LAW ON TRANSPORTATION AND PUBLIC UTILITIES 1.
He must be engaged in the business of carrying goods for others as a
Contract of Transportation person obligates himself to transport persons or
property from one place to another for a consideration.
2 KINDS:
1. CARRIAGE OF PASSENGERS
Parties: common carrier & passenger (carried gratuitously or not)
Passenger one who travels in a public conveyance by virtue of contract,
express or implied, with the carrier as to the payment of fare or that which is
accepted as an equivalent thereof
Perfection:
2 types of contracts of carriage of PASSENGERS:
> contract to carry (agreement to carry the passenger at some future date)
consensual contract and perfected by mere consent
* AIRCRAFT perfected even without issuance of ticket as long as there was
already meeting of minds with respect to the subject matter and consideration
> Contract of Carriage
real contract; not until the facilities of the carrier are actually used can the
carrier be said to have assumed the obligation of the carrier; perfected by
actual use.
* AIRCRAFT perfected if it was established that the passenger had checked in
at the departure counter, passed through customs and immigration, boarded
the shuttle bus and proceeded to the ramp of the aircraft and baggage already
loaded to the aircraft.
* Public Utility Bus or Jeepneys or Street Cars once it stops it is in effect
making a continuous offer to riders; perfected when passenger is already
attempting to board the vehicle
* TRAINS perfected when a person:
a. purchased a ticket/ possess sufficient fare with which to pay for
his passage
b. presented himself at the proper place and in a proper manner to
be transported
c. has a bona fide intention to use facilities of the carrier
2. CARRIAGE OF GOODS
Parties: shipper & carrier
Shipper the person who delivers the goods to the carrier for transportation;
pays the consideration or on whose behalf payment is made
Consignee person to whom the goods are to be delivered. May be the shipper
himself or a third person who is not actually a party to the contract
Perfection:
> contract to carry goods consensual
> contract of carriage - act of delivery of goods ( goods are unconditionally
placed in the possession and control of the carrier and upon their receipt by the
carrier for transportation)
CARRIER:
Common carriers (CC) (1732)
persons, corporations, firms or associations engaged in the business
of carrying or transporting passengers or goods or both, by land,
water, or air, for compensation, offering their services to the public.
(NOT the means of transportation)
one that holds itself out as ready to engage in the transportation of
goods for hire as a public employment and not as a casual
occupation.
Tests for determining WON a party is a common carrier of goods:
APRIL LYNN L. URSAL
public employment, and must hold himself out as ready to engage in
the transportation of goods for persons generally as a business and
not as a casual occupation.
2. He must undertake to carry good of the kind to which his business is
confined.
3. He must undertake to carry by the method by which his business is
conducted and over his established roads.
4. Transportation must be for hire.
Characteristics of Common carriers (CC):
no distinction between one whose principal business is the
transportation of persons/goods and one who does such as an
ancillary business (sideline)
no distinction between regular or scheduled basis and one offering
such service on an occasional, episodic or unscheduled business
still a CC even if services offered to a limited clientele (between the
general public and a narrow segment of the general population)
Still considered a CC even if he did not secure a Certificate of Public
Convenience
No distinction as to the means of transporting, as long as it is by
land, water or air
The Civil Code does not provide that the transportation should be by
motor vehicle
Still a CC even if he has no fixed and publicly know route, maintains
no terminals, and issues no tickets
pipeline operators are CCs not necessarily motor vehicles (Case:
First Philippine Industrial Corp. vs. CA)
Case: Jose Mendoza vs. Philippine Airlines Inc
- The test of whether one is a common carrier by air is whether he
holds out that he will carry for hire, so long as he has room, goods of
everyone bringing goods to him for carriage, not whether he is
carrying as a public employment or whether he carries to a fixed
place
CHARTER PARTY:
- Contract by which an entire ship or some principal part thereof is let
by the owner to another person for a specified time or use.
Q: What is the effect of charter party?
A: It may transform a common carrier into a private carrier. However, it must be
a bareboat or demise charter where the charterer mans the vessel with his own
people and becomes, in effect, the owner for the voyage or service stipulated
2 types:
1. Contract of Affreightment
- involves the use of shipping space on vessels leased by
the owner in part or as a whole, to carry goods for
another
- CC = observe extraordinary diligence; in case of loss,
deterioration or destruction of goods of goods, CCs are
presumed to be at fault or have acted negligently
- 2 types
i. Time charter: vessel is leased to the charterer
for a fixed period of time
ii. Voyage charter: ship is leased for a single
voyage
2. Charter by demise/ Bareboat Charter
- whole vessel is let to the charterer with a transfer to him
of its entire command and possession and consequent
control over its navigation including the master and the
crew who are his servants.
- charter includes both vessel and crewCC becomes
private carrier (PC) insofar as that particular voyage is
concerned
- if it is already a PC- ordinary diligence in the carriage of
goods will suffice
Page 1
 - PC = undertaking is a single transaction, not a part of the
general business or occupation, although involving the
carriage of goods for a fee; NO presumption of negligence
applies whosoever alleges damage to or deterioration
of the goods carried has the burden of proving that the
cause was the negligence of the carrier.
Distinction between Common Carriers and Private Carriers
COMMON CARRIER PRIVATE CARRIER
Extraordinary diligence in the Ordinary diligence in the carriage of
vigilance over the goods they carry goods will suffice
In case of loss, destruction, or No such presumption applies to
deterioration of goods, they are private carriers, for whosoever alleges
presumed to have been at fault or to damage to or deterioration n of the
have acted negligently; burden of goods carried has the onus of proving
proving otherwise rests on them that the cause was the negligence of
the carrier
Cannot stipulate that it is exempt May validly enter into such stipulation
from liability for the negligence of its
agents or employees
Arrastre
- Arrastre operators functions has nothing to do with the trade and
business of navigation nor to the use or operation of vessels
- Services are not maritime
- Functions of arrastre operator:
o Receive, handle, care for, and deliver all merchandise
imported and exported, upon or passing over
Government-owned wharves and piers in the port
o Record or check all merchandise which may be delivered
to said port ant shipside
o Furnish light, and water services and other incidental
service in order to undertake its arrastre service
- Such service is in face, no different from those of a depositary or
warehouseman
Stevedoring
- involves the loading and unloading of coastwise vessels calling at
the port.
>>> Common carriers are public utilities, impressed with public interest and
concern subject to regulation by the state.

Factors to be considered whether a carrier is common/private: GOVERNING LAWS

Law applicable - read summary of rules on page 40 of book
o Common Civil Code
Article 1766 (Civil Code). In all matters not regulated by this Code, the
o Private contract
rights and obligations of common carriers shall be governed by the Code
Diligence required
of Commerce and by special laws.
o Common extraordinary diligence
o Private diligence of a good father of a family
NATURE OF BUSINESS
Burden of proof in relation to negligence
- Common Carriers exercise a sort of public office
o Common the carrier
- Consequently, common carriers are subject to regulation by the
o Private on the party having a claim against the carrier
State
Case: Planters Products, Inc. vs. CA
REGISTERED OWNER RULE/REGISTRATION LAWS
- It is therefore imperative that a public carrier shall remain as such,
- Governed by the Land Transportation and Traffic Code and
notwithstanding the charter of the whole or portion of a vessel by
administered by the Land Transportation Office
one or more persons, provided the charter is limited to the ship only,
- The registered owner of a vehicle is liable fro any damage caused by
as in the case of a time-charter or voyage-charter. It is only when the
the negligent operation of the vehicle although the same was
charter includes both the vessel and its crew that a common carrier
already sold or conveyed to another person at the time of the
becomes private
accident.
- The registered owner is liable to the injured party subject to his right
True Test of Common Carrier Is the carriage of passengers or goods, provided it
of recourse against the transferee or the buyer
has space, for all who opt to avail themselves of its transportation service for a
- Applicable in case of lease
fee
- Registered owner not liable if vehicle was taken form him without
his knowledge and consent.
Generally, private carriage is undertaken by spcial agreement and the carrier
does not hold hiself out to carry goods for the general public
Q: what is the purpose of such law?
A: The main aim of motor vehicle registration is to identify the owner so that if
Case: Estela Crisostomo vs. CA and Caravan Travel and Tours International
any accident happens, or that any damage or injury is caused by the vehicle on
- By definition, a contract of carriage is one whereby a certain person
the public highways, responsibility therefor can be fixed on a definite individual
or association of persons obligate themselves to transport person,
the registered owner.
thing or new from one place to another for a fixed price
- It is obvious from the above definition that respondent is not an
KABIT SYSTEM
entity engaged in the business of transporting either passengers or
- The registered owner rule is applicable to people involved on a kabit
goods and is therefore, neither a private nor a common carrier. Its
system
covenant with its customers is simply to make travel arrangements
- arrangement whereby a person who has been granted a certificate of
in their behalf.
public convenience allows other persons who own motor vehicles to
- It is in this sense that the contract between the parties in this case
operate them under his license, sometimes for a fee or percentage of the
was an ordinary one for services and not one of carriage; it is thus
earnings --- contrary to public policy (thus VOID and INEXISTENT)
not bound under the law to observe extraordinary diligence in the
- parties to the kabit system cannot invoke the same as against each
performance of its obligation.
other either to enforce their illegal agreement or to invoke the same to
escape liability --- pari delicto rule
COMMON CARRIERS vs. TOWAGE, ARRASTRE AND STEVEDORING
- having entered into an illegal contract, neither can seek relief from the
courts and each must bear the consequences of his acts
Towage
- also applicable to aircrafts and vessels basic rule that no person can
- A vessel is hired to bring another vessel to another place
operate a common carrier without securing a certificate of public
- e.g. a tugboat may be hired by CC to bring the vessel to a port
convenience and necessity.
(operator of tugboat not CC)
- in maritime law: towing for the mere purpose of expediting her
voyage without reference to any circumstances of danger

APRIL LYNN L. URSAL Page 2

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