Ganzon v.

Court of Appeals
161 SCRA 646

Facts:
Ganzon, petitioner herein, was hired by Tumambing to haul 305 tons of scrap iron.
The contract was for the petitioner to transport the scrap iron to Manila from Bataan.
Tumambing delivered the scrap iron to Niza, captain of the lighter LCT Batman, to board it
on the same. The crew of the Batman started to load the iron, and when they were about
halfway through, Mayor Advincula arrived and demanded P5,000 from Tumambing. The latter
resisted and a heated argument started. Mayor Advincula drew his gun and fired at
Tumambing. He was brought to the hospital for treatment, lucky for him the wound was not
fatal.
A few days after this incident, the loading of the scrap metal was resumed. However,
the acting Mayor this time went to the port where the Batman was docked. He was
accompanied by 3 policemen and he ordered Captain Niza to dump the scrap iron where the
lighter was docked. What was left or the iron was confiscated by the Acting Mayor and brought
to NASSCO. A receipt was issued showing that the municipality had taken custody of the
scraps or iron.
Tumambing filed a case in order to recover damages for the loss that he sustained.
The lower court rendered a decision in favor of Ganzon. However, on appeal the Court of
Appeals reversed the decision ordering Ganzon to pay Tumambing P5,895 as actual damages,
P5,000 for exemplary damages and attorneys fees as well. Hence this petition by Ganzon.

Issue:
Whether or not Ganzon is liable for the loss that Tumambing sustained.

Held:
The Court held that Ganzon is liable for the loss of Tumambing. The defense that the
scraps of iron were not unconditionally placed in his custody and control is untenable.
Petitioner herein admits that the scraps of iron were delivered to Captain Niza by Tumambing
in order to load the same on the lighter Batman. The employees of Ganzon received the scraps
of iron on his behalf, therefore the scraps of metal were placed in his custody and control.
Upon the receipt of the scraps by the carrier in order transport the same, the contract of
carriage was perfected. Upon perfection of the contract, the exercise of extraordinary
diligence in caring for the goods shall also commence to begin.
Article 1738 of the NCC provides that the exercise of extraordinary diligence shall
cease only upon delivery to the consignee or to the person who has the right to receive the
same. In this case, there was no delivery made to the consignee, therefore the carrier should
have exercised extraordinary diligence in taking care of the scraps of iron. It is irrelevant that
the scraps of iron were only partially loaded on the lighter. The scraps of iron were already
under the custody and control of the carrier, therefore he shall be liable for its loss.