their use to serve the public.
In law, there is a clear distinction between the "operation" of a public
utility and the ownership of the facilities and equipment used to serve the
public. The right to operate a public utility may exist independently and
separately from the ownership of the facilities thereof. One can own said
facilities without operating them as a public utility, or conversely, one may
operate a public utility without owning the facilities used to serve the public.
The devotion of property to serve the public may be done by the owner or by
the person in control thereof who may not necessarily be the owner thereof.
In the case at bar, private respondent and DOTC agreed that on completion
date, private respondent will immediately deliver possession of the LRT
system by way of lease for 25 years, during which period DOTC shall operate
the same as a common carrier and private respondent shall provide technical
maintenance and repair services to DOTC. Clearly, private respondent will
not run the light rail vehicles and collect fees from the riding public. It will
have no dealings with the public and the public will have no right to demand
any services from it. It is DOTC which shall operate the EDSA LRT III.
Therefore, private respondent, EDSA LRT Corp., Ltd. does not own EDSA LRT
III as a public utility.
Issue: Whether or not the various clauses and stipulations in the Bill of
lading is valid.
Held: Yes. The validity of stipulations in bills of lading exempting the carrier
from liability for loss or damage to the goods when the same are not in its
actual custody has been upheld in PHOENIX ASSURANCE CO., LTD. vs.
UNITED STATES LINES, 22 SCRA 674 (1968).
The stipulations in the bill of lading in the PHOENIX case which are
substantially the same as the subject stipulations provides:
“The carrier shall not be liable in any capacity whatsoever for any loss or
damage to the goods while the goods are not in its actual custody.” (Par. 2,
last subpar.)
Finding the above stipulations not contrary to law, morals, good customs,
public order or public policy their validity was sustained.
A careful perusal of the provisions of the New Civil Code on common
carriers was looked into by the Court particularly, Article 1736 and 1738.
There is no doubt that Art. 1738 finds no applicability to the instant
case. The said article contemplates a situation where the goods had already
reached their place of destination and are stored in the warehouse of the
carrier. The subject goods were still awaiting transshipment to their port of
destination, and were stored in the warehouse of a third party when last seen
and/or heard of.
Article 1736 is applicable to the instant suit. Under said article, the
carrier may be relieved of the responsibility for loss or damage to the goods
upon actual or constructive delivery of the same by the carrier to the
consignee, or to the person who has a right to receive them. In sales, actual
delivery has been defined as the ceding of corporeal possession by the seller,
and the actual apprehension of corporeal possession by the buyer or by some
person authorized by him to receive the goods as his representative for the
purpose of custody or disposal. By the same token, there is actual delivery in
contracts for the transport of goods when possession has been turned over to
the consignee or to his duly authorized agent and a reasonable time is given
him to remove the goods. The court a quo found that there was actual
delivery to the consignee through its duly authorized agent, the carrier.
Two undertakings appeared embodied and/or provided for in the Bill of
Lading in question. The first is FOR THE TRANSPORT OF GOODS from Bremen,
Germany to Manila. The second, THE TRANSSHIPMENT OF THE SAME GOODS
from Manila to Davao, with appellant acting as agent of the consignee. At the
hiatus between these two undertakings of appellant which is the moment
when the subject goods are discharged in Manila, its personality changes
from that of carrier to that of agent of the consignee. Thus, the character of
appellant's possession also changes, from possession in its own name as
carrier, into possession in the name of consignee as the latter's agent. Such
being the case, there was, in effect, actual delivery of the goods from
appellant as carrier to the same appellant as agent of the consignee. Upon
such delivery, the appellant, as erstwhile carrier, ceases to be responsible for
any loss or damage that may befall the goods from that point onwards. This
is the full import of Article 1736, as applied to the case.
The actions of appellant carrier and of its representative in the
Philippines being in full faith with the lawful stipulations of Bill of Lading No.
18 and in conformity with the provisions of the New Civil Code on common
carriers, agency and contracts, they incur no liability for the loss of the goods
in question.
Appealed decision is REVERSED. Plaintiff-appellee's complaint is
DISMISSED.
Facts: In G.R. No. 69044, sometime in or prior to June, 1977, the M/S
ASIATICA, a vessel operated by petitioner loaded at Kobe, Japan for
transportation to Manila, 5,000 pieces of calorized lance pipes consigned to
Philippine Blooming Mills Co., Inc., and 7 cases of spare parts valued
consigned to Central Textile Mills, Inc. Both sets of goods were insured
against marine risk for with respondent.
In G.R. No. 71478, during the same period, the same vessel took on
board 128 cartons of garment fabrics and accessories consigned to Mariveles
Apparel Corporation, and two cases of surveying instruments consigned to
Aman Enterprises and General Merchandise. The 128 cartons were insured
for their stated value by respondent Nisshin and the 2 cases by respondent
Dowa.
Enroute for Kobe, Japan, to Manila, the vessel caught fire and sank,
resulting in the total loss of ship and cargo. The respective respondent
Insurers paid the corresponding marine insurance values to the consignees
concerned and were thus subrogated unto the rights of the latter as the
insured.
Respondents filed a claim for reimbursement from petitioner. The RTC
ruled in their favor to which the petitioner appealed.
Issue: (1) Which law should govern the Civil Code provisions on Common
carriers or the Carriage of Goods by Sea Act? and (2) who has the burden of
proof to show negligence of the carrier?
Held: (1) The law of the country to which the goods are to be transported
governs the liability of the common carrier in case of their loss, destruction or
deterioration. As the cargoes in question were transported from Japan to the
Philippines, the liability of Petitioner Carrier is governed primarily by the Civil
Code. However, in all matters not regulated by said Code, the rights and
obligations of common carrier shall be governed by the Code of Commerce
and by special laws. Thus, the Carriage of Goods by Sea Act, a special law, is
suppletory to the provisions of the Civil Code.
(2) Under the Civil Code, common carriers, from the nature of their
business and for reasons of public policy, are bound to observe extraordinary
diligence in the vigilance over goods, according to all the circumstances of
each case. Common carriers are responsible for the loss, destruction, or
deterioration of the goods unless the same is due to any of the following
causes only:
(1) Flood, storm, earthquake, lightning or other natural disaster or calamity;
Petitioner Carrier claims that the loss of the vessel by fire exempts it
from liability under the phrase "natural disaster or calamity.” However, the
Court said that fire may not be considered a natural disaster or calamity. This
must be so as it arises almost invariably from some act of man or by human
means. It does not fall within the category of an act of God unless caused by
lightning or by other natural disaster or calamity. It may even be caused by
the actual fault or privity of the carrier.
As the peril of the fire is not comprehended within the exception in
Article 1734, supra, Article 1735 of the Civil Code provides that all cases than
those mention in Article 1734, the common carrier shall be presumed to have
been at fault or to have acted negligently, unless it proves that it has
observed the extraordinary diligence required by law.
In this case, the respective Insurers. as subrogees of the cargo
shippers, have proven that the transported goods have been lost. Petitioner
Carrier has also proved that the loss was caused by fire. The burden then is
upon Petitioner Carrier to proved that it has exercised the extraordinary
diligence required by law, which it failed to do.
And even if fire were to be considered a "natural disaster" within the
meaning of Article 1734 of the Civil Code, it is required under Article 1739 of
the same Code that the "natural disaster" must have been the "proximate
and only cause of the loss," and that the carrier has "exercised due diligence
to prevent or minimize the loss before, during or after the occurrence of the
disaster.” This Petitioner Carrier has also failed to establish satisfactorily.
Nor may Petitioner Carrier seek refuge from liability under the Carriage
of Goods by Sea Act, It is provided therein that:
Sec. 4(2). Neither the carrier nor the ship shall be responsible for loss
or damage arising or resulting from
(b) Fire, unless caused by the actual fault or privity of the carrier.
Both the Trial Court and the Appellate Court, in effect, found, as a fact,
that there was "actual fault" of the carrier shown by "lack of diligence" in that
when the smoke was noticed, the fire was already big; that the fire must
have started 24 hours before the same was noticed; and that after the
cargoes were stored in the hatches, no regular inspection was made as to
their condition during the voyage. The foregoing suffices to show that the
circumstances under which the fire originated and spread are such as to
show that Petitioner Carrier or its servants were negligent in connection
therewith. Consequently, the complete defense afforded by the COGSA when
loss results from fire is unavailing to Petitioner Carrier.
Issue: Which law shall govern loss or destruction of goods due to collision of
vessels outside Philippine waters, and the extent of liability?
Held: This issue has already been laid to rest by this Court of Eastern
Shipping Lines Inc. v. IAC (150 SCRA 469-470 [1987])
In the case at bar, it has been established that the goods in question
are transported from San Francisco, California and Tokyo, Japan to the
Philippines and that they were lost or due to a collision which was found to
have been caused by the negligence or fault of both captains of the colliding
vessels. Under the above ruling, it is evident that the laws of the Philippines
will apply, and it is immaterial that the collision actually occurred in foreign
waters, such as Ise Bay, Japan.
It appears, however, that collision falls among matters not specifically
regulated by the Civil Code, so that no reversible error can be found in
respondent courses application to the case at bar of Articles 826 to 839, Book
Three of the Code of Commerce, which deal exclusively with collision of
vessels.
More specifically, Article 826 of the Code of Commerce provides that
where collision is imputable to the personnel of a vessel, the owner of the
vessel at fault, shall indemnify the losses and damages incurred after an
expert appraisal. But more in point to the instant case is Article 827 of the
same Code, which provides that if the collision is imputable to both vessels,
each one shall suffer its own damages and both shall be solidarily responsible
for the losses and damages suffered by their cargoes.
Significantly, under the provisions of the Code of Commerce,
particularly Articles 826 to 839, the shipowner or carrier, is not exempt from
liability for damages arising from collision due to the fault or negligence of
the captain. Primary liability is imposed on the shipowner or carrier in
recognition of the universally accepted doctrine that the shipmaster or
captain is merely the representative of the owner who has the actual or
constructive control over the conduct of the voyage.
The agreement between NDC and MCP shows that MCP is appointed as
agent, a term broad enough to include the concept of ship agent in maritime
law. In fact MCP was even conferred all the powers of the owner of the
vessel, including the power to contract in the name of the NDC. Both owner
and agent should be declared jointly and severally liable since the obligation
which is the subject of the action had its origin in a fortuitous act and did not
arise from contract.
CA decision is affirmed.
Issue: Whether or not Gelisan should be held solidarily liable with Espiritu,
being the registered owner of the truck.
Held: Yes, Gelisan should be held solidarily liable with Espiritu, being the
registered owner of the truck.
The Court has invariably held in several decisions that the registered
owner of a public service vehicle is responsible for damages that may arise
from consequences incident to its operation or that may be caused to any of
the passengers therein. The claim of the petitioner that he is not liable in
view of the lease contract executed by and between him and Roberto Espiritu
which exempts him from liability to third persons, cannot be sustained
because it appears that the lease contract, adverted to, had not been
approved by the Public service Commission. It is settled in our jurisprudence
that if the property covered by a franchise is transferred or leased to another
without obtaining the requisite approval, the transfer is not binding upon the
public or third persons. However, Gelisan is not without recourse because he
has a right to be indemnified by Roberto Espiritu for the amount that he may
be required to pay as damages for the injury caused to Benito Alday, since
the lease contract in question, although not effective against the public for
not having been approved by the Public Service Commission, is valid and
binding between the contracting parties.
The Court ruled that the petitioner is DENIED. With costs against the
petitioner.
Held: Yes, Benedicto is liable for the undelivered or lost sawn lumber as
registered owner. There is no dispute that petitioner Benedicto has been
holding herself out to the public as engaged in the business of hauling or
transporting goods for hire or compensation. Petitioner Benedicto is, in brief,
a common carrier.
The prevailing doctrine on common carrier makes the registered owner
liable for consequences flowing from the operations of the carrier, even
though the specific vehicle involved may already have been transferred to
another person. This doctrine rests upon the principle that in dealing with
vehicles registered under the Public Service Law, the public has the right to
assume that the registered owner is the actual or lawful owner thereof. It
would be very difficult and often impossible as a practical matter, for
members of the general public to enforce the rights of action that they may
have for injuries inflicted by the vehicles being negligently operated if they
should be required to prove who the actual owner is. The registered owner is
not allowed to deny liability by proving the identity of the alleged transferee.
In the case at bar, private respondent is not required to go beyond the
vehicle’s certificate of registration to ascertain the owner of the carrier. In
this regard, the letter presented by petitioner allegedly written by Benjamin
Tee admitting that Licuden was his driver, had no evidentiary value not only
because Benjamin Tee was not presented in court to testify on this matter
but because of the afore mentioned doctrine. To permit the ostensible or
registered owner to prove who the actual owner is, would be to set at naught
the purpose or public policy which infuses that doctrine.
The Court ruled that the Petition fro Review is Denied.
Facts: The victim Ramon Acuesta was riding in his easy rider bicycle along
Calbayog City. Also in Calbayog City, defendant Philtranco driven by
defendant Rogasiones Dolina Manilhig was being pushed by some persons in
order to start its engine. As the bus was pushed, its engine started thereby
the bus continued its running motion and it occurred at the time when Ramon
A. Acuesta who was still riding on his bicycle was directly in front of the said
bus. As the engine of Philtranco started abruptly and suddenly, its running
motion was also enhanced by the said functioning engine, thereby bumped
on the victim Ramon. As a result, fell and was ran over by the bus.
Still, the bus did not stop although it had already bumped and ran over
the victim; instead, it proceeded running. Thereafter, P/sgt. Yabao who was
then jogging approached the bus driver defendant Manilhig and signaled him
to stop, but the latter did not listen. So, the police officer introduced himself
and ordered the latter to stop. The said defendant drivers stopped the
Philtranco bus.
The trial court rendered a decision ordering the petitioners to jointly
and severally pay the private respondent. On appeal, the CA affirmed the
decision of the trial court.
Facts: Prior to April 26, 1963, Vidad was duly authorized passenger jeepney
operator. Also, prior to said date, petitioner Santos was the owner of a
passenger jeep, but he had no certificate of public convenience for the
operation of the vehicle as a public passenger jeep. Santos then transferred
his jeep to the name of Vidad so that it could be operated under the latter’s
certificate of public convenience. Thus, Santos became what is known as a
kabit operator. For the protection of Santos, Vidad executed a re-transfer
document to the former, which was to be a private document presumably to
be registered if and when it was decided that the passenger jeep of Santos
was to be withdrawn from the kabit agreement.
On April 26, 1963, private respondent Sibug was bumped by a
passenger jeepney operated by vidad and driven by Severo Gragas. Thus,
filed a complaint for damages. Judgment was rendered in favor of Sibug.
On April 10, 1964, the Sheriff of Manila levied on a motor vehicle,
registered in the name of Vidad, and scheduled the public auction sale. The
next day, Santos presented a third-party claim with the Sheriff, as a result,
Santos, instituted an Action for Damages and Injunction with a prayer for
Preliminary Mandatory Injunction. On October 14, 1965, branch X affirmed
Santos’ ownership of the jeepney in question.
Sibug sought relief from respondent Appellate Court. Respondent Court
held that Santos may not be permitted to prove his ownership over a
particular vehicle being levied upon but registered in another’s name in a
separate action.
Held: Yes, the jeepney under the “kabit system” which bumped Sibu can be
sold at public auction to satisfy the court’s award.
Sec. 20 (g) of the Public Service Act provides: “it shall be unlawful for
any public service or for the owner, lessee or operator thereof, without the
approval or authorization of the Commission previously had- (g) to sell,
alienate, mortgage, encumber or lease its property, franchise certificates,
privileges, or rights, or any part thereof.
In the case at bar, Santos had fictitiously sold the jeepney to Vidad,
who had become the registered owner and operator of record at the time of
the accident. It is true that Vidad had executed a re-sale to Santos, but the
document was not registered. Although Santos, as the kabit, was the true
owner as against Vidad, the latter, as the registered owner/ operator and
grantee of the franchise, is directly and primarily responsible and liable for
damages caused to Sibug, the injured party, as a consequence of the
negligent or careless operation of the vehicle. This ruling is based on the
principle that the operator of record is considered the operator of the vehicle
in contemplation of law as regards the public and third persons even if the
vehicle involved in the accident had been sold to another where such sale
had not been approved by the then Public Service commission.
The court ruled that the petition for review filed by Santos is dismissed.
Facts: Sometime in 1966, the spouses Nicasio Ocampo and Francisca Garcia,
herein private respondent purchased in installment from the Delta Motor
Sales Corp. five Toyota Corona Standard cars to be used as taxicabs. Since
they had no franchise to operate taxicabs, they contracted with petitioner, for
the use of the latter’s certificate of public convenience in consideration of an
initial payment of P1,000 and a monthly rental of P200 per taxi cab unit.
About a year later, one of said taxicabs driven by their employee,
Emeterio Martin, collided with a motorcycle whose driver, Florante Galvez,
died from the head injuries sustained. A criminal case was filed against the
driver while a civil case was filed against Lita enterprises seeking for
damages. In the CFI of Manila, petitioner Lita Enterprises was adjudged liable
for damages as the registered owner of the taxicab. Thus, a writ of execution
was issued and one of the vehicles of respondent spouses was levied upon
and sold at public auction.
Thereafter, respondent Nicasio Ocampo decided to register his taxicab
in his name, but Lita Enterprises allegedly refused. Hence, the spouses filed a
complaint. The CFI of Manila ordered Lita Enterprises to transfer the
registration certificate. On Appeal, the IAC modified the decision.
Held: Yes, the parties entered into a “kabit system”. The parties herein
operated under an arrangement, commonly known as the “kabit system”,
whereby a person who has been granted a certificate of convenience allows
another person who owns motor vehicles to operate under such franchise for
a fee. A certificate of public convenience is a special privilege conferred by
the government. Abuse of this privilege by the grantees thereof cannot be
countenanced. The kabit system has been identified as one of the root
causes of the prevalence of graft and corruption in the government
transportation services. Thus, the concept of Kabit system being contrary to
public policy and void and existent, the court cannot allow either of the
parties to enforce an illegal contract bu leaves them both where it finds
them.
The Court ruled that the decisions rendered by the CFI of Manila and
IAC are hereby annulled and set aside.
Facts: On May 9, 1975, the defendant bought from the plaintiff a motorcycle
with complete accessories and a sidecar in the total consideration of
P8,000.00. Out of the total purchase price the defendant gave a down
payment of P1,700.00 with a promise that he would pay plaintiff the balance
within sixty days. The defendant, however, failed to comply with his promise
and so upon his own request, the period of paying the balance was extended
to one year in monthly installments until January 1976 when he stopped
paying anymore. The plaintiff made demands but just the same the
defendant failed to comply thus forcing plaintiff to consult a lawyer and file
this action for his damage.
It also appears and the court so finds that the defendant purchased the
motorcycle in question and the Court so finds that defendant purchased the
motorcycle in question, particularly for the purpose of engaging and using
the same in transportation business and for this purpose said trimobile unit
was attached to the plaintiff’s transportation line who had the franchise, so
much so that in the registration certificate, the plaintiff appears to be the
owner of the unit. Furthermore, it appears to have been agreed further
between, the plaintiff and the defendant, that plaintiff would undertake the
yearly registration of the unit in question with the LTC. Thus, for the
registration of the unit for the year 1976, per agreement, the defendant gave
to the plaintiff the amount of P82.00 of rits registration, as well as the
insurance coverage of the unit.
Petitioner Teja Marketing and/or Angel Jaucian filed an action for the
“sum of money with damages”. The city court rendered judgment in favor of
petitioner. On appeal, the decision was affirmed in toto.
Held: Yes, the parties operated under an agreement called “kabit system”.
This is a system whereby a person who has been granted a certificate of
public convenience allows another person who owns motor vehicles to
operate under such franchise for a fee. A certificate of public convenience is a
special privilege conferred by the government. Although not outrightly
penalized as a criminal offense, the kabit system is invariably recognized as
being contrary to public policy and therefore, void and inexistent under
Article 1404 of the Civil Code. Thus, court will not aid either party to enforce
an illegal contract, but will leave both where it finds them.
The court ruled that the petition is hereby dismissed for lack of merit.
The assailed decision of the IAC now the CA is AFFIRMED.
MAGBOO vs. BERNARDO
Facts: The spouses Magboo are the parents of the 8-year old child killed in a
motor vehicle accident, the vehicle owned by the defendant Bernardo. At the
time of the accident, said passenger jeepney was driven by Corado Roque.
The contract between Conrado Roque and defendant Delfin Bernardo was
that Roque was to pay to defendant the sum of P8.00, which he paid to said
defendant, for privilege of driving the jeepney, it being their agreement that
whatever earnings Roque could make out of the use of the jeepney in
transporting passengers from one point to another would belong entirely to
Conrado Roque.
As a result of the accident, Conrado Roque was prosecuted for
homicide thru reckless imprudence before the CFI of Manila, and that upon
arraignment, Conrado Roque pleaded guilty to the information and was
sentenced to a jail term, to indemnify the heirs of the deceased in the sum of
P3, 000.00 with subsidiary imprisonment in case of insolvency. Conrado
Roque served his sentence but he was not able to pay the indemnity because
he was insolvent.
GANZON vs. CA
Issue: Whether or not rains and rough is considered as caso fortuito which
would exempt petitioner from liability for the deterioration of the cargo.
Held: No, such is not considered caso fortuito which would exempt from
liability for the deterioration of the cargo. Art. 1737 of the Civil Code provides
that, “common carrier are bound to observe extraordinary vigilance over
goods according to all circumstances of each case.” Further Article 1735 of
the Civil Code provides that, “if the goods are lost, destroyed, or
deteriorated, common carriers are presumed to have been at fault or to have
acted negligently, unless they prove that they observed extraordinary
diligence as required in Article 1733.”
In the case at bar, heavy rains and rough seas were not caso fortuito,
but normal occurrences that an ocean- going vessel, particularly in the month
of September, is a month of rains and heavy seas would encounter as a
matter of routine. They are not unforeseen nor unforeseeable. These are
conditions that ocean- going vessels would encounter and provide for, in the
ordinary course of voyage. That rain water (not sea water) found its way into
the holds of the Jupri Venture is a clear indication that care and foresight did
not attend the closing of ships hatches so that rain water would not find its
way into the cargo holds of the ship. Since, the carrier has failed to establish
any caso fortuito, the presumption by law of fault or negligence on the part of
the carrier applies.
The Court ruled that the petition is DISMISSED.
Held: The petitioner is liable for the lost baggage’s. Under the Civil Code,
“common carriers from the nature of their business and for reasons of public
policy are bound to observe extraordinary diligence and vigilance over goods
transported by the,” and this liability “last from the time the goods are
unconditionally placed in the possession of, and received by the carrier for
transportation until the same are delivered, actually or constructively, by the
carrier to the person who has a right to receive them, “unless the loss is due
to any of the excepted causes under Article 1734 thereof.
In the case at bar, the cause of the loss 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 the baggage was
lost to the prejudice of the paying passengers. Thus, petitioner is held liable.
The Court affirmed the decision of the Court of Appeals with
modification.
Facts: Spouses Tito and Leny Tumboy and their minor children boarded
a Yobido Liner bus at Surigaodel Sur. along Picop Road, Agusan del Sur, the
left front tire of the bus exploded. The bus fell into a ravine around the three
feet from the road and struck a tree. The incident resulted in the death if Tito
Tumboy and physical injuries to other passengers.
Leny filed a case of breach of contract of carriage against petitioners.
The owners of Yobido Liner Bus.
Alberto and Cresencio Yobido raised the affirmative defense of caso
fortuito. They claimed that the bus was not full as there were only 32
passengers out of the 42 seating capacity. They also claimed that the bus
was running as speed pr “60 to 50” and that the tire was brand-new.
Respondents on the other hand, asserted the violation of the contract of
carriage was brought about by the driver’s failure to exercise the diligence
required of the carrier. Leny claimed that the was running fast in a winding
road which was not cemented and was wet because of the rain.
Issue: Whether or not the tire blow out is considered a fortuitous event
which would exempt petitioners from liability.
Held: The tire blow out is not considered as a fortuitous event which would
exempt petitioners from liability.
Article 1756 of the Civil Code provides that, “in case of death or
injuries to passengers, common carriers are presumed to have been at fault
or to have acted negligently unless they prove that they observed
extraordinary diligence as prescribed in Articles 1733 and 1755.” Further,
Article 1755 provides that “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 due regard for all
circumstances..”
In the case at bar, the explosion of the new tire may not be considered
a fortuitous event. There are human factors involved in the situation. The fact
that the tire was new did not imply that it was entirely free from
manufacturing defects or that it was properly mounted on the vehicle.
Neither may the fact that the tire bought and used in the vehicle is of a brand
name noted for quality, resulting in the conclusion that it could not explode
within five days use. Be that as it may, it is settled that an accident caused
either by defects in the automobile or through the negligence of its driver is
not a case fortuity that would exempt the carrier from liability for damages.
Moreover, a common carrier may not be absolved from liability in case of
force majeure or fortuitous event alone. The common carrier must still prove
that it was not negligent in causing the death or injury resulting from an
accident. Thus, having failed to discharge its duty to overthrow the
presumption of negligence with clear and convincing evidence, petitioners
are hereby held liable for damages.
The Court ruled that the Decision of the Court of Appeals is hereby
affirmed.
COMPANIA MARITIMA vs. INSURANCE CO. OF NORTH AMERICA
LU DO vs. BINAMIRA
Facts: Delta Company of New York shipped six cases of films and
photographic supplies to Binamira. The ship arrived in Cebu and discharged
her cargo, placing it in the custody of the arrastre operator appointed by the
Bureau of Customs. The cargo was checked both by the stevedoring company
and the arrastre operator and was found in good order. On the contract of
carriage, however, it was stipulated that the carrier in no longer liable for the
cargo upon its delivery to the hands of the customs authorities. The cargo
was later delivered to Binamira and a marine surveyor found that some were
missing valued at P324.63. Lower Court held that the carrier liable.
Issue: Whether or not the stipulations limiting the liability of the carrier
is valid.
Held: While delivery of the cargo to the customs authorities is not delivery to
the consignee of the person who has the right to receive them as
contemplated in Article 1736 of the Civil Code because in such case the
goods are still in the hands of the government and the owner cannot be
exercise dominion over them, however, the parties may agree to limit the
liability of the carrier considering that the goods have still to go through the
inspection of the customs authorities before they are actully turned over to
the consignee.
These stipulations limiting liability is not contrary to morals or public
policy. This is a situation where the carrier loses control of the goods because
of a custom regulation and it is unfair that it be made responsible for any loss
or damage that may be caused to the goods during the interregnum.
Judgment reversed.
Held: The Civil Code. With regard to the contention of the carrier that
COGSA should control in this case, the same is of no moment. Art. 1763 of
the New Civil Code provides that “the laws of the country to which the goods
are transported shall govern the liability of the common carrier in case of
loss, destruction and deterioration.” This means that the law of the
Philippines on the New Civil Code. Under 1766 of NCC, “in all matter not
regulated by this Code, the rights and obligations of common carriers shall be
governed by the Code of Commerce and by Special Laws.” Art. 1736-1738,
NCC governs said rights and obligations. Therefore, although Sec 4(5) of
COGSA states that the carrier shall not be liable in an amount exceeding
$500 per package unless the value of the goods had been declared by the
shipper and asserted in the bill of lading, said section is merely
supplementary to the provisions of the New Civil Code.
Issue: Whether or not the stipulations in the bill of lading limiting the
liability of carrier is valid.
Held: The court a quo held that the delivery of the shipment on question to
the warehouse of the Bureau of Customs is not the delivery contemplated by
Article 1736; and since the burning of the warehouse occurred before actual
or constructive delivery of the goods to the appellees, the loss is chargeable
against the appellant.
However, that in the bills of lading issued for the cargoes in question,
parties agreed to limit the responsibility of the carrier for the loss or damage
that may be caused to the shipment by inserting therein the following
stipulation.
“Clause 14. Carrier shall not be responsible for loss or damage to
shipments billed “owner’s risk” unless such damage is due to negligence of
carrier. Nor shall carrier be responsible for loss or damage cause by force
majeure, dangers or accidents of the sea or other waters; war; public
enemies, xxx fire xxx.”
We sustain the validity of the above stipulation; there is nothing
therein that is contrary to law, morals or public policy. Appellees would
contend that the above stipulation does not bind them because it was printed
in fine letters on the back of the bills of lading; and that they did not sign the
same. This argument overlooks the pronouncement of this Court in Ong Yiu
vs. Court of Appeals.
“While it may be true that petitioner had not signed the plane ticket,
he is nevertheless bound by the provisions thereof. Such provisions have
been held to be part of the contract of carriage and valid and binding upon
the passenger regardless of the latter’s lack of knowledge or assent to the
regulation.”
There is nothing in the record to show that appellant carrier in delay in
the performance of its obligation nor that was the cause of the fire that broke
out in the Custom’s warehouse in anyway attributable to the negligence of
the appellant or its employees.
Held: Petitioner Ganzon insists that the scrap iron had not been
unconditionally placed under his custody and control to make him liable.
However, he completely agrees with the respondent Court’s finding that on
December 1, 1956, the private respondent delivered the scraps to Captain
Niza for loading in the lighter “Batman.” That the petitioner, thru his
employees, actually received the scraps is freely admitted.
By the said act of delivery, the scraps were unconditionally placed in
the possession and control of the common carrier and upon their receipt by
the carrier for transportation, the contract of carriage was deemed perfected.
Consequently, the petitioner-carrier’s extraordinay responsibility for the loss,
destruction, or deterioration of the goods commenced.
Pursuant to Art. 1738, such extraordinary responsibility would cease
only upon the delivery, actual or constructive, by the carrier to the consignee,
or to the person who has a right to receive them. The fact that part of the
shipment had not been loaded on board the lighter did not impair the said
contract of transportation as the goods remained in the custody and control
of the carrier, albeit unloaded.
Held: The records reveal that petitioners, particularly Maria and Saturnino
Saludo, agonised 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. They
were entitled to the understanding and humane consideration called of by
and commensurate with the extraordinary diligence required for common
carriers, and not the cold insensitivity to their predicament. Common sense
could and should have dictated that they exert a little effort in making a more
extensive inquiry by themselves or through their superiors, rather than just
shrug off the problem with a callous and uncaring remark that they had no
knowledge about it. With all the modern communications equipment readily
available to them, it could have easily facilitated said inquiry. TWA’s
apathetic stance while not legally reprehensible is morally deplorable.
Losing a loved one, especially one’s parent, is a painful experience.
Our culture accords utmost tenderness human feelings toward and in
reverence to the dead. That the remains of the deceased were subsequently
delivered, albeit, belatedly and eventually laid in her final resting place is of
little consolation. The imperviousness displayed by TWA’s personnel, even for
just that fraction of time, was especially condemnable particularly in the
hours of bereavement of the family of Crispina Saludo, intensified by anguish
due to the uncertainty of the whereabouts of their mother’s remains. TWA’s
personnel were remiss in the observance of that genuine human concern and
professional attentiveness required and expected of them.
The foregoing observations, however, do not appear to be applicable to
respondent PAL. No attribution of discourtesy or indifference has been made
against PAL by petitioners and, in fact, petitioner Maria Saludo testified that it
was to PAL they repaired after failing to receive proper attention from TWA. It
was from PAL that they received confirmation that their mother’s remains
would be on the same flight with them.
Petitioner’s right to be treated with due courtesy in accordance with
the degree of diligence required by law to be exercised by every common
carrier was violated by the TWA and this entitles them, atleast to nominal
damages from TWA alone. Articles 2221 and 2222 of the Civil Code make it
clear that nominal damages are not intended for indemnification of loss
suffered but for the vindication or recognition of a right violated or invaded.
They are recoverable where some injury has been done but the amount of
which the evidence fails to show, the assessment of damages being left to
the discretion of the court according to the circumstances of the case.
Facts: Petitioner Benito Macam shipped on board the vessel Nen Jiang,
through local agent respondent Wallem Philippines Shipping, Inc.
watermelons valued at US$5,950.00 and fresh mangoes valued at
US$14,273.46. The shipment was bound for Hongkong with Pakistan Bank as
consignee and Great Prospect Company of Kowloon, Hongkong as notify
party. Petitioner’s depository bank. Consolidated Banking
Corporation(SOLIDBANK) paid petitioner in advance the total value of the
shipment of US$20,223.46.
Upon arrival in Hongkong, the shipment was delivered by respondent
WALLEM directly to GPC, not to Pakistan Bank, and without the required bill of
lading having been surrendered. Subsequently, GPC failed to pay Pakistan
Bank such that the latter, still in possession of the original bills of lading,
refused to pay petitioner through SOLIDBANK. Since SOLIDBANK already pre-
paid petitioner the value of the shipment, it demanded payment from
respondent WALLEM but was refused. Petitioner returned the amount
involved to SOLIDBANK, and then demanded payment from respondent
WALLEM in writing but to no avail.
Hence petitioner sought collection of the value of the shipment if
US$20,223.46 from respondents before the RTC of Manila, bases on delivery
of the shipment to GPC without presentation of the bills of lading and bank
guarantee.
Held: Under Art. 1736 of the Civil Code, the extraordinary responsibility of
the common carrier lasts until actual or constructive delivery of the cargoes
to the consignee or to the person who has a right to receive them. PAKISTAN
BANK was indicated in the bills of lading as consignee whereas GPC was
notifying party. However, in the export invoices GPC was clearly named as
buyer/importer. Petitioner also referred to GPC as such in his demand letter
to respondent WALLEM and in his complaint before the trial court. This
premise draws us to conclude that the delivery of the cargoes to GPC as
buyer/importer which, conformably with Art. 1736 had, other than the
consignee, the right to receive them was proper.
The real issue is whether respondents are liable to petitioner for
releasing the goods to GPC without the bills of lading or bank guarantee.
From the testimony of petitioner, we gather that he has been
transacting with GPC as buyer/importer for around 2 to 3 years already. When
mangoes and watermelons are in season, his shipment to GPC using the
facilities of respondents is twice or thrice a week. The goods are released to
GPC. It has been the practice of petitioner to request the shipping lines to
immediately release perishable cargoes such as watermelons and fresh
mangoes through telephone calls by himself or his “people.” In transactions
covered by a letter of credit, bank guarantee is normally required by the
shipping lines prior to releasing the goods. But for buyers using telegraphic
transfers, petitioner dispenses with the bank guarantee because the goods
are already fully paid. In his several years of business relationship with GPC
and respondents, there was not a single instance when the bill of lading was
first presented before the release of the cargoes.
Held: Yes. While it is true that common carriers are not obligated by law to
carry and to deliver merchandise, and persons are not vested with the right
to prompt delivery, unless such common carriers previously assume the
obligation to deliver at a given date or time, delivery of shipment or cargo
should at least be made within a reasonable time. An examination of the
subject bill of lading shows that the subject shipment was estimated to arrive
in Manila on April 3, 1977. While there was no special contract entered into
by the parties indicating the date of arrival of the subject shipment, petitioner
nevertheless, was very well aware of the specific date when the goods were
expected to arrive as indicated in the bill of lading itself. In this regard, there
arises no need to execute another contract for the purpose as it would be a
mere superfluity. In the case before us, we find that a delay in the delivery of
the goods spanning a period of two months and seven days falls was beyond
the realm of reasonableness.
With respect to the ruling that contracts of adhesion are void, SC said
that it was necessarily so and that it is a settled rule that bills of lading are
contracts not entirely prohibited.
Held: No, the stipulation is not valid. A common carrier cannot lawfully
stipulate for exemption from liability, unless such exemption is just
andreasonable and the contract is freely and fairly made.
A common carrier cannot lawfully stipulate for the exemption from liability,
unless such exemption is just and reasonable. The carrier cannot limit its
liability for injury to or loss of goods shipped if such was caused by its own
negligence.
Based upon the findings of fact of the trial court which are sustained
by the evidence, the plaintiff delivered to the defendants 164 cases of silk
consigned and to be delivered by the defendants to Salomon Sharuff in
Surigao. Four of such cases were never delivered to the consignee, and the
evidence shows that their value is the alleged in the complaint. Also, the
goods in question were shipped from Manila on October 25, 1922, to be
delivered to Salomon Sharuff in Surigao, Plaintiff's original complaint was
filed on April 17, 1923, or a little less than six months after the shipment was
made. The lower court also points out that the conditions in question "are not
printed on the triplicate copies which were delivered to the plaintiff," and that
by reason thereof they "are not binding upon the plaintiff." The clause in
question provides that the carrier shall not be liable for loss or damage from
any cause or for any reason to an amount in excess of P300 "for any single
package of silk or other valuable cargo."
The evidence shows that 164 "cases" were shipped, and that the value
of each case was very near P2,500. In this situation, the limit of defendants'
liability for each case of silk "for loss or damage from any cause or for any
reason" would put it in the power of the defendants to have taken the whole
cargo of 164 cases of silk at a valuation of P300 for each case, or less than
one-eight of its actual value. If that rule of law should be sustained, no silk
would ever be shipped from one island to another in the Philippines. Such a
limitation of value is unconscionable and void as against public policy. There
is no merit in the appeal. The judgment of the lower court is affirmed.
Held: No. The limited liability rule shall not apply. The requirements provided
in Article 1750 of the New Civil Code must be complied with before a
common carrier can claim a limitation of its pecuniary liability in case of loss,
destruction or deterioration of the goods it has undertaken to transport. In
the case before us We believe that the requirements of said article have not
been met. It can not be said that the appellee had actually entered into a
contract with the appellant, embodying the conditions as printed at the back
of the ticket. The fact that those conditions are printed at the 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.
Shewaram did not agree to the stipulation on the ticket, as manifested by the
fact that Shewaram did not sign the ticket.
Held: No. PAL did not act in bad faith. It was the duty of PAL to look for
petitioner’s luggage which had been miscarried. PAL exerted diligent efforts
to locate the plaintiff’s baggage. Petitioner is neither entitled to exemplary
damages. Exemplary damages can only be granted if the defendant asked in
a wanton, fraudulent, reckless, oppressive or malevolent manner, which loss,
in accordance with the stipulation written at the back of the ticket is limited
to P100 per luggage plaintiff not having declared a greater value and not
having called the attention of the defendant on its value ad paid the tariff
thereon.
While it may be true that petitioner had not signed the plane ticket, he is
nevertheless bound by the provisions thereof. "Such provisions have been
held to be a part of the contract of carriage, and valid and binding upon the
passenger regardless of the latter's lack of knowledge or assent to the
regulation". It is what is known as a contract of "adhesion", in regards which
it has been said that contracts of adhesion wherein one party imposes a
ready made form of contract on the other, as the plane ticket in the case at
bar, are contracts not entirely prohibited. The one who adheres to the
contract is in reality free to reject it entirely; if he adheres, he gives his
consent. A contract limiting liability upon an agreed valuation does not offend
against the policy of the law forbidding one from contracting against his own
negligence.
Held: Yes, the stipulation is valid. Basic is the rule that a stipulation limiting
the liability of the carrier to the value of the goods appearing in the bill of
lading, unless the shipper or owner declares a greater value, is binding.
Furthermore, 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 fairly and freely
agreed upon.
In this case, the award of P315,000 based on the alleged market value
of the goods is erroneous. It is provided in Clause 6 that its liability is limited
to US$2.00/kilo. The consignee also admits in the memorandum that the
value of the goods does not appear in the bill of lading. Hence, the stipulation
on the carrier’s limited liability applies.
The bill of lading shows that 120 cartons weight 2,978 kilos or
24.82kilos/carton. Since 90 cartons were lost and the weight of said cartons is
2,233.80, the carrier’s liability amounts only to US$4,467.60.
The judgment of CA is hereby modified.
Issue: Whether or not the petitioner is liable for the actual value and not the
maximum value recoverable under the bill of lading.
Held: No. A stipulation in the bill of lading limiting the liability of the
common carrier for the loss, damages of cargo to a certain sum, unless the
shipper declares or a higher value is sanctioned by law, particularly Articles
1749 and 1750 of the Civil Code. 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 bill of lading subject of the present controversy specifically
provides, among others:
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 damage to or in
any connection with, goods in an amount 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.
The above stipulations are, to our mind, 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.
To defeat the carrier's limited liability, the aforecited Clause 18 of the
bill of lading requires that the shipper should have declared in writing a
higher valuation of its goods before receipt thereof by the carrier and insert
the said declaration in the bill of lading, with extra freight paid. These
requirements in the bill of lading were never complied with by the shipper,
hence, the liability of the carrier under the limited liability clause stands. The
commercial Invoice does not in itself sufficiently and convincingly show that
petitioner has knowledge of the value of the cargo as contended by private
respondent.
Facts: Mahtani obtained the services of a certain Mr. Gemar to prepare his
travel plan to Bombay, India. Mr. Gemar purchased a ticket from British
Airways, however since it had no ticket flights from Manila to Bombay,
Mahtani had to take a connecting flight to Bombay. Prior to his departure,
Mahtani checked in the PAL counter in Manila his two pieces of luggage
containing his clothing and personal effects, confident that upon reaching
Hong Kong, the same would be transferred to the BA flight bound for
Bombay. Unfortunately, when Mahtani arrived in Bombay, he discovered that
his luggage was missing and that upon inquiry from the BA representatives,
he was told that the same might have been diverted to London. After
plaintiff waited for his luggage for one week, BA finally advised him to file a
claim. Mahtani filed his complaint for damages. BA filed a third-party
complaint against PAL alleging that the reason for the non-transfer of the
luggage was due to the latter's late arrival in Hongkong, thus leaving hardly
any time for the proper transfer of Mahtani's luggage to the BA aircraft bound
for Bombay. RTC rendered its decision in favor of Mahtani, which CA affirmed,
hence the instant petition. BA alleged that there should have been no
separate award for the luggage and the contents thereof since Mahtani failed
to declare a separate higher valuation for the luggage and therefore, its
liability is limited, at most, only to the amount stated in the ticket.
Facts: The plaintiff shipped Edmonton clocks from New York to Manila
on board a vessel of the defendant. The BOL has the following stipulations:
1. It is mutually agreed that the value of the goods receipted for above does
not exceed $500 per freight ton, or, in proportion for any part of a ton, unless
the value be expressly stated herein and ad valorem freight paid thereon.
9. Also, that in the event of claims for short delivery of, or damage to, cargo
being made, the carrier shall not be liable for more than the net invoice price
plus freight and insurance less all charges saved, and any loss or damage for
which the carrier may be liable shall be adjusted pro rata on the said basis.
The clocks were not delivered despite demands. Plaintiff claimed P420.00,
the market value of the clocks, while defendant tendered only P76.36, the
proportionate freight ton value. The trial court decided for the plaintiff for
P226.02, the invoice value plus freight and insurance. Both appealed. The
claim of the plaintiff is based upon the argument that the clause in the bill of
lading, limiting the liability of the carrier, are contrary to public order and,
therefore, null and void. The defendant, on the other hand, contends that
clause 1 is valid, and clause 9 should have not been applied by the lower
court.
Held: Yes. Three kinds of stipulations have often been made in a bill of
lading. The first is one exempting the carrier from any and all liability for loss
or damage occasioned by its own negligence. The second is one providing for
an unqualified limitation of such liability to an agreed valuation. And the third
is one limiting the liability of the carrier to an agreed valuation unless the
shipper declares a higher value and pays a higher rate of freight. According
to an almost uniform weight of authority, the first and second kinds of
stipulations are invalid as being contrary to public policy, but the third is valid
and enforceable.
A reading of clauses 1 and 9 of the bill of lading here in question,
however, clearly shows that the present case falls within the third stipulation,
to wit: That a clause in a bill of lading limiting the liability of the carrier to a
certain amount unless the shipper declares a higher value and pays a higher
rate of freight, is valid and enforceable. Thus, if a common carrier gives to a
shipper the choice of two rates, the lower of the conditioned upon his
agreeing to a stipulated valuation of his property in case of loss, even by the
carrier's negligence, if the shipper makes such a choice, understandingly and
freely, and names his valuation, he cannot thereafter recover more than the
value which he thus places upon his property. A limitation of liability based
upon an agreed value to obtain a lower rate does not conflict with any sound
principle of public policy; and it is not conformable to plain principles of
justice that a shipper may understate value in order to reduce the rate and
then recover a larger value in case of loss.
Facts: Norberto Quisumbing Sr. and Gunther Leoffler were among the
passengers of PAL’s plane from Mactan City Cebu to Manila. There was an
exchange of gunshot between a Senior NBI agent Villarin and the four armed
hijackers one of which was “Zaldy” who is a suspect in the killing of Judge
Valdez. Zaldy then announced to the passengers and the pilots that it was a
hijacked and ordered the pilot not to send any SOS. The robbers divested the
passengers of their belongings including Quisumbing who was divested with
his jewelries and cash amounting to P18,650.00 and Leoffler with his watch,
wallet and cash amounting to P1,700. Quisumbing suffered a shock for a gun
had been pointed at him by one of the hold uppers. The four hijackers
succeeded in their escape upon arrival at Manila.
Contending that the "aforesaid loss is a result of breach of PAL's
contractual obligation to carry them and their belongings and effects to their
Manila destination without loss or damage, and constitutes a serious
dereliction of PAL's legal duty to exercise extraordinary diligence in the
vigilance over the same, Quisumbing and Loeffler brought suit against PAL to
recover the value of the property lost by them to the robbers as well as moral
and exemplary damages.The CFI dismissed the complaint and the CA
affirmed the CFI’s decision. Hence the instant petition. The plaintiffs declared
that their suit was instituted "... pursuant to Civil Code articles 1754, 998,
2000 and 2001 and on the ground that in relation to said Civil Code article
2001 the complained-of act of the armed robbers is not a force majeure, as
the 'use of arms' or 'irresistible force' was not taken advantage of by said
armed robbers in gaining entrance to defendant's ill-fated plane in questions.
And, with respect to said Civil Code article 1998, it is not essential that the
lost effects and belongings of plaintiffs were actually delivered to defendant's
plane personnel or that the latter were notified thereof.
Held: 1) Yes. The Court ruled that under the facts, "the highjacking-robbery
was force majeure," observing that: hijackers do not board an airplane
through a blatant display of firepower and violent fury. Firearms, hand-
grenades, dynamite, and explosives are introduced into the airplane
surreptitiously and with the utmost cunning and stealth, although there is an
occasional use of innocent hostages who will be coldly murdered unless a
plane is given to the hijackers' complete disposal.
2) No, PAL was not negligent so as to overcome the force majeure nature of
the hi-jacking. Hijackers do not board an airplane through a blatant display of
firepower and violent fury. Firearms and grenades are brought to the plane
surreptitiously. PAL could not have been faulted for want of diligence,
particularly for failing to take positive measures to implement Civil
Aeronautics Administration regulations prohibiting civilians from carrying
firearms on board the plane. The use of the most sophisticated electronic
detection devices may have minimized hijacking but still ineffective against
truly determining hijackers.
The petition is denied and appealed decision of CA is affirmed.
Facts: Private respondent held Passenger Ticket and Baggage Claim Check
for petitioner's Flight with the route from Guam to Manila. While standing in
line to board the flight at the Guam airport, Rapadas was ordered by
petitioner's handcarry control agent to check-in his Samsonite attache case.
Rapadas protested pointing to the fact that other co-passengers were
permitted to handcarry bulkier baggages. He stepped out of the line only to
go back again at the end of it to try if he can get through without having to
register his attache case. However, the same man in charge of handcarry
control did not fail to notice him and ordered him again to register his
baggage. For fear that he would miss the plane if he insisted and argued on
personally taking the valise with him, he acceded to checking it in. He then
gave his attache case to his brother who happened to be around and who
checked it in for him, but without declaring its contents or the value of its
contents. Upon arriving in Manila Rapadas claimed and was given all his
checked-in baggages except the attache case. He sent his son, Jorge Rapadas
to request for the search of the missing luggage. The petitioner exerted
efforts to locate the luggage through the Pan American World Airways-Manila
International Airport (PAN AM-MIA) Baggage Service. Rapadas received a
letter from the petitioner's counsel offering to settle the claim for the sum of
$160.00 representing the petitioner's alleged limit of liability for loss or
damage to a passenger's personal property under the contract of carriage
between Rapadas and PAN AM. Refusing to accept this kind of settlement,
Rapadas filed the instant action for damages. The lower court ruled in favor
of Rapadas after finding no stipulation giving notice to the baggage liability
limitation. On appeal, the Court of Appeals affirmed the trial court decision.
Hence, this petition.
B. Safety of Passengers
Facts: A passenger boarded the respondents bus carrying a box which such
person attested to the conductor as containing clothes and miscellaneous
items.
Appellee, who was a passenger in appellant's Bus No. 120 then making a trip
within the barrio of Dita, Municipality of Bay, Laguna, was injured as a
consequence of the explosion of firecrackers, contained in the box brought by
the co-passenger.
MECENAS vs. CA
Held: Yes, the behaviour of the captain of the "Don Juan" in tills instance-
playing mahjong "before and up to the time of collision constitutes behaviour
that is simply unacceptable on the part of the master of a vessel to whose
hands the lives and welfare of at least seven hundred fifty (750) passengers
had been entrusted. Whether or not Capt. Santisteban was "off-duty" or "on-
duty" at or around the time of actual collision is quite immaterial; there is,
both realistically speaking and in contemplation of law, no such thing as "off-
duty" hours for the master of a vessel at sea that is a common carrier upon
whom the law imposes the duty of extraordinary diligence.
The record shows that the "Don Juan" sank within ten (10) to fifteen (15)
minutes after initial contact with the "Tacloban City. While the failure of Capt.
Santisteban to supervise his officers and crew in the process of abandoning
the ship and his failure to avail of measures to prevent the too rapid sinking
of his vessel after collision, did not cause the collision by themselves, such
failures doubtless contributed materially to the consequent loss of life and,
moreover, were indicative of the kind and level of diligence exercised by
Capt. Santisteban in respect of his vessel and his officers and men prior to
actual contact between the two (2) vessels. The officer-on-watch in the "Don
Juan" admitted that he had failed to inform Capt. Santisteban not only of the
"imminent danger of collision" but even of "the actual collision itself " There
is also evidence that the "Don Juan" was carrying more passengers than she
had been certified as allowed to carry.
Held: No. As with the Mecenas case, this Court found petitioner guilty of
negligence in (1) allowing or tolerating the ship captain and crew members in
playing mahjong during the voyage, (2) in failing to maintain the vessel
seaworthy and (3) in allowing the ship to carry more passengers than it was
allowed to carry.
Also, the duty to exercise due diligence includes the duty to take
passengers or cargoes that are within the carrying capacity of the vessel.
Held: Yes. The status of Lapuz as standby passenger was changed to that of
a confirmed passenger when his name was entered in the passenger
manifest of KAL for its Flight No. KE 903. His clearance through immigration
and customs clearly shows that he had indeed been confirmed as a
passenger of KAL in that flight. KAL thus committed a breach of the contract
of carriage between them when it failed to bring Lapuz to his destination.
This Court has held that a contract to transport passengers is different in kind
and degree from any other contractual relation. The business of the carrier is
mainly with the traveling public. It invites people to avail themselves of the
comforts and advantages it offers. The contract of air carriage generates a
relation attended with a public duty. Passengers have the right to be treated
by the carrier's employees with kindness, respect, courtesy and due
consideration. They are entitled to be protected against personal misconduct,
injurious language, indignities and abuses from such employees. So it is that
any discourteous conduct on the part of these employees toward a passenger
gives the latter an action for damages against the carrier.
Held: Yes, Art. 1763 of the Civil Code provides that a common carrier is
responsible for injuries suffered by a passenger on account of wilfull acts of
other passengers, if the employees of the common carrier could have
prevented the act through the exercise of the diligence of a good father of a
family. In the present case, it is clear that because of the negligence of
petitioner's employees, the seizure of the bus by Mananggolo and his men
was made possible.
Despite warning by the Philippine Constabulary at Cagayan de Oro that
the Maranaos were planning to take revenge on the petitioner by burning
some of its buses and the assurance of petitioner's operation manager,
Diosdado Bravo, that the necessary precautions would be taken, petitioner
did nothing to protect the safety of its passengers. Had petitioner and its
employees been vigilant they would not have failed to see that the
malefactors had a large quantity of gasoline with them. Under the
circumstances, simple precautionary measures to protect the safety of
passengers, such as frisking passengers and inspecting their baggages,
preferably with non-intrusive gadgets such as metal detectors, before
allowing them on board could have been employed without violating the
passenger's constitutional rights.
The acts of Maranaos could not be considered as caso fortuito because
there was already a warning by the PC.
No contributory negligence could be attributed to the deceased. The
assailant's motive was to retaliate for the loss of life of two Maranaos as a
result of the collision between petitioner's bus and the jeepney in which the
two Maranaos were riding. The armed men actually allowed deceased to
retrieve something from the bus. What apparently angered them was his
attempt to help the driver of the bus by pleading for his life.
Because what is involved here is the liability of a common carrier for injuries
sustained by passengers in respect of whose safety a common carrier must
exercise extraordinary diligence, we must construe any such purported
waiver most strictly against the common carrier. For a waiver to be valid and
effective, it must not be contrary to law, morals, public policy or good
customs. A cursory examination of the purported waiver will readily show
that appellees did not actually waive their right to claim damages from
appellant for the latter's failure to comply with their contract of carriage. All
that said document proves is that they expressed a "desire" to make the
waiver which obviously is not the same as making an actual waiver of their
right. A waiver of the kind invoked by appellant must be clear and
unequivocal.
Held: No, common carriers are responsible for the death of their passengers
(Articles 1764 and 2206 of the Civil Code). This liability includes the loss of
the earning capacity of the deceased. It appears proven that the defendant
corporations failed to exercise the diligence that was their duty to observe
according to Articles 1733 and 1755. The conductor was apprised of the fact
that Mario del Castillo was deaf and dumb. With this knowledge the
conductor should have taken extra-ordinary care for the safety of the said
passenger. In this he failed.
Facts: Catalina Pascua with several others boarded the jeep owned by
spouses Isidro Mangune and Guillerma Carreon and driven by Tranquilino
Manalo bound for Carmen, Rosales, Pangasinan.
Upon reaching Tarlac the right rear wheel of the jeepney was
detached, so it was running in an unbalanced position. Manalo stepped on
the brake, as a result of which, the jeepney which was then running on the
eastern lane (its right of way) made a U-turn, invading and eventually
stopping on the western lane and was hit by the petitioner company’s bus
causing the death of Catalina Pascua and two other passengers.
Issue: Wether or not the Doctrine of Last Clear Chance applies in the
case at bar?
Held: No, The principle about "the last clear" chance, would call for
application in a suit between the owners and drivers of the two colliding
vehicles. It does not arise where a passenger demands responsibility from the
carrier to enforce its contractual obligations. For it would be inequitable to
exempt the negligent driver of the jeepney and its owners on the ground that
the other driver was likewise guilty of negligence."
It is the rule under the substantial factor test that if the actor's conduct is a
substantial factor in bringing about harm to another, the fact that the actor
neither foresaw nor should have foreseen the extent of the harm or the
manner in which it occurred does not prevent him from being liable. The bus
driver's conduct is not a substantial factor in bringing about harm to the
passengers of the jeepney. It cannot be said that the bus was travelling at a
fast speed when the accident occurred because the speed of 80 to 90
kilometers per hour, assuming such calculation to be correct, is yet within the
speed limit allowed in highways.
The driver cannot be held jointly and severally liable with the carrier in case
of breach of the contract of carriage. The rationale behind this is readily
discernible. Firstly, the contract of carriage is between the carrier and the
passenger, and in the event of contractual liability, the carrier is exclusively
responsible therefore to the passenger, even if such breach be due to the
negligence of his driver. In other words, the carrier can neither shift his
liability on the contract to his driver nor share it with him, for his driver's
negligence is his. Secondly, if We make the driver jointly and severally liable
with the carrier, that would make the carrier's liability personal instead of
merely vicarious and consequently, entitled to recover only the share which
corresponds to the driver, contradictory to the explicit provision of Article
2181 of the New Civil Code.
BUSTAMANTE vs. CA
Facts: A collision occurred between a gravel and sand truck, and a Mazda
passenger bus along the national road at Calibuyo, Tanza, Cavite. The front
left side portion (barandilla) of the body of the truck sideswiped the left side
wall of the passenger bus, ripping off the said wall from the driver's seat to
the last rear seat. Due to the impact, several passengers of the bus were
thrown out and died as a result of the injuries they sustained, Among those
killed were Rogelio Bustamante and his spouse and children, and several
others.
During the incident, the cargo truck was driven by defendant
Montesiano and owned by defendant Del Pilar; while the passenger bus was
driven by defendant Susulin. The vehicle was registered in the name of
defendant Novelo but was owned and/or operated as a passenger bus jointly
by defendants Magtibay and Serrado, under a franchise, with a line from
Naic, Cavite, to Baclaran, Paranaque, Metro Manila, and vice versa, which
Novelo sold to Magtibay on November 8, 1981, and which the latter
transferred to Serrado (Cerrado) on January 18, 1983.
After a careful perusal of the circumstances of the case, the trial court
reached the conclusion "that the negligent acts of both drivers contributed to
or combined with each other in directly causing the accident which led to the
death of the aforementioned persons. It could not be determined from the
evidence that it was only the negligent act of one of them which was the
proximate cause of the collision. In view of this, the liability of the two drivers
for their negligence must be solidary.
From said decision, only defendants Federico del Pilar and Edilberto
Montesiano, owner and driver, respectively, of the sand and gravel truck
have interposed an appeal before the respondent Court of Appeals, which set
aside the trial court’s decision. Hence the present petition.
Issue: Whether the respondent court has properly and legally applied the
doctrine of "last clear chance" in the present case despite its own finding that
appellant cargo truck driver Edilberto Montesiano was admittedly negligent in
driving his cargo truck very fast on a descending road and in the presence of
the bus driver coming from the opposite direction.
Held: The respondent court adopted the doctrine of "last clear chance." The
doctrine, stated broadly, is that the negligence of the plaintiff does not
preclude a recovery for the negligence of the defendant where it appears
that the defendant, by exercising reasonable care and prudence, might have
avoided injurious consequences to the plaintiff notwithstanding the plaintiff's
negligence. In other words, the doctrine of last clear chance means that even
though a person's own acts may have placed him in a position of peril, and an
injury results, the injured person is entitled to recovery. As the doctrine is
usually stated, a person who has the last clear chance or opportunity of
avoiding an accident, notwithstanding the negligent acts of his opponent or
that of a third person imputed to the opponent is considered in law solely
responsible for the consequences of the accident. (Sangco, Torts and
Damages, 4th Ed., 1986, p. 165).
The practical import of the doctrine is that a negligent defendant is
held liable to a negligent plaintiff, or even to a plaintiff who has been grossly
negligent in placing himself in peril, if he, aware of the plaintiffs peril, or
according to some authorities, should have been aware of it in the reasonable
exercise of due case, had in fact an opportunity later than that of the plaintiff
to avoid an accident (57 Am. Jur., 2d, pp. 798-799).
All premises considered, the Court is convinced that the respondent
Court committed an error of law in applying the doctrine of last clear chance
as between the defendants, since the case at bar is not a suit between the
owners and drivers of the colliding vehicles but a suit brought by the heirs of
the deceased passengers against both owners and drivers of the colliding
vehicles. Therefore, the respondent court erred in absolving the owner and
driver of the cargo truck from liability.
Facts: Severina Garces and her one-year old son boarded passenger
auto truck of the Philippine Rabbit Bus Lines. The truck entered a wooden
bridge, but the front wheels swerved to the right; the driver lost control, and
after wrecking the bridge's wooden rails, the truck fell on its right side into a
creek where water was breast deep. The mother, Severina Garces, was
drowned; the son,the truck fell on its right side into a creek where water was
breast deep. The mother, Severina Garces, was drowned; the son sustained
injuries.
Held: While the carrier is not an insurer of the safety of the passengers, it
should nevertheless be held to answer for the laws its equipment if such
flaws were at all discoverable. In this connection, the manufacturer of the
defective appliance is considered in law the agent of the carrier, and the
good repute of the manufacturer will not relieve the carrier from liability. The
rationale of the carrier's liability is the fact that the passenger has no privity
with the manufacturer of the defective equipment; hence, he has no remedy
against him, while the carrier usually has.
Facts: Private respondents boarded the JAL flights to Manila with a stop
over at Narita Japan at the airlines' expense. Upon arrival at Narita private
respondents were billeted at Hotel Nikko Narita for the night. The next day,
private respondents went to the airport to take their flight to Manila.
However, due to the Mt. Pinatubo eruption rendered NAIA inaccessible to
airline traffic. Hence, private respondents' trip to Manila was cancelled
indefinitely. JAL then booked another flight fort the passengers and again
answered for the hotel accommodations but still the succeeding flights were
cancelled.
Held: No, there is no question that when a party is unable to fulfill his
obligation because of "force majeure," the general rule is that he cannot be
held liable for damages for non-performance. Corollarily, when JAL was
prevented from resuming its flight to Manila due to the effects of Mt. Pinatubo
eruption, whatever losses or damages in the form of hotel and meal expenses
the stranded passengers incurred, cannot be charged to JAL. Yet it is
undeniable that JAL assumed the hotel expenses of respondents for their
unexpected overnight stay on June 15, 1991.
It has been held that airline passengers must take such risks incident to the
mode of travel. In this regard, adverse weather conditions or extreme
climatic changes are some of the perils involved in air travel, the
consequences of which the passenger must assume or expect.
While JAL was no longer required to defray private respondents' living
expenses during their stay in Narita on account of the fortuitous event, JAL
had the duty to make the necessary arrangements to transport private
respondents on the first available connecting flight to Manila. Petitioner JAL
reneged on its obligation to look after the comfort and convenience of its
passengers when it declassified private respondents from "transit
passengers" to "new passengers" as a result of which private respondents
were obliged to make the necessary arrangements themselves for the next
flight to Manila.
Facts: Plaintiffs husband and wife, together with their minor children,
boarded a La Mallorca bus. Upon arrival at their destination, plaintiffs and
their children alighted from the bus and the father led them to a shaded spot
about 5 meters away from the vehicle. The father returned to the bus to get a
piece of baggage which was not unloaded. He was followed by her daughter
Raquel. While the father was still on the running board awaiting for the
conductor to give his baggage, the bus started to run so that the father had
to jump. Raquel, who was near the bus, was run over and killed.
The Lower Court rendered judgment for the plaintiff which was
affirmed by CA, holding La Mallorca liable for quasi-delict. La Mallorca
contended that when the child was killed, she was no longer a passenger and
therefore the contract of carriage had terminated.
Held: Yes. It is a recognized rule that the relation between carrier and
passengers does not cease at the moment the passenger alights from the
carrier’s premises, to be determined from the circumstances. In this case,
there was no utmost diligence. Firstly, the driver, although stopping the bus,
did not put off the engine. Secondly, he started to run the bus even before
the bus conductor gave him the signal and while the latter was unloading
cargo. Here the presence of said passengers near the bus was not
unreasonable and the duration of responsibility still exists.
Issue: Whether or not the responsibility of Aboitiz to the victim ceased when
it disembarked from the vessel.
Held: No. 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.
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. Even if he
had already disembarked an hour earlier, his presence in petitioner's
premises was not without cause. The victim had to claim his baggage which
was possible only one hour after the vessel arrived since it was admittedly
standard procedure in the case of petitioner's vessels that the unloading
operations shall start only after that time. Consequently, under the foregoing
circumstances, the victim Anacleto Viana is still deemed a passenger of said
carrier at the time of his tragic death.
As found by the Court of Appeals, the evidence does not show that
there was a cordon of drums around the perimeter of the crane, as claimed
by petitioner. It also adverted to the fact that the alleged presence of visible
warning signs in the vicinity was disputable and not indubitably established.
Thus, we are not inclined to accept petitioner's explanation that the victim
and other passengers were sufficiently warned that merely venturing into the
area in question was fraught with serious peril. Hence, Aboitiz is negligent.
Pioneer had taken the necessary safeguards insofar as its unloading
operations were concerned, a fact which appears to have been accepted by
the plaintiff therein by not impleading Pioneer as a defendant, and likewise
inceptively by Aboitiz by filing its third-party complaint only after ten months
from the institution of the suit against it. Parenthetically, Pioneer is not within
the ambit of the rule on extraordinary diligence required of, and the
corresponding presumption of negligence foisted on, common carriers like
Aboitiz.
MALLARI SR. vs. CA
Facts: The passenger jeepney driven by petitioner Alfredo Mallari Jr. and
owned by his co-petitioner Alfredo Mallari Sr. collided with the delivery van of
respondent Bulletin along the National Highway in Barangay San Pablo,
Dinalupihan, Bataan. 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. The widow of the
victim, filed a complaint for damages against petitioners and also against
BULLETIN, its driver Felix Angeles, and the N.V. Netherlands Insurance
Company. The trial court found that the proximate cause of the collision was
the negligence of Felix Angeles, driver of the Bulletin delivery van,
considering the fact that the left front portion of the delivery truck driven by
Felix Angeles hit and bumped the left rear portion of the passenger jeepney
driven by Alfredo Mallari Jr. Hence, the trial court held that BULLETIN and
Felix Angeles are jointly and severally liable. It also dismissed the complaint
against the other defendants Alfredo Mallari Sr. and Alfredo Mallari Jr. On
appeal the Court of Appeals modified the decision of the trial court and found
no negligence on the part of Angeles and consequently of his employer,
respondent BULLETIN. Instead, the appellate court ruled that the collision was
caused by the sole negligence of petitioner Alfredo Mallari Jr. who admitted
that immediately before the collision and after he rounded a curve on the
highway, he overtook a Fiera which had stopped on his lane and that he had
seen the van driven by Angeles before overtaking the Fiera. Hence this
petition.
Held: Yes. The Court of Appeals correctly found, that the collision occurred
immediately after petitioner 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.
Sec. 41. Restrictions on overtaking and passing.
(a) The driver of a vehicle shall not drive to the left side of the center line of a
highway in overtaking or passing another vehicle proceeding in the same direction,
unless such left side is clearly visible and is free of oncoming traffic for a sufficient
distance ahead to permit such overtaking or passing to be made in safety.
(b) The driver of a vehicle shall not overtake or pass another vehicle proceeding in
the same direction when approaching the crest of a grade, nor upon a curve in the
highway, where the driver's view along the highway is obstructed within a distance of
five hundred feet ahead except on a highway having two or more lanes for
movement of traffic in one direction where the driver of a vehicle may overtake or
pass another vehicle: Provided That on a highway, within a business or residential
district, having two or more lanes for movement of traffic in one direction, the driver
of a vehicle may overtake or pass another vehicle on the right.
The rule is settled that 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.
In the instant case, by his own admission, petitioner 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 two vehicles in
front of it at a curve in the highway. Clearly, the proximate cause of the
collision resulting in the death of Israel Reyes, a passenger of the jeepney,
was the sole negligence of the driver of the passenger jeepney, petitioner
Alfredo 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. As found by the appellate court, petitioners
failed to present satisfactory evidence to overcome this legal presumption.
Under Art. 1755 of the Civil Code, 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 due regard for all the
circumstances. Moreover, under Art. 1756 of the Civil Code, in case of death
or injuries to passengers, a common carrier is presumed to have been at fault
or to have acted negligently, unless it proves that it observed extraordinary
diligence. Further, pursuant to Art. 1759 of the same Code, it is liable for the
death of or injuries to passengers through the negligence or willful acts of the
former's employees. This liability of the common carrier does not cease upon
proof that it exercised all the diligence of a good father of a family in the
selection of its employees. Clearly, by the contract of carriage, the carrier
jeepney owned by Mallari Sr. assumed the express obligation to transport the
passengers to their destination safely and to observe extraordinary diligence
with due regard for all the circumstances, and any injury or death that might
be suffered by its passengers is right away attributable to the fault or
negligence of the carrier.
BAYASEN vs. CA
Held: Yes. It is obvious that the proximate cause of the tragedy was the
skidding of the rear wheels of the jeep and not the "unreasonable speed" of
the petitioner because there is no evidence on record to prove or support the
finding that the petitioner was driving at "an unreasonable speed".
It is a well known physical tact that cars may skid on greasy or slippery
roads, as in the instant case, without fault on account of the manner of
handling the car. Skidding means partial or complete loss of control of the car
under circumstances not necessarily implying negligence. It may occur
without fault.
No negligence as a matter of law can, therefore, be charged to the
petitioner. In fact, the moment he felt that the rear wheels of the jeep
skidded, he promptly drove it to the left hand side of the road, parallel to the
slope of the mountain, because as he said, he wanted to play safe and avoid
the embankment.
Under the particular circumstances of the instant case, the petitioner-
driver who skidded could not be regarded as negligent, the skidding being an
unforeseen event, so that the petitioner had a valid excuse for his departure
from his regular course. The negligence of the petitioner not having been
sufficiently established, his guilt of the crime charged has not been proven
beyond reasonable doubt. He is, therefore, entitled to acquittal.
CERVANTES vs. CA
Facts: PAL issued to the petitioner a round trip plane ticket for Manila-
Honolulu-Los Angeles-Honolulu-Manila, which ticket expressly provided an
expiry of date of one year from issuance, i.e., until March 27, 1990. On March
23, 1990, four days before the expiry date of subject ticket, the petitioner
used it. Upon his arrival in Los Angeles on the same day, he immediately
booked his Los Angeles-Manila return ticket with the PAL office, and it was
confirmed for the April 2, 1990 flight. Upon learning that the same PAL plane
would make a stop-over in San Francisco, and considering that he would be
there on April 2, 1990, petitioner made arrangements with PAL for him to
board the flight In San Francisco instead of boarding in Los Angeles. On April
2, 1990, when the petitioner checked in at the PAL counter in San Francisco,
he was not allowed to board. The PAL personnel concerned marked the
following notation on his ticket: "TICKET NOT ACCEPTED DUE EXPIRATION OF
VALIDITY." Petitioner Cervantes filed a Complaint for Damages, for breach of
contract of carriage. But the said complaint was dismissed for lack of merit.
On appeal, the lower court’s decision was upheld, hence the instant petition.
Issue: Whether or not the act of the PAL agents in confirming subject ticket
extended the period of validity of petitioner's ticket.
Held: No. Since the PAL agents are not privy to the said Agreement and
petitioner knew that a written request to the legal counsel of PAL was
necessary, he cannot use what the PAL agents did to his advantage. The said
agents, according to the Court of Appeals, acted without authority when they
confirmed the flights of the petitioner. Under Article 1989 of the New Civil
Code, the acts an agent beyond the scope of his authority do not bind the
principal, unless the latter ratifies the same expressly or impliedly.
Furthermore, when the third person (herein petitioner) knows that the agent
was acting beyond his power or authority, the principal cannot be held liable
for the acts of the agent. If the said third person is aware of such limits of
authority, he is to blame, and is not entitled to recover damages from the
agent, unless the latter undertook to secure the principal's ratification.
In awarding moral damages for breach of contract of carriage, the
breach must be wanton and deliberately injurious or the one responsible
acted fraudulently or with malice or bad faith. Petitioner knew there was a
strong possibility that he could not use the subject ticket, so much so that he
bought a back-up ticket to ensure his departure. Should there be a finding of
bad faith, we are of the opinion that it should be on the petitioner. What the
employees of PAL did was one of simple negligence. No injury resulted on the
part of petitioner because he had a back-up ticket should PAL refuse to
accommodate him with the use of subject ticket. Neither can the claim for
exemplary damages be upheld. Such kind of damages is imposed by way of
example or correction for the public good, and the existence of bad faith is
established.
CALALAS vs. CA
Held: No. There is no basis for the contention that the ruling in Civil Case No.
3490, finding Salva and his driver Verena liable for the damage to petitioner's
jeepney, should be binding on Sunga. It is immaterial that the proximate
cause of the collision between the jeepney and the truck was the negligence
of the truck driver. The doctrine of proximate cause is applicable only in
actions for quasi-delict, not in actions involving breach of contract. The
doctrine is a device for imputing liability to a person where there is no
relation between him and another party. In such a case, the obligation is
created by law itself. But, where there is a pre-existing contractual relation
between the parties, it is the parties themselves who create the obligation,
and the function of the law is merely to regulate the relation thus created.
Insofar as contracts of carriage are concerned, some aspects regulated by
the Civil Code are those respecting the diligence required of common carriers
with regard to the safety of passengers as well as the presumption of
negligence in cases of death or injury to passengers.
In quasi-delict, the negligence or fault should be clearly established
because it is the basis of the action, whereas in breach of contract, the action
can be prosecuted merely by proving the existence of the contract and the
fact that the obligor, in this case the common carrier, failed to transport his
passenger safely to his destination. In case of death or injuries to passengers,
Art. 1756 of the Civil Code provides that common carriers are presumed to
have been at fault or to have acted negligently unless they prove that they
observed extraordinary diligence as defined in Arts. 1733 and 1755 of the
Code. This provision necessarily shifts to the common carrier the burden of
proof.
Now, did the driver of jeepney carry Sunga "safely as far as human
care and foresight could provide, using the utmost diligence of very cautious
persons, with due regard for all the circumstances" as required by Art. 1755?
We do not think so. First, the jeepney was not properly parked, its rear
portion being exposed about two meters from the broad shoulders of the
highway, and facing the middle of the highway in a diagonal angle. The
petitioner's driver took in more passengers than the allowed seating capacity
of the jeepney. These are violations of the Land Transportation and Traffic
Code. Petitioner should have foreseen the danger of parking his jeepney with
its body protruding two meters into the highway.
As a general rule, moral damages are not recoverable in actions for
damages predicated on a breach of contract for it is not one of the items
enumerated under Art. 2219 of the Civil Code. As an exception, such
damages are recoverable: (1) in cases in which the mishap results in the
death of a passenger, as provided in Art. 1764, in relation to Art. 2206(3) of
the Civil Code; and (2) in the cases in which the carrier is guilty of fraud or
bad faith, as provided in Art. 2220.In this case, there is no legal basis for
awarding moral damages since there was no factual finding by the appellate
court that petitioner acted in bad faith in the performance of the contract of
carriage.
Held: Yes. Petitioners contend that Pestaño was not under any obligation to
slow down when he overtook the motorcycle, because the deceased had
given way to him upon hearing the bus horn. Seeing that the left side of the
road was clearly visible and free of oncoming traffic, Pestaño accelerated his
speed to pass the motorcycle. Having given way to the bus, the motorcycle
driver should have slowed down until he had been overtaken. They further
contend that the motorcycle was not in the middle of the road nearest to the
junction but was on the inner lane. This explains why the damages on the bus
were all on the right side - the right end of the bumper and the right portion
of the radiator grill were bent and dented. SC disagreed with this contention
and considered the findings of CA, based on the testimony of the witnesses,
wherein, it was found out that as the two vehicles approached the junction,
the victim raised his left arm to signal that he was turning left to Tabagon,
but that the latter and his companion were thrown off the motorcycle after it
was bumped by the overspeeding bus. As a professional driver operating a
public transport bus, Pestaño should have anticipated that overtaking at a
junction was a perilous maneuver and should thus have exercised extreme
caution.
Petitioners also aver that the CA was wrong in attributing the accident
to a faulty speedometer and in implying that the accident could have been
avoided had this instrument been properly functioning. This contention has
no factual basis. 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.
Facts: Lieut. Tomas Gillaco, husband of the plaintiff, was a passenger in the
early morning train of the Manila Railroad Company from Calamba, Laguna to
Manila. When the train reached the Paco Railroad station, Emilio Devesa, a
train guard of the Manila Railroad Company happened to be in said station
waiting for the same train which would take him to Tutuban Station, where he
was going to report for duty. Emilio Devesa had a long standing personal
grudge against Tomas Gillaco, because of this, Devesa shot Gillaco with the
carbine furnished to him by the Manila Railroad Company for his use as such
train guard, upon seeing him inside the train coach. Tomas died. Devesa was
convicted of homicide. A complaint for damages was filed by the victim’s
widow. Damages were awarded to the plaintiff, hence the instant petition.
Appellant's contention is that, no liability attaches to it as employer of the
Emilio Devesa because the crime was not committed while the slayer was in
the actual performance of his ordinary duties and service and that no
negligence on appellant's part was shown.
Issue: Whether or not appellant could be held liable for the acts of its
employee.
Issue: Whether or not defendant- operators could be held liable for damages
Issue: Whether or not PNR can raise the defense of doctrine of state
immunity from suit.
Held: No. The PNR was created under Rep. Act 4156, as amended. Section 4
of the said Act provides:
The Philippine national Railways shall have the following powers:
a. To do all such other things and to transact all such business directly or
indirectly necessary, incidental or conducive to the attainment of the purpose
of the corporation; and
b. Generally, to exercise all powers of a corporation under the Corporation
Law.
Under the foregoing section, the PNR has all the powers, the
characteristics and attributes of a corporation under the Corporation Law.
There can be no question then that the PNR may sue and be sued and may
be subjected to court processes just like any other corporation.
Now, is PNR negligent? Yes. The appellate court found, the petitioner
does not deny, that the train boarded by the deceased Winifredo Tupang was
so over-crowded that he and many other passengers had no choice but to sit
on the open platforms between the coaches of the train. It is likewise
undisputed that the train did not even slow down when it approached the
Iyam Bridge which was under repair at the time, Neither did the train stop,
despite the alarm raised by other passengers that a person had fallen off the
train at lyam Bridge. The petitioner has the obligation to transport its
passengers to their destinations and to observe extraordinary diligence in
doing so. Death or any injury suffered by any of its passengers gives rise to
the presumption that it was negligent in the performance of its obligation
under the contract of carriage. Thus, as correctly ruled by the respondent
court, the petitioner failed to overthrow such presumption of negligence with
clear and convincing evidence.
But while petitioner failed to exercise extraordinary diligence as
required by law, it appears that the deceased was chargeable with
contributory negligence. Since he opted to sit on the open platform between
the coaches of the train, he should have held tightly and tenaciously on the
upright metal bar found at the side of said platform to avoid falling off from
the speeding train. Such contributory negligence, while not exempting the
PNR from liability, nevertheless justified the deletion of the amount
adjudicated as moral damages and exemplary damages. Exemplary damages
may be allowed only in cases where the defendant acted in a wanton,
fraudulent, reckless, oppressive or malevolent manner.
Held: The bus was running at a moderate speed. The driver of the bus upon
the speeding pick-up truck swerved the bus to the very extreme right of the
road. Said driver would not move the bus further without endangering the
safety of his passengers. Notwithstanding all these efforts, the rear left side
was hit. This finding of the lower court was sustained.
Also, of the carrier’s employee is confronted with a sudden emergency,
he is not held to the same degree of care he would otherwise, he required in
the absence of such emergency.
By placing his left arm on the window, he is guilty of contributory
negligence cannot relieve the carrier but can only reduce its liability (ART.
1762), this is a circumstance which further militates against plaintiff’s
position. It is a prevailing rule that it is negligence per se for passengers on a
railroad to protrude any part of his body and that no recovery can be had for
an injury.”
Facts: The bus owned by Petitioners came from Davao City on its way to
Cagayan de Oro City passing Butuan City. While at Tabon-Tabon, Butuan City,
the bus picked up a passenger, that about fifteen minutes later, a passenger
at the rear portion suddenly stabbed a PC soldier which caused commotion
and panic among the passengers. When the bus stopped, passengers
Ornominio Beter and Narcisa Rautraut were found lying down the road, the
former already dead as a result of head injuries and the latter also suffering
from severe injuries which caused her death later. The passenger assailant
alighted from the bus and ran toward the bushes but was killed by the police.
Thereafter, the heirs of Ornominio Beter and Narcisa Rautraut, private
respondents herein filed a complaint for "sum of money" against Bachelor
Express, Inc., its alleged owner and the driver Rivera. The lower court
dismissed the complaint. CA reversed the decision, hence the instant
petition.
Held: Yes. Art. 1763 of the Civil Code provides that a common carrier is
responsible for injuries suffered by a passenger on account of wilfull acts of
other passengers, if the employees of the common carrier could have
prevented the act through the exercise of the diligence of a good father of a
family. In the present case, it is clear that because of the negligence of
petitioner's employees, the seizure of the bus by Mananggolo and his men
was made possible.
Despite warning by the Philippine Constabulary at Cagayan de Oro that
the Maranaos were planning to take revenge on the petitioner by burning
some of its buses and the assurance of petitioner's operation manager,
Diosdado Bravo, that the necessary precautions would be taken, petitioner
did nothing to protect the safety of its passengers. Had petitioner and its
employees been vigilant they would not have failed to see that the
malefactors had a large quantity of gasoline with them. Under the
circumstances, simple precautionary measures to protect the safety of
passengers, such as frisking passengers and inspecting their baggages,
preferably with non-intrusive gadgets such as metal detectors, before
allowing them on board could have been employed without violating the
passenger's constitutional rights.
Petitioner invokes the ruling in Pilapil v. Court of Appeals, and De
Guzman v. Court of Appeals, in support of its contention that the seizure of its
bus by the assailants constitutes force majeure. In Pilapil v. Court of Appeals,
it was held that a common carrier is not liable for failing to install window
grills on its buses to protect the passengers from injuries cause by rocks
hurled at the bus by lawless elements. On the other hand, in De Guzman v.
Court of Appeals, it was ruled that a common carriers is not responsible for
goods lost as a result of a robbery which is attended by grave or irresistable
threat, violence, or force.
It is clear that the cases of Pilapil and De Guzman do not apply to the
prensent case. Art. 1755 of the Civil Code provides that "a common carrier is
bound to carry the passengers as far as human care and foresight can
provide, using the utmost diligence of very cautious persons, with due regard
for all the circumstances." Thus, we held in Pilapil and De Guzman that the
respondents therein were not negligent in failing to take special precautions
against threats to the safety of passengers which could not be foreseen, such
as tortious or criminal acts of third persons. In the present case, this factor of
unforeseeability (the second requisite for an event to be considered force
majeure) is lacking. As already stated, despite the report of PC agent
Generalao that the Maranaos were planning to burn some of petitioner's
buses and the assurance of petitioner's operation manager (Diosdado Bravo)
that the necessary precautions would be taken, nothing was really done by
petitioner to protect the safety of passengers.
The petitioner contends that Atty. Caorong was guilty of contributory
negligence in returning to the bus to retrieve something. But Atty. Caorong
did not act recklessly. It should be pointed out that the intended targets of
the violence were petitioners and its employees, not its passengers. The
assailant's motive was to retaliate for the loss of life of two Maranaos as a
result of the collision between petitioner's bus and the jeepney in which the
two Maranaos were riding. Mananggolo, the leader of the group which had
hijacked the bus, ordered the passengers to get off the bus as they intended
to burn it and its driver. The armed men actually allowed Atty. Caorong to
retrieve something from the bus. What apparently angered them was his
attempt to help the driver of the bus by pleading for his life. He was playing
the role of the good Samaritan. Certainly, this act cannot be considered an
act of negligence, let alone recklessness.
III. DAMAGES
A. Actual/Compensatory Damages
Held: The findings of the trial court was sustained. Firstly, the train whistle
had been sounded several times before it reached the crossing; secondly,
that another LTB bus which arrived at the crossing ahead of the one where
Edgardo was a passenger, paid heed to the warning and stopped before the
"crossing".
Upon the whole evidence on the matter, the lower court found that the
removal of the right frontal lobe of the brain of Edgardo reduced his
intelligence by about 50%; that due to the replacement of the right frontal
bone of his head with a tantalum plate Edgardo has to lead a quite and
retired life because "if the tantalum plate is pressed in or dented it would
cause his death." The impression one gathers from this evidence is that, as a
result of the physical injuries suffered by Edgardo Cariaga, he is now in a
helpless condition, virtually an invalid, both physically and mentally.
Appellant LTB admits that under Art. 2201 of the Civil Code the
damages for which the obligor, guilty of a breach of contract but who acted in
good faith, is liable shall be those that are the natural and probable
consequences of the breach and which the parties had foreseen or could
have reasonably foreseen at the time the obligation was constituted,
provided such damages, according to Art. 2199 of the same Code, have been
duly proved. Upon this premise it claims that only the actual damages
suffered by Edgardo consisting of medical, hospital and other expenses in the
total sum of P17,719.75 are within this category. We are of the opinion
however, that the income which Edgardo could earn if he should finish the
medical course and pass the corresponding board examinations must be
deemed to be within the same category because they could have reasonably
been foreseen by the parties at the time he boarded the bus.
Upon consideration of all the facts this Court is of the opinion, and so
holds, that the compensatory damages awarded to petitioner should be
increased to P25,000.00.The claim for moral damages and attorney's fees is
denied. Article 2219 of the Civil Code enumerates the instances when moral
damages may be covered and the case under consideration does not fall
under any one of them. The present action cannot come under Paragraph 2
of said article because it is not one of quasi-delict and cannot be considered
as such because of the pre-existing contractual relation between the Laguna
LTB and Edgardo. Neither could LTB be held liable to pay moral damages
under Article 2220 of the Civil Code on account of breach of its contract of
carriage because it did not act fraudulently or in bad faith. LTB had exercised
due diligence in the selection and supervision of its employees like the
drivers of its buses in connection with the discharge of their duties and so it
must be considered an obligor in good faith. Petitioner is not entitled to
recover attorney's fees, because this case does not fall under any of the
instances enumerated in Article 2208 of the Civil Code.
Facts: An Izuzu First Class passenger bus owned and operated by the
petitioner left Lingayen, Pangasinan, for Manila. Among its paying passengers
was the deceased, Policronio Quintos, Jr. When the vehicle was nearing the
Sadsaran Bridge on the national highway in barrio Sto. Domingo, municipality
of Minalin, Pampanga, it frontally hit the rear side of a bullcart filled with hay.
As a result the end of a bamboo pole placed on top of the hayload and tied to
the cart to hold it in place, hit the right side of the windshield of the bus. The
protruding end of the bamboo pole, about 8 feet long from the rear of the
bullcart, penetrated through the glass windshield and landed on the face of
deceased, which caused several wounds. Notwithstanding the medical
assistance, the Quintos died. The private respondents, brought this action
against petitioner for breach of the contract of carriage to recover the
aggregate sum of P63,750.00 as damages, including attorney's fees. Said
petitioner contended that the mishap was due to a fortuitous event, but this
pretense was rejected by the trial court and the Court of Appeals, both of
which found that the accident and the death of Policronio had been due to
the negligence of the bus driver. Hence the instant petition.
Issue: Did CA erred in its award of the damages to the heirs of Quintos?
Held: No. Petitioner maintains that the lower courts had erred in placing the
life expectancy of Quintos at 33-1/3, he being over 29 years of age at the
time of his demise and in not acting in accordance with Alcantara v. Surro in
which the damages were computed on a four year basis, despite the fact that
the victim therein was 39 years old, at the time of his death, and had a life
expectancy of 28.90 years. The case cited is not, however, controlling in the
one at bar. In the Alcantara case, none of the parties had questioned the
propriety of the four-year basis adopted by the trial court in making its award
of damages. Both parties appealed, but only as regards the amount thereof.
In addition, the case had not thereby laid down any rule on the length of time
to be used in the computation of damages. It even declared “that the
determination of the indemnity to be awarded to the heirs of a deceased
person has therefore no fixed basis. Much is left to the discretion of the court
considering the moral and material damages involved, and so it has been
said that there can be no exact or uniform rule for measuring the value of a
human life and the measure of damages cannot be arrived at by precise
mathematical calculation, but the amount recoverable depends on the
particular facts and circumstances of each case. The life expectancy of the
deceased or of the beneficiary, whichever is shorter, is an important factor.”
Thus, life expectancy is, not only relevant, but, also, an important
element in fixing the amount recoverable by private respondents herein.
Although it is not the sole element determinative of said amount, no cogent
reason has been given to warrant its disregard and the adoption, in the case
at bar, of a purely arbitrary standard, such as a four-year rule. In short, the
Court of Appeals has not erred in basing the computation of petitioner's
liability upon the life expectancy of Policronio Quintos, Jr.
With respect to the rate at which the damages shall be computed,
petitioner impugns the decision appealed from upon the ground that the
damages awarded therein will have to be paid now, whereas most of those
sought to be indemnified will be suffered years later. This argument is
basically true, and this is, perhaps, one of the reasons why the Alcantara case
points out the absence of a "fixed basis" for the ascertainment of the
damages recoverable in litigations like the one at bar. Just the same, the
force of the said argument of petitioner herein is offset by the fact that,
although payment of the award in the case at bar will have to take place
upon the finality of the decision therein, the liability of petitioner herein had
been fixed at the rate only of P2,184.00 a year, which is the annual salary of
Policronio Quintos, Jr. at the time of his death, as a young "training assistant"
in the Bacnotan Cement Industries, Inc. In other words, unlike the Alcantara
case, on which petitioner relies, the lower courts did not consider, in the
present case, Policronio's potentiality and capacity to increase his future
income. Indeed, upon the conclusion of his training period, he was supposed
to have a better job and be promoted from time to time, and, hence, to earn
more, if not considering the growing importance of trade, commerce and
industry and the concomitant rise in the income level of officers and
employees therein much more.
Held: Yes, but subject to modifications. Findings of fact show that plaintiff, a
businesswoman and a multimillionaire in her own right as evidenced
(proprietor of Sampaguita Restaurant, New York City USA; Treasurer of the
Molave Development Corp., Phil., proprietor of Cavite Household Appliances
and Rowena's Handicraft, Phil.), was on a business trip with a Pan-Am ticket.
While in Sto. Domingo, after talking thru the telephone with a certain Mrs.
Lilibeth Warner, the former said that she (plaintiff) must be in San Juan that
same day, to sign her contract or lose it. Plaintiff expected to make a profit of
$1,000 in said contract but since she wasn’t able to board the flight, said
profit was lost.
Other instances which caused moral damage to the plaintiff are the
following:
1. While plaintiff was standing in line preparatory to boarding the aircraft,
Rene Nolasco, a Pan Am employee ordered her in a loud voice to step out of
line because her ticket was not confirmed to her consternation and
embarrassment in the presence of several people who heard and order.
Despite her Pleas she was not allowed to board the aircraft. And as if to add
insult to injury, she saw that her seat was given to a white man.
2. When the plane took off without her but with her luggage on board. She
was forced to return to her hotel without any luggage much less an extra
dress. It was a good thing that the Hotel people remembered her because
they do not usually accommodate female guests, without any luggage to stay
in the hotel. While normally, hotel accommodation was paid before
departure, plaintiff was made to pay the room accommodation petition in
advance.
It is clear from the evidence that defendant issued a Passenger Ticket and
Baggage Check with assigned seat and the corresponding pass and baggage
claim symbol. Plaintiff was made to pay the fare and terminal fee. At the
immigration section, plaintiff's passport was stamped accordingly. Plaintiff's
name was included in the passenger manifest. And these show that plaintiff
was indeed a confirmed passenger of defendant's Flight 431 for San Juan.
There was, therefore, a contract or carriage perfected between plaintiff and
defendant for the latter to take plaintiff to her place of destination. By
refusing to accommodate plaintiff in said flight, defendant had willfully and
knowingly violated the contract of carriage and failed to bring the plaintiff to
her place of destination under its contract with plaintiff. Bad faith was also
present. Self enrichment or fraternal interest and not personal ill will may
have been the motive of defendant, but it is malice nevertheless. The fact
that plaintiff was ordered out under some pretext in order to accommodate a
white man in an airline owned by an American firm with a reputation for
bumping off non- Caucasian to accommodate whites is very regrettable.
Defendant having breached its contract with plaintiff in bad faith, it is not
error to have awarded exemplary damages. The rational behind exemplary or
corrective damages is, as the name implies, to provide an example or
correction for public good . In view of it nature, it should be imposed in such
amount as to sufficiently and effectively deter similar breach of contract in
the future by defendant and other airlines.
An award of attorney's fees is also in order, having found bad faith on the
part of defendant.
Held: Yes. A person is entitled to the physical integrity of his or her body; if
that integrity is violated or diminished, actual injury is suffered for which
actual or compensatory damages are due and assessable. Petitioner
Gatchalian is entitled to be placed as nearly as possible in the condition that
she was before mishap. A scar, especially one on the face of the woman,
resulting from the infliction of injury upon her, is a violation of bodily
integrity, giving raise to a legitimate claim for restoration to her condition
ante.
Facts: Juana Soberano boarded a bus of the Benguet Auto Line (BAL), a
subsidiary of the Manila Railroad Co. (MRR), driven by Santiago Caccam,
bound for Baguio City. In that trip, Juana brought with her 3,024 chicken eggs
to be sold in Baguio City, and some personal belongings which she needed in
that trip. About three kilometers away from Baguio City, along the Naguilian
road, the bus hit a stone embankment, causing it to fall into a 65-foot deep
precipice, resulting in death to two of its passengers and serious physical
injuries to Juana and loss and destruction of all her belongings.
Juana Soberano did not intervene in the criminal case because she
filed a formal reservation to institute a separate civil action for damages and
indemnity against the MRR and the BAL. Because of the loss of the eggs and
the destruction of the personal effects that Juana brought with her in that
trip, Jose Soberano, her husband, demanded from the defendant companies
the value thereof amounting to P370.66, of which sum the MRR paid P300.
The MRR also paid the daily expenses, allowances, subsistence,
hospitalization, medical fees and medicines of Juana Soberano, as well as the
service fees of her caretaker. The MRR has paid a total sum of P4,219. Later
the MRR offered to settle the case extrajudicially, tendering to the Soberanos
the additional sum of P5,000. The offer was rejected, and the Soberanos filed
the present action against the defendant companies and Caccam, to recover
from them damages in the total sum of P76,757.76. After due trial, the lower
court rendered the decision appealed from, dismissing at the same time the
complaint against Caccam. The Soberanos moved to have the decision
reconsidered. The motion for reconsideration was denied; hence the present
recourse.
Issue: Whether or not the amount of damages awarded is adequate.
Held: The Soberanos initially contend that the lower court erred in
disallowing their claim of P200, representing the expenses of Juana Soberano
in attending as a witness in the criminal case and attorney's fees incurred in
connection therewith. This claim was correctly denied by the lower court,
because these expenses were properly taxable in the criminal case. It may be
argued that the Soberanos could not have recovered this sum in the criminal
case because Juana Soberano expressly filed a formal reservation to institute
a separate civil action for damages, but such reservation did not preserve
whatever rights they had against Caccam on the basis of the latter's
imprudence. The reservation is ineffective as to Caccam as it did not include
him among those against whom their rights had been reserved. And the
Soberanos not having intervened in the criminal case, this claim must be
considered as having been impliedly adjudicated in the criminal case, and
cannot therefore be ventilated in the present action.
The Soberanos next contend that the lower court erred in denying their
claim for moral damages in the sum of P15,000, for the physical suffering,
mental anguish, serious anxiety and fright they suffered as a consequence of
the mishap. The lower court denied this claim on the strength of the oft-
reiterated ruling of this Court that moral damages cannot be recovered
against the employer in actions based on a breach of contract of carriage in
the absence of malice, fraud, or bad faith. The lower court rightly denied the
claim for moral damages as far as Jose Soberano is concerned. In case of
physical injuries, moral damages are recoverable only by the party injured
and not by his next of kin, unless there is express statutory provision to the
contrary. In this case it was Juana Soberano, not her husband Jose, who
sustained the bodily injuries.
The claim for attorney's fees was also properly denied by the lower
court. The Soberanos aver that they were obliged to file a separate civil
action for damages against the defendant companies. This claim is
predicated upon paragraphs (2) and (5) of article 2208 of the New Civil Code,
which provide that attorney's fees and expenses of litigation may be
recovered when the defendant's act or omission has compelled the plaintiff to
litigate with third persons or incur expenses to protect his interest, or when
the defendant acted in gross and evident bad faith in refusing to satisfy the
plaintiff's plainly valid, just and demandable claim. It will be observed that
the defendant companies offered to settle the case by offering to the
Soberanos the additional sum of P5,000. The Soberanos, however, rejected
the offer and proceeded to court to recover damages in the total sum of
P76,757.76. It was not, therefore, the defendant companies that compelled
the Soberanos to litigate, or to incur expenses in connection with the
litigation instituted by them.
Lastly, the nature and extent of the physical injuries suffered by Juana
Soberano has the effect of making her live an abnormal life. Considering all
the facts this Court is of the opinion that the sum of P5,000 in compensatory
damages awarded to her for loss of earning capacity is inadequate; the
amount should be increased to P15,000. She should also be awarded the sum
of P45.35, representing unrealized profits from the 3,024 chicken eggs which
she brought with her in the trip and which were destroyed.
Facts: A passenger bus of the Philippine Rabbit Bus Lines which was then
driven by Silverio Marchan fell into a ditch somewhere in Barrio Malanday,
Polo, Bulacan, while travelling on its way to Manila. As a result of which
Arsenio Mendoza, his wife and child, who were then inside the bus as
passengers were thrown out to the ground resulting in their multiple injuries.
Arsenio Mendoza suffered the most serious injuries which damaged his
vertebrae causing the paralysis of his lower extremities. An action was
brought to recover damages against petitioners predicated not only on a
breach of contract of carriage for failure to safely convey the plaintiffs to their
destination, but also on account of a criminal negligence on the part of
defendant driver. The lower court ruled in favor of plaintiffs. The award of
P40,000.00 as compensatory damages was affirmed by CA. It however added
the amount of P30,000.00 as exemplary damages and sustained the award of
attorney's fees in the amount of P5,000.00.
DE CALISTON vs. CA
Issue: Whether or not the deletion of the P10,000.00 awarded for loss of
pension is justified?
(1) The defendant shall be liable for the loss of the earning capacity of the
deceased, and the indemnity shall be paid to the heirs of the latter.
The pension of the decedent being a sure income that was cut short by her
death for which Dalmacio was responsible, the surviving heir of the former is
entitled to the award of P 10,000.00 which is just equivalent to the pension
the decedent would have received for one year if she did not die.
On the other hand, the P5,000.00 paid to the herein petitioner by the insurer
of the passenger bus which figured in the accident may be deemed to have
come from the bus owner who procured the insurance. Since the civil liability
(ex-delicto) of the latter for the death caused by his driver is subsidiary and,
at bottom, arises from the same culpa, the insurance proceeds should be
credited in favor of the errant driver.
Facts: On November 23, 1960, Starlight Flight No. 26 of the Philippine Air
Lines took off from Iloilo, on its way to Manila, with 33 persons on board,
including the plane's complement. The plane did not reach its destination but
crashed on Mt. Baco, Mindoro, one hour and fifteen minutes after takeoff .The
plane was Identified as PI-C133, a DC-3 type aircraft manufactured in 1942
and acquired by PAL in 1948. It had flown almost 18,000 hours at the time of
its illfated flight. It had been certified as airworthy by the Civil Aeronautics
Administration.
Among the fatalities was Nicanor Padilla. He was 29 years old, single.
His mother, Natividad A. Vda. de Padilla, was his only legal heir.
As a result of her son's death, Mrs. Padilla filed a complaint (which was
amended twice) against PAL, demanding payment of P600,000 as actual and
compensatory damages, plus exemplary damages and P60,000 as attorney's
fees.
In its answer, PAL denied that the accident was caused by its
negligence or that of any of the plane's flight crew, and that, moreover, the
damages sought were excessive and speculative.
On August 31, 1973, the trial court promulgated a decision, ordering the
defendant Philippine Air Lines, Inc. to pay the plaintiff Natividad A. Vda. de
Padilla the sum of P477,000.00 as award for the expected income of the
deceased Nicanor; P10,000.00 as moral damages; P10,000.00 as attorney's
fees; and to pay the costs.
On Appeal to the Court of Appeals the decision of the trial court was affirmed
in toto.
Issue: Whether or not the respondent court erred in computing the awarded
indemnity on the basis of the life expectancy of the late Nicanor A. Padilla
rather than on the life expectancy of private respondent, and thus erred in
awarding what appears to the petitioner as the excessive sum of P477,000 as
indemnity for loss of earnings.
For the settlement of the issue at hand, there are enough applicable
local laws and jurisprudence. Under Article 1764 and Article 2206(1) of the
Civil Code, the award of damages for death is computed on the basis of the
life expectancy of the deceased, not of his beneficiary. The articles provide:
Art. 2206. The amount of damages for death caused by a crime or quasi-
delict shall be at least three thousand pesos, even though there may have
been mitigating circumstances. In addition:
(1) The defendant shall be liable for the loss of the earning capacity of the
deceased, and the indemnity shall be paid to the heirs of the latter; such
indemnity shall in every case be assessed and awarded by the court, unless
the deceased on account of permanent physical disability not caused by the
defendant, had no earning capacity at the time of his death.
In the case of Davila vs. PAL, 49 SCRA 497 which involved the same tragic
plane crash, this Court determined not only PALs liability for negligence or
breach of contract, but also the manner of computing the damages due the
plaintiff therein which it based on the life expectancy of the deceased, Pedro
Davila, Jr.
B. MORAL DAMAGES
Held: In all cases, the attorney's fees and expenses of litigation must
be reasonable.The present action was instituted because plaintiff demanded
an exorbitant amount for moral damages (P60,000) and naturally the
defendant did not and could not yield to such demand. This is neither a case
that comes under paragraph 11 of Article 2208 because the Lower Court did
not deem it just and equitable to award any amount for attorney's fees. As
We agree with the trial Judge on this point, We cannot declare that he erred
for not awarding to plaintiff any such fees in this case.
"Realizing its obligation under its contract of carriage with the plaintiff,
and because the facts of the case, as have been shown, mark it as more
proper for the Municipal Court only, the defendant, to avoid the expense and
time of litigation, offered to settle the case amicably with plaintiff, but the
latter refused and insisted on his demand for P72,050.20 as the only basis for
settlement, thus adding a clearly petty case to the already overflowing desk
of the Honorable Members of this Court.
We admire and respect at all times a man for standing up and fighting
for his rights, and when said right consists in injuries sustained due to a
breach of a contract of carriage with us, sympathy and understanding are
added thereto. But when a person starts demanding P2,050.20 for a solitary
bruise and sprain, injuries for which the trial court, even at its generous
although erroneous best, could only grant P5,900, then respect and
sympathy give way to something else. It is time to fight, for, in our humble
opinion, there is nothing more loathsome nor truly worthy of condemnation
than one who uses his injuries for other purposes than just rectification. If
plaintiff's claim is granted, it would be a blessing, not a misfortune, to be
injured."
This case was instituted by a lawyer who, as an officer of the courts,
should be the first in helping Us in the administration of justice, and after
going over the record of this case, we do not hesitate to say that the demand
of this case, we do not hesitate to say that the demand of P72,050.20 for a
subluxation of the right humerus bone and an insignificant contusion in 'he
chest, has not even the semblance of reasonableness. The plaintiff himself
must have felt embarrassed by his own attitude when after receiving
defendant's brief as appellant, he makes in his brief as appellee the
categorical statement that he "DOES NOT NOW INSIST NOR PRETEND IN THE
LEAST to collect from the defendant all the damages he had claimed in his
complaint, but instead he is submitting his case to the sound discretion of the
Honorable Court for the award of a reasonable and equitable damages
allowable by law, to compensate the plaintiff of the suffering and losses he
had undergone and incurred because of the accident oftentimes mentioned
in this brief in which plaintiff was injured". This acknowledgment comes too
late, for plaintiff has already deprived the Court of Appeals of the occasion to
exercise its appellate jurisdiction over this case which he recklessly dumped
to this Court. We certainly cannot look with favor at this attitude of plaintiff.
Wherefore, the decision appealed from is hereby modified by reducing
the amount awarded as unearned professioral fees from P3,000 to P2,000
and by eliminating, the moral damages of P2,000 awarded by the Lower
Court to the plaintiff. Said decision is in all other respects affirmed, without
pronouncement as to costs. It is so ordered.
Issue: Whether or not the award of moral damages given by the CA was
valid?
Facts: The Sharp Travel Service, the travel department of C. F. Sharp, Inc.,
the majority interest-in-which is held by Rocha y Cia., Inc., General Agents of
the defendant, Lufthansa German Airlines issued to the plaintiff First Class
Pan American Ticket which would take him from Manila, the place of
departure, to Hongkong, various cities in the United States, Europe, Asia, the
Far East, and then back to Manila, the place of destination. Ortigas' ticket for
all these different legs of his journey was first class. He left Manila as
scheduled. In New York, he decided to leave out some cities, included in his
original itinerary, to be in Hongkong, for several appointments he had there.
Ortigas arrived in due course in Rome. To be sure he could fly first class to
Hongkong, for his appointments there the next day, Ortigas went to the office
of the Alitalia to book passage. The man at the counter of the Alitalia office
told him it had no flight on Monday but the Lufthansa had. The man
thereupon called up the office of the Lufthansa and, after talking to an
employee thereof, told Ortigas that the Lufthansa had no first class, but only
economy seats available. Ortigas was not willing to take an economy seat
and requested the employee to call up other airlines. The employee
afterwards informed Ortigas that the Lufthansa had a first class seat
available. Ortigas immediately asked him to get the seat and to see to it that
his ticket be confirmed and validated for the flight and a first class seat. The
man thereafter asked for Ortigas' passport and other travel papers and
attached a validating sticker on flight coupon No. 4 which corresponded to
the Rome-Hongkong leg of his TWA Ticket.
The following Monday, Ortigas checked out of his hotel and took a taxi
to the terminal. He unloaded his baggage and proceeded to the counter in
charge of the Lufthansa passengers. The lady at the counter told him that
Lufthansa had no space for him that day. Ortigas requested her to check with
her main office, which she did by calling it up. After calling, she apologized
and said the plaintiff's ticket was in order and would be confirmed and
validated. On her request, Ortigas had his luggage weighed and was given
the free luggage allowance of a first class passenger. He was furthermore
asked to pay 800 liras for bus fare and 700 liras as embarkation tax. An
employee in the airport asked for his passport and other papers and, after
examining his passport, where his Filipino nationality appears, said he could
not board the plane that day because his seat would be given to a Belgian.
After an argument with the employee, Ortigas made another request,
that the employee call other airlines to inquire if they had flights to Hongkong
that day but he once more turned down the plea and insisted that Ortigas
travel economy, with the promise that he will be transferred to first class in
Cairo and onward to Hongkong. He was constrained to agree with the
arrangement. Upon arrival in Cairo, the plaintiff requested the Lufthansa
agent to transfer him to first class but the agent said he could not and that he
did not receive any communication from Rome to that effect. At Dharham,
the plaintiff once more requested a transfer to first class but was also told by
the Lufthansa agent that he had not received any communication about the
change and the request could not be granted. In Calcutta, Ortigas once again
requested a transfer or that he be assisted in booking passage on other
planes but was also refused. It was only in Bangkok when the chief steward
asked him if he wanted to move over to first class but having been already
embarrassed and humiliated and the trip to Hongkong being only three
hours, he said he would not as a sign of protest. The foregoing facts resulted
in the filing of the case by the plaintiff against defendant, in which an award
of moral and exemplary damages was ordered and now subject of an appeal.
Held: Yes. Manuel Otayza, general manager of Filital, Inc., which is the
general agent of the Alitalia in the Philippines, testified that space reservation
through telephone calls between airlines is permitted by IATA's, "Manual of
Traffic Conference Resolutions" and that telephone calls for reservation by
one airline to another is in fact accepted procedure in accordance with the
official airline guide of the Air Traffic Conference and International Air
Transport Association. There was, therefore, a valid and binding contract
between Lufthansa and the plaintiff to transport him as a first class
passenger from Rome to Hongkong, and this agreement the defendant
violated by compelling the plaintiff to travel as an economy passenger. It
cannot be said the breach was the result of an honest mistake or excusable
negligence. There is evidence that the defendant acted with bad faith and in
willful disregard of the plaintiffs rights.
It is Our considered view that when it comes to contracts of common
carriage, inattention and lack of care on the part of the carrier resulting in the
failure of the passenger to be accommodated in the class contracted for
amounts to bad faith or fraud which entitles the passenger to the award of
moral damages in accordance with Article 2220 of the Civil Code. But in the
instant case, the breach appears to be of graver nature, since the preference
given to the Belgian passenger over plaintiff was done willfully and in wanton
disregard of plaintiff's rights and his dignity as a human being and as a
Filipino, who may not be discriminated against with impunity.
Lufthansa contends, however, that there could not have been any
possible discrimination by reason of race against Ortigas because from his
appearance, said plaintiff can easily be taken for a European or white more
than his own witness Amado Castro and besides, there were other Orientals
in the same flight on that occasion. It is argued that any such policy would be
self-defeating, since it would certainly be damaging to its own business.
Again, this ratiocination is untenable, for what appears from the evidence is
not really a case of a general policy of discriminating against Orientals or
non-whites, but a specific act of Lufthansa employee at the airport of giving
preference to a Belgian after examining Ortigas passport wherein his Filipino
nationality is noted.
As found by the lower court what worsened the situation of Ortigas was
that Lufthansa succeeded in keeping him as its passenger by assuring him
that he would be given first class accommodation at Cairo, the next station,
the proper arrangements therefor having been made already, when in truth
such was not the case. Thus, instead of complying with the request of Ortigas
that other airlines be contacted to find out it they had first class space for
him, the Lufthansa employee who had indifferently told him about his
downgrading paid very little attention if ever to said request. Although
molested and embarrassed to the point that he had to take nitroglycerine
pills to ward off a possible heart attack, Ortigas hardly had any choice, since
his luggage was already in the plane. To his disappointment, when the plane
reached Cairo, he was told by the Lufthansa office there that no word at all
had been received from Rome and they had no space for him in first class.
Worse, similar false representations were made to him at Dharham and
Calcutta. It was only at Bangkok where for the first time, Ortigas was at last
informed that he could have a first class seat in that leg of the flight, from
Bangkok to Hongkong. This Ortigas rejected, if only to make patent his
displeasure and indignation at being so inconsiderately treated in the earlier
part of his journey.
Moreover, it is argued, the economy class accommodations are
not much different from first class and Ortigas was not delayed in his trip. We
cannot see the point. A passenger contracts for first class accommodations
for many reasons peculiar to himself and pays a higher price therefor, and it
is certainly not for the airplane to say later, after it deprives him of his space
in order to favor another passenger, that economy class is anyway just as
good as first class.
In the light of all the foregoing, there can be no doubt as to the
right of Ortigas to damages, both moral and exemplary. We have uniformly
upheld the right of a passenger to damages in all cases wherein, after having
contracted and paid for first class accommodations duly confirmed and
validated, he is transferred over his objection to economy, class, which he
has to take in order to be able to arrive at his destination on his scheduled
time.
Held: No. The contention of petitioners with respect to the award of moral
damages is meritorious. This Court has repeatedly held that moral damages
are not recoverable in actions for damages predicated on a breach of the
contract of transportation, as in the instant case, in view of the provisions of
Articles 2219 and 2220 of the New Civil Code. The exceptions are (1) where
the mishap results in the death of a passenger, and (2) where it is proved
that the carrier was guilty of fraud or bad faith, even if death does not result.
The Court of Appeals found that the two vehicles sideswiped each other at
the middle of the road. In other words both vehicles were in their respective
lanes and that they did not invade the lane of the other. It cannot be said
therefore that there was fraud or bad faith on the part of the carrier's driver.
This being the case, no moral damages are recoverable.
Hence, this suit for damages for breach of contract of carriage which the Trial
court, affirmed by the CA, decided in favor of plaintiffs.
Held: Yes. Under Art. 2220 of the Civil Code, moral damages are justly due in
breaches of contract where the defendant acted fraudulently or in bad faith.
Both the Trial Court and the Appellate Court found that there was bad faith
on the part of petitioner in that:
That the finding of bad faith is binding on us, since it is not the function
of the court to analyze and review evidence on this point all over again, aside
from the fact that we find it faithful to the meaning of bad faith enunciated
thus:
“Bad faith means a breach of a known duty through some motive or
interest or ill will. Self enrichment or fraternal interest, and not personal ill
will, may have been the motive, but it is malice nevertheless.”
Held: Respondent had a first class ticket for Flight No. 41 of petitioner from
New York to San Francisco on April 20, 1979. It was twice confirmed and yet
respondent unceremoniously told him that there was no first class seat
available for him and that he had to be downgraded to the economy class. As
he protested, he was arrogantly threatened by one Mr. Braam. Worst still,
while he was waiting for the flight, he saw that several Caucasians who
arrived much later were accommodated in first class seats when the other
passengers did not show up.
The discrimination is obvious and the humiliation to which private
respondent was subjected is undeniable. Consequently, the award of moral
and exemplary damages by the respondent court is in order.
Indeed, private respondent had shown that the alleged switch of planes from
a Lockheed 1011 to a smaller Boeing 707 was because there were only 138
confirmed economy class passengers who could very well be accommodated
in the smaller plane and not because of maintenance problems.
Petitioner sacrificed the comfort of its first class passengers including
private respondent Vinluan for the sake of economy. Such inattention and
lack of care 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. 5 More so in this case
where instead of courteously informing private respondent of his being
downgraded under the circumstances, he was angrily rebuffed by an
employee of petitioner.
At the time of this unfortunate incident, the private respondent was a
practicing lawyer, a senior partner of a big law firm in Manila. He was a
director of several companies and was active in civic and social organizations
in the Philippines. Considering the circumstances of this case and the social
standing of private respondent in the community, he is entitled to the award
of moral and exemplary damages. However, the moral damages should be
reduced to P300,000.00, and the exemplary damages should be reduced to
P200,000.00. This award should be reasonably sufficient to indemnify private
respondent for the humiliation and embarrassment that he suffered and to
serve as an example to discourage the repetition of similar oppressive and
discriminatory acts.
On their return trip from Manila to the U.S. scheduled on January 17,
1982, petitioner arrived at the check-in counter of private respondent at the
Manila International Airport at 9:15 in the morning, which is a good one (1)
hour and fifteen (15) minutes ahead of the 10:30 A.M. scheduled flight time
recited in their tickets. Petitioners were rudely informed that they cannot be
accommodated inasmuch as Flight 002 scheduled at 9:15 a.m. was already
taking off and the 10:30 A.M. flight time entered in their plane tickets was
erroneous.
Issue: Whether or not the elimination of the CA of the award for moral
damages.
Held: Yes. The contention of the CA that the appellees did not take the
witness stand to testify on their "social humiliation, wounded feelings and
anxiety" and the breach of contract was not malicious or fraudulent was
without merit. The CA overlooked the fact that a year after the incident there
was a turmoil in the country because of the assassination of Benigno Aquino
and that violent demonstrations in the country were sensationalized in the
U.S. media so petitioners were advised to refrain from returning to the
Philippines at the time when they were scheduled to testify. Nevertheless,
Atty. Armovit, brother of Dr. Armovit, took the witness stand for he was there
from the time they checked in until the time they were rudely informed that
their flight had already taken off.
Angered and frustrated Dr. Armovit told the said check-in-officer that
he had to be accommodated that morning so that he could attend to all his
appointments in the U.S.; that petitioner Jacqueline Armovit also complained
about not being able to report for work at the expiration of her leave of
absence; that while petitioner had to accept private respondent's offer for
hotel accommodations at the Philippine Village Hotel so that they could follow
up and wait for their flight out of Manila the following day, petitioners did not
use their meal coupons supplied because of the limitations thereon so they
had to spend for lunch, dinner, and breakfast in the sum of P1,300.00 while
waiting to be flown out of Manila; that Dr. Armovit had to forego the
professional fees for the medical appointments he missed due to his inability
to take the January 17 flight; that the petitioners were finally able to fly out of
Manila on January 18, 1982, but were assured of this flight only on the very
morning of that day, so that they experienced anxiety until they were
assured seats for that flight.
C. Exemplary Damages
PRUDENCIADO vs. ALLIANCE TRANSPORT SYSTEM, INC.
Facts: Petitioner was driving her own Chevrolet Bel Air car along Arroceros
Street with the intention of crossing Taft Avenue in order to turn left, to go to
the Philippine Normal College Compound where she would hold classes. She
claimed that she was driving her car at the rate of 10 kmph, that before
crossing Taft Ave. she stopped her car and looked to the right and to the left
and not noticing any on-coming vehicle on either side she slowly proceeded
on first gear to cross the same, but when she was almost at the center, near
the island thereof, Jose Leyson who was driving People's Taxicab owned and
operated by Alliance Transport System, Inc., suddenly bumped and struck
petitioner’s car, thereby causing physical injuries in different parts of her
body, suffering more particularly brain concussion while her car was
damaged to the extent of P2,451.27. The damage to the taxicab amounted to
P190.00. Petitioner filed a complaint for damages against respondents. The
lower court found Jose Leyson guilty of negligence. Alliance Transport
System, Inc. failed to prove to the satisfaction of the court that it had
exercised the required diligence of a good father of the family in the
selection, supervision and control of its employees. Both defendants were
held jointly and severally liable for the physical injuries suffered by the
plaintiff as well as for the damage to her car, in addition to the other
consequential damages prayed for. The award was P2,451.27 for actual
damages representing the cost for the repair of the car of plaintiff;
P25,000.00 as moral damages; P5,000.00 as exemplary damages; and the
further sum of P3,000.00 as attorney's fees, with costs against the
defendants. CA modified the award, reducing the amount of moral damages
from P25,000 to P2,000 and eliminating the award of exemplary damages
and attorney's fees. Hence the instant petition.
Held: No. A careful review of the records makes it readily apparent that the
injuries sustained by petitioner are not as serious or extensive as they were
claimed to be, to warrant the damages awarded by the trial court. In fact, a
closer scrutiny of the exhibits showing a moderate damage to the car can by
no stretch of the imagination produce a logical conclusion that such
disastrous effects of the accident sought to be established, actually took
place, not to mention the fact that such were not supported by the medical
findings presented. Unquestionably, therefore, the damages imposed by the
lower court should be reduced to more reasonable levels. On the other hand,
it will be observed that the reduction of the damages made by the Court of
Appeals is both too drastic and unrealistic, to pass the test of
reasonableness, which appears to be the underlying basis to justify such
reduction. While the damages sought to be recovered were not satisfactorily
established to the extent desired by the petitioner, it was nonetheless not
disputed that an accident occurred due to the fault and negligence of the
respondents that Dra. Prudenciado suffered a brain concussion which
although mild can admittedly produce the effects complained of by her and
that these symptoms can develop after several years and can lead to some,
serious handicaps or predispose the patient to other sickness. Being a doctor
by profession, her fears can be more real and intense than an ordinary
person. Otherwise stated, she is undeniably a proper recipient of moral
damages which are proportionate to her suffering.
As to exemplary damages, Article 2231 of the Civil Code provides: “In
quasi-delicts, exemplary damages may be granted if the defendant acted
with grave negligence.” The rationale behind exemplary or corrective
damages is, as the name implies, to provide an example or correction for the
public good. The findings of the trial court is apparent, which became the
basis of the award of exemplary damages that respondent driver was running
at high speed after turning to the right along Taft Ave. coming from Ayala
Boulevard, considering that the traffic was clear. Failing to notice petitioner's
car, he failed to apply his brakes and did not even swerve to the right to
avoid the collision. Much more, it was raining that time and the roads are
slippery. The frequent incidence of accidents of this nature caused by taxi
drivers indeed demands corrective measures. This however was overruled by
CA and did not subscribed to the fact that the driver was grossly negligent, in
which this Court finds that it has erred.
DISPOSITIVE: PREMISES CONSIDERED, the assailed decision of the Court of
Appeals is hereby MODIFIED insofar as the award of damages is concerned;
and respondents are ordered to jointly and severally pay the petitioner; (1)
the sum of P2,451.27 for actual damages representing the cost of the repair
of her car; (2) the sum of P15,000.00 as moral damages; (3) the sum of
P5,000.00 as exemplary damages; and (4) the sum of P3,000.00 as attorney's
fees. No pronouncement as to costs.
Facts: A passenger bus of the Philippine Rabbit Bus Lines which was then
driven by Silverio Marchan fell into a ditch somewhere in Barrio Malanday,
Polo, Bulacan, while travelling on its way to Manila. As a result of which
Arsenio Mendoza, his wife and child, who were then inside the bus as
passengers were thrown out to the ground resulting in their multiple injuries.
Arsenio Mendoza suffered the most serious injuries which damaged his
vertebrae causing the paralysis of his lower extremities. An action was
brought to recover damages against petitioners predicated not only on a
breach of contract of carriage for failure to safely convey the plaintiffs to their
destination, but also on account of a criminal negligence on the part of
defendant driver. The lower court ruled in favor of plaintiffs. The award of
P40,000.00 as compensatory damages was affirmed by CA. It however added
the amount of P30,000.00 as exemplary damages and sustained the award of
attorney's fees in the amount of P5,000.00.
Held: Yes. It is argued that this Court is without jurisdiction to adjudicate the
exemplary damages since there was no allegation nor prayer, nor proof, nor
counterclaim of error for the same by the respondents. It is to be observed
however, that in the complaint, plaintiffs "prayed for such other and further
relief as this Court may deem just and equitable." Now, since the body of the
complaint sought to recover damages against the defendant-carrier wherein
plaintiffs prayed for indemnification for the damages they suffered as a result
of the negligence of the driver who is appellant's employee and since
exemplary damages is intimately connected with general damages, plaintiffs
may not be expected to single out by express term the kind of damages they
are trying to recover against the defendant's carrier. Suffice it to state that
when plaintiffs prayed in their complaint for such other relief and remedies
that may be availed of under the premises, in effect, therefore, the court is
called upon the exercise and use its discretion whether the imposition of
punitive or exemplary damages even though not expressly prayed or pleaded
in the plaintiffs' complaint. Exemplary damages may be imposed by way of
example or correction only in addition, among others, to compensatory
damages, but that they cannot be recovered as a matter of right, their
determination depending upon the discretion of the court. If the amount of
exemplary damages need not be proved, it need not also be alleged, and the
reason is obvious because it is merely incidental or dependent upon what the
court may award as compensatory damages.
There is no reason to consider that the lower court erred in awarding
the P5,000 attorneys fees. A modification of the decision however is proper.
Respondents are entitled to interest for the amount of compensatory
damages from the date of the decision of the lower court and legal interest
on the exemplary damages from the date of the decision of the Court of
Appeals.