Transpo Cases 2

1
Cristostomo vs CA gr no. 138334 August 25 2003
Problem:
Facts:
Estela L. Crisostomo contracted the services of Caravan Travel and Tours International, Inc. to arrange
and facilitate her booking, ticketing and accommodation in a tour dubbed "Jewels of Europe". The
package tour cost her P74, 322.70. She was given a 5% discount on the amount, which included airfare,
and the booking fee was also waived because petitioner’s niece, Meriam Menor, was former’s
company’s ticketing manager.
Menor went to her aunt’s residence on a Wednesday to deliver petitioner’s travel documents and plane
tickets. Estela, in turn, gave Menor the full payment for the package tour. Menor then told her to be at
the Ninoy Aquino International Airport (NAIA) on Saturday, two hours before her flight on board British
Airways.
Without checking her travel documents, Estela went to NAIA on Saturday, to take the flight for the first
leg of her journey from Manila to Hongkong. She discovered that the flight she was supposed to take
had already departed the previous day. She learned that her plane ticket was for the flight scheduled on
June 14, 1991. She thus called up Menor to complain.
Subsequently, Menor prevailed upon Estela to take another tour the "British Pageant”, which cost P20,
881.00. She gave caravan travel and tours P7, 980.00 as partial payment and commenced the trip in July
1991.
Upon petitioner’s return from Europe, she demanded from respondent the reimbursement of P61,
421.70, representing the difference between the sum she paid for "Jewels of Europe" and the amount
she owed respondent for the "British Pageant" tour. Despite several demands, respondent company
refused to reimburse the amount, contending that the same was non-refundable.
Estela filed a complaint against Caravan travel and Tours for breach of contract of carriage and damages.
Issue:
A) Will the action prosper?
B) Will she be entitled to damages?
Answer:
No, for there was no contract of carriage.
Transpotational Law notes 2

2
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.
B) No.
The negligence of the obligor in the performance of the obligation renders him liable for damages for
the resulting loss suffered by the obligee. Fault or negligence of the obligor consists in his failure to
exercise due care and prudence in the performance of the obligation as the nature of the obligation so
demands.
In the case at bar, Caravan Travel and Tours exercised due diligence in performing its obligations under
the contract and followed standard procedure in rendering its services to Estela. The plane ticket issued
to petitioner clearly reflected the departure date and time, contrary to Estela’s contention. The travel
documents, consisting of the tour itinerary, vouchers and instructions, were likewise delivered to her
two days prior to the trip. The Caravan Travel and Tours also properly booked Estela for the tour,
prepared the necessary documents and procured the plane tickets. It arranged Estela’s hotel
accommodation as well as food, land transfers and sightseeing excursions, in accordance with its
avowed undertaking.
From the foregoing, it is clear that the Caravan Travel and Tours performed its prestation under the
contract as well as everything else that was essential to book Estela for the tour.
Hence, Estela cannot recover and must bear her own damage.
________________________________________________________
PAL vs CA gr. 123238 September 22, 2008
DECISION
CHICO-NAZARIO, J.:

3
Before Us is a Petition for Review[1] on Certiorari under Rule 45 of the Rules of Court seeking to set
aside the Decision,[2] dated 20 December 1995, of the Court of Appeals in CA-G.R. CV No. 26921 which
affirmed in toto the Decision,[3] dated 2 April 1990, of the Quezon City Regional Trial Court (RTC),
Branch 90, in Civil Case No. Q-33893.
The undisputed facts are as follows:
Sometime before 2 May 1980, private respondents spouses Manuel S. Buncio and Aurora R. Buncio
purchased from petitioner Philippine Airlines, Incorporated, two plane tickets[4] for their two minor
children, Deanna R. Buncio (Deanna), then 9 years of age, and Nikolai R. Buncio (Nikolai), then 8 years
old. Since Deanna and Nikolai will travel as unaccompanied minors, petitioner required private
respondents to accomplish, sign and submit to it an indemnity bond.[5] Private respondents complied
with this requirement. For the purchase of the said two plane tickets, petitioner agreed to transport
Deanna and Nikolai on 2 May 1980 from Manila to San Francisco, California, United States of America
(USA), through one of its planes, Flight 106. Petitioner also agreed that upon the arrival of Deanna and
Nikolai in San Francisco Airport on 3 May 1980, it would again transport the two on that same day
through a connecting flight from San Francisco, California, USA, to Los Angeles, California, USA, via
another airline, United Airways 996. Deanna and Nikolai then will be met by their grandmother, Mrs.
Josefa Regalado (Mrs. Regalado), at the Los Angeles Airport on their scheduled arrival on 3 May 1980.
On 2 May 1980, Deanna and Nikolai boarded Flight 106 in Manila.
On 3 May 1980, Deanna and Nikolai arrived at the San Francisco Airport. However, the staff of United
Airways 996 refused to take aboard Deanna and Nikolai for their connecting flight to Los Angeles
because petitioners personnel in San Francisco could not produce the indemnity bond accomplished and
submitted by private respondents. The said indemnity bond was lost by petitioners personnel during the
previous stop-over of Flight 106 in Honolulu, Hawaii. Deanna and Nikolai were then left stranded at the
San Francisco Airport. Subsequently, Mr. Edwin Strigl (Strigl), then the Lead Traffic Agent of petitioner in
San Francisco, California, USA, took Deanna and Nikolai to his residence in San Francisco where they
stayed overnight.
Meanwhile, Mrs. Regalado and several relatives waited for the arrival of Deanna and Nikolai at the Los
Angeles Airport. When United Airways 996 landed at the Los Angeles Airport and its passengers
disembarked, Mrs. Regalado sought Deanna and Nikolai but she failed to find them. Mrs. Regalado
asked a stewardess of the United Airways 996 if Deanna and Nikolai were on board but the stewardess
told her that they had no minor passengers. Mrs. Regalado called private respondents and informed
them that Deanna and Nikolai did not arrive at the Los Angeles Airport. Private respondents inquired
about the location of Deanna and Nikolai from petitioners personnel, but the latter replied that they
were still verifying their whereabouts.
On the morning of 4 May 1980, Strigl took Deanna and Nikolai to San Francisco Airport where the two
boarded a Western Airlines plane bound for Los Angeles. Later that day, Deanna and Nikolai arrived at
the Los Angeles Airport where they were met by Mrs. Regalado. Petitioners personnel had previously
informed Mrs. Regalado of the late arrival of Deanna and Nikolai on 4 May 1980.
On 17 July 1980, private respondents, through their lawyer, sent a letter[6] to petitioner demanding
payment of 1 million pesos as damages for the gross negligence and inefficiency of its employees in
transporting Deanna and Nikolai. Petitioner did not heed the demand.
On 20 November 1981, private respondents filed a complaint[7] for damages against petitioner before
the RTC. Private respondents impleaded Deanna, Nikolai and Mrs. Regalado as their co-plaintiffs. Private
respondents alleged that Deanna and Nikolai were not able to take their connecting flight from San
Francisco to Los Angeles as scheduled because the required indemnity bond was lost on account of the
gross negligence and malevolent conduct of petitioners personnel. As a consequence thereof, Deanna

4
and Nikolai were stranded in San Francisco overnight, thereby exposing them to grave danger. This
dilemma caused Deanna, Nikolai, Mrs. Regalado and private respondents to suffer serious anxiety,
mental anguish, wounded feelings, and sleepless nights. Private respondents prayed the RTC to render
judgment ordering petitioner: (1) to pay Deanna and Nikolai P100,000.00 each, or a total of
P200,000.00, as moral damages; (2) to pay private respondents P500,000.00 each, or a total of
P1,000,000,00, as moral damages; (3) to pay Mrs. Regalado P100,000.00 as moral damages; (4) to pay
Deanna, Nikolai, Mrs. Regalado and private respondents P50,000.00 each, or a total of P250,000.00 as
exemplary damages; and (5) to pay attorneys fees equivalent to 25% of the total amount of damages
mentioned plus costs of suit.
In its answer[8] to the complaint, petitioner admitted that Deanna and Nikolai were not allowed to take
their connecting flight to Los Angeles and that they were stranded in San Francisco. Petitioner, however,
denied that the loss of the indemnity bond was caused by the gross negligence and malevolent conduct
of its personnel. Petitioner averred that it always exercised the diligence of a good father of the family in
the selection, supervision and control of its employees. In addition, Deanna and Nikolai were personally
escorted by Strigl, and the latter exerted efforts to make the connecting flight of Deanna and Nikolai to
Los Angeles possible. Further, Deanna and Nikolai were not left unattended from the time they were
stranded in San Francisco until they boarded Western Airlines for a connecting flight to Los Angeles.
Petitioner asked the RTC to dismiss the complaint based on the foregoing averments.
After trial, the RTC rendered a Decision on 2 April 1990 holding petitioner liable for damages for breach
of contract of carriage. It ruled that petitioner should pay moral damages for its inattention and lack of
care for the welfare of Deanna and Nikolai which, in effect, amounted to bad faith, and for the agony
brought by the incident to private respondents and Mrs. Regalado. It also held that petitioner should
pay exemplary damages by way of example or correction for the public good under Article 2229 and
2232 of the Civil Code, plus attorneys fees and costs of suit. In sum, the RTC ordered petitioner: (1) to
pay Deanna and Nikolai P50,000.00 each as moral damages and P25,000.00 each as exemplary damages;
(2) to pay private respondent Aurora R. Buncio, as mother of Deanna and Nikolai, P75,000.00 as moral
damages; (3) to pay Mrs. Regalado, as grandmother of Deanna and Nikolai, P30,000.00 as moral
damages; and (4) to pay an amount of P38,250.00 as attorneys fees and the costs of suit. Private
respondent Manuel S. Buncio was not awarded damages because his court testimony was disregarded,
as he failed to appear during his scheduled cross-examination. The dispositive portion of the RTC
Decision reads:
ACCORDINGLY, judgment is hereby rendered:
1. Ordering defendant Philippines Airlines, Inc. to pay Deanna R. Buncio and Nikolai R. Buncio the
amount of P50,000.00 each as moral damages; and the amount of P25,000.00 each as exemplary
damages;
2. Ordering said defendant to pay the amount of P75,000.00 to Aurora R. Buncio, mother of Deanna and
Nikolai, as moral damages; and the amount of P30,000.00 to Josefa Regalado, grandmother of Deanna
and Nikolai, as moral damages; and
3. Ordering said defendant to pay P38,250.00 as attorneys fees and also the costs of the suit.[9]
Petitioner appealed to the Court of Appeals. On 20 December 1995, the appellate court promulgated its
Decision affirming in toto the RTC Decision, thus:
WHEREFORE, the decision appealed is hereby AFFIRMED in toto and the instant appeal DISMISSED.[10]
Petitioner filed the instant petition before us assigning the following errors[11]:
I.

5
THE COURT OF APPEALS ERRED IN SUSTAINING THE RTC AWARD OF MORAL DAMAGES.
II.
THE COURT OF APPEALS ERRED IN SUSTAINING THE RTC AWARD OF EXEMPLARY DAMAGES
III.
THE COURT OF APPEALS ERRED IN SUSTAINING THE RTC AWARD OF ATTORNEYS FEES AND ORDER FOR
PAYMENT OF COSTS.
Anent the first assigned error, petitioner maintains that moral damages may be awarded in a breach of
contract of air carriage only if the mishap results in death of a passenger or if the carrier acted
fraudulently or in bad faith, that is, by breach of a known duty through some motive of interest or ill will,
some dishonest purpose or conscious doing of wrong; if there was no finding of fraud or bad faith on its
part; if, although it lost the indemnity bond, there was no finding that such loss was attended by ill will,
or some motive of interest, or any dishonest purpose; and if there was no finding that the loss was
deliberate, intentional or consciously done.[12]
Petitioner also claims that it cannot be entirely blamed for the loss of the indemnity bond; that during
the stop-over of Flight 106 in Honolulu, Hawaii, USA, it gave the indemnity bond to the immigration
office therein as a matter of procedure; that the indemnity bond was in the custody of the said
immigration office when Flight 106 left Honolulu, Hawaii, USA; that the said immigration office failed to
return the indemnity bond to petitioners personnel before Flight 106 left Honolulu, Hawaii, USA; and
that even though it was negligent in overlooking the indemnity bond, there was still no liability on its
part because mere carelessness of the carrier does not per se constitute or justify an inference of malice
or bad faith.[13]
When an airline issues a ticket to a passenger, confirmed for a particular flight on a certain date, a
contract of carriage arises. The passenger has every right to expect that he be transported on that flight
and on that date, and it becomes the airlines obligation to carry him and his luggage safely to the agreed
destination without delay. If the passenger is not so transported or if in the process of transporting, he
dies or is injured, the carrier may be held liable for a breach of contract of carriage.[14]
Private respondents and petitioner entered into a contract of air carriage when the former purchased
two plane tickets from the latter. Under this contract, petitioner obliged itself (1) to transport Deanna
and Nikolai, as unaccompanied minors, on 2 May 1980 from Manila to San Francisco through one of its
planes, Flight 106; and (2) upon the arrival of Deanna and Nikolai in San Francisco Airport on 3 May
1980, to transport them on that same day from San Francisco to Los Angeles via a connecting flight on
United Airways 996. As it was, petitioner failed to transport Deanna and Nikolai from San Francisco to
Los Angeles on the day of their arrival at San Francisco. The staff of United Airways 996 refused to take
aboard Deanna and Nikolai for their connecting flight to Los Angeles because petitioners personnel in
San Francisco could not produce the indemnity bond accomplished and submitted by private
respondents. Thus, Deanna and Nikolai were stranded in San Francisco and were forced to stay there
overnight. It was only on the following day that Deanna and Nikolai were able to leave San Francisco and
arrive at Los Angeles via another airline, Western Airlines. Clearly then, petitioner breached its contract
of carriage with private respondents.

6
In breach of contract of air carriage, moral damages may be recovered where (1) the mishap results in
the death of a passenger; or (2) where the carrier is guilty of fraud or bad faith; or (3) where the
negligence of the carrier is so gross and reckless as to virtually amount to bad faith.[15]
Gross negligence implies a want or absence of or failure to exercise even slight care or diligence, or the
entire absence of care. It evinces a thoughtless disregard of consequences without exerting any effort to
avoid them.[16]
In Singson v. Court of Appeals,[17] we ruled that a carriers utter lack of care for and sensitivity to the
needs of its passengers constitutes gross negligence and is no different from fraud, malice or bad faith.
Likewise, in Philippine Airlines, Inc. v. Court of Appeals,[18] we held that a carriers inattention to, 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 and entitles the passenger to an award of moral damages.
It was established in the instant case that since Deanna and Nikolai would travel as unaccompanied
minors, petitioner required private respondents to accomplish, sign and submit to it an indemnity bond.
Private respondents complied with this requirement. Petitioner gave a copy of the indemnity bond to
one of its personnel on Flight 106, since it was required for the San Francisco-Los Angeles connecting
flight of Deanna and Nikolai. Petitioners personnel lost the indemnity bond during the stop-over of
Flight 106 in Honolulu, Hawaii. Thus, Deanna and Nikolai were not allowed to take their connecting
flight.
Evidently, petitioner was fully aware that Deanna and Nikolai would travel as unaccompanied minors
and, therefore, should be specially taken care of considering their tender age and delicate situation.
Petitioner also knew well that the indemnity bond was required for Deanna and Nikolai to make a
connecting flight from San Francisco to Los Angeles, and that it was its duty to produce the indemnity
bond to the staff of United Airways 996 so that Deanna and Nikolai could board the connecting flight.
Yet, despite knowledge of the foregoing, it did not exercise utmost care in handling the indemnity bond
resulting in its loss in Honolulu, Hawaii. This was the proximate cause why Deanna and Nikolai were not
allowed to take the connecting flight and were thus stranded overnight in San Francisco. Further,
petitioner discovered that the indemnity bond was lost only when Flight 106 had already landed in San
Francisco Airport and when the staff of United Airways 996 demanded the indemnity bond. This only
manifests that petitioner did not check or verify if the indemnity bond was in its custody before leaving
Honolulu, Hawaii for San Francisco.
The foregoing circumstances reflect petitioners utter lack of care for and inattention to the welfare of
Deanna and Nikolai as unaccompanied minor passengers. They also indicate petitioners failure to
exercise even slight care and diligence in handling the indemnity bond. Clearly, the negligence of
petitioner was so gross and reckless that it amounted to bad faith.
It is worth emphasizing that petitioner, as a common carrier, is bound by law to exercise extraordinary
diligence and utmost care in ensuring for the safety and welfare of its passengers with due regard for all
the circumstances.[19] The negligent acts of petitioner signified more than inadvertence or inattention
and thus constituted a radical departure from the extraordinary standard of care required of common
carriers.
Petitioners claim that it cannot be entirely blamed for the loss of the indemnity bond because it gave
the indemnity bond to the immigration office of Honolulu, Hawaii, as a matter of procedure during the
stop-over, and the said immigration office failed to return the indemnity bond to petitioners personnel
before Flight 106 left Honolulu, Hawaii, deserves scant consideration. It was petitioners obligation to
ensure that it had the indemnity bond in its custody before leaving Honolulu, Hawaii for San Francisco.
Petitioner should have asked for the indemnity bond from the immigration office during the stop-over

7
instead of partly blaming the said office later on for the loss of the indemnity bond. Petitioners
insensitivity on this matter indicates that it fell short of the extraordinary care that the law requires of
common carriers.
Petitioner, nonetheless, insists that the following circumstances negate gross negligence on its part: (1)
Strigl requested the staff of United Airways 996 to allow Deanna and Nikolai to board the plane even
without the indemnity bond; (2) Strigl took care of the two and brought them to his house upon refusal
of the staff of the United Airways 996 to board Deanna and Nikolai; (3) private respondent Aurora R.
Buncio and Mrs. Regalado were duly informed of Deanna and Nikolais predicament; and (4) Deanna and
Nikolai were able to make a connecting flight via an alternative airline, Western Airlines.[20] We do not
agree. It was petitioners duty to provide assistance to Deanna and Nikolai for the inconveniences of
delay in their transportation. These actions are deemed part of their obligation as a common carrier,
and are hardly anything to rave about.[21]
Apropos the second and third assigned error, petitioner argues that it was not liable for exemplary
damages because there was no wanton, fraudulent, reckless, oppressive, or malevolent manner on its
part. Further, exemplary damages may be awarded only if it is proven that the plaintiff is entitled to
moral damages. Petitioner contends that since there was no proof that private respondents were
entitled to moral damages, then they are also not entitled to exemplary damages.[22]
Petitioner also contends that no premium should be placed on the right to litigate; that an award of
attorneys fees and order of payment of costs must be justified in the text of the decision; that such
award cannot be imposed by mere conclusion without supporting explanation; and that the RTC
decision does not provide any justification for the award of attorneys fees and order of payment of
costs.[23]
Article 2232 of the Civil Code provides that exemplary damages may be awarded in a breach of contract
if the defendant acted in a wanton, fraudulent, reckless, oppressive or malevolent manner. In addition,
Article 2234 thereof states that the plaintiff must show that he is entitled to moral damages before he
can be awarded exemplary damages.
As we have earlier found, petitioner breached its contract of carriage with private respondents, and it
acted recklessly and malevolently in transporting Deanna and Nikolai as unaccompanied minors and in
handling their indemnity bond. We have also ascertained that private respondents are entitled to moral
damages because they have sufficiently established petitioners gross negligence which amounted to bad
faith. This being the case, the award of exemplary damages is warranted.
Current jurisprudence[24] instructs that in awarding attorneys fees, the trial court must state the
factual, legal, or equitable justification for awarding the same, bearing in mind that the award of
attorneys fees is the exception, not the general rule, and it is not sound public policy to place a penalty
on the right to litigate; nor should attorneys fees be awarded every time a party wins a lawsuit. The
matter of attorneys fees cannot be dealt with only in the dispositive portion of the decision. The text of
the decision must state the reason behind the award of attorneys fees. Otherwise, its award is totally
unjustified.[25]
In the instant case, the award of attorneys fees was merely cited in the dispositive portion of the RTC
decision without the RTC stating any legal or factual basis for said award. Hence, the Court of Appeals
erred in sustaining the RTCs award of attorneys fees.

8
Since we have already resolved that the RTC and Court of Appeals were correct in awarding moral and
exemplary damages, we shall now determine whether their corresponding amounts were proper.
The purpose of awarding moral damages is to enable the injured party to obtain means, diversion or
amusement that will serve to alleviate the moral suffering he has undergone by reason of defendants
culpable action.[26] On the other hand, the aim of awarding exemplary damages is to deter serious
wrongdoings.[27]
Article 2216 of the Civil Code provides that assessment of damages is left to the discretion of the court
according to the circumstances of each case. This discretion is limited by the principle that the amount
awarded should not be palpably excessive as to indicate that it was the result of prejudice or corruption
on the part of the trial court.[28] Simply put, the amount of damages must be fair, reasonable and
proportionate to the injury suffered.
The RTC and the Court of Appeals ordered petitioner to pay Deanna and Nikolai P50,000.00 each as
moral damages. This amount is reasonable considering the harrowing experience they underwent at
their tender age and the danger they were exposed to when they were stranded in San Francisco. Both
of them testified that they were afraid and were not able to eat and sleep during the time they were
stranded in San Francisco.[29] Likewise, the award of P25,000.00 each to Deanna and Nikolai as
exemplary damages is fair so as to deter petitioner and other common carriers from committing similar
or other serious wrongdoings.
Both courts also directed petitioner to pay private respondent Aurora R. Buncio P75,000.00 as moral
damages. This is equitable and proportionate considering the serious anxiety and mental anguish she
experienced as a mother when Deanna and Nikolai were not allowed to take the connecting flight as
scheduled and the fact that they were stranded in a foreign country and in the company of strangers.
Private respondent Aurora R. Buncio testified that she was very fearful for the lives of Deanna and
Nikolai when they were stranded in San Francisco, and that by reason thereof she suffered emotional
stress and experienced upset stomach.[30] Also, the award of P30,000.00 as moral damages to Mrs.
Regalado is appropriate because of the serious anxiety and wounded feelings she felt as a grandmother
when Deanna and Nikolai, whom she was to meet for the first time, did not arrive at the Los Angeles
Airport. Mrs. Regalado testified that she was seriously worried when Deanna and Nikolai did not arrive
in Los Angeles on 3 May 1980, and she was hurt when she saw the two crying upon arriving in Los
Angeles on 4 May 1980.[31] The omission of award of damages to private respondent Manuel S. Buncio
was proper for lack of basis. His court testimony was rightly disregarded by the RTC because he failed to
appear in his scheduled cross-examination.[32]
On another point, we held in Eastern Shipping Lines, Inc. v. Court of Appeals,[33] that when an
obligation, not constituting a loan or forbearance of money is breached, an interest on the amount of
damages awarded may be imposed at the rate of 6% per annum. We further declared that when the
judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest,
whether it is a loan/forbearance of money or not, shall be 12% per annum from such finality until its
satisfaction, this interim period being deemed to be then equivalent to a forbearance of credit.
In the instant case, petitioners obligation arose from a contract of carriage and not from a loan or
forbearance of money. Thus, an interest of 6% per annum should be imposed on the damages awarded,
to be computed from the time of the extra-judicial demand on 17 July 1980 up to the finality of this
Decision. In addition, the interest shall become 12% per annum from the finality of this Decision up to its
satisfaction.

9
Finally, the records[34] show that Mrs. Regalado died on 1 March 1995 at the age of 74, while Deanna
passed away on 8 December 2003 at the age of 32. This being the case, the foregoing award of damages
plus interests in their favor should be given to their respective heirs.
WHEREFORE, the Petition is PARTLY GRANTED. The Decision of the Court of Appeals, dated 20
December 1995, in CA-G.R. CV No. 26921, is hereby AFFIRMED with the following MODIFICATIONS: (1)
the award of attorneys fees is deleted; (2) an interest of 6% per annum is imposed on the damages
awarded, to be computed from 17 July 1980 up to the finality of this Decision; and (3) an interest of 12%
per annum is also imposed from the finality of this Decision up to its satisfaction. The damages and
interests granted in favor of deceased Mrs. Regalado and deceased Deanna are hereby awarded to their
respective heirs. Costs against petitioner.
SO ORDERED.
______________________________________________
Phil American vs PKS Shipping gr no. 149038 April 9 2008
FACTS:
Davao Union Marketing Corporation (DUMC) contracted the services of PKS Shipping Company (PKS
Shipping) for the shipment to Tacloban City of 75,000 bags of cement worth P3,375,000.
DUMC insured the goods for its full value with Philippine American General Insurance Company
(Philamgen).
The goods were loaded aboard the dumb barge Limar I belonging to PKS Shipping.
December 22, 1988 9 pm: While Limar I was being towed by PKS’ tugboat MT Iron Eagle, the barge sank
a couple of miles off the coast of Dumagasa Point, in Zamboanga del Sur, bringing down with it the
entire cargo of 75,000 bags of cement.
DUMC filed a formal claim with Philamgen for the full amount of the insurance. Philamgen promptly
made payment; it then sought reimbursement from PKS Shipping of the sum paid to DUMC but the
shipping company refused to pay so Philamgen to file suit against PKS Shipping
RTC: dismissed the complaint - fortuitous event
CA:Affirmed - not a common carrier but a casual occupation
ISSUE: W/N PKS Shipping is NOT liable since it was NOT a common carrier
HELD: NO. Petition is DENIED
Article 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
Complementary is Section 13, paragraph (b), of the Public Service Act
public service" to be –

10
"x x x every person that now or hereafter may own, operate, manage, or control in the Philippines, for
hire or compensation, with general or limited clientele, whether permanent, occasional or accidental,
and done for general business purposes, any common carrier, railroad, street railway, subway motor
vehicle, either for freight or passenger, or both, with or without fixed route and whatever may be its
classification, freight or carrier service of any class, express service, steamboat, or steamship, or
steamship line, pontines, ferries and water craft, engaged in the transportation of passengers or freight
or both, shipyard, marine repair shop, wharf or dock, ice plant, ice refrigeration plant, canal, irrigation
system, gas, electric light, heat and power, water supply and power petroleum, sewerage system, wire
or wireless communication systems, wire or wireless broadcasting stations and other similar public
services
So understood, the concept of `common carrier’ under Article 1732 may be seen to coincide neatly with
the notion of `public service,’ under the Public Service Act
distinction between:
common or public carrier
private or special carrier - character of the business, such that if the undertaking is an isolated
transaction , not a part of the business or occupation, and the carrier does not hold itself out to carry
the goods for the general public or to a limited clientele, although involving the carriage of goods for a
fee
EX: charter party which includes both the vessel and its crew, such as in a bareboat or demise, where
the charterer obtains the use and service of all or some part of a ship for a period of time or a voyage or
voyages and gets the control of the vessel and its crew.
The regularity of its activities in this area indicates more than just a casual activity on its part
The appellate court ruled, gathered from the testimonies and sworn marine protests of the respective
vessel masters ofLimar I and MT Iron Eagle, that there was no way by which the barge’s or the tugboat’s
crew could have prevented the sinking of Limar I. The vessel was suddenly tossed by waves of
extraordinary height of 6 to 8 feet and buffeted by strong winds of 1.5 knots resulting in the entry of
water into the barge’s hatches. The official Certificate of Inspection of the barge issued by the Philippine
Coastguard and the Coastwise Load Line Certificate would attest to the seaworthiness of Limar I and
should strengthen the factual findings of the appellate court.
Findings of fact of the Court of Appeals generally conclude this Court; none of the recognized exceptions
from the rule - (1) when the factual findings of the Court of Appeals and the trial court are contradictory;
(2) when the conclusion is a finding grounded entirely on speculation, surmises, or conjectures; (3) when
the inference made by the Court of Appeals from its findings of fact is manifestly mistaken, absurd, or
impossible; (4) when there is a grave abuse of discretion in the appreciation of facts; (5) when the
appellate court, in making its findings, went beyond the issues of the case and such findings are contrary
to the admissions of both appellant and appellee; (6) when the judgment of the Court of Appeals is
premised on a misapprehension of facts; (7) when the Court of Appeals failed to notice certain relevant
facts which, if properly considered, would justify a different conclusion; (8) when the findings of fact are
themselves conflicting; (9) when the findings of fact are conclusions without citation of the specific
evidence on which they are based; and (10) when the findings of fact of the Court of Appeals are
premised on the absence of evidence but such findings are contradicted by the evidence on record –
would appear to be clearly extant in this instance.
______________________________________
Edgar Cokaliong vs UCPB Gr no. 146018

11
DECISION
PANGANIBAN, J.:
The liability of a common carrier for the loss of goods may, by stipulation in the bill of lading, be limited
to the value declared by the shipper. On the other hand, the liability of the insurer is determined by the
actual value covered by the insurance policy and the insurance premiums paid therefor, and not
necessarily by the value declared in the bill of lading.
The Case
Before the Court is a Petition for Review[1] under Rule 45 of the Rules of Court, seeking to set aside the
August 31, 2000 Decision[2] and the November 17, 2000 Resolution[3] of the Court of Appeals[4] (CA) in
CA-GR SP No. 62751. The dispositive part of the Decision reads:
IN THE LIGHT OF THE FOREGOING, the appeal is GRANTED. The Decision appealed from is REVERSED.
[Petitioner] is hereby condemned to pay to [respondent] the total amount of P148,500.00, with interest
thereon, at the rate of 6% per annum, from date of this Decision of the Court. [Respondents] claim for
attorneys fees [is] DISMISSED. [Petitioners] counterclaims are DISMISSED.[5]
The assailed Resolution denied petitioners Motion for Reconsideration.
On the other hand, the disposition of the Regional Trial Courts[6] Decision,[7] which was later reversed
by the CA, states:
WHEREFORE, premises considered, the case is hereby DISMISSED for lack of merit.
No cost.[8]
The Facts
The facts of the case are summarized by the appellate court in this wise:
Sometime on December 11, 1991, Nestor Angelia delivered to the Edgar Cokaliong Shipping Lines, Inc.
(now Cokaliong Shipping Lines), [petitioner] for brevity, cargo consisting of one (1) carton of Christmas
dcor and two (2) sacks of plastic toys, to be transported on board the M/V Tandag on its Voyage No. T-
189 scheduled to depart from Cebu City, on December 12, 1991, for Tandag, Surigao del Sur. [Petitioner]
issued Bill of Lading No. 58, freight prepaid, covering the cargo. Nestor Angelia was both the shipper and
consignee of the cargo valued, on the face thereof, in the amount of P6,500.00. Zosimo Mercado
likewise delivered cargo to [petitioner], consisting of two (2) cartons of plastic toys and Christmas decor,

12
one (1) roll of floor mat and one (1) bundle of various or assorted goods for transportation thereof from
Cebu City to Tandag, Surigao del Sur, on board the said vessel, and said voyage. [Petitioner] issued Bill of
Lading No. 59 covering the cargo which, on the face thereof, was valued in the amount of P14,000.00.
Under the Bill of Lading, Zosimo Mercado was both the shipper and consignee of the cargo.
On December 12, 1991, Feliciana Legaspi insured the cargo, covered by Bill of Lading No. 59, with the
UCPB General Insurance Co., Inc., [respondent] for brevity, for the amount of P100,000.00 against all
risks under Open Policy No. 002/91/254 for which she was issued, by [respondent], Marine Risk Note
No. 18409 on said date. She also insured the cargo covered by Bill of Lading No. 58, with [respondent],
for the amount of P50,000.00, under Open Policy No. 002/91/254 on the basis of which [respondent]
issued Marine Risk Note No. 18410 on said date.
When the vessel left port, it had thirty-four (34) passengers and assorted cargo on board, including the
goods of Legaspi. After the vessel had passed by the Mandaue-Mactan Bridge, fire ensued in the engine
room, and, despite earnest efforts of the officers and crew of the vessel, the fire engulfed and destroyed
the entire vessel resulting in the loss of the vessel and the cargoes therein. The Captain filed the
required Marine Protest.
Shortly thereafter, Feliciana Legaspi filed a claim, with [respondent], for the value of the cargo insured
under Marine Risk Note No. 18409 and covered by Bill of Lading No. 59. She submitted, in support of her
claim, a Receipt, dated December 11, 1991, purportedly signed by Zosimo Mercado, and Order Slips
purportedly signed by him for the goods he received from Feliciana Legaspi valued in the amount of
P110,056.00. [Respondent] approved the claim of Feliciana Legaspi and drew and issued UCPB Check
No. 612939, dated March 9, 1992, in the net amount of P99,000.00, in settlement of her claim after
which she executed a Subrogation Receipt/Deed, for said amount, in favor of [respondent]. She also
filed a claim for the value of the cargo covered by Bill of Lading No. 58. She submitted to [respondent] a
Receipt, dated December 11, 1991 and Order Slips, purportedly signed by Nestor Angelia for the goods
he received from Feliciana Legaspi valued at P60,338.00. [Respondent] approved her claim and remitted
to Feliciana Legaspi the net amount of P49,500.00, after which she signed a Subrogation Receipt/Deed,
dated March 9, 1992, in favor of [respondent].
On July 14, 1992, [respondent], as subrogee of Feliciana Legaspi, filed a complaint anchored on torts
against [petitioner], with the Regional Trial Court of Makati City, for the collection of the total principal
amount of P148,500.00, which it paid to Feliciana Legaspi for the loss of the cargo, praying that
judgment be rendered in its favor and against the [petitioner] as follows:
WHEREFORE, it is respectfully prayed of this Honorable Court that after due hearing, judgment be
rendered ordering [petitioner] to pay [respondent] the following.
1. Actual damages in the amount of P148,500.00 plus interest thereon at the legal rate from the time of
filing of this complaint until fully paid;
2. Attorneys fees in the amount of P10,000.00; and
3. Cost of suit.

13
[Respondent] further prays for such other reliefs and remedies as this Honorable Court may deem just
and equitable under the premises.
[Respondent] alleged, inter alia, in its complaint, that the cargo subject of its complaint was delivered to,
and received by, [petitioner] for transportation to Tandag, Surigao del Sur under Bill of Ladings, Annexes
A and B of the complaint; that the loss of the cargo was due to the negligence of the [petitioner]; and
that Feliciana Legaspi had executed Subrogation Receipts/Deeds in favor of [respondent] after paying to
her the value of the cargo on account of the Marine Risk Notes it issued in her favor covering the cargo.
In its Answer to the complaint, [petitioner] alleged that: (a) [petitioner] was cleared by the Board of
Marine Inquiry of any negligence in the burning of the vessel; (b) the complaint stated no cause of action
against [petitioner]; and (c) the shippers/consignee had already been paid the value of the goods as
stated in the Bill of Lading and, hence, [petitioner] cannot be held liable for the loss of the cargo beyond
the value thereof declared in the Bill of Lading.
After [respondent] rested its case, [petitioner] prayed for and was allowed, by the Court a quo, to take
the depositions of Chester Cokaliong, the Vice-President and Chief Operating Officer of [petitioner], and
a resident of Cebu City, and of Noel Tanyu, an officer of the Equitable Banking Corporation, in Cebu City,
and a resident of Cebu City, to be given before the Presiding Judge of Branch 106 of the Regional Trial
Court of Cebu City. Chester Cokaliong and Noel Tanyu did testify, by way of deposition, before the Court
and declared inter alia, that: [petitioner] is a family corporation like the Chester Marketing, Inc.; Nestor
Angelia had been doing business with [petitioner] and Chester Marketing, Inc., for years, and incurred
an account with Chester Marketing, Inc. for his purchases from said corporation; [petitioner] did issue
Bills of Lading Nos. 58 and 59 for the cargo described therein with Zosimo Mercado and Nestor Angelia
as shippers/consignees, respectively; the engine room of the M/V Tandag caught fire after it passed the
Mandaue/Mactan Bridge resulting in the total loss of the vessel and its cargo; an investigation was
conducted by the Board of Marine Inquiry of the Philippine Coast Guard which rendered a Report, dated
February 13, 1992 absolving [petitioner] of any responsibility on account of the fire, which Report of the
Board was approved by the District Commander of the Philippine Coast Guard; a few days after the
sinking of the vessel, a representative of the Legaspi Marketing filed claims for the values of the goods
under Bills of Lading Nos. 58 and 59 in behalf of the shippers/consignees, Nestor Angelia and Zosimo
Mercado; [petitioner] was able to ascertain, from the shippers/consignees and the representative of the
Legaspi Marketing that the cargo covered by Bill of Lading No. 59 was owned by Legaspi Marketing and
consigned to Zosimo Mercado while that covered by Bill of Lading No. 58 was purchased by Nestor
Angelia from the Legaspi Marketing; that [petitioner] approved the claim of Legaspi Marketing for the
value of the cargo under Bill of Lading No. 59 and remitted to Legaspi Marketing the said amount under
Equitable Banking Corporation Check No. 20230486 dated August 12, 1992, in the amount of P14,000.00
for which the representative of the Legaspi Marketing signed Voucher No. 4379, dated August 12, 1992,
for the said amount of P14,000.00 in full payment of claims under Bill of Lading No. 59; that [petitioner]
approved the claim of Nestor Angelia in the amount of P6,500.00 but that since the latter owed Chester
Marketing, Inc., for some purchases, [petitioner] merely set off the amount due to Nestor Angelia under
Bill of Lading No. 58 against his account with Chester Marketing, Inc.; [petitioner] lost/[misplaced] the
original of the check after it was received by Legaspi Marketing, hence, the production of the microfilm
copy by Noel Tanyu of the Equitable Banking Corporation; [petitioner] never knew, before settling with
Legaspi Marketing and Nestor Angelia that the cargo under both Bills of Lading were insured with

14
[respondent], or that Feliciana Legaspi filed claims for the value of the cargo with [respondent] and that
the latter approved the claims of Feliciana Legaspi and paid the total amount of P148,500.00 to her;
[petitioner] came to know, for the first time, of the payments by [respondent] of the claims of Feliciana
Legaspi when it was served with the summons and complaint, on October 8, 1992; after settling his
claim, Nestor Angelia x x x executed the Release and Quitclaim, dated July 2, 1993, and Affidavit, dated
July 2, 1993 in favor of [respondent]; hence, [petitioner] was absolved of any liability for the loss of the
cargo covered by Bills of Lading Nos. 58 and 59; and even if it was, its liability should not exceed the
value of the cargo as stated in the Bills of Lading.
[Petitioner] did not anymore present any other witnesses on its evidence-in-chief. x x x[9] (Citations
omitted)
Ruling of the Court of Appeals
The CA held that petitioner had failed to prove that the fire which consumed the vessel and its cargo
was caused by something other than its negligence in the upkeep, maintenance and operation of the
vessel.[10]
Petitioner had paid P14,000 to Legaspi Marketing for the cargo covered by Bill of Lading No. 59. The CA,
however, held that the payment did not extinguish petitioners obligation to respondent, because there
was no evidence that Feliciana Legaspi (the insured) was the owner/proprietor of Legaspi Marketing.
The CA also pointed out the impropriety of treating the claim under Bill of Lading No. 58 -- covering
cargo valued therein at P6,500 -- as a setoff against Nestor Angelias account with Chester Enterprises,
Inc.
Finally, it ruled that respondent is not bound by the valuation of the cargo under the Bills of Lading, x x x
nor is the value of the cargo under said Bills of Lading conclusive on the [respondent]. This is so because,
in the first place, the goods were insured with the [respondent] for the total amount of P150,000.00,
which amount may be considered as the face value of the goods.[11]
Hence this Petition.[12]
Issues
Petitioner raises for our consideration the following alleged errors of the CA:

15
The Honorable Court of Appeals erred, granting arguendo that petitioner is liable, in holding that
petitioners liability should be based on the actual insured value of the goods and not from actual
valuation declared by the shipper/consignee in the bill of lading.
II
The Court of Appeals erred in not affirming the findings of the Philippine Coast Guard, as sustained by
the trial court a quo, holding that the cause of loss of the aforesaid cargoes under Bill of Lading Nos. 58
and 59 was due to force majeure and due diligence was [exercised] by petitioner prior to, during and
immediately after the fire on [petitioners] vessel.
III
The Court of Appeals erred in not holding that respondent UCPB General Insurance has no cause of
action against the petitioner.[13]
In sum, the issues are: (1) Is petitioner liable for the loss of the goods? (2) If it is liable, what is the extent
of its liability?
This Courts Ruling
The Petition is partly meritorious.
First Issue:
Liability for Loss
Petitioner argues that the cause of the loss of the goods, subject of this case, was force majeure. It adds
that its exercise of due diligence was adequately proven by the findings of the Philippine Coast Guard.
We are not convinced. The uncontroverted findings of the Philippine Coast Guard show that the M/V
Tandag sank due to a fire, which resulted from a crack in the auxiliary engine fuel oil service tank. Fuel
spurted out of the crack and dripped to the heating exhaust manifold, causing the ship to burst into
flames. The crack was located on the side of the fuel oil tank, which had a mere two-inch gap from the
engine room walling, thus precluding constant inspection and care by the crew.

16
Having originated from an unchecked crack in the fuel oil service tank, the fire could not have been
caused by force majeure. Broadly speaking, force majeure generally applies to a natural accident, such
as that caused by a lightning, an earthquake, a tempest or a public enemy.[14] Hence, fire is not
considered a natural disaster or calamity. In Eastern Shipping Lines, Inc. v. Intermediate Appellate
Court,[15] we explained:
x x x. 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 lighting or by other natural disaster or
calamity. It may even be caused by the actual fault or privity of the carrier.
Article 1680 of the Civil Code, which considers fire as an extraordinary fortuitous event refers to leases
or rural lands where a reduction of the rent is allowed when more than one-half of the fruits have been
lost due to such event, considering that the law adopts a protective policy towards agriculture.
As the peril of fire is not comprehended within the exceptions in Article 1734, supra, Article 1735 of the
Civil Code provides that in all cases other than those mentioned 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.
Where loss of cargo results from the failure of the officers of a vessel to inspect their ship frequently so
as to discover the existence of cracked parts, that loss cannot be attributed to force majeure, but to the
negligence of those officials.[16]
The law provides that a common carrier is presumed to have been negligent if it fails to prove that it
exercised extraordinary vigilance over the goods it transported. Ensuring the seaworthiness of the vessel
is the first step in exercising the required vigilance. Petitioner did not present sufficient evidence
showing what measures or acts it had undertaken to ensure the seaworthiness of the vessel. It failed to
show when the last inspection and care of the auxiliary engine fuel oil service tank was made, what the
normal practice was for its maintenance, or some other evidence to establish that it had exercised
extraordinary diligence. It merely stated that constant inspection and care were not possible, and that
the last time the vessel was dry-docked was in November 1990. Necessarily, in accordance with Article
1735[17] of the Civil Code, we hold petitioner responsible for the loss of the goods covered by Bills of
Lading Nos. 58 and 59.
Second Issue:
Extent of Liability
Respondent contends that petitioners liability should be based on the actual insured value of the goods,
subject of this case. On the other hand, petitioner claims that its liability should be limited to the value
declared by the shipper/consignee in the Bill of Lading.

17
The records[18] show that the Bills of Lading covering the lost goods contain the stipulation that in case
of claim for loss or for damage to the shipped merchandise or property, [t]he liability of the common
carrier x x x shall not exceed the value of the goods as appearing in the bill of lading.[19] The attempt by
respondent to make light of this stipulation is unconvincing. As it had the consignees copies of the Bills
of Lading,[20] it could have easily produced those copies, instead of relying on mere allegations and
suppositions. However, it presented mere photocopies thereof to disprove petitioners evidence showing
the existence of the above stipulation.
A stipulation that limits liability is valid[21] as long as it is not against public policy. In Everett Steamship
Corporation v. Court of Appeals,[22] the Court stated:
A stipulation in the bill of lading limiting the common carriers liability for loss or destruction of a cargo to
a certain sum, unless the shipper or owner declares a greater value, is sanctioned by law, particularly
Articles 1749 and 1750 of the Civil Code which provides:
Art. 1749. A stipulation that the common carriers liability is limited to the value of the goods appearing
in the bill of lading, unless the shipper or owner declares a greater value, is binding.
Art. 1750. A contract fixing the sum that may be recovered by the owner or shipper for the loss,
destruction, or deterioration of the goods is valid, if it is reasonable and just under the circumstances,
and has been freely and fairly agreed upon.
Such limited-liability clause has also been consistently upheld by this Court in a number of cases. Thus,
in Sea-Land Service, Inc. vs. Intermediate Appellate Court, we ruled:
It seems clear that even if said section 4 (5) of the Carriage of Goods by Sea Act did not exist, the validity
and binding effect of the liability limitation clause in the bill of lading here are nevertheless fully
sustainable on the basis alone of the cited Civil Code Provisions. That said stipulation is just and
reasonable is arguable from the fact that it echoes Art. 1750 itself in providing a limit to liability only if a
greater value is not declared for the shipment in the bill of lading. To hold otherwise would amount to
questioning the justness and fairness of the law itself, and this the private respondent does not pretend
to do. But over and above that consideration, the just and reasonable character of such stipulation is
implicit in it giving the shipper or owner the option of avoiding accrual of liability limitation by the
simple and surely far from onerous expedient of declaring the nature and value of the shipment in the
bill of lading.
Pursuant to the afore-quoted provisions of law, it is required that the stipulation limiting the common
carriers liability for loss must be reasonable and just under the circumstances, and has been freely and
fairly agreed upon.

18
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
shippers 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 (100,000.00) 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. (Italics supplied)
In the present case, the stipulation limiting petitioners liability is not contrary to public policy. In fact, its
just and reasonable character is evident. The shippers/consignees may recover the full value of the
goods by the simple expedient of declaring the true value of the shipment in the Bill of Lading. Other
than the payment of a higher freight, there was nothing to stop them from placing the actual value of
the goods therein. In fact, they committed fraud against the common carrier by deliberately
undervaluing the goods in their Bill of Lading, thus depriving the carrier of its proper and just transport
fare.
Concededly, the purpose of the limiting stipulation in the Bill of Lading is to protect the common carrier.
Such stipulation obliges the shipper/consignee to notify the common carrier of the amount that the
latter may be liable for in case of loss of the goods. The common carrier can then take appropriate
measures -- getting insurance, if needed, to cover or protect itself. This precaution on the part of the
carrier is reasonable and prudent. Hence, a shipper/consignee that undervalues the real worth of the
goods it seeks to transport does not only violate a valid contractual stipulation, but commits a
fraudulent act when it seeks to make the common carrier liable for more than the amount it declared in
the bill of lading.
Indeed, Zosimo Mercado and Nestor Angelia misled petitioner by undervaluing the goods in their
respective Bills of Lading. Hence, petitioner was exposed to a risk that was deliberately hidden from it,
and from which it could not protect itself.
It is well to point out that, for assuming a higher risk (the alleged actual value of the goods) the
insurance company was paid the correct higher premium by Feliciana Legaspi; while petitioner was paid
a fee lower than what it was entitled to for transporting the goods that had been deliberately

19
undervalued by the shippers in the Bill of Lading. Between the two of them, the insurer should bear the
loss in excess of the value declared in the Bills of Lading. This is the just and equitable solution.
In Aboitiz Shipping Corporation v. Court of Appeals,[23] the description of the nature and the value of
the goods shipped were declared and reflected in the bill of lading, like in the present case. The Court
therein considered this declaration as the basis of the carriers liability and ordered payment based on
such amount. Following this ruling, petitioner should not be held liable for more than what was declared
by the shippers/consignees as the value of the goods in the bills of lading.
We find no cogent reason to disturb the CAs finding that Feliciana Legaspi was the owner of the goods
covered by Bills of Lading Nos. 58 and 59. Undoubtedly, the goods were merely consigned to Nestor
Angelia and Zosimo Mercado, respectively; thus, Feliciana Legaspi or her subrogee (respondent) was
entitled to the goods or, in case of loss, to compensation therefor. There is no evidence showing that
petitioner paid her for the loss of those goods. It does not even claim to have paid her.
On the other hand, Legaspi Marketing filed with petitioner a claim for the lost goods under Bill of Lading
No. 59, for which the latter subsequently paid P14,000. But nothing in the records convincingly shows
that the former was the owner of the goods. Respondent was, however, able to prove that it was
Feliciana Legaspi who owned those goods, and who was thus entitled to payment for their loss. Hence,
the claim for the goods under Bill of Lading No. 59 cannot be deemed to have been extinguished,
because payment was made to a person who was not entitled thereto.
With regard to the claim for the goods that were covered by Bill of Lading No. 58 and valued at P6,500,
the parties have not convinced us to disturb the findings of the CA that compensation could not validly
take place. Thus, we uphold the appellate courts ruling on this point.
WHEREFORE, the Petition is hereby PARTIALLY GRANTED. The assailed Decision is MODIFIED in the
sense that petitioner is ORDERED to pay respondent the sums of P14,000 and P6,500, which represent
the value of the goods stated in Bills of Lading Nos. 59 and 58, respectively. No costs.
SO ORDERED.
____________________________________________________________________
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

20
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.
_____________________________________________________
Sun vs Cebu Autobus Company 94 Phil 892
Facts:
Plaintiff was a passenger of defendant in one of its truck. Allegedly due to the negligence of the driver
or defective engine, the truck fell into a canal causing plaintiff to receive serious injuries and to kill two
of his hogs (loaded therein). This prompted plaintiff to institute a complaint for damages against the
company. The trial court and the CA ruled in favour of plaintiff. I
Ssue: Whether the Bus company must be held liable.
Ruling: yes. The defense of defendant, that the wreckage of the drag & link spring could not be foreseen
and if foreseen was inevitable, is untenable. It was already held that an accident cause either by defects

21
in the automobile or through the negligence of its driver is not a caso fortuito. As such, the company
must #e held liable.
____________________________________
Juntilla vs FOntanar gr no. L-45637
FACTS:
Jeepney was driven by Berfol Camoro from Danao City to Cebu City. It was Clemente Fontanar but was
actually owned by defendant Fernando Banzon.
When the jeepney reached Mandaue City, the right rear tire exploded causing the vehicle to turn turtle.
Roberto Juntilla was sitting at the front seat was thrown out of the vehicle.
Upon landing on the ground, he momentarily lost consciousness. When he came to his senses, he found
that he had a lacerated wound on his right palm. He also injured his left arm, right thigh and on his
back.
Because of his shock and injuries, he went back to Danao City but on the way, he discovered that his
"Omega" wrist watch worth P 852.70 was lost. Upon his arrival in Danao City, he immediately entered
the Danao City Hospital to attend to his injuries, and also requested his father-in-law to proceed
immediately to the place of the accident and look for the watch.
Roberto Juntilla filed for breach of contract with damages
Respondents: beyond the control since tire that exploded was newly bought and was only slightly used
RTC: favored Roberto Juntilla
CA: Reversed since accident was due to fortuitous event
ISSUE: W/N there is a fortuitous event
HELD: NO. CA reversed, RTC reinstated.
passenger jeepney was running at a very fast speed before the accident
at a regular and safe speed will not jump into a ditch when its right rear tire blows up
passenger jeepney was overloaded
3 passengers in the front seat
14 passengers in the rear
caso fortuito presents the following essential characteristics:
(1) The cause of the unforeseen and unexpected occurrence, or of the failure of the debtor to comply
with his obligation, must be independent of the human will.
(2) It must be impossible to foresee the event which constitutes the caso fortuito, or if it can be
foreseen, it must be impossible to avoid.
(3) The occurrence must be such as to render it impossible for the debtor to fulfill his obligation in a
normal manner.

22
(4) the obligor (debtor) must be free from any participation in the aggravation of the injury resulting to
the creditor.
In the case at bar, the cause of the unforeseen and unexpected occurrence was not independent of the
human will. The accident was caused either through the negligence of the driver or because of
mechanical defects in the tire. Common carriers should teach their drivers not to overload their vehicles,
not to exceed safe and legal speed limits, and to know the correct measures to take when a tire blows
up thus insuring the safety of passengers at all times
the source of a common carrier's legal liability is the contract of carriage, and by entering into the said
contract, it binds itself to carry the passengers safely as far as human care and foresight can provide,
using the utmost diligence of a very cautious person, with a due regard for all the circumstances. The
records show that this obligation was not met by the respondents
respondents likewise argue that the petitioner cannot recover any amount for failure to prove such
damages during the trial
findings of facts of the City Court of Cebu
_____________________________________________
Bacaro vs Castano gr no. 34597 1982
FACTS:
Respondent Castano boarded a jeep driven by Petitioner Monte falcon who thereafter drove it at
around 40 kilometers per hour. While approaching Sumasap Bridge at the said speed, a cargo truck
coming from behind, blowing its horn to signal its intention to overtake the jeep. The jeep, without
changing its speed, gave way by swerving to the right, such that both vehicles ran side by side for a
distance of around 20 meters. Thereafter as the jeep was left behind, its driver was unable to return it to
its former lane and instead it obliquely or diagonally ran down an inclined terrain towards the right until
it fell into a ditch pinning down and crushing Castano’s right leg in the process. Castano filed a case for
damages against Rosita Bacarro, William Sevilla, and Felario Montefalcon. Defendants alleged that the
jeepney was sideswiped by the overtaking cargo truck. After trial, the CFI of Misamis Oriental ordered
Bacarro, et.al. to jointly and severally pay Castano. It was affirmed by the CA upon appeal.
ISSUES:
1. Whether or not there was a contributory negligence on the part of the jeepney driver.
2. Whether or not extraordinary diligence is required of the jeepney driver.
3. Whether or not the sideswiping is a fortuitous event.
HELD: 1.) Yes. The fact is, petitioner-driver Montefalcon did not slacken his speed but instead continued
to run the jeep at about forty (40) kilometers per hour even at the time the overtaking cargo truck was
running side by side for about twenty (20) meters and at which time he even shouted to the driver of
the truck.
2.) Yes. The fact is, there was a contract of carriage between the private respondent and the herein
petitioners in which case the Court of Appeals correctly applied Articles 1733, 1755 and 1766 of the Civil
Code which require the exercise of extraordinary diligence on the part of petitioner Montefalcon.
3.) The third assigned error of the petitioners would find fault upon respondent court in not freeing
petitioners from any liability, since the accident was due to a fortuitous event. But, We repeat that the
alleged fortuitous event in this case - the sideswiping of the jeepney by the cargo truck, was something

23
which could have been avoided considering the narrowness of the Sumasap Bridge which was not wide
enough to admit two vehicles. As found by the Court of Appeals, Montefalcon contributed to the
occurrence of the mishap.
_______________________________________________
Bachelor express vs CA gr no. 85697 1990
_________________________________________________
Japan Airlines vs CA gr no. 118664 1998
Facts: Private respondents boarded a JAL flight in San Francisco, California bound for Manila. It included
an overnight stopover at Narita, Japan at JAL’s expense. Due to the Mt. Pinatubo eruption, private
respondents’ trip to Manila was cancelled. JAL rebooked all the Manila-bound passengers and paid for
the hotel expenses of their unexpected overnight stay. The flight of private respondents was again
cancelled due to NAIA’s indefinite closure. JAL informed the respondents that it would no longer defray
their hotel and accommodation expense during their stay in Narita. The respondents were forced to pay
for their accommodations and meal expenses for 5 days.
Issues:
Whether or not JAL has the obligation to shoulder the hotel and meal expenses even if the delay was
caused by force majeure
Whether or not the award of damages was proper
Held:
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. When JAL was prevented from resuming its
flight to Manila due to the effects of the eruption, whatever losses or damages in the form of hotel and
meal expenses the stranded passengers incurred cannot be charged to JAL. The predicament of the
private respondents was not due to the fault or negligence of JAL. JAL had the duty to arrange the
respondents’ flight back to Manila. However, it failed to look after the comfort and convenience of its
passengers when it made the passengers arrange their flight back to Manila on their own and after
waiting in the airport for a whole day.
Yes, the award of nominal damages is proper. Nominal damages are adjudicated in order that a right of
a plaintiff, which has been violated or invaded by the defendant, may be vindicated or recognized and
not for the purpose of indemnifying any loss suffered by him.
_______________________________________
Calalas vs CA gr no. 122039 2000
FACTS:
At 10 o'clock in the morning of August 23, 1989, private respondent Eliza Jujeurche G. Sunga, then a
college freshman majoring in Physical Education at the Siliman University, took a passenger jeepney
owned and operated by petitioner Vicente Calalas. As the jeepney was filled to capacity of about 24

24
passengers, Sunga was given by the conductor an "extension seat," a wooden stool at the back of the
door at the rear end of the vehicle.
On the way to Poblacion Sibulan, Negros Occidental, the jeepney stopped to let a passenger off. As she
was seated at the rear of the vehicle, Sunga gave way to the outgoing passenger. Just as she was doing
so, an Isuzu truck driven by Iglecerio Verena and owned by Francisco Salva bumped the left rear portion
of the jeepney. As a result, Sunga was injured.
On October 9, 1989, Sunga filed a complaint for damages against Calalas, alleging violation of the
contract of carriage by the former in failing to exercise the diligence required of him as a common
carrier. Calalas, on the other hand, filed a third-party complaint against Francisco Salva, the owner of the
Isuzu truck.
DECISION OF LOWER COURTS:
1. RTC – Dumaguete – rendered judgment against Salva holding that the driver of the Isuzu truck was
responsible
It took cognizance of another case (Civil Case No. 3490), filed by Calalas against Salva and Verena, for
quasi-delict, in which Branch 37 of the same court held Salva and his driver Verena jointly liable to
Calalas for the damage to his jeepney.
2. CA – reversed the RTC, awarding damages instead to Sunga as plaintiff in an action for breach of
contract of carriage since the cause of action was based on such and not quasi delict.
Hence, current petition for review on certiorari.
ISSUE:
Whether (per ruling in Civil Case) negligence of Verena was the proximate cause of the accident negates
his liability and that to rule otherwise would be to make the common carrier an insurer of the safety of
its passengers
In relation thereto, does the principle of res judicata apply?
RULING:
No.
The issue in Civil Case No. 3490 was whether Salva and his driver Verena were liable for quasi-delict for
the damage caused to petitioner's jeepney. On the other hand, the issue in this case is whether
petitioner is liable on his contract of carriage.
Quasi-delict / culpa aquiliana / culpa extra contractual
1. Has as its source the negligence of the tortfeasor
2. negligence or fault should be clearly established because it is the basis of the action
3. doctrine of proximate cause is applicable

25
(device for imputing liability to a person where there is no relation between him and another party,
obligation is created by law itself)
Breach of contract / culpa contractual
1. premised upon the negligence in the performance of a contractual obligation
2. action can be prosecuted merely by proving the existence of the contract and the fact that the obligor
(here, the common carrier) failed to transport his passenger safely to his destination
3. not available; it is the parties themselves who create the obligation and the function of the law is
merely to regulate the relation thus created
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.
Hence, Vicente Calalas (operator) is liable since he did not exercise utmost diligence.
1. Jeepney was not properly parked;
2. Overloading of passengers.
____________________________________________________________
UCPB vs Aboitiz gr no .168433
Facts:
On June 1991, 3 units of waste water treatment plant with accessories were purchased by San Miguel
Corp from Super Max Engineering. The goods came from Charleston, USA and arrived in port of Manila
on board MV Scandutch Star. From Manila it was transported to Cebu on board of Aboitiz Supercon II. In
Cebu, with clearance from the Bureau of Customs, the goods were delivered and received by San Miguel
at its plant site. It was then discovered that the motor of the unit was damaged.
Pursuant to the insurance agreement, UCPB General Insurance paid San Miguel P1,703,381.40
representing the value of the damaged unit. In turn, San Miguel executed a subrogation form in favor of
UCPB. Then, UCPB filed a complaint on Kuly 1992 as subrogee of San Miguel seeking to recover from
Aboitiz. Aboitiz moved to admit East Asiatic Co. as general agent of DAMCO Intermodal System. RTC
held Aboitiz, East Asiatic and DAMCO solidarily liable.
CA reversed the decision of the RTC and ruled that UCPBs right of action did not accrue because UCPB
failed to file a formal notice within 24 hours from the damaged. In a memorandum, UCPB asserts that
the claim requirement does not apply to cases concerning damages to the merchandise had already
been known to the carrier. UCPB revealed that the damage to the cargo was found upon discharge from
the foreign carrier witnessed by the carrier’s representative who signed the request for bad order
survey and the turnover of bad order cargoes. This knowledge, UCPB argues, dispenses with the need to

26
give the carrier a formal notice of claim. Incidentally, the carrier’s representative mentioned by UCPB as
present at the time the merchandise was unloaded was in fact a representative of respondent Eagle
Express Lines (Eagle Express). UCPB further claims that the issue of the applicability of Art. 366 of the
Code of Commerce was never raised before the trial court and should, therefore, not have been
considered by the CA.
Eagle Express, in its Memorandum dated February 7, 2007, asserts that it cannot be held liable for the
damage to the merchandise as it acted merely as a freight forwarders agent in the transaction. It
allegedly facilitated the transhipment of the cargo from Manila to Cebu but represented the interest of
the cargo owner, and not the carriers.
Aboitiz, on the other hand, points out, in its Memorandum dated March 29, 2007, that it obviously
cannot be held liable for the damage to the cargo which, by UCPBs admission, was incurred not during
transhipment to Cebu on board one of Aboitizs vessels, but was already existent at the time of
unloading in Manila. Aboitiz also argues that Art. 366 of the Code of Commerce is applicable and serves
as a condition precedent to the accrual of UCPBs cause of action against it.
Issue: Whether any of the remaining parties may still be held liable by UCPB.
Ruling:
UCPB obviously made a gross misrepresentation to the Court when it claimed that the issue regarding
the applicability of the Code of Commerce, particularly the 24-hour formal claim rule, was not raised as
an issue before the trial court. The appellate court, therefore, correctly looked into the validity of the
arguments raised by Eagle Express, Aboitiz and Pimentel Customs on this point after the trial court had
so ill-advisedly centered its decision merely on the matter of extraordinary diligence.
Interestingly enough, UCPB itself has revealed that when the shipment was discharged and opened at
the ICTSI in Manila in the presence of an Eagle Express representative, the cargo had already been found
damaged. In fact, a request for bad order survey was then made and a turnover survey of bad order
cargoes was issued, pursuant to the procedure in the discharge of bad order cargo. The shipment was
then repacked and transhipped from Manila to Cebu on board MV Aboitiz Supercon II. When the cargo
was finally received by SMC at its Mandaue City warehouse, it was found in bad order, thereby
confirming the damage already uncovered in Manila.
We have construed the 24-hour claim requirement as a condition precedent to the accrual of a right of
action against a carrier for loss of, or damage to, the goods. The shipper or consignee must allege and
prove the fulfilment of the condition. Otherwise, no right of action against the carrier can accrue in favor
of the former.
The shipment in this case was received by SMC on August 2, 1991. However, as found by the Court of
Appeals, the claims were dated October 30, 1991, more than three (3) months from receipt of the

27
shipment and, at that, even after the extent of the loss had already been determined by SMCs surveyor.
The claim was, therefore, clearly filed beyond the 24-hour time frame prescribed by Art. 366 of the Code
of Commerce.
Petition was denied. CA's decision was affirmed.
____________________________________________
Phil Am Insurance vs Heung-A Shipping
____________________________________________
Ang vs American Steamship 125 Scra 543
FACTS:
Yau Yae comerical Bank LTD of Hongkong represented by Yau Yae agreed to sell 140 packsges of
galvanized steel dursink sheets to one Herminio G Teves. Said agreement was subject to the terms and
arrangements.
Pursuant to said terms and arrangements, Yau Yae through Tokyo boeki LTD of Tokyo Japan, shipped the
articles at Yakata, Japan and later to Manila which was processed by American Staemship Agencies INC.
in which under a shipping agreement or bill of lading it consigned to order of the shipper with Mr Teves.
On May 9, 1961 the article arrived in manila, and under the bill of lading of the arrival of the goods and
requested payments of the demand draft representing the purchased price of the article, however, Mr
Teves did not pay the demand draft to Hongkong and Shanghai bank where it was to be processed the
payments. Prompting the bank to make corresponding protest and the bank likewise returned the bill of
lading and demand draft to Yau Yae which later endorsed the bill of lading to Domingo Ang.
Meanwhile, despite his non-payments of the purchase price of the articles. Teves was able to obtain a
bank guaranty in favor of American Steamship agencies INC. as carriers agent to the effect that he would
surrender the negotiable bill of lading duly endorsed by Yau Yae on the strength of this guaranty. Teves
succeded in securing a permit to deliver imported goods from the carriers agent, which he presented to
Bureau of customs which in turn release to him the articles covered by the bill of lading.
Subsequently, Domingo Ang claimed for the articles from the American steamship agencies Inc. by
presenting the indorsed bill of lading, but he was informed by the latter that the articled he claimed was
already delivered to Mr. Teves.
ISSUE:

28
Whether or not the American Steamship Agencies Inc. punishable under carriage of goods by Sea act for
misdelivery of goods?
HELD:
When the delivery of articles carried by the herein defendant-appellee (American steamship agencies
Inc) on May 9, 1961 to Herminio Teves but supposedly to Mr Domingo Ang ,plaintiff-appellant and upon
knowing by the plaintiff-appellant that the articles intended to him was misdelivered to other person, he
filed in court of first instance of Manila on October 30, 1963 against American Steamship agencies Inc
for allegedly wrongful delivery of goods belonging to him.
The defendant-appellee filed motion to dismissed with the contention that the ground of the plaitiff’s
caused of action is prescribed under the carriage of goods by sea act particular section 3(6) paragraph 4,
which provides that;
“In any event, the carrier and the ship shall be discharge from
all liability in respect to loss or damage unless suit is brought within
one year, after delivery of the goods or date when the goods should
have been delivered”
The defendant further contented that the action of the plaintiff-appellant even allowing a reasonable
time from the date of delivery on May 9, 1961, still initiated his action on October 30, 1963 which
beyond the prescribed period of One (1) year under the preceding paragraph.
The court rendered it decision dismissing the complaint of the plaintiff, appellant for the ground of
prescription, however the provision involved in this case as mentioned earlier speaks ”loss or damage”
despite that the plaintiff filed motion for reconsideration and it has been denied by the lower court,
afterwards, the plaintiff directly appealed to the higher court for the matter that; has plaintiff-appellant
cause of action prescribed under section 3(6) paragraph 4 of the carriage of goods by sea act?
The court ruled that, the word” loss or damage “as speaks to the provision in this case was not
transpired because only the misdelivery of goods occurred to the defendant, and upon admitted by the
defendant in motion to dismissed that the articles belongs for Mr. Ang has been misdelivered to Mr.
Teves.

29
Therefore it clearly shows that the defendant violates the provision of civil code of the Philppines
particular in Article 1144, which provides; the following actions must be brought within ten (10) years
from the time the right of the action accrues, paragraph (1) upon a written contract and Article 1146,
the following action must be instituted within four(4) years, paragraph (2) quasi delict, wherein it
supplies the deficiency provided in article 18 of the same code. To read” in matters which are governed
by the code of commerce and special laws, their deficiency shall be supplied by the provision of this
code.”
Wherefore, suits predicated not upon loss or damage but misdelivery of goods that so, the defendant
was not held liable for carriage of goods by sea act and the court hereby reversed the dismissal order
afterwards remanded to the lower court for further proceedings.

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1

Cristostomo vs CA gr no. 138334 August 25 2003

A) Will the action prosper?

B) Will she be entitled to damages?

No, for there was no contract of carriage.

Transpotational Law notes 2

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

PAL vs CA gr. 123238 September 22, 2008

Transpotational Law notes 2

The undisputed facts are as follows:

On 2 May 1980, Deanna and Nikolai boarded Flight 106 in Manila.

Transpotational Law notes 2

ACCORDINGLY, judgment is hereby rendered:

Transpotational Law notes 2

Transpotational Law notes 2

Transpotational Law notes 2

Transpotational Law notes 2

Transpotational Law notes 2

Phil American vs PKS Shipping gr no. 149038 April 9 2008

RTC: dismissed the complaint - fortuitous event

CA:Affirmed - not a common carrier but a casual occupation

HELD: NO. Petition is DENIED

Complementary is Section 13, paragraph (b), of the Public Service Act

Transpotational Law notes 2

common or public carrier

Edgar Cokaliong vs UCPB Gr no. 146018

Transpotational Law notes 2

The assailed Resolution denied petitioners Motion for Reconsideration.

Transpotational Law notes 2

2. Attorneys fees in the amount of P10,000.00; and

Transpotational Law notes 2

Transpotational Law notes 2

Ruling of the Court of Appeals

Hence this Petition.[12]

Transpotational Law notes 2

This Courts Ruling

The Petition is partly meritorious.

Liability for Loss

Transpotational Law notes 2

Transpotational Law notes 2

Transpotational Law notes 2

Transpotational Law notes 2

Transpotational Law notes 2

(1) Was petitioner a common carrier?

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

Sun vs Cebu Autobus Company 94 Phil 892

Ssue: Whether the Bus company must be held liable.

Transpotational Law notes 2

Juntilla vs FOntanar gr no. L-45637

Roberto Juntilla filed for breach of contract with damages

RTC: favored Roberto Juntilla

CA: Reversed since accident was due to fortuitous event

ISSUE: W/N there is a fortuitous event

HELD: NO. CA reversed, RTC reinstated.

passenger jeepney was overloaded

3 passengers in the front seat

14 passengers in the rear

caso fortuito presents the following essential characteristics:

Transpotational Law notes 2

findings of facts of the City Court of Cebu

Bacaro vs Castano gr no. 34597 1982

2. Whether or not extraordinary diligence is required of the jeepney driver.

3. Whether or not the sideswiping is a fortuitous event.

Transpotational Law notes 2