Pedro de Guzman v.

Court of Appeals
G.R. No. L-47822
Facts:
Herein respondent Ernesto Cendana was engaged in buying up used bottles and scrap metal in
Pangasinan. Normally, after collection respondent would bring such material to Manila for
resale. He
utilized (2) two six-wheelers trucks which he owned for the purpose. Upon returning to
Pangasinan, he
would load his vehicle with cargo belonging to different merchants to different establishments in
Pangasisnan which respondents charged a freight fee for.
Sometime in November 1970, herein petitioner Pedro de Guzman, a merchant and dealer of
General Milk Company Inc. in Pangasinan contracted with respondent for hauling 750 cartons of
milk.
Unfortunately, only 150 cartons made it, as the other 600 cartons were intercepted by hijackers
along
Marcos Highway. Hence, petitioners commenced an action against private respondent.
In his defense, respondent argued that he cannot be held liable due to force majuere, and that
he
is not a common carrier and hence is not required to exercise extraordinary diligence.
Issues:
1. Whether or not respondent can be held liable for loss of the cartons of milk due to force
majeure.
2. Whether or not respondent is a common carrier.
Held:
1. The court ruled the affirmative. The circumstances do not fall under the exemption from
liability as
enumerated in Article 1734 of the Civil Code. The general rule is established by the article 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:
a. Flood, storm, earthquake, lightning or other natural disasters;
b. Act of the public enemy, whether international or civil;
c. Act or omission of the shipper or owner of the goods;
d. Character of the goods or defects in the packing;
e. Order or act of competent public authority.
2. The court ruled the affirmative. Article 1732 of the New Civil Code avoids any 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. It also avoids a distinction between a person or
enterprise offering transportation services on a regular or scheduled basis and one offering such
services on an occasional, episodic, and unscheduled basis.
First Philippine Industrial Corp. v. Court of Appeals
7
Transportation Law Case Digests
G.R. No. 125948
Facts:
Herein petitioner applied for a mayor’s permit to operate its pipeline concession. Before such
permit was issued, the City treasurer required petitioner to pay local tax. In order not to hamper
its
operations, petitioner paid the tax under protest.
Then the petitioner filed a letter protest addressed to the treasurer claiming exemption from
payment of the tax because according to the Local Government Code of 1991, transportation
contractors
are not included in the enumeration of contractors which are liable to pay taxes. The city
treasurer denied
the protest. The petitioner filed a case before the trial court for tax refund, however it was
subsequently
dismissed. Hence, this petition.
Issue:
Whether or not the petitioner is a common carrier as contemplated to be exempted under the
law.
Held:
The court rules the affirmative. The court enunciated the (4) tests in determining whether the
carrier is that of a common carrier:
a. must be engaged int eh business of carrying goods for other as a public employment and
must hold itself out as ready to engage in the transportation of goods generally as a business
and not a casual occupation
b. it must undertake to carry goods of the kind which its business is confined;
c. it must undertake the method by which his business is conducted and over its established
roads;
d. the transportation must be for hire.
In the case at bar, the court categorically ruled that the transporting of oil through pipelines is
still
considered to be an activity of a common carrier. The petitioner is a common carrier because it
is
engaged in the business of transporting passengers or goods; like petroleum. It undertakes to
carry for
all persons indifferently. The fact that the petitioner has limited clientele does not exclude it from
the
definition of common carrier. Under the petroleum act of the Philippines, the petitioner is
considered a
common carrier even if it is a pipeline concessionaire.
And even as regards the petroleum operation, it is of public utility. Specifically, the Bureau of
Internal Revenue considers petitioners as common carrier not subject to withholding tax.
Bascos v. CA

Facts:

Rodolfo Cipriano, representing CIPTRADE, entered into a hauling contract with Jibfair Shipping Agency
Corporation whereby the former bound itself to haul the latter’s 2000m/tons of soya bean meal from
Manila to Calamba. CIPTRADE subcontracted with petitioner Estrellita Bascos to transport and deliver
the 400 sacks of soya beans. Petitioner failed to deliver the cargo, and as a consequence, Cipriano paid
Jibfair the amount of goods lost in accordance with their contract. Cipriano demanded reimbursement
from petitioner but the latter refused to pay. Cipriano filed a complaint for breach of contract of
carriage. Petitioner denied that there was no contract of carriage since CIPTRADE leased her cargo truck,
and that the hijacking was a force majeure. The trial court ruled against petitioner.

Issues:

(1) Was petitioner a common carrier?

(2) Was the hijacking referred to a force majeure?

Held:

(1) Article 1732 of the Civil Code defines a common carrier as "(a) person, corporation or firm, or
association 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." The test to determine a common
carrier is "whether the given undertaking is a part of the business engaged in by the carrier which he has
held out to the general public as his occupation rather than the quantity or extent of the business
transacted." In this case, petitioner herself has made the admission that she was in the trucking
business, offering her trucks to those with cargo to move. Judicial admissions are conclusive and no
evidence is required to prove the same.

(2) Common carriers are obliged to observe extraordinary diligence in the vigilance over the goods
transported by them. Accordingly, they are presumed to have been at fault or to have acted negligently
if the goods are lost, destroyed or deteriorated. There are very few instances when the presumption of
negligence does not attach and these instances are enumerated in Article 1734. In those cases where
the presumption is applied, the common carrier must prove that it exercised extraordinary diligence in
order to overcome the presumption. The presumption of negligence was raised against petitioner. It
was petitioner's burden to overcome it. Thus, contrary to her assertion, private respondent need not
introduce any evidence to prove her negligence. Her own failure to adduce sufficient proof of
extraordinary diligence made the presumption conclusive against her.
Fabre vs CA Case Digest
Fabre vs. Court of Appeals
259 SCRA 426
G.R. No. 111127
July 26, 1996

Facts: Petitioners Engracio Fabre, Jr. and his wife were owners of a Mazda minibus. They used the
bus principally in connection with a bus service for school children which they operated in Manila. It
was driven by Porfirio Cabil.

On November 2, 1984 private respondent Word for the World Christian Fellowship Inc. (WWCF)
arranged with the petitioners for the transportation of 33 members of its Young Adults Ministry from
Manila to La Union and back in consideration of which private respondent paid petitioners the
amount of P3,000.00.

The usual route to Caba, La Union was through Carmen, Pangasinan. However, the bridge at
Carmen was under repair, so that petitioner Cabil, who was unfamiliar with the area (it being his first
trip to La Union), was forced to take a detour through the town of Ba-ay in Lingayen, Pangasinan. At
11:30 that night, petitioner Cabil came upon a sharp curve on the highway. The road was slippery
because it was raining, causing the bus, which was running at the speed of 50 kilometers per hour,
to skid to the left road shoulder. The bus hit the left traffic steel brace and sign along the road and
rammed the fence of one Jesus Escano, then turned over and landed on its left side, coming to a full
stop only after a series of impacts. The bus came to rest off the road. A coconut tree which it had hit
fell on it and smashed its front portion. Because of the mishap, several passengers were injured
particularly Amyline Antonio.

Criminal complaint was filed against the driver and the spouses were also made jointly liable.
Spouses Fabre on the other hand contended that they are not liable since they are not a common
carrier. The RTC of Makati ruled in favor of the plaintiff and the defendants were ordered to pay
jointly and severally to the plaintiffs. The Court of Appeals affirmed the decision of the trial court.

Issue: Whether the spouses Fabre are common carriers?

Held: Petition was denied. Spouses Fabre are common carriers.

The Supreme Court held that this case actually involves a contract of carriage. Petitioners, the
Fabres, did not have to be engaged in the business of public transportation for the provisions of the
Civil Code on common carriers to apply to them. As this Court has held: 10 Art. 1732, Common
carriers are persons, corporations, firms or associations engaged in the business of carrying or
transporting passengers or goods or both, by land, water, or air for compensation, offering their
services to the public.

The above article 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. We think that Article 1732 deliberately refrained from making such distinctions.
FGU Insurance v. GP Sarmiento Trucking and Lambert Eroles

FACTS:

- G.P. Sarmiento Trucking Corporation (GPS) undertook to deliver 30 units of Condura S.D. white
refrigerators aboard one of its Isuzu trucks, driven by Lambert Eroles, from the plant site of
Concepcion Industries, Inc., along South Superhighway in Alabang, Metro Manila, to the Central
Luzon Appliances in Dagupan City. While the truck was traversing the north diversion road
along McArthur highway in Barangay Anupol, Bamban, Tarlac, it collided with an unidentified
truck, causing it to fall into a deep canal, resulting in damage to the cargoes.

- FGU Insurance Corporation (FGU), an insurer of the shipment, paid to Concepcion Industries,
Inc., the value of the covered cargoes in the sum of P204,450.

- FGU, in turn, being the subrogee of the rights and interests of Concepcion Industries, Inc.,
sought reimbursement of the amount it had paid to the latter from GPS.

- Since the trucking company failed to heed the claim, FGU filed a complaint for damages and
breach of contract of carriage against GPS and its driver Lambert Eroles with the RTC.

- Respondents asserted that GPS was the exclusive hauler only of Concepcion Industries, Inc.,
since 1988, and it was not so engaged in business as a common carrier. Respondents further
claimed that the cause of damage was purely accidental. GPS instead of submitting evidence,
filed with leave of court a motion to dismiss the complaint by way of demurrer to evidence on
the ground that petitioner had failed to prove that it was a common carrier.

- RTC granted the motion to dismiss. FGU appealed. CA rejected such appeal and ruled in favor of
petitioner.

ISSUE:

- W/N GPS may be considered as a common carrier as defined under the law and existing
jurisprudence? NO

- W/N GPS may be presumed to have been negligent when the goods it undertook to transport
safely were subsequently damaged while in its custody? YES

RULING:

GPS, being an exclusive contractor and hauler of Concepcion Industries, Inc., rendering or offering its
services to no other individual or entity, cannot be considered a common carrier. Common carriers are
persons, corporations, firms or associations engaged in the business of carrying or transporting
passengers or goods or both, by land, water, or air, for hire or compensation, offering their services to
the public, whether to the public in general or to a limited clientele in particular, but never on an
exclusive basis. The true test of a common carrier is the carriage of passengers or goods, providing space
for those who opt to avail themselves of its transportation service for a fee. Given accepted standards,
GPS scarcely falls within the term "common carrier."

The above conclusion nothwithstanding, GPS cannot escape from liability. In culpa contractual, upon
which the action of petitioner rests as being the subrogee of Concepcion Industries, Inc., the mere proof
of the existence of the contract and the failure of its compliance justify, prima facie, a corresponding
right of relief. The law, recognizing the obligatory force of contracts, will not permit a party to be set
free from liability for any kind of misperformance of the contractual undertaking or a contravention of
the tenor thereof. A breach upon the contract confers upon the injured party a valid cause for
recovering that which may have been lost or suffered.

Respondent trucking corporation recognizes the existence of a contract of carriage between it and
petitioner’s assured, and admits that the cargoes it has assumed to deliver have been lost or damaged
while in its custody. In such a situation, a default on, or failure of compliance with, the obligation – in
this case, the delivery of the goods in its custody to the place of destination - gives rise to a presumption
of lack of care and corresponding liability on the part of the contractual obligor the burden being on him
to establish otherwise. GPS has failed to do so.

Respondent driver, on the other hand, without concrete proof of his negligence or fault, may not
himself be ordered to pay petitioner. The driver, not being a party to the contract of carriage between
petitioner’s principal and defendant, may not be held liable under the agreement. A contract can only
bind the parties who have entered into it or their successors who have assumed their personality or
their juridical position.Consonantly with the axiom res inter alios acta aliis neque nocet prodest, such
contract can neither favor nor prejudice a third person. Petitioner’s civil action against the driver can
only be based on culpa aquiliana, which, unlike culpa contractual, would require the claimant for
damages to prove negligence or fault on the part of the defendant.
Asia Lighterage and Shipping, Inc vs CA

FACTS:

Asia Lighterage and Shipping, Inc was contracted as carrier to deliver 3,150 metric tons of Better

Western White Wheat in bulk, (US$423,192.35) to the consignee‘s (General Milling Corporation)

warehouse at Bo. Ugong, Pasig City insured by Prudential Guarantee and Assurance, Inc. against

loss/damage for P14,621,771.75.

It appears that on August 17, 1990, the transport of said cargo was suspended due to a warning of

an incoming typhoon. PSTSI III was tied down to other barges which arrived ahead of it while

weathering out the storm that night. A few days after, the barge developed a list because of a hole

it sustained after hitting an unseen protuberance underneath the water. It filed a Marine Protest on

August 28, 1990 and also secured the services of Gaspar Salvaging Corporation to refloat the

barge.

The barge was then towed to ISLOFF terminal before it finally headed towards the consignee’s

wharf on September 5, 1990. Upon reaching the Sta. Mesa spillways, the barge again ran aground

due to strong current.

7 days later, a bidding was conducted to dispose of the damaged wheat retrieved & loaded on the

3 other barges. The total proceeds from the sale of the salvaged cargo was P201,379.75.

ISSUES:

1. Whether petitioner is a common carrier.

2. Assuming petitioner is a common carrier, whether it exercised extraordinary care and diligence

in its care and custody of the consignee’s cargo.

HELD:

1. Petitioner is a common carrier.

Article 1732 of the Civil Code defines common carriers as 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.

In De Guzman vs. CA it was held that the definition of common carriers in Article 1732 of the

Civil Code 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. There is

also no distinction between a person or enterprise offering transportation service on a

regular/scheduled basis and one offering such service on an occasional, episodic or unscheduled

basis.]

The test to determine a common carrier is “whether the given undertaking is a part of the business

engaged in by the carrier which he has held out to the general public as his occupation rather than

the quantity or extent of the business transacted.” In the case at bar, the petitioner admitted that it

is engaged in the business of shipping, lighterage and drayage, offering its barges to the public,

despite its limited clientele for carrying/transporting goods by water for compensation.

2. The findings of the lower courts should be upheld. Petitioner failed to exercise extraordinary

diligence in its care and custody of the consignee’s goods.

Common carriers are bound to observe extraordinary diligence in the vigilance over the goods

transported by them. They are presumed to have been at fault or to have acted negligently if the

goods are lost, destroyed or deteriorated. To overcome the presumption of negligence in the case

of loss, destruction or deterioration of the goods, the common carrier must prove that it exercised

extraordinary diligence.There are, however, exceptions

Art. 1734. 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;

In the case at bar, the barge completely sank after its towing bits broke, resulting in the total loss

of its cargo. Petitioner claims that this was caused by a typhoon, hence, it should not be held liable

for the loss of the cargo. However, petitioner failed to prove that the typhoon is the proximate and
only cause of the loss of the goods, and that it has exercised due diligence before, during and after

the occurrence of the typhoon to prevent/minimize the loss. The evidence show that, even before

the towing bits of the barge broke, it had already previously sustained damage when it hit a sunken

object while docked at the Engineering Island. It even suffered a hole. Clearly, this could not be

solely attributed to the typhoon. Thus, when petitioner persisted to proceed with the voyage, it

recklessly exposed the cargo to further damage.

Moreover, petitioner still headed to the consignee’s wharf despite knowledge of an incoming

typhoon. During the time that the barge was heading towards the consignee’s wharf on September

5, 1990, typhoon “Loleng” has already entered the Philippine area of responsibility
FACTS:1.

Petitioner Estela L. Crisostomo (Crisostomo) contracted the services of respondent Caravan Travel and
ToursInternational, Inc. (Caravan) to arrange and facilitate her booking, ticketing and accommodation in
a tour dubbed

“Jewels of Europe”.

2.

Pursuant to said contract, Meriam Menor (MEN

OR) who is also the niece of Crisostomo, went to the latter’s

residence to deliver the travel documents and plane tickets. Crisostomo, in turn, gave Menor the full
paymentfor the package tour.

3.

Without checking her travel documents, Crisostomo went to NAIA. However, she discovered that the
flightshe was supposed to take had already departed the previous day. She thus called up Menor to
complain.

4.

Subsequently, Menor prevailed upon Crisostomo to take another tour

the “British Pageant” to which

Crisostomo was asked to pay once again.

5. Upon Crisostomo’s return from Europe, she demanded from Caravan the reimbursement of
P61,421.70,representing the difference between the sum she paid for “Jewels of Europe” and the
amount she owed

Caravanfor the

“British Pageant” tour. Despite several demands,

Caravan refused to reimburse the amount, contendingthat the same was non-refundable. Crisostomo
thus filed a case.

6.

Crisostomo alleged that her failure to join “Jewels of Europe” was due to Caravan’s fa
ult since it did notclearly indicate the departure date on the plane ticket. Caravan was also negligent in
informing her of the wrongflight schedule through its employee Menor.7. Caravan insisted that
Crisostomo was informed of the correct departure date, which was clearly and legibly printed on the
plane ticket. The travel documents were given two days ahead of the scheduled trip. Crisostomohad
only herself to blame for missing the flight, as she did not bother to read or confirm her flight schedule
as printed on the ticket.8. RTC: Caravan was negligent in erroneously advising Crisostomo of the wrong
date. Crisostomo incurredcontributory negligence for not checking her travel documents. Caravan
should reimburse Crisostomo but withdeductions due to her contributory negligence.9. CA: Both parties
were at fault. However, Crisostomo is more negligent because as a lawyer and well-
traveled person, she should have known better than to simply rely on what was told to her. This being s
o, she is notentitled to any form of damages.10. Crisostomo appealed to SC.

She contended that Caravan did not observe the standard of care requiredof a common carrier when
it informed her wrongly of the flight schedule. She could not be deemed morenegligent than Caravan
since the latter is required by law to exercise extraordinary diligence in thefulfillment of its obligation

. If she were negligent at all, the same is merely contributory and not the proximatecause of the damage
she suffered.

ISSUE

: Whether or not a travel agency is a common carrier and is therefore required to exercise
extraordinarydiligence.

HELD

: No, a travel agency is not an entity engaged in the business of transporting either passengers or
goodsand is therefore, neither a private nor a common carrier.

RATIO

: By definition, a contract of carriage or transportation is one whereby a certain person or association

of persons obligate themselves to transport persons, things, or news from one place to another for a fix
ed price. Such person or association of persons are regarded as carriers and are classified as private or s
pecialcarriers and common or public carriers. A common carrier is defined under Article 1732 of the Civil
Code
as persons, corporations, firms or associations engaged in the business of carrying or transporting passe
ngers orgoods or both, by land, water or air, for compensation, offering their services to the public.

No, for there was no contract of carriage.

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

From the above definition, Caravan Travel and Tours is not an entity engaged in the business of
transporting either passengers or goods and is therefore, neither a private nor a common carrier. Caravan
Travel and Tours did not undertake to transport Estela from one place to another since its covenant with
its customers is simply to make travel arrangements in their behalf. Caravan travel and tour’s services as
a travel agency include procuring tickets and facilitating travel permits or visas as well as booking
customers for tours.

While Estela concededly bought her plane ticket through the efforts of respondent company, this does not
mean that the latter ipso facto is a common carrier. At most, Caravan Travel and Tours acted merely as
an agent of the airline, with whom the former ultimately contracted for her carriage to Europe.